A report noted that a recent Digital Transformation (DT) Index found that Malaysia outranks both Singapore and Japan in terms of digital maturity.
Even so, 85% of business leaders in the country admitted that digital transformation should be more widespread throughout their organisation. Meanwhile, 51% believe they will struggle to meet changing consumer demands within five years, and 48% worry their organisation will be left behind.
The index was produced by a major multinational corporation in the information technology industry in collaboration with another tech company and an independent and specialist market research provider for the global technology sector.
The index surveyed 4,600 business leaders from mid- to large-sized companies from around the world to score their organisations’ transformation efforts.
The index divided the business leaders surveyed into five benchmark groups – digital leaders, digital adopters, digital evaluators, digital followers and digital laggards.
About 41% of Malaysian business leaders surveyed fell under digital followers, which was defined as leaders who make very few digital investments and are tentatively starting to make plans. This was followed by digital evaluators (28%), who are gradually embracing digital transformation and investing for the future. Only 3% of Malaysian business leaders were categorised as digital leaders who had digital transformation ingrained in their DNA.
In other parts of the world, emerging markets like Thailand, India and Brazil, are the most digitally mature, compared to developed markets including Denmark and France which are slipping behind.
The index also stated that emerging markets are more confident in their ability to disrupt rather than be disrupted (53%), compared to just 40% in developed nations.
The latest index builds on the first ever DT Index released in 2016. The two-year comparison highlights that progress has been slow, with organisations struggling to keep up with the blistering pace of change.
While the percentage of digital adopters has increased, the index said there has been no progress at the top. Close to four in 10 (39%) businesses are still spread across the two least digitally mature groups on the benchmark (digital laggards and digital followers).
The five most prevalent barriers to digital transformation success
According to the index, 91% of those surveyed are held back by persistent barriers. Globally, the top five barriers to digital transformation success are:
- data privacy and security concerns;
- lack of budget and resources;
- lack of the right in-house skill sets and expertise;
- regulation and legislative changes; and,
- an immature digital culture.
Half of the Malaysian business leaders believe their organisation will struggle to prove it is trustworthy within the next five years, while 31% do not trust their own organisation to comply with regulations such as GDPR. Meanwhile, 38% do not trust their own organisation to protect employee or customer data.
To realise their digital future, 56% of those surveyed in Malaysia said they are developing in-house digital skills and talent, this includes teaching all employees how to code.
The index also listed cybersecurity, Internet of Things technology, multi-cloud environment, AI and computer-centric approach as the top technology investments for the next one to three years.
It was noted that in the near future, every organisation will need to be a digital organisation, but research indicates that the majority still have a long way to go. Organisations need to modernise their technology to participate in the unprecedented opportunity of digital transformation, according to the Chairman and CEO of the tech firm that developed the survey.
