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Digital Transformation wins by exploiting software advantages from disrupters: exclusive CA interview

AvantiKumar | Jan. 8, 2016
Stephen Miles, CA Technologies' APJ CTO, gives a snapshot from a recent survey of the Digital Transformation scenario across the Asia Pacific region.

Stephen Miles, chief technology officer in APJ for IT management solutions provider CA Technologies, continues the Digital Transformation narrative in the Asia Pacific region. In this interview, he focuses on how CIOs can gain software advantages from digital disrupters as well as unveil some survey results on the Digital Transformation scene in the Asia Pacific & Japan (APJ) region.

The online study, 'Exploiting the Software Advantage: Lessons from Digital Disrupters', surveyed 1,442 senior IT and business executives and was sponsored by CA Technologies and conducted by industry analyst firm Freeform Dynamics. It was augmented by in-depth telephone interviews with key industry executives.

Globally, Digital Transformation is being driven as a coordinated strategy across a majority of organisations (55 percent), with many projects underway in multiple areas of the company, including customer services, sales and marketing, and product/service development. As a result, 45 percent of respondents have already seen measurable increases in customer retention and acquisition from their digital transformation initiatives and 44 percent have seen an overall increase in revenue.

Stephen Miles - CA Technologies 

Photo - Stephen Miles, Chief Technology Officer, APJ, CA Technologies

 

Let's start with how you would define 'digital transformation'?

"Digital transformation" is really about exploiting modern technology and communications to transform one or more key aspects of your business.

This is often associated with customer engagement, but could also be concerned with transforming your core business processes, your workforce, or the way you engage with suppliers and partners. Digital techniques can also be used to simply enhance and optimise the way you do things.


What's the overall picture we are seeing in relation to digital transformation activity across the Asia Pacific and Japan? Could you also say something about this activity in Malaysia?

More than two-thirds (69 percent) of businesses surveyed in the Asia Pacific region acknowledge that digital transformation is important and are committed to it.

This strongly suggests that those who have yet to start on the journey see the value and are already thinking about it, and this is a scenario we are seeing in Malaysia as well.

In addition, Digital Transformation in APJ is being driven as a coordinated strategy across half of the organisations (50 percent), with many projects underway in multiple areas of the company, including customer services, sales and marketing, and product/service development.

Beyond high level revenue and profit motives, the top three drivers, or potential drivers, of digital initiatives in organisations in APJ are: improved customer satisfaction (across the world, this is the #1 driver of digital initiatives), better workforce productivity and improved customer experience. 

As a result of digital transformation, 43 percent of respondents in APJ have already seen measurable increases in customer retention from their digital transformation initiatives and 42 percent have seen an overall increase in revenue. It pays to embrace digital transformation in the application economy. We fully expect the focus on customer experience across APJ including Malaysia to increase.


How are Asian countries faring relative to each other?

On a country-level, we are seeing progress at different paces. India and China are ranked first and second globally.

The general trend that we have observed is that developed countries such as Australia, Japan, Singapore, South Korea, are at the bottom half of the table, whereas emerging markets like China and India are at the top.

This points to the fact that in more developed economies, digital transformation has reached a certain maturity and saturation level that businesses no longer see massive impact on their operations. This is in stark contrast to emerging markets where the effects of adopting digital technologies is still transformative.

There were also many other variables that went into scoring this on the index. This includes cultural differences which could affect how conservative or optimistic their responses are.

In Malaysia, while we do not have the specific figures, we observed that an increasing number of companies are recognizing the importance of a digital presence to customer engagement and market development.  However, many companies have yet to actively embrace the innovations needed to deliver that transformation.


How are various industries responding to digital transformation?

From the survey, Freeform Dynamic developed the Digital Effectiveness Index (DEI) using measurements based on a combination of responses to questions about market competitiveness and business scorecard metrics (customer retention, customer acquisition, profitability, new income streams, share of market, overall revenue and profit).

Using this measure, a group of top-performing organisations has emerged - the Digital Disrupters, identified as the top 12 percent of respondents in APJ.

In this elite group of Digital Disrupters in APJ, or those well on their digital transformation journey, respondents are already seeing impressive business benefits, including 2 times higher revenue and 2 times higher profit growth.

Put simply, exploiting modern technology and communications to transform one or more key aspects of the business to achieve a state of digital readiness has now become a mainstream activity to drive return on investment (ROI).

And it turns out that digital disrupter have common characteristics. They are

  • 2.4 times more likely to have advanced agile practices in place
  • 2.4 times more likely to have broadly implemented DevOps
  • 2 times more likely to leverage APIs for mobile app development.

 

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