Digital transformation: Do businesses need government help?
With digitization happening at an unprecedented pace, integration of technology in businesses is a crucial matter of staying relevant and keeping a competitive edge across all industries.
By adopting technological solutions to keep operations running smoothly, more time and investment can be allocated for development in other aspects.
With that in mind, businesses lacking a digital transformation strategy risk falling behind.
That is evidenced by the results of a new survey by Sage entitled “We Power the Nation”, which reported that productivity loss has cost the US economy US$346 billion in the last 12 months.
Clearly, that’s a high price to pay for the lack of digital integration in organizations.
Why digital transformation adds value to work
According to experts, even ‘minor’ digital transformation can not only reduce manual work but also increase efficiency by 80 percent.
With routine manual work increasingly automated, employees can be reallocated to more high-level tasks.
Besides that, organizations can invest more time in their people; they are able to improve skill sets and engage in more creative projects.
Retraining and reskilling of employees is also crucial for readying organizations to make full use of the technology acquired.
But it also helps to improve job satisfaction and increase employee motivation in the long run— with a clear path for career development and opportunities to develop skill sets, organizations are more likely to retain talents.
US behind global rivals
Being on the ‘back foot’ with digital transformation is something of an ongoing trend for developed countries like the US.
Dell Technologies’ Digital Transformation (DT) Index found emerging markets to be some of the most mature.
India, Brazil, and Thailand topped the ranks, while developed markets, including the US, Japan, Denmark, and France were scored some of the lowest.
“In the near future, every organization will need to be a digital organization, but our research indicates that the majority still have a long way to go,” said Michael Dell, chairman, and CEO of Dell Technologies.
Indeed, the majority of organizations undergoing digital transformation report suffering failure, delays or scaled back expectations, according to Couchbase.
Just over a fifth of IT heads said they had transformed or completely “revolutionized” end-user experience, while 86 percent said reliance on legacy technology, the complexity of implementing technologies, and lack of resources and skills had got in the way.
How government imitative can propel the digital movement
With so much potentially at stake, and yet many lacking the means, resources or skills to implement a strategy effectively, many believe that external intervention is vital to boost and incentivize investment in technology.
In the US, various organizations are in support of government intervention in digital transformation such as providing free classes to develop IT skills and tax breaks for investment in programs and initiatives.
Meanwhile, the EU is promoting vocational training to ensure its citizens are fit and ready for digital transformation in the workplace— working hours and conditions are being reassessed as well.
“As businesses around the world continue to face an increasingly competitive marketplace, the need for digital tools and skills has never been greater,” said Nancy Harris, Managing Director, Sage North America.
“As we speak to our customers, they resoundingly agree that a combination of investment and government programs can help solve this productivity puzzle.”
Interestingly, a study by Swedish think tank, International Institute for Management Development (IMD) showed the US to be leading in IT integration and employees having a high capacity for adapting to digitalized operations.
Clearly, the US has the potential for businesses to wholly brace the era of digitalization, but are few really seizing the potential?
6 June 2023