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Are ANZ business lagging behind when it comes to digital transformation?

05 Jul 16

Organisations across the Asia Pacific region are still in the burgeoning stages of digital transformation, according to a new report from IDC, although Australia and New Zealand are looking to be the most mature.

According to the report, the vast majority (45.4%) of enterprises surveyed operating at the basic ad hoc level (i.e. digital resisters) and yet to establish basic DX capabilities and adopt digital solutions systematically.

The  IDC MaturityScape Benchmark: Digital Transformation in Asia/Pacific (Excluding Japan) provides objective data to help organizations uncover gaps between their own and their competitors' DX maturity. It consists of five stages: ad hoc, opportunistic, repeatable, managed and optimised.

"The pace of DX is accelerating in Asia/Pacific, but 45% of organizations are still in the first stage of DX maturity (out of 5 stages), compared with 14% in the United States,” notes Daniel-Zoe Jimenez, associate director and lead of IDC's Asia Pacific Digital Transformation research practice.

“Organisations in Asia Pacific need to focus on accelerating their digital capabilities, otherwise they will face irrelevance.

“If successfully done, this will help drive competitive advantage, grow revenue, and ultimately increase market share,” he says.

Thirty-three percent of organizations (the second largest group) fall within the opportunistic stage of Digital Transformation maturity, the report shows.

“These organisations have already established basic digital capabilities, but to progress to the next stage of maturity (repeatable) they need to focus on increasing the integration and consistency of its digital initiatives,” says Jimenez.

To view the opportunities and challenges more clearly as IT moves through the various stages of DX maturity, IDC also measured maturity across the five key dimensions of the IDC MaturityScape framework. The five critical dimensions which organisations need to understand are the following: leadership, omni-experience, worksource, operating model, and information.

Key findings from the research include:

• The overall trend of the maturity stages across all the dimensions is quite consistent, although there are some notable points, including that Leadership DX, Omni-Experience DX, and Information DX are the dimensions most difficult to reach the managed or optimised stage for organisations in Asia/Pacific.

• The ANZ sub-region is the most mature of Asia/Pacific (excluding Japan) and its results are more similar to respondents in the United States than the total results at the APEJ level.

• Financial services, communications and healthcare show the most relative maturity at the overall DX level in Asia/Pacific excluding Japan.

"DX is not just another technology trend, but a critical business priority for many CEOs and their leadership teams across Asia Pacific,” Jimenez says.

“Processes and business models that were optimal a few years ago are now outdated — or simply don't provide the speed and agility required to compete,” he explains.

“The fact that the majority of Asia Pacific organisations are in the first 2 stages of maturity shows that digital transformation is not as simple as buying a technology solution,” adds Jimenez.

“DX involves a radical rethink of how to do business. To be successful, organisations need to focus on developing the vision and strategy for digital transformation of products, services, and experiences to deliver value to partners, customers, and employees,” he explains.

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