Em­brac­ing Dig­i­tal

New re­search by Microsoft states that Dig­i­tal Trans­for­ma­tion to con­trib­ute US$154 Bil­lion to In­dia’s GDP by 2021

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Ac­cord­ing to a new re­search, by 2021, dig­i­tal trans­for­ma­tion will add an es­ti­mated US$154 bil­lion to In­dia’s GDP, and in­crease the growth rate by 1.0% an­nu­ally. This is ac­cord­ing to a new busi­ness study re­leased to­day. The re­search, “Un­lock­ing the Eco­nomic Im­pact of Dig­i­tal Trans­for­ma­tion in Asia Pa­cific”was pro­duced by Microsoft in part­ner­ship with IDC Asia/Pa­cific.

The study pre­dicts a dra­matic ac­cel­er­a­tion in the pace of dig­i­tal trans­for­ma­tion across In­dia and Asia Pa­cific’s economies. In 2017, about 4% of In­dia’s GDP was de­rived from dig­i­tal prod­ucts and ser­vices cre­ated di­rectly through the use of dig­i­tal tech­nolo­gies, such as mo­bil­ity, cloud, In­ter­net of Things (IoT), and ar­ti­fi­cial in­tel­li­gence (AI).

“In­dia is clearly on the dig­i­tal trans­for­ma­tion fast track. Within the next four years, it is es­ti­mated that nearly 60% of In­dia’s GDP will have a strong con­nec­tion to the dig­i­tal trans­for­ma­tion trends.” said Anant Ma­hesh­wari, Pres­i­dent, Microsoft In­dia. “Or­ga­ni­za­tions are in­creas­ingly de­ploy­ing emerg­ing tech­nolo­gies such as ar­ti­fi­cial in­tel­li­gence, and that will ac­cel­erate dig­i­tal trans­for­ma­tion led growth even fur­ther.”

The sur­vey con­ducted with 1,560 busi­ness de­ci­sion mak­ers in mid and large-sized or­ga­ni­za­tions across 15 economies in the re­gion high­lights the rapid im­pact and wide­spread dis­rup­tion that dig­i­tal trans­for­ma­tion is hav­ing on tra­di­tional busi­ness mod­els. The study iden­ti­fied five key ben­e­fits from dig­i­tal trans­for­ma­tion.

Ac­cord­ing to the re­search find­ings, or­ga­ni­za­tions are see­ing sig­nif­i­cant and tan­gi­ble im­prove­ments from their dig­i­tal trans­for­ma­tion efforts across these ben­e­fits in the range of 11% to 14% to­day. Busi­ness lead­ers ex­pect to see more than 40% im­prove­ments in those key ar­eas by 2020, with the big­gest jump ex­pected in pro­duc­tiv­ity, cus­tomer ad­vo­cacy as well as profit mar­gin.

Dig­i­tal Lead­ers in In­dia to Gain Lion’s Share of Eco­nomic Op­por­tu­ni­ties

The study in­di­cates that while 90% of or­ga­ni­za­tions in In­dia are in the midst of their dig­i­tal trans­for­ma­tion jour­ney, only 7% in the en­tire re­gion can be clas­si­fied as Lead­ers. These are or­ga­ni­za­tions that have full or pro­gress­ing dig­i­tal trans­for­ma­tion strate­gies, with at least

a third of their revenue de­rived from dig­i­tal prod­ucts and ser­vices. In ad­di­tion, these com­pa­nies are see­ing be­tween 20 - 30% im­prove­ments in ben­e­fits across var­i­ous busi­ness ar­eas from their ini­tia­tives. The study in­di­cates that Lead­ers ex­pe­ri­ence dou­ble the ben­e­fits of Fol­low­ers, and these im­prove­ments will be more pro­nounced by 2020. Al­most half of Lead­ers (48%) have a full dig­i­tal trans­for­ma­tion strat­egy in place.

Adds San­gita Reddy, Joint Manag­ing Di­rec­tor, Apollo Hos­pi­tals En­ter­prise Ltd., one of In­dia’s Lead­ers in Dig­i­tal Trans­for­ma­tion, “Apollo Hos­pi­tals rec­og­nized the po­ten­tial of tech­nolo­gies like ar­ti­fi­cial in­tel­li­gence, ma­chine learn­ing and data an­a­lyt­ics in pro­vid­ing high qual­ity pre­ven­tive health­care ser­vices, very early on. With data be­ing gen­er­ated at an ex­po­nen­tial pro­por­tion, tech­nol­ogy is help­ing us de­rive in­sights to pre­dict and sug­gest pre­ven­tive steps with ut­most ac­cu­racy. Our part­ner­ship with Microsoft bring us to the fore­front of this re­mark­able meta­mor­pho­sis that is al­low­ing us to meet health­care de­mand and main­tain ser­vice ex­cel­lence re­gard­less of ge­og­ra­phy.”

The Study iden­ti­fied key dif­fer­ences be­tween Lead­ers and Fol­low­ers, which con­trib­ute to the im­prove­ments tracked: Lead­ers are more con­cerned about com­peti­tors and emer­gence of dis­rup­tive tech­nolo­gies: The dig­i­tal econ­omy has also given rise to new types of com­peti­tors, as well as emerg­ing tech­nolo­gies such as AI that have con­trib­uted to the dis­rup­tion of busi­ness mod­els. Busi­ness agility and cul­ture of innovation are key goals: When ad­dress­ing busi­ness con­cerns, Lead­ers are fo­cused on cre­at­ing a cul­ture of agility and innovation to counter com­pe­ti­tion. Fol­low­ers, on the other hand, are more fo­cused on im­prov­ing em­ployee pro­duc­tiv­ity and prof­itabil­ity. Mea­sur­ing dig­i­tal trans­for­ma­tion suc­cesses: Or­ga­ni­za­tions across Asia Pa­cific are start­ing to adopt new key per­for­mance in­di­ca­tors (KPI) to bet­ter mea­sure their dig­i­tal trans­for­ma­tion ini­tia­tives, such as ef­fec­tive­ness of pro­cesses, data as a cap­i­tal, and cus­tomer ad­vo­cacy in the form of Net Pro­moter Score (NPS). As or­ga­ni­za­tions re­al­ize the po­ten­tial of data as the new oil for the dig­i­tal econ­omy, Lead­ers are much more fo­cused on lever­ag­ing data to grow revenue and pro­duc­tiv­ity, and to trans­form busi­ness mod­els. Lead­ers are more aware of chal­lenges in their dig­i­tal trans­for­ma­tion jour­neys: In ad­di­tion to skills and cy­ber­se­cu­rity threats as key chal­lenges, Lead­ers have also iden­ti­fied the need to bol­ster their data ca­pa­bil­i­ties through the use of ad­vanced an­a­lyt­ics to de­velop actionable in­sights in fast­mov­ing mar­kets. Lead­ers are look­ing to in­vest in AI and In­ter­net of Things: Emerg­ing tech­nolo­gies such as AI (in­clud­ing cog­ni­tive ser­vices and robotics) and IoT are ar­eas where Lead­ers are in­vest­ing in for 2018. Be­sides these emerg­ing tech­nolo­gies, Lead­ers are also more in­ter­ested in in­vest­ing in big data an­a­lyt­ics to mine data for actionable in­sights than oth­ers. What sets Lead­ers apart from oth­ers are their abil­ity to ride on the dig­i­tal trans­for­ma­tion wave from an or­ga­ni­za­tional cul­ture per­spec­tive. The study found that Lead­ers have these traits: “There is a press­ing need for or­ga­ni­za­tions to fully cap­i­tal­ize on the po­ten­tial value of dig­i­tal trans­for­ma­tion in the next few years. To do so, or­ga­ni­za­tions need to in­vest in build­ing their ecosys­tem, from em­ploy­ees, to cus­tomers, to part­ners, across their value chain by gain­ing new in­sights through new data sources, and in­cor­po­rat­ing dig­i­ti­za­tion in their prod­ucts and ser­vices, said Anil Bhansali, Manag­ing Di­rec­tor, Microsoft In­dia (R&D) “Microsoft is uniquely po­si­tioned to help or­ga­ni­za­tions in In­dia to suc­ceed in their dig­i­tal trans­for­ma­tion jour­neys to­day through our agile plat­forms and solutions that pri­or­i­tize flex­i­bil­ity, in­te­gra­tion and trust. We un­der­stand what or­ga­ni­za­tions will need to make their jour­neys a suc­cess­ful one”, he added.

Rid­ing the Wave of Dig­i­tal Trans­for­ma­tion

Or­ga­ni­za­tions in Asia Pa­cific need to ac­cel­erate their dig­i­tal trans­for­ma­tion jour­ney to reap the full ben­e­fits of their ini­tia­tives, and to ad­dress the in­vis­i­ble rev­o­lu­tion brought about the mass adop­tion of AI. More im­por­tantly, com­pa­nies need to fo­cus on cap­i­tal­iz­ing their own data in or­der to gain new mar­ket in­sights, cre­ate new dig­i­tal prod­ucts and ser­vices, and mon­e­tize data through data shar­ing se­curely, and in col­lab­o­ra­tion with its ecosys­tem.

Com­pa­nies l i ke Mi­cro soft rec­om­mends or­ga­ni­za­tions to adopt the fol­low­ing strate­gies to be­come a dig­i­tal trans­for­ma­tion Leader: 1. Cre­ate a dig­i­tal cul­ture: An or­ga­ni­za­tion need to build a cul­ture of col­lab­o­ra­tion where it is con­nected across busi­ness func­tions, and has a vi­brant and ma­ture ecosys­tem of cus­tomers and part­ners. Data can then be em­braced across or­ga­ni­za­tion and func­tions, where bet­ter de­ci­sions can be made and ul­ti­mately serv­ing the needs of cus­tomers and part­ners bet­ter. 2. Build an in­for­ma­tion ecosys­tem: In a dig­i­tal world, or­ga­ni­za­tions are cap­ture more vol­umes of data in­ter­nally and ex­ter­nally. The key to be­com­ing a Leader is for or­ga­ni­za­tions to be able to con­vert data into cap­i­tal as­sets, and en­able data shar­ing and col­lab­o­ra­tion in­ter­nally and ex­ter­nally in an open yet trusted man­ner. In ad­di­tion, a proper data strat­egy will al­low busi­nesses to start their AI ini­tia­tives to iden­tify con­nec­tions, in­sights and trends. 3. Em­brace mi­cro-revo­lu­tions: In most cases, dig­i­tal trans­for­ma­tion efforts do not start with wide­spread change, but a se­ries of mi­cro-revo­lu­tions. These are small, quick projects that de­liver pos­i­tive busi­ness out­comes and ac­crue to a big­ger and bolder dig­i­tal trans­for­ma­tion ini­tia­tives. 4. De­velop Fu­ture Ready Skills for In­di­vid­u­als and Or­ga­ni­za­tions: Or­ga­ni­za­tions to­day must relook at train­ing and reskilling its work­force so that work­ers are equipped with fu­ture ready skill sets such as com­plex prob­lem solv­ing, crit­i­cal think­ing and cre­ativ­ity for the dig­i­tal econ­omy. More im­por­tantly, they need to re­bal­ance the work­force to at­tain and at­tract key dig­i­tal tal­ents, as well as be open in cre­at­ing a flex­i­ble work source model where they tap into skills-based mar­ket­place. From a dig­i­tal skills per­spec­tive, LinkedIn’s lat­est study out­lines the ABCs of dig­i­tal tal­ents re­quired for fu­ture economies in the re­gion – ar­ti­fi­cial in­tel­li­gence, big data and cloud com­put­ing. In In­dia, the top in-de­mand skills are big data, ar­ti­fi­cial in­tel­li­gence, and cloud com­put­ing. “The pace of dig­i­tal trans­for­ma­tion is ac­cel­er­at­ing, and IDC ex­pects that by 2021, at least 60% of In­dia’s GDP will be de­rived from dig­i­tal prod­ucts and ser­vices, with growth in ev­ery in­dus­try driven by dig­i­tally en­hanced of­fer­ings, op­er­a­tions and re­la­tion­ships. The study shows Lead­ers see­ing dou­ble the ben­e­fits of Fol­low­ers, with im­prove­ments in pro­duc­tiv­ity, cost re­duc­tions, and cus­tomer ad­vo­cacy. To re­main com­pet­i­tive, or­ga­ni­za­tions must es­tab­lish new met­rics, re­align or­ga­ni­za­tion struc­tures, and re-ar­chi­tect their tech­nol­ogy plat­form,” said DanielZoe Jimenez, Re­search Di­rec­tor Dig­i­tal Trans­for­ma­tion Prac­tice Lead, IDC Asia/ Pa­cific.

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