The recent CIO Survey report has indicated the majority of industries are facing Digital Disruption. Up to 54% of digital leaders believe their companies will fail if they don’t implement Digital Transformation in the same pace as their competitors. Nevertheless, the Couchbase survey has found 90% of Digital Transformation projects will fail because many businesses are struggling to implement their transformation strategies.

Many businesses may not be fully aware of the challenges and vulnerabilities to be caused by Industry 4.0. Yet, according to the World Economic Forum, Digital Disruption caused by Industry 4.0 will have a serious impact on the workforce with possibly five million jobs lost worldwide by 2020. This view is supported by the Jobs Lost, Jobs Gained Work Force Transitions Report2 published by McKinsey Global Institute which estimates between 400 million and 800 million individuals around the world could be displaced by automation, many of this needing to find new jobs by 2030.

The latest news on Digital Disruption is not encouraging in Retail and Banking industries. Massive job losses have been reported. These include:

Automation and Robotics have been the key drivers of these job losses. However, Techcrunch presents a paradoxical view arguing that although technology is killing jobs, it will be technology that will save their jobs accesses. The reason is that Digital Technologies can be leveraged to provide innovative solutions, digital tools and smart apps to reach out to new Digital Users. Traditional businesses may survive Digital Disruption if SME businesses empower their workforce and leverage Digital Solutions to reimagine their existing business processes in order to stay competitive.

Unfortunately, some SME businesses struggle to embrace and adapt to the emerging Digital Technology. Reasons for this may including the following: 

  • Resistance among staff to change its company’s culture; 
  • A lack of leadership to drive and execute a Digital Strategy;
  • Insufficient technical skills for the Digitization Process to reimagine existing business processes;
  • Insufficient understanding of how to upskill existing staff and build a digital team to drive Digital Transformation projects.

To be successful with a Digital Transformation initiative, traditional SME businesses have to change their mindset to understand that legacy information and data must be converted from a physical hard copy format into a digital format. A new digital skillset is required to enable the Digitalization Process to integrate emerging Digital Technologies into everyday life. The good news is that there are a few successful Digital Transformation stories showing us how digitalization solutions work to target a new generation of digital users. These digital solutions include Uber for ordering taxis, Netflix for media streaming, AirB2B for booking accommodation, Deliveroo for ordering and delivery of meals, etc.  

SME businesses don’t have to build their Digital Solutions from ground zero. Some successful Digital Solutions have had a comparative short start-up time to market. The important factor is that these successful companies have gained a clear mindset of their digital audience and understand how to apply the Digitalization Process in their digital solutions. 

The following Digital Technologies are available for SME businesses to evaluate and tap into for their future business: 

  • Cloud Technology enables businesses to store and accesses their business data and application programs over the Internet, operating in an agile, cost-effective and flexible operating platform; 
  • The trend of Digital Transformation is moving toward Internet of Everything for Smart Living where Internet of Things (IoT) smart devices connecting with Artificial Intelligence (AI) software provides users with data to live their lives more efficiently. 
  • Big Data has a vital role in storing all data generated by IoT applications (such as connected homes, smart cities and healthcare). Big Data and Data Analytics are designed to work together to deliver better, fact-based information for decision-making and for improving the overall customer experience.
  • Biometrics Security uses Fingerprint scanners or Facial Recognition cameras to provide positive Identity Verification and Authentication before granting digital consumers access and appropriate permission to use core business applications such as Financial Banking applications and eCommerce payment systems. 
  • Virtual Reality (VR) is being jointly deployed with Augmented Reality (AR) to let users view the real world overlaid with computer-generated imagery and information for a different digital experiences.

There are known business benefits from Digital Transformation projects. These benefits include: 

  • Lower Costs: The lower cost of digital technologies has contributed to mass adoption by businesses and a new generation of digital consumers. 
  • Quick to Market: Products and services can be deployed quickly by new startup companies to millions of users.
  • User Satisfaction: Digital consumers enjoy quick access to information about products and services they wish to purchase in real time.
  • Financial Benefits: With theadoption of Virtualization and Cloud Technology and a reduced IT Infrastructure Footprint, there are proven tangible financial benefits from a better Return on Investment (RoI).

The recent CIO Survey report has indicated the majority of industries are facing Digital Disruption. Up to 54% of digital leaders believes their companies will fail if they don’t implement Digital Transformation in the same pace as their competitors. Nevertheless, the Couchbase survey has found 90% of Digital Transformation projects will fail because many business are struggling to implement their transformation strategies.

In conclusion, Digital Technology has the potential to transform SME businesses. To avoid the failure as reported by Couchbase survey, it is advisable that SME businesses should engage external Digital Consultants to help them to define with its Digital Transformation Strategy and ensure its Core Business will be aligned with the future Digital Business. 

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About Michael Dai – Country Director at Consulus New Zealand, Global Head of Digital Transformation

Michael Dai is a recognised Lead Computer Architect with more than 29 years of experience in Information Technology and Digital Technology. Michael has worked on many significant projects within Biometrics Security, Enterprise & Infrastructure Architecture and Cloud Computing.

Apart from his IT skills, Michael is well versed in being able to apply a wide range of other technical management and consulting skills which can apply in a variety of cultures and situations, with proven team-working ability, demonstrated by the length of his involvement in large-scale projects and his commitment in delivering the required outcome for his clients.

Michael leads Consulus global work in the digital transformation.