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'Wait and watch' means Malaysia lags behind ASEAN in digital transformation stakes

AvantiKumar | May 13, 2016
Only 34% of Malaysian organisations are actively on the digital transformation (DX) road, says IDC's Sreenath Kandarpah.

IDC - Sreenath Kandarpah 

Photo -Sreenath Kandarpah, IT Services Research Manager, IDC Asia Pacific.


According to analyst firm IDC, Malaysian organisations are lagging behind their Asean counterparts in the digital transformation (DX) stakes.

Sreenath Kandarpah, IT Services research manager, IDC Asia Pacific, pointed out that overall findings from IDC's new research 'How Digital Transformation (DX) is Reshaping the IT Services Market in Malaysia' do show that DX will experience positive growth in Malaysia.

Kandarpah said the drivers are the growing demand for organisations to create new revenue streams, reduce expenses, improve customer experience and stay ahead of competition.

However, the research revealed that 34 percent of the organisations in Malaysia said they were engaged in Digital Transformation projects.

"Nowadays, enterprises in Malaysia are under great pressure to serve their increasingly demanding and digitally savvy customers," he said.

"This in turn prompts them to relook at their DX strategy and make quick decisions in transforming their business processes to achieve business goals," Kandarpah said.

This IDC Survey report examines the key factors, impact, challenges and IT Services trends driving Digital Transformations in Malaysia.

'Wait and watch'

He said that as enterprises in Malaysia faced fierce competition and price war to win customers, digital technologies must be used optimally as a leverage to "deliver superior customer service experience and create competitive advantage through product differentiation."

Kandarpah said Malaysia's enterprises were still "only at the early stage of DX adoption due to the lack of clear understanding. Therefore, a high percentage of organisations are still not prepared for the DX transition with most deciding to wait and watch."

He added that according to a recent IDC survey, organisations in Malaysia "are lacking the required internal IT skills and are increasingly interested in engaging with external service providers to build DX strategy and integrate DX solutions with their existing architecture."

Kandarpah said this opened up growing opportunities for service providers to provide DX consulting and integration services.

He said IDC expected that an organisation's spending on DX solutions, which encompasses Cloud, Mobility, IoT, Big Data and Analytics will grow by an average of 13 percent per year through 2020.

Service providers need to take the lead role and drive industry specific DX solutions, he said. Apart from the lack of expertise in driving DX strategies in Malaysia, enterprises were facing challenges in building business cases and measuring return on investment (ROI) while leveraging digital solutions.

This again will open up growth opportunities for service providers in creating awareness, building use cases, and delivering value to these enterprises, added Kandarpah.


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