How to Build a Digital Transformation Strategy Ready for Asia Pacific's Digital Economy

18 September 2018 | Matt Gutierrez, Senior Managing Director, Asia Pacific

Asia Pacific will be the world’s fastest growing economy for the foreseeable future. For enterprises planning to expand into this region, they will need to ensure that their IT capabilities are sufficient to support and drive this growth. An adaptive network, agile IT powered by the cloud, and connected security are key components that will ensure success. Here are four key considerations that enterprises must ask themselves. 

Asia Pacific will derive around 60 percent of its GDP from digital transformation by 2021.

Asia Pacific: Growing Opportunities Driven by Digital Transformation

Asia Pacific is poised to remain as the world’s fastest growing economy until 2030. On top of that, IDC estimates that digital transformation will add an additional US$1.16 trillion to the region’s GDP. Roughly six percent of the region’s GDP last year was driven by digital products and services. With the continuous advancements of digital capabilities like mobility, cloud, Internet of Things (IoT), and Artificial Intelligence (AI), Asia Pacific will derive around 60 percent of its GDP from digital transformation by 2021.

On top of that, 451 Research found that the enterprises in the Asia Pacific region are the most advanced in terms of digital transformation maturity, ahead of North America and Europe. Fifty-seven percent of organizations in the region have formalized a digital transformation plan and are actively digitizing key business processes. More than a third of companies have seen massive disruption due to digital transformation and expect this to occur over the next few years. The top three drivers of this trend are improving customer experience, better risk management, and enhancing operational efficiency. Hence, the Asia Pacific business landscape is likely to see a spurt of exciting digital innovation in terms of mobile applications, new ways of doing business, and flexible modes of working.

Conducive Environments for Investment and Expansion

Several countries in the region are also making it simpler for new companies to set up operations. Singapore, for instance, has set up numerous incentive programs to aid business investors. They include schemes, grants, and tax incentives for foreign companies across various verticals. For financial services and fintech companies, Hong Kong is an ideal base due to its vibrant financial services institutions (FSIs) ecosystem and proximity to China. Rising economies like Thailand are also ramping up their digital transformation initiatives. The Thailand 4.0 program will provide more business opportunities in AI, automation, and data analytics.

The region offers numerous business possibilities for international enterprises. However, before embarking on any expansion plans, enterprises must assess their digital readiness. Entering a whole new competitive market requires an IT infrastructure that can accommodate new customer demands, additional business workloads, and governmental regulations. To help them decide if they are ready, enterprises can think along the following lines:

#1. Is your digital launch pad to Asia Pacific ready with the right network solutions?

The network is one of the key cornerstones of digital transformation. In a new market, having a robust base for connectivity is crucial to support customer experience initiatives, establish operational processes, and drive new business models. Furthermore, competition in terms of digital capabilities will be fierce — in light of Asia Pacific companies being ahead in digital transformation. Before expanding into the region, enterprises need to ensure that their networks are sufficiently robust to handle increasing workload demands, technical and regulatory complexities, as well as evolving threats. 

The network is one of the key cornerstones of digital transformation. In a new market, having a robust base for connectivity is crucial. 

This entails building an adaptive network that leverages a combination of public and private connectivity options. It is crucial to lay a foundation of operational capabilities, such as VoIP and ERP systems, for digital initiatives that will create a competitive advantage. 

#2. Can you stretch the cloud’s potential with hybrid IT to serve a diverse digital economy?

Enterprises need to be able to consistently deliver great customer experiences across a growth economy comprising diverse business environments, cultures, and languages. In light of this, the scalability and flexibility of the cloud will be integral to expand effectively across Asia Pacific. Hence, adopting a cloud-first model for running and growing the business should be a top priority. 

Enterprises have to understand the pros and cons of various cloud environments — private, public, and hybrid — and find a combination that is right for them. Private models offer more control but require more cost and effort to set up. Using public cloud services offers more agility and cost flexibility, but might present challenges when it comes to customization and security. Due to the complexity of multiple cloud environments, it is important to devise a management strategy to harness cloud’s capabilities to empower new ways of working, as well as drive operational efficiency and innovation in an entirely new market. 

To consistently deliver great customer experiences, the scalability and flexibility of the cloud will be integral to expand effectively across Asia Pacific. 

For several businesses in North America and Europe, the challenge is dealing with legacy on-premise solutions and systems. These enterprises must be prepared to rapidly migrate their existing data and applications in their current environments to the cloud first. Only then can they take the next step of adopting new cloud environments in Asia Pacific more seamlessly. Businesses that are already leveraging cloud environments extensively can further explore the potential of multiple clouds to work better and smarter, accelerate time-to-market and foster innovation. They can tap on multi-cloud management platforms that are able to orchestrate and automate new workload deployments and application updates to meet different market and customer needs. 

Success in controlling and managing the cloud offers numerous benefits. For instance, an online gaming company is now able to offer seamless gaming experiences to its customers around the world with CenturyLink’s cloud services. The company’s cloud architecture maximizes centralized management and global replication in other cloud data centers so that latency is not an issue for users located around the world. Such on-demand flexibility is extremely important when it comes to meeting the changing needs of Asia Pacific’s fast growing economy. 

#3. Can your systems enable consistent IT security across the world? 

Globally, cybersecurity threats are on the rise. In 2017, CenturyLink Threat Research Labs tracked an average of 195,000 threats per day impacting, on average, 104 million unique targets – from servers and computers to handheld or other internet-connected devices – due to the work of botnets. The labs also discovered botnet hotspots in markets like China, South Korea, and Vietnam. With the region’s IoT spending expected to reach US$291.7 billion this year, interconnected devices will further increase security concerns as it opens up more avenues of attack. Enterprises digitizing across and taking on new customers and environments will also find it more difficult to track the flow of data, secure networks, and comply with different regulations.

Hence, organizations need to take a holistic view of their security strategy and maintaining visibility of threats globally, while enabling local delivery of security. In order to keep one step ahead of cyber threats, enterprises need to start adopting a proactive security posture for their network — backed by threat intelligence as well as staffing support from third-party vendors.  

#4. Are you able to overcome talent shortage from the outset?

All over the world, talent is in shortage — especially in the technology industry. In Asia Pacific specifically, the region is expected to face an imminent labor shortage of 12.3 million workers by 2020, with the possibility of rising to 47 million by 2030 at an annual opportunity cost of US$4.238 trillion.

Talent is in shortage – especially in the technology industry. Asia Pacific is expected to face an imminent labor shortage of 12.3 million workers by 2020.

When expanding into the region, enterprises need to be mindful of these issues, especially during the growing phases in a new country where they will need to build high-performing teams from scratch. The problem is exacerbated when finding professionals in areas that require specific technology expertise, such as cybersecurity, software development and data science. However, several plausible solutions include seeking third-party outsourcing or adopting automation solutions to drive operational productivity and efficiency without having to hire additional manpower.  

Selecting a trusted business and IT partner to ensure a successful business expansion to APAC

Fulfilling the above requirements can be a monumental task that is beyond the skillsets and core offerings of the typical enterprise. Some might work with vendors like managed services providers to help them with this transition.

Enterprises that choose to partner with a vendor to manage their business expansion into Asia Pacific should assess companies for the following qualities:


  1. Does the company have an extensive global network that covers Asia Pacific and across other key regions like North America, Europe, and Latin America?
  2. Can it offer service flexibility and expertise to enable digital transformation success?
  3. Does it have an innovative, enhanced product portfolio with end-to-end ICT solutions that can support a wide range of enterprise needs?
  4. Does it have dedicated local resources with language support, business hours’ service, and in-region knowledge?
  5. Does the company understand the local regulatory landscape in terms of security, compliance, data governance, and network?

These traits are essential to helping expanding enterprises position IT as an enabler for digital transformation and offer seamless customer and user experiences in Asia Pacific.

Don’t miss out on the immense opportunities in one of the world’s fastest growing economies.

Enterprises that wish to incorporate the region into its growth strategy should start preparing their IT teams to take on the challenges and new customer demands. Use these questions to guide your assessment and find out whether your organization is ready to take that leap. 


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