If there was one take-away from the Microsoft Analyst Summit Asia 2016, it was that digital transformation in Asia is not the future, it is already in full swing.
Held over two jam-packed days, the Microsoft Analyst Summit Asia 2016 brought together over 90 leading IT analysts and over 25 innovative companies and technology partners to discuss digital transformation in Asia, a topic that has gained increasing importance as every business is expected to be a digital business to remain competitive.
The 18th annual PwC CEO Survey[i] discovered that CEOs across the globe clearly recognized the importance of digital transformation. 86% of CEOs also cite that they felt it was important that they themselves led digital transformation for the organization.
Ricky Kapur, General Manager, Enterprise and Partner Group, Microsoft Asia Pacific highlighted that with the weaker economic climate in Asia, digital transformation is more relevant than ever for businesses in the region.
Kapur said, “Digital transformation is an important force coming into play. Companies are asking themselves how they can reduce costs, while still be innovative and competitive. Increasingly, they know that digital transformation is the answer. Recently we are seeing even very traditional industries looking at digital to find ways to change up their operations.”
Simon Davies, Vice President, Microsoft Business Solutions, Microsoft Asia highlighted Pepperfy, a furniture retailer in India as an example of digital transformation in a traditional industry. He said, “Pepperfry took a traditional business model, digitised it and significantly disrupted the furniture retail business. They transformed digitally to remain in line with how consumers today, consume and buy.”
Stefan Sjöström, Vice President, Public Sector, Microsoft Asia pointed out that digital transformation is being championed by local governments as well, with exciting developments being driven by governments across the region, with Singapore and India’s push to develop smart cities as examples of this.
But it is not only large enterprises and government bodies that are moving towards digitization. According to Bertrand Launay, Vice President, Small and Midmarket Solutions & Partners (SMS&P), Microsoft Asia, there is large appetite for digital investments in the Small and Medium Businesses (SMB) space. He added, “SMBs in Asia want to increase profits and reduce costs, and they are not hindered by legacy systems. It is possible that 100% of SMB businesses in Asia will be on the cloud by 2020.”
Defining Digital Transformation
Does digital transformation mean different things to different organisations? It is evident from our conversations that every business leader has a different perspective on what digitization really means for their business.
From Microsoft’s viewpoint, it is a combination of technology, people and processes that are put in place to create a continuous cycle of value for the organization. It is not all just about technology or about digitizing an existing process.
Cesar Cernuda, President of Microsoft Asia Pacific, explained, “We are going through the fourth industrial revolution as we speak. And it is one that is driven by data. Organizations need to look at how data can provide unprecedented and timely insights to enable actions which result in better engagement with customers, empowerment of employees, optimization of operations, and transformation of products and services.”
Simon Challies, Managing Director of Ryman Healthcare, New Zealand’s leading provider of retirement living options for those over the age of 65, and Microsoft customer, was at the summit to share the company’s digital transformation journey with analysts. Challies said, “Productivity in the health sector is a big problem. The trend we are seeing is that the cost of healthcare is ballooning everywhere across the world, not just in terms of number of patients but also the cost per patient. Nurses and doctors are a scarce resource, with the industry being in dark ages in terms of utilizing data to drive decision making, this is where technology advances can help drive productivity.”
Partnering with Intergen, a Microsoft partner which is focused on delivering business outcomes to its customers in New Zealand, Ryman Healthcare created a staff and customer application called myRyman, a project which Challies personally drove. Until the introduction of the myRyman application, systems and processes largely revolved around written notes stored in physical files. Paper-based admin accounted for up to a quarter of a caregiver’s time.
The development of the application and equipping staff and residents with tablets meant a paradigm shift in mobility was enabled. With all business processes and work digitized, nurses and caregivers save time on paperwork, spend more time with residents – raising satisfaction levels for staff and residents.
Other business leaders, such as Singapore’s national developer of industrial infrastructure, JTC’s CEO Png Cheong Boon, are ambitiously looking at digital transformation as a means to transform the industry.
“Traditionally, buildings were constructed as system silos where air conditioning, elevators and lighting were planned and managed separately, with limited to no consideration of the impact of one on the other,” said Png, “Additionally, it is possible that errors made in the planning phase were only discovered during the construction stage.”
Png added, “Leveraging digitized drawings, we can now also have the facilities management team coming upstream to get involved in the design process. All parties are able to look at the same set of plans which cuts down on errors and processes.”
JTC is also looking at more innovative solutions that can help reduce manpower requirements, while expanding their capabilities to serve customers better. This includes deploying drones to help survey gutters for blockages as opposed to having staff climb ladders to check them manually. The company is also experimenting with robots as a more labour efficient means to paint buildings.
Microsoft IT partners are also playing an instrumental role in driving digital transformation in the region. MOQdigital, a Microsoft partner worked with Laing O’ Rourke, an international engineering company, demonstrated how they pioneered the internet of things enabled smart helmet worn by construction workers as a way to pre-empt medication situations.
Focused on ensuring the safety of staff, Laing O’ Rourke was looking for ways to ensure that employees operating in hot climates did not suffer from heat strokes. A hard to detect problem as when individuals begin to feel symptoms it means they already have it.
Using Microsoft Azure and Azure IoT Suite, the company developed an interactive smart hardhat which is based around a sweatband sensor array and data collection unit which can be retrofitted to an existing hardhat. It monitors the temperature, the external temperature, humidity and the heart-rate of the wearer.
The data collected through the hardhat is analysed and monitored in real-time, giving the company the ability to predict and warn employees of possible heatstroke well ahead of time.
While improving business processes and operations is important, Simon Davies, Vice President, Microsoft Business Solutions, Microsoft Asia noted, “the ability to transform a business through digital technologies is only constrained by the ability to innovate – imagining new possibilities.”
He added, “Leveraging the power of Microsoft’s cloud, customers are able to innovate at a much faster pace. Customers can deploy and test new applications and solutions at a much faster pace bringing to bear the fruits of innovation now rather than 3 years down the road, which was the old way of implementing technology.”
However, even as digital transformation is increasingly top of mind for business and governments in the region, César Cernuda, President of Microsoft Asia Pacific, cautions that the true potential of digitization can only be realised if there is complete trust and transparency built-in, “technology needs to be transparent, secure and compliant.”
This sentiment was echoed by Sascha Froemming, Head of Innovation & Sustainability Management, ThyssenKrupp, “Security is the first consideration when we partnered with Microsoft to connect our elevators to the cloud and build an intelligent line-of-business asset monitoring system.”
Whether you were there, or missed the summit, it is clear that digital transformation of organizations in Asia Pacific is well underway. To learn more about the state of digital transformation in Asia, check out the first ever Microsoft Asia Data Culture Study 2016 here.