Asia Pacific Businesses Poised To Become Digital Leaders, Says New Forbes Insights Study

Asia Pacific Businesses Poised To Become Digital
Leaders, Says New Forbes Insights Study

Over Half of APAC Executives Expect Their
Organization To Undergo Vast Digital Transformation in the Next Two Years

SINGAPORE — November 30, 2016 — According to a new report by Forbes
Insights, in association with Hitachi Data Systems (HDS), a wholly owned
subsidiary of Hitachi Ltd. (TSE:6501) titled “How to Win at Digital
Transformation: Insights from a Global Survey of Top Executives,” companies
in Asia Pacific are pulling ahead when it comes to the implementation of
digital projects. Amongst those surveyed, 55% of APAC respondents expect their
organizations to undergo vast digital transformation in the next two years, 6%
more than the global average of 49%. 

The
global study—based on a survey of 573 senior executives worldwide of which 34%
were from the Asia-Pacific region, as well as on one-on-one conversations with
top executives—reveals that, regardless of industry or location, companies are
being placed under increasing pressure to transform to keep up with market
demands. 

“Digital
transformation is now essential for corporate survival,” said Bruce Rogers,
chief insights officer at Forbes Media. “And it’s more about people and
culture—about change management—along with investing in the technology.” 

“At
the center of transformation is data. It is both the creator and accelerator
that has proven to be the currency of IT organizations. By failing to unlock
the potential of data, organizations are falling short of their own
transformation,” said Mark Ablett, general manager and senior vice president,
Hitachi Data Systems Asia Pacific. “Hitachi Data Systems is at the center of
this customer transformation and the leader in data strategy, creating
opportunities for organizations to manage, govern, mobilize, learn from and
ultimately transform insights into actions for business.” 

The
research suggests that those in APAC are further along the road to digital
maturity than their global counterparts, with the transition toward digital
maturity pointing to five major steps:

·  Make transformation a top strategic priority: The Forbes Insights-Hitachi survey
confirms that digital transformation is the top strategic priority in the
region (60% versus 50% globally). The strategic emphasis on digital
transformation is reinforced by executives’ focus on investment. Investing in
new technologies to enable digitization is the joint top investment priority
for APAC respondents over the next two years (65%), along with increasing data
and analytics capabilities (65%). 

·  Business outcomes need to drive digital
transformation (DX): New business
models and industry competitors were the top drivers for DX (both at 42%),
followed by new technologies (38%) and customer expectations (33%). Ability to
innovate was the top measure of DX success, selected by 57% of APAC respondents
and higher than the global average of 46%. This was followed by revenue or
margin growth (54% in APAC vs 46% globally) and cost reduction (49% in APAC vs
43% globally). 

At the
same time, there are issues companies still grapple with and must
resolve: 

·  Untapped potential of data and analytics: While less than half of APAC companies
(45%) see themselves as advanced or leaders in data and analytics, the clear
majority (95%) have already seen revenue increases due to the use of data and
analytics. APAC, once again, was ahead of the pack – 39% of respondents
have seen an increase of more than 5% on revenues thanks to data analytics,
compared to 31% globally. Only 5% of respondents from the region have seen no
impact or are unsure of the effects. These findings indicate the clear
potential that data analytics present for businesses in 2017.

·  An enterprise-wide approach to DX needs to be
adopted: Currently,
cross-functional teams are not involved enough in developing (40%) or
implementing (also 40%) strategy, with the bulk of this work done by IT (57%
and 59% respectively). In APAC, 55% of respondents believe that IT is
fully ready for digital transformation while only 42% consider other
business functions to be fully ready.  

·  Companies must learn how best to marry
technology with human resources:  Technology has long been a core focus of DX strategies but,
as the research highlights, people also have a big role to play in the APAC region.
Technology is seen as one of the top three challenges (26%) and the top
contributor to successful digital transformation (54%) in the Asia Pacific
region. Nearly half (42%) of respondents felt top-level executives were the
second top contributor to DX success (versus just 29% globally). Likewise,
‘Lack of Talent’ was cited as the top challenge to the implementation of DX by
APAC respondents (29%). Companies that wish to succeed must understand the role
that talent and skills play in this new landscape and ensure they have the
right people for the job.

The findings also point
to a growing awareness of cloud and the internet of things (IoT) in the region.
When asked about the technology focus for digital transformation, 64% of
respondents in APAC selected cloud as a priority (same as the global average), while
41% opted for IoT, which was 10% more than the global average, making IoT the
second most important focus for APAC respondents. In addition to this, when
asked about top investment priorities, 45% of APAC respondents selected IoT
technologies, versus the global average of 38%.
 

About this research

This report’s findings
are based on responses of 573 C-level executives from North America, Latin
America, Europe and Asia-Pacific. They represented enterprises with revenues
above US$500 million, with 62% of companies having revenue of more than $1
billion, and 19% with revenues of $10 billion or more. The majority of
respondents were chief executive officers (CEO) (23%), chief technology
officers (20%), chief information officers (15%), and chief financial officers
(7%), and all were involved in the planning or implementing of digital
transformation in their organizations.  Respondents represented a wide
range of industries, including technology and services (20%),
telecommunications (10%), financial services (14%), and healthcare (10%). 

The report also includes
econometric research, conducted by the Department of Business Technology,
University of Miami, in association with Forbes Insights. This research
examined the relationship between increasing technology expenditures during the
last recession (2007 through 2009) and an increased compound annual growth rate
(CAGR) during economic recovery (2010 through 2015). It is based on the
analysis of 99 of the world’s biggest companies. In APAC, companies that prioritized
technology spend during recession experienced 86% greater revenue growth during
the recovery, which is significantly higher than the global average of 61%.