Top 5 picks to bring about a quantum leap in your digital services strategy – Shazurawati Abd Karim

During the TM Leap Summit 2021, we heard about aspects such as the power of knowing, a human-centred approach for transformation and design thinking. Here is a quick summary of our top five picks required to reshape our digital services strategies.

#1 Artificial intelligence is our forever companion

AI is a competitive necessity driving new levels of efficiency and performance for businesses of all sizes. According to IDC, 14% of Southeast Asian firms have adopted AI to some extent, with another 37% planning to adopt it in the next five years. Additionally, an EDBI and Kearney assessment of ASEAN nations forecasted AI to add USD 1 trillion¹ to the region’s GDP if properly implemented. AI is already part and parcel of our lives. AI enables apps like Google Maps, Waze and Foodpanda, and we also see the technology in chatbots and digital marketing tool use cases.

The use of AI in cybersecurity applications is also growing. The ASEAN Post suggests that Southeast Asian companies may suffer a loss of USD180 billion to USD365 billion over the next few years due to massive data breaches. However, AI-powered cybersecurity technologies can collect data from various sources and digital networks. They use algorithms to spot trends and flag up potentially malicious threats.

5G and IoT applications will further fuel the usage of AI.

#2 Mobile app is the enterprise’s best fashion accessory

Mobile apps have made their way to every sector covering all aspects of modern life. According to Statista, worldwide mobile app downloads will reach 161 billion by 2023. Mobile phones already account for 70% of all user traffic. Interestingly, about 42% of the adult population have used at least one on-demand service app in their lifetimes, such as food, grocery, and parcel delivery.

The demand for application-based on-demand services will become more assertive in 2022. It will expand to other categories such as fuel delivery, medicine delivery, etc. One of the leading drivers would be growing momentum for on-demand services in the B2B space. Consequently, it becomes important for businesses to differentiate and compete in the market.

#3 The digital gap will always be there

There are two key approaches to manage the constant changes in digital services:

• Adopting agile practices at scale help businesses to respond to the changes with speed and the quick thinking required to mitigate alterations. Thus, agility at scale is fundamental for an enterprise’s digital transformation and service development.
• Secondly, embrace digital coalition and co-creation. A digital coalition between enterprises and digital service providers is a powerful way to co-create sustainable and impactful solutions. This practice allows the building of solutions that is aligned to the strategic objectives of an enterprise, leveraging on the strength of digital talents across all parties.

#4 Cloud-powered future

Cloud will serve as a key driver to navigate innovation, new business models, new revenue streams, and most importantly, to create the ultimate customer experience. By 2025, nearly all companies will have a cloud-first approach, and we can expect cloud spend to surpass non-cloud spend. To compete with digital giants, it has become a necessity for enterprises to shift their focus towards platform-based business models. Capital UK projects that 80% of organisations will migrate to cloud hosting and colocation services by 2025. Shift to the cloud will also enable organisations to connect to a vast ecosystem of partners and suppliers that offer an extensive array of digital solutions and services.

#5 Level up your IT budget

Irrespective of the industry you are operating in, you cannot ignore investments in technology. Spending on technology can also help in differentiating your products and services. There is an expectation for technology to reach 20% of the total operating costs by 2023, and technology spending as a portion of revenue could range from 6.2% to 8%.

By and large CIOs report less than 15% of their technology budget for fostering innovation. We recommend successful companies set aside at least 20 to 25% of their IT spending to reimagine value creation and discover new ways to disrupt the status quo. As far as costs are concerned, taking a hybrid approach of outsourcing some of the digital services is be the best solution to sustain digital transformation efforts without dissipating technology budgets.

TM One empowers enterprises and the public sector human centered transformation forward by harnessing the power of IR 4.0, AI, IoT, and big data through our robust building blocks of cloud, cybersecurity, smart services, connectivity solutions, data centre, and professional services, along with our many leading global partners.

Reference:
https://www.kearney.com/digital/article/?/a/racing-toward-the-future-artificial-intelligence-in-southeast-asia