The remaining respondent businesses in a Q1 survey were struggling or felt disrupted—rather than being “ahead of the curve”
How many organizations in the Asia Pacific region (APAC) are handling digital transformation well in the current pandemic economy?
According to one survey, the vast majority of respondents believed they were either barely keeping pace with their industry from a digital perspective, or in many cases actively were falling behind.
The report involved 800 respondents in Q1 2021 across Australia, Mainland China, India, Indonesia, Japan, Malaysia, Singapore, and Thailand and six sectors: Technology Media and Telecoms (TMT); Healthcare and Life Sciences (HLS), Consumer Goods and Retail (CGR); Industrial; Manufacturing and Transport (IMT); Financial Institutions (FI); and Energy, Mining and Infrastructure (EMI).
The report has discerned in the sample population, a huge acceleration in business digitalization, but also deep anxieties around the pace and risks associated with this digital transformation across almost every market and sector.
- 79% of executives in the survey saw themselves facing significant competitive headwinds, describing themselves as digitally-disrupted within their industry. Some 21% saw themselves as proactively disrupting their sector. In the 2019 version of the survey 75% of respondents had felt their organizations were among the disrupted.
- Singapore business leaders (30%) in the study were the most confident that their companies were digital disruptors, followed by respondents from Hong Kong (28%) and Mainland China (27%).
- The pandemic has unquestionably accelerated digitalization efforts in respondents, with 72% saying that the impact of the pandemic has been a major accelerant, including almost a third describing it as “transformative”.
- Key areas seeing the greatest digital investment among respondents included sales and distribution channels; enhanced customer relationship management; supply chains and compliance functions.
- The following technology-related ranked highest among respondents: regulatory investigations; theft of sensitive information; and lastly—major systems failure. Two-thirds of respondents predicted tech and data related regulatory and compliance enforcement would become significantly more rigorous in the year ahead.
- 64% of respondents described their business as “somewhat or highly adept” at data protection, with 8% believing their data and tech risk profile was getting worse.
Commenting on the report, the Partner of Baker McKenzie (Hong Kong), Paolo Sbuttoni, noted: “At a time when many businesses are focused on strengthening their digital transformation capabilities, an early assessment of the global and regional regulatory hurdles is essential to ensure a smooth roll out of digital transformation projects.”
Digital transformation is also driving deal making, according to the firm’s data. In its previous Q1 2021 report focused on mergers and acquisition trends in APAC, 57% of respondents had cited acquiring new technology and associated expertise. This was compared to 74% for the healthcare respondents, 85% for financial institutions, and 92% for technology, media and telecoms respondents.