Digital transformation is an inevitable reality for modern businesses. Refusing to embrace digital technology is simply counterintuitive. As a World Economic Forum white paper on the digital transformation of industries writes: “Digitalization is the cause of large-scale and sweeping transformations across multiple aspects of business, providing unparalleled opportunities for value creation and capture.”
To emphasize, digitalization is not just about the acquisition of non-analog equipment and the implementation of digital solutions. Of equal importance is the readiness of people in an organization, their capability to work with digital tools and systems. That’s why it is vital to establish a digital-compatible culture. Companies need to incorporate digitalization in their employee training programs.
Go Digital ASEAN
ASEAN has a number of initiatives aimed at promoting digital transformation. One of the most notable of which is the recently approved Go Digital ASEAN project. In the later part of 2019, the ASEAN Coordinating Committee on Micro, Small and Medium Enterprises (ACCMSME) approved the implementation of this Google (News - Alert)-supported collaborative endeavor between the ACCMSME and The Asia Foundation.
The project is designed to address the economic impact of the COVID-19 pandemic by facilitating the implementation of the Action Agenda on Digitalization of ASEAN MSMEs. Go Digital ASEAN specifically targets the marginalized communities and other underprivileged areas that tend to be isolated from progress-advancing economic and technological trends. Ultimately, the project seeks to equip people and businesses with digital skills and tools to expand economic opportunities, thus reducing the adverse impact of the COVID-19 pandemic.
MSMEs make up 99 percent of businesses in the key sectors of the ASEAN economic bloc. Based on data from the ASEAN Secretariat, these businesses employ more than 80 percent of the region’s workforce. Go Digital ASEAN is an excellent initiative that aims to harness digital technology for economic advancement.
“We are pleased to activate this first-of-its-kind collaboration—pooling expertise and approaches from government, business, and NGO sectors—to help bridge the digital gap,” says The Asia Foundation President David D. Arnold. “The Asia Foundation’s local country offices will lead a community network of trainers and volunteers to help integrate MSME owners and underemployed youth workers into the digital economy,” he adds.
The need to build a culture of digitalization
Initiatives like Go Digital ASEAN are welcome efforts in promoting a culture of digitalization, especially among startups. Without a push from external parties, not many ASEAN businesses would actively pursue digitalization especially when it comes to employee training.
Based on data gathered by the Economic Research Institute for ASEAN and East Asia (ERIA) in the report “Study on MSMEs Participation in the Digital Economy in ASEAN,” the shortage of digital skills and knowledge is a key barrier that prevents MSMEs from taking full advantage of digital tools. This unfortunate situation is a big drawback on the ASEAN economic agenda.
To put things in perspective, the digital economy of ASEAN is only 7 percent of its total GDP. As detailed in Bain & Company’s Advancing Towards ASEAN Digital Integration report, the ASEAN economic bloc has a lot of catching up to do to reach the level of economically-stimulating digital transformation. China’s digital economy is 16 percent of its GDP, while the EU’s is at 27 percent. The United States has the highest digital economy to GDP ratio at 35 percent.
“Digital integration is a critical enabler for harnessing the scale of ASEAN as a region, enabling ASEAN to compete more effectively in the global economy, and bridging the digital divide to create a more inclusive ASEAN region,” writes the Go Digital ASEAN June 2020 fact sheet.
Digitalization challenges and benefits that apply to all
The information cited above regarding digital transformation and the emphasis of digitalization in employee training may focus on the ASEAN region, but it bears pointing out that the benefits of establishing a culture of digital employee training are not that different in other parts of the world.
Even bigger enterprises can learn something from getting an external push to jumpstart a digital transformation. In the US, for example, The Enterprisers Project has been helping companies in solving various business problems. This community of IT leaders and CIOs actively promotes digital transformation.
The case of the digital transformation in terms of employee experiences at the height of the COVID-19 crisis merits careful scrutiny. Melissa Swift (News - Alert), an active member of The Enterprisers Project explains how there is hesitation in companies to fully embrace digitalization because of the hurdles.
"Even as employee experience has become a key theme in the HR community, in IT circles this notion had been getting a mixed reception – sometimes stereotyped as ‘spoiled employees expecting best-in-class consumer-grade tech on shoestring budgets,’” Swift notes.
Without subtle stimulation from external forces or third-party initiatives, it may take quite some time before enterprises decide to fully go digital and recognize the advantages of doing so. It is not only the poor and underprivileged that are deprived of the advantages of digital technology because of hesitations on the part of business owners or managers.
No one-size-fits-all solution
While there challenges and benefits of digital transformation for businesses may be comparable regardless of the size or wealth of organizations, it is also important to take note that there is no single effective approach for digitalization that applies to all.
As Melissa Swift explains, “Companies should consider both digital experience and behavioral preferences of different sub-populations within their organization, and they should craft messaging, programs, and even environments to hit the right starting point and realistic endpoint for different groups.” Digital transformation, especially in terms of employee training, cannot be undertaken uniformly.
Even the highly enthusiastic digitalization adopters in lower-income ASEAN countries would have a hard time embracing digital tech if the initiative does not take into account their specific needs and preferences.
A culture of openness to change
Digital transformation entails a major change, and just like any other change management problem, there is a need to convince the people in an organization to be open to change. Employee training or onboarding is a crucial point for introducing change and providing people with the right information and tools to see the benefits of embracing new technologies, systems, and paradigms.
