Research has revealed a strong correlation between the use of the cloud applications and the degree of internationalization of a business.
Commissioned by NetSuite and conducted by Frost & Sullivan, the study surveyed more than 800 senior executives (CEOs, CFOs and finance managers, CIOs and other senior managers) across Australia, Hong Kong, New Zealand, the Philippines and Singapore. The study aimed to understand how businesses are responding to the pace of industry change in 2016 and how business confidence in exploring international opportunities is on the rise.
Findings showed that overseas expansion is viewed as a major growth engine for businesses in Singapore and Hong Kong, which often face limited growth potential domestically due to the small population size and falling growth rates in their local markets.
The study also found a link between a company’s degree of expansion outside of its home market, and its use of cloud applications.
According to the study, 70 percent of Asia-Pacific businesses that currently use cloud-based business management applications are internationalized, compared to just 22 percent of non-cloud users. Furthermore, 71 percent of cloud users have entered new geographic markets in the past five years, compared to only 31 percent of non-cloud users.
Additionally, 45 percent of cloud users believe that the use of cloud solutions has enabled them to internationalize more quickly, including 41 percent of businesses in Singapore and 45 percent of businesses in Hong Kong.
“Our research has shown how industry change is not just continuing, but accelerating. Two new key factors that are driving this change have emerged from this study: significant increase in business costs and evolving customer needs,” said Mark Dougan, Managing Director for Australia and New Zealand at Frost & Sullivan. “These trends may create new challenges for organisations, but at the same time they also create significant opportunities for growth, with internationalisation topping the list.”
The study shows that in 2016, 38 percent of senior executives believe their industry is changing “fast” or “very fast”, compared to 28 percent in 2014 and only 7 percent in 2010. A critical area that businesses are exploring is to expand their international footprint, in part supported by increasing economic integration in the Asia-Pacific region.
According to the study, while not all businesses have yet entered overseas markets, globalization is currently seen as an opportunity rather than a threat by 83 percent of organizations, particularly in Singapore, New Zealand and the Philippines.