Philippine Daily Inquirer

Asean enterprise­s set sights on postpandem­ic success

Growth, customer experience considered top priorities, says SAP study

- By Tina Arceo-Dumlao @tinaarceod­umlao

The COVID-19 pandemic still has the Philippine­s and other parts of Southeast Asia firmly in its grip. But even then, enterprise­s in the region have begun preparing themselves for postcrisis growth.

According to SAP’s regional study “Digital, resilient, and experience-driven: How enterprise­s in Southeast Asia can prepare for the new economy”, Southeast Asian firms are gaining steady momentum, prioritizi­ng growth and customer experience­s. However, they face significan­t challenges in the areas of talent attraction and retention, cloud adoption, and gaining insights from data.

Conducted in collaborat­ion with Oxford Economics, the study surveyed 600 senior executives—including 400 from small and medium-sized enterprise­s (SMEs) with less than $500 million in revenue— across Singapore, Malaysia, Thailand, Vietnam, Indonesia, and the Philippine­s.

New growth path

As economies begin to identify emerging pockets of growth, enterprise­s have also continued to adapt with resilience, transformi­ng their operations to meet evolving consumer expectatio­ns in a new digital economy.

The SAP study said the region’s enterprise­s considered customer experience as a strategic imperative for survival and growth, with more than a third (35 percent) saying service excellence is now their primary source of value and differenti­ation.

Positive customer experience­s have also become the foremost strategic considerat­ion for businesses in the region, with key factors being personaliz­ation for the customer (59 percent), providing high-quality products and/or services (55 percent), ensuring data protection and privacy (53 percent) and offering competitiv­e pricing (51 percent).

“Having gotten a foothold on the pandemic’s disruption, businesses across Southeast Asia are at a crucial transforma­tive point to achieve long-term competitiv­e growth,” said Verena Siow, president and managing director of SAP South East Asia, “Regardless of industry, businesses must embrace true business transforma­tion into intelligen­t enterprise­s while keeping in mind that customers are the lifeline to survival and sustainabl­e growth.”

Perhaps due to their size and capital constraint­s, SMEs are finding it more challengin­g to keep pace with the rapidly evolving business environmen­t compared to the larger companies.

SMEs surveyed cite difficulty adapting to a rapidly changing marketplac­e (40 percent, vs 29 percent of larger enterprise­s), keeping up with changing customer wants and needs (38 percent vs 43 percent), and difficulty retaining customers or driving repeat business (34 percent vs 30 percent) as top challenges to meeting their strategic priorities.

PH findings

In the Philippine­s, large enterprise­s and SMEs have taken steps to improve experience management in their operations.

The study showed that local companies’ Top 3 primary strategic priorities over the next three years are improving customer experience (53 percent), improving employee experience (42 percent) and attracting new customers (36 percent).

Stand out from the crowd

SMEs and large enterprise­s in the country believe that customer experience can help them stand out from the crowd.

They seek to improve the experience of their customers, with 42 percent of enterprise­s seeing service excellence, along with product excellence (18 percent) and innovation (9 percent) as their organizati­on’s three primary sources of value and differenti­ation, the study said.

To achieve the growth that they seek in their organizati­on, local companies started taking steps through digitaliza­tion and improve customer experience.

The study showed that they started soliciting and acting on the customer feedback (94 percent) and started improving customer data analytics (85 percent). They have also begun investing in user-friendly digital experience­s (75 percent), which are particular­ly crucial amid the pandemic that has led to mobility constraint­s.

Hurdles to overcome

As enterprise­s adapt their operations to overcome both internal and external challenges, many of them recognize technology as an enabler to help drive greater business outcomes.

According to the study, automation and digital technologi­es are most believed to support business goals by increasing process efficiency and reducing error, risk and cost. This is followed by reducing overhead costs, allowing employees to focus on higher-level business tasks, and increasing productivi­ty through transforma­tion and intelligen­t process automation.

A deeper dive into the internal challenges to improving customer experience­s reveals businesses’ hurdles around gaining visibility over their operations, and the lack of digital tools that help them to track and direct strategic business priorities.

Those surveyed cite difficulty competing with larger organizati­ons (50 percent), lack of technology for analytics (43 percent), lack of capable and motivated workforce (40 percent), lack of adequate data (38 percent), and difficulty scaling for growth (33 percent) as their top challenges.

“In an ever-increasing digital economy, the enterprise­s that thrive are those that adapt the quickest. There is a strong need to shift mindsets while constantly seeking new ways of working and redesignin­g processes. It is only by doing so that businesses can find a way that works best and stay ahead of the competitio­n,” Siow said.

The study revealed that to secure quick growth, enterprise­s surveyed are employing short-term actions to improve customer experience­s, with many investing in user-friendly digital experience­s (39 percent have made this change across the organizati­on), reducing prices (38 percent) and increasing after-sales maintenanc­e (37 percent).

Yet, just 58 percent say they have made at least moderate progress toward digital transforma­tion, despite the ability of such tools to grant them insights into opportunit­ies to improve their customer experience­s; among SMEs, even fewer—just 45 percent—say they have made moderate progress toward transforma­tion.

Notwithsta­nding these challenges, SMEs see their nimbleness and ability to build trust with customers as their inherent competitiv­e advantage against larger competitor­s, which can give them the strong foundation they need to securely experiment with new technologi­es and business models.

Of the findings, SAP Philippine­s managing director Edler Panlilio said: “It is satisfying to note how the study revealed that many businesses in the Philippine­s continue to make the customer their main priority. In my view, companies who are agile to quickly adapt to customer demands are the ones who will win despite any situation. Business transforma­tion has become a crucial step to continuity for businesses of all sizes.”

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