Hong Kong organizations are lagging behind their global peers in terms of progress with digital transformation, according to new research from Telstra.
A survey of business decision makers in 14 markets worldwide found that just 14% of Hong Kong organisations report being “highly mature” in their digital transformation journey, compared to 21% overall.
A further 26% of Hong Kong business leaders report having not or barely started their digital transformation, although this compares to 30% worldwide.
In addition, only 14% of local respondents feel they make digital transformation decisions extremely well (23% globally), with 29% feeling they don't make such decisions very well (30% globally).
The report found that while 70% of respondents believe they are proficient or extremely proficient at making technology decisions, Hong Kong organizations are not putting enough emphasis on people, processes and partnerships.
“Beyond the right technology, successful digital transformation relies on people. You need the right culture and the right people, but also the right processes to support them,” Telstra head of North Asia and global wholesale Paul Abfalter said.
“Successful digital transformation is a whole-of-business journey that involves upskilling and changing employee mindsets, adapting structures and ways of working, and creating teams that can maximise new technologies being introduced.”
Abfalter said the report identified a gap between Hong Kong organizations' digital transformation priorities and their performance in delivering on these priorities.
Hong Kong respondents rated their top three digital transformation priorities as ‘optimize technology to be more competitive’, ‘accelerate time to market to remain relevant to customers’, and ‘manage risk and compliance’, but their performance in these areas ranked particularly poorly.
“While leaders ranked ‘accelerating time to market to remain relevant to customers’ as their second highest rated priority, it came in 16th out of 17 when it came to performance delivery. When we looked more closely at this, organizations in Hong Kong struggled to perform with their processes and partnerships when attempting to deliver on this priority,” he said.
“In general, barriers to achievement cited by respondents included concerns around security and ongoing costs as their biggest obstacles in general.”
On the bright side, Hong Kong organizations are making digital transformation a priority, with 35% expecting to increase their total spending on transformation by 10% over the next three years, and 25% having invested more than US$1 million on digital transformation products and services over the past year.
But the report found that Hong Kong businesses are struggling to measure the outcomes of these investments such as the financial returns.
“Measuring the progress and success of any digital transformation strategy or individual project is an absolute essential. But the metrics in which we measure success are just as important,” Abfalter said.
“While it was great to see strong digital decision-making having a measurable impact on increasing customer experience, organisations in Hong Kong are finding it harder to realise financial results from digital transformation. In fact, of all the business outcomes we surveyed, streamlining business costs and increasing revenue growth saw the lowest levels of outcome achievement in Hong Kong.”