In February 2017, Microsoft published the results of its Asia Digital Transformation Study. It found that most business leaders in the region accepted that they had to become digital businesses, but that few had a complete plan for getting there. The finding captured the mood of Asia-Pacific enterprises that year: the importance of the journey was widely agreed, and the strategy was not yet in place.
What the study asked
Microsoft said it spoke to close to 1,500 business leaders in 13 Asian markets. It wanted to learn where each organisation stood in its own transformation. Microsoft Asia president Ralph Haupter said leaders had begun to act on the challenges and opportunities of what he called the fourth industrial revolution. He also warned that organisations that did not evolve fast enough would become less competitive.
The main findings
- Some 80% of Asian business leaders agreed that future growth depended on thinking and acting like a digital business.
- 79% agreed that new data insights could lead to new revenue streams.
- Only 29% had a full digital transformation strategy.
- Less than half (49%) were running specific initiatives for selected parts of the business.
- 22% had very limited or no strategy.
Microsoft’s own conclusion was that the journey for most Asian organisations was still at an early stage. The company also treated data as the fuel for the effort. It said each business needed to use data in the way that suited its own situation.
Trust as a barrier
Microsoft tied the slow pace partly to confidence in the technology. It cited a separate September 2016 survey of 1,200 Asia-Pacific IT leaders, in which 87% believed the cloud would be safer in the longer term. Haupter argued that people do not use technology they do not trust. He said security, privacy and compliance were what let businesses transform with confidence.
How the picture developed
Later surveys showed continued movement. In the fourth quarter of 2017, Forrester surveyed 53 executives at midsize and large companies in Singapore and Hong Kong, which it described as two of the most mature technology markets in Asia. It reported that two-thirds of Asia Pacific services decision-makers said their firm was undergoing digital transformation.
A CenturyLink global study reported that Asia-Pacific enterprises were leading the way in starting transformation projects. It also found they expected a long road. 63% estimated that a company-wide transformation would take three to six years, and another 7% estimated more than seven years. The biggest barriers it listed were failure to secure sensitive data (35%), inflexible IT systems and limited operational agility (32%), and difficulty moving legacy applications to the cloud (31%). The main drivers were better customer experience (44%), risk management (43%) and lower operating costs (41%).
In July 2020, Red Hat announced a study by Harvard Business Review Analytic Services, titled “Understanding APAC’s Success in Digital Transformation”. It surveyed 143 APAC executives. Of these, 95% said digital transformation had grown in importance over the previous 18 months. 80% ranked cultural change and technology modernisation as equally important. 40% said they were quickly developing and delivering new applications, against 23% of executives in the rest of the world. Collaboration (44%), inclusivity (42%), adaptability (41%) and transparency (40%) were the cultural factors respondents named most often.
Taken together, the surveys show a shift in Asia-Pacific from agreeing that transformation mattered, in 2017, to asking how culture, infrastructure and security should support it, by 2020. That is three years on from the 2017 finding that only 29% had a full strategy.