While the current pandemic continues changing many aspects of business around the globe, one thing’s definitely here to stay: digital transformation. In fact, today’s global health crisis is only accelerating digital change and the Asia-Pacific region is likely poised to see some of the world’s fastest growth.
By late 2020, Asia Pacific will have 2.4B Internet consumers—a bit less than the populations of the Americas & northwestern Europe combined.
According to the International Data Corporation (IDC), some 60% of the region’s GDP will be derived from digital products or services created through digital transformation by 2021. This development alone will add nearly one percent annually to Asia Pacific’s GDP, or US$1.16 trillion by 2022.
Overall, three major building blocks are driving this transformation:
- Cutting-edge technologies
- Differentiated employee/ client experiences
- Re-skilled employees to meet the demands of a new talent agenda
- Here’s how each is changing the face of Asia Pacific today, as well as the implications for the region’s business landscape tomorrow.
Cutting-edge Technologies Are Changing the Future
Almost every month, we hear about the impact of automation and disruptive technologies on the region’s workforce. In fact, across Asia, adaptation of various tech platforms—videoconferencing, AI-enabled facial recognition, thermal scanning, contactless payments, and patient tracking/tracing apps—have scaled exponentially during the last half-year alone. For example, consider the example of contactless payments, where China is fast leaving cash behind as the world’s largest user of mobile payment systems. Hundreds of millions are already using WeChat and Alipay for everyday transactions, opening up tremendous opportunities for consumers and businesses alike.
Speeding Down the Digital Highway
Although several megatrends are impacting the region—including changing demographics, urbanization and global trade—technological change is having the most direct impact on how businesses are run, with digital platforms now becoming mainstream. They’re at the core of the enterprise and the “new factor of production.” They’ll increasingly determine how we acquire and deploy skills, raise capital and provide choices to the consumer as well as enhance our collaboration with suppliers. Over the last 10+ years, Asia Pacific has embraced these digital opportunities with open arms, with Gojek, Alibaba, Tencent, Paytm, Byju’s, Zomato, and Jio platforms emerging as just a few of the region’s most successful “unicorns.”
Customer trust in the Asia Pacific region has risen as a result of this blockchain technology, increasing point-of-purchase transparency and choice.
For example, one of our global clients specializing in food supply chain management actively embraced blockchain technology to ensure that ingredients like coffee, nuts and milk are sourced from reliable and ethical producers, ensuring sustainable development at the source. Customer trust in the region has risen as a result of this blockchain technology, increasing point-of-purchase transparency and choice.
In Vietnam, one of our Asian pharma distributor clients announced a project to expand access to vaccines using an innovative packaging technology that ensures the integrity of temperature-sensitive products to the last mile of transportation. They partnered with a global ERP platform to leverage intelligent technology such as blockchain and platform-as-a-service (PaaS) to enhance vaccine efficacy as well as reduce waste related to temperature control and shipment issues. As global scientists work hard to find a COVID-19 vaccine, developments like these will only grow in importance.
Differentiated Experiences Are Redefining Business
The pace is staggering. Every minute of every day, a new digital consumer is added in Asia Pacific. In fact, The Times of India predicted that by the end of 2020, the region will have 2.4 billion internet consumers—a bit less than the populations of the Americas and northwestern Europe combined. Given this new dynamism, regional businesses are leading a strategic shift using several levers:
Reinvent and reinvest: Initiate organizational change to provide training in digital platforms, acquire digital-savvy employees, change mindsets and establish an agile roadmap to embrace these changes.
Develop new channels enabled by digital platforms: DBS Bank’s new digital-only bank in Singapore is just one example of how traditional physical branch networks are no longer necessary for financial services companies’ success. Think: all click—no brick. And, as Zalora Singapore has shown, an entire shopping enterprise can provide a more robust e-retailing experience from one’s smartphone.
Drive efficiencies: By embracing assisted intelligence platforms including process automation, RPA and other enablers, back-office functions at large shared service and call centers from Manila to Mumbai are achieving greater efficiencies while enabling better customer experience.
Businesses across Asia Pacific are also developing holistic digital road maps to transform and future-proof their organizations. Successful businesses there have already learned the lessons of Barnes & Noble, Blockbuster, Borders, HMV, Kodak, Polaroid, Thomas Cook and others that failed to adopt digital business models and are today footnotes to business history.
Even with today’s technological change, employers will still need to focus on re-skilling their employees to meet the demands of a new talent agenda. With Asia-Pacific’s diversity of cultures, languages, complex social structures, as well as disparate business practices organizations also need to ensure that new technologies are collaboration enablers—not counterproductive blockers. Employees need to adopt mindsets that are more “us together” instead of “me alone”—a major challenge in such a diverse marketplace.
Digital platforms can help. In particular, they can:
- Enable better access to data/information,
- Reduce process inefficiencies, and
- Flatten organizational hierarchies.
- This can only be enabled by a harmonious collaborative organizational culture where the shared business vision is to transform and embrace new business models.
Machines and bots will assume repetitive tasks, but humans with higher-value skills will continue to be required—in abundance!
In its 2018 Digital Leadership publication, Korn Ferry coined the phrase “digital sustainability—a new state of being.” They illustrated the idea with the example of a German engineering organization’s journey to embed innovation as its core ethos by creating a “digital friendly” environment that encouraged risk-taking as well as trying new concepts and approaches in markets like Singapore, China and Japan.
Organizations will need to hire skilled professionals who embrace change, demonstrate intellectual curiosity, have an analytical mindset, are innovative by nature, and can work seamlessly across digital platforms. The Power of Humans to drive organizational change cannot be denied.
The bottom line: Machines and bots will assume repetitive, commoditized tasks, but humans with higher-value cognitive and critical skills will continue to be required—in abundance! For many organizations, this will mean unlearning some past skills while simultaneously upgrading—or learning new—skill sets that better meet tomorrow’s needs.
What’s Next? Human-Digital Platforms
There’s no doubt that Asia-Pacific is embarking on a digital journey of unprecedented scale that will shape its—and the world’s—marketplace, provide new opportunities, as well as create significant wealth. However, uncertainty, fear and apprehension also persist across this vast region. Rising unemployment among relatively low-cost service workers as well as the elimination of cost arbitrage unleashed by digital automation cannot be ignored.
Business leaders will play a critical role in allaying these concerns by:
Building a positive narrative about automation by focusing on benefits.
Thinking about people, not jobs—focus on retooling, re-skilling and rehiring employees.
Owning the technology debate—provide insights on how companies in global and regional marketplaces are adapting to dynamic technological changes.
Introducing the concept of shared destiny—digital platforms should result in more integration not fragmentation. Think: “we’re all in this together…” instead of “you’re on your own….”
The Asia-Pacific region has embarked on an irreversible journey. They’re already innovating and creating new business models supported by automation and digital platforms that span many companies’ entire value chains.
Century-old organizations and norms are being challenged by small and nimble companies with entrepreneurial and innovative business practices. Each of these developments will have deep and profound impacts on employers, workers and society at large.
When employers and employees alike in Asia-Pacific actively embrace that spirit of agility, opportunity and impact follow like never before.
Individual employees will need to “future-proof” themselves by unlearning age-old practices in favor of niche/specialist skills as well as adopting more agile approaches so they can transform faster as the world around them changes. Employers and corporations will need to lend a helping hand to support their workforces as everyone transitions to this more digital world.
Finally, our company’s stated purpose of “human agility ignites opportunity and impact” definitely applies here. When employers and employees alike in Asia Pacific actively embrace that spirit of agility, opportunity and impact follow like never before. If not already started—the time to begin is now.