A new digital game plan for business survival mode

MORE than two months have passed since the announcement of Singapore's Fortitude Budget, which included a sum of more than S$500 million allocated as part of the supplementary Covid-19 relief package to fund local digital transformation initiatives. For companies that have toughened it out throughout the lockdown period, now is the time to look at rebooting the innovation engines to prepare for the next phase, but through a new lens. After all, we have at hand a new economic climate.

A closer look at what the government has earmarked as funds to "support digital transformation" reveals specific areas on maintaining the workforce's productivity and accelerating innovation. This is a good place to start for businesses that are still debating how to spend the fund wisely - by prioritising critical digital upgrades that could significantly increase their viability. But building and running an organisation fit for today's economy has become a lot more difficult, and business owners will need to approach IT projects very wisely to keep their ships afloat.

Innovating not for tomorrow - but for today

According to a study conducted last year by AI Summit Singapore, just 14 per cent of Singapore-based companies could boast mature artificial intelligence (AI) capabilities, and only 8 per cent reported the regular use of AI - one of the key frontiers in enterprise technology today. It is worth noting that more than half of the companies surveyed were large enterprises, with one-third reporting annual revenues of over US$500 million.

A closer look at Singapore-based employees' sentiment towards advanced technology revealed that just over half - 57 per cent - agreed that automation and AI are needed in their companies. Only 35 per cent said that these technologies are better at complex decisions and will give workers the advantage.

These are alarming findings given Singapore's aggressive push for innovation and digital adoption in the past 10 years. If the resistance to digital transformation was a mindset issue, it would be interesting to hear from the same group of respondents again today amid a very different business landscape. One thing is for certain, transformations are no longer focused on future growth - it is vital to business survival today.

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At the peak of Singapore's "circuit-breaker", more than 80 per cent of its workforce opted to work from home and, even following the economy's reopening, the government has observed that this trend will likely continue. The implication of this shift in the workforce for businesses is vast - companies will need to ensure that internal and external business applications can cope with an influx of traffic stemming from internal employees and external customers who prefer digital interactions. Tougher trade conditions will also prompt business owners to keep a close eye on keeping their manpower costs and retaining their top talent.

Those who have been relying primarily on traditional systems and processes will find themselves lagging in terms of overall flexibility and adaptability compared to their technology-favouring counterparts. To top it off, digital bottlenecks within an organisation's operations will likely contribute to a loss of talent and customers who are becoming increasingly technology-savvy.

With Covid-19 acting as a ruthless reality check, companies that prefer the traditional approach will find it almost impossible to survive and thrive today without a strong technological foundation.

New realities call for new digital transformation approach

The word "transformation" may sound daunting to enterprise business leaders who might associate it with complete rip-and-replace projects and massive sums of IT investments. In fact, 79 per cent of large companies cited cost as the biggest barrier to their technology adoption, according to a report by Singapore Business Federation earlier this year. However, one should look at it as very targeted and strategic upgrades to existing operations that have a significant impact on immediate-term objectives, which are perhaps never more important than right now.

In light of the changes to how and where companies do business due to the current pandemic, organisations have to place an acute focus on "keeping the lights on" by answering some very important questions such as: How do I cope with additional online traffic? How do I get information out quickly to remote workers? How can I make sure remote workers and customers can securely access the data and systems they need? Meeting both short-term and long-term business commitments through the strategic spending of limited IT funds - without falling into the trap of stop-gaps, is the modern-day challenge for business and IT leaders.

The optimal approach is to bridge existing and emerging technology by modernising and building on core business systems. This allows organisations to achieve the balance of carrying on day-to-day functions and transforming at the same time. For Singaporean companies that are already facing difficulties remaining open, having downtime for rip-and-replace IT projects is not an option.

On the other hand, modernisation projects that pinpoint and address present issues are highly beneficial, even in the long run. This approach ultimately allows IT professionals to leverage existing investments and processes, lower risk of disruptions, and achieve a faster return on investment - which is critical in today's climate.

With Covid-19 acting as an important catalyst, the rules to the digital transformation game have vastly changed for local players who will have to navigate new technological investments and advancements very carefully, yet quickly, for the foreseeable future. Opting out is not an option, while remaining in the game requires a highly strategic mindset and approach. One could only hope that Singapore enterprises are up for the challenge.