Thai business ‘must transform faster to avoid digital disruption wave’
Thai companies must speed up their digital transformation to avoid the impact of a wave of disruption within the next five years, warns a new report by Deloitte Thailand.
The Covid-19 crisis will accelerate that digital transformation, the report adds.
Ninety-one executives from several industries participated in the “Thailand Digital Transformation Survey” conducted last October.
In Thailand, technology, media and telecommunications, and financial services are among the leading industries in moving towards digital transformation.
Only one-third of respondents said they were succeeding with their digital transformation, however.
The survey offered insights into the key challenges of companies facing the new era of digital disruption.
"Digital disruption has been changing the rules of the game, blurring the lines between industries and creating a need for dramatic efficiency gains across the board," said Narain Chutijirawong, clients and industries director at Deloitte Thailand.
"The impact of digital disruption is already here, so no surprise that the results of the survey show most businesses are aware and in fact, some have been engaging digital initiatives already," he added.
The report found that key purposes for digital transformation are enhancing end-user experience, transforming business processes and better utilising data.
However, all the companies surveyed reported only partial success in improving business performance through their digital transformation initiatives.
Deloitte identified “people issues” as the biggest challenge to digital transformation. In response, it advised companies to break down functional silos and build a digital mindset as well as employ the right people.
"Key challenges facing by digital transformation initiatives, whether relating to people or money, can be easily mitigated by having a clear vision and strategy. Executives need to clearly understand why and what they want to achieve, not just because of having to do it," said Viney Hora, a partner with Deloitte Consulting.
"For some, digital disruption will be explosive and immediate while for others less vulnerable to digital trends, the changes will be slower and more subtle. Still, digital innovation will be the cornerstone for future value creation,” he added.
The report also focused on the skills gap that needs to be filled to meet Thai companies’ digital ambitions. Data analysts and data scientists are considered crucial to efforts for digital transition, while AI and machine-learning specialists will become more influential in the near future.
The “Buy-Build-Borrow” model describes three ways of addressing the talent shortage.
The survey found that more than half of the respondents chose the short-term “Borrow” strategy – part-time, freelance and temporary workers – to fill their digital skill gaps.
However, digital transformation will require longer-term investment in human capital and collaboration with other stakeholders to upskill the workforce, it said.
The lack of investment in employee skills meant Thai companies are also falling behind in adoption of blockchain, artificial intelligence (AI) and the internet of Things (IoT), the survey found.
Meanwhile, tax incentives, easing regulations and well-established infrastructure are the most popular demands companies make on the government. Hence, said the report, the government should improve the digital business environment in Thailand by focusing on these issues, reforming education systems and emphasising the importance of data science skills.
