Vietnamese SMBs eager for digital transformation push
Vietnamese SMBs eager for digital transformation push
Small and medium-sized businesses (SMBs) in Vietnam are making initial technology investments in cloud, cybersecurity and IT software and hardware upgrades, as a large majority of them begin their digital transformation journeys, according to the ‘APAC SMB Digital Maturity Index’ (Index), released by global tech firm Cisco today.
The Index, developed by global research firm IDC based on an independent survey of 1,340 respondents, looked at digital maturity of SMBs across four business dimensions: technology adoption and application, digital transformation strategy and organisation, processes and governance, and the capability to source, manage and retain the right talent to enable their digital transformation.
Taking into account the four dimensions, SMBs in ASEAN, with the exception of Singapore, were classified into the ‘Digital Indifferent’ stage of digital maturity.
The stage is defined as being one where companies’ digital efforts are often reactive to market changes, rather than driven by a proactive tactical approach.
As SMBs in Vietnam become more digital, it is not surprising that Cloud is the top technology they are investing in (18 per cent).
This aligns with the trend of cloud adoption across the region as the technology allows SMBs to scale rapidly as and when required and without significant upfront capital investment in IT infrastructure.
As SMBs in Vietnam digitalise, they are also adopting Cybersecurity technologies, with 12.7 per cent of respondents listing it as one of the top three technologies they are investing in, highlighting that they are placing security front and centre of their digital transformation journey.
Having the right IT infrastructure in place is critical to meet the evolving needs of SMBs in Vietnam and ensure long term success.
The SMBs recognise the importance and 10.7 per cent of respondents say they are investing in IT software and hardware upgrades.
“SMBs in Vietnam are digitalising rapidly and harnessing the power of technology to expand revenue streams and reach a wider pool of customers beyond geographical borders. With the support of the government and corporations, SMBs will truly propel Vietnam’s economy to the next stage of growth,” said Luong Thi Le Thuy, managing director, Vietnam, Cisco.
“Cisco plays a role in building a strong digital foundation in Vietnam on multiple fronts. The Cisco Networking Academy, for example, has trained nearly 36,000 students in Vietnam and supported the development of digital skills in the country’s workforce. We look forward to strengthening our partnerships with the government and with SMBs to accelerate digitalisation in Vietnam,” Thuy noted.
The SMBs in Vietnam, however, are also facing hurdles to digital transformation. Respondents said they are being held back by the lack of digital skills and talent (17 per cent), lack of a robust IT platform to enable digital transformation (16.7 per cent) and the lack of a digital mind-set or cultural challenges in the organisation (15.7 per cent).
The survey also revealed that government initiatives have a clear impact on SMB digitalisation in Vietnam.
A majority of respondents (64 per cent) say they are aware of government initiatives that support SMBs and have already benefitted from them. Another 30 per cent are aware but have not taken part in these programmes.
According to Bidhan Roy- regional director and general manager of SMB Markets and Distribution, ASEAN, Cisco, one of the greatest advantages of technology is that it helps small businesses scale quickly without requiring huge upfront investment in IT infrastructure.
“As SMBs become more digital, and their applications and data are stored in the cloud, keeping them secure will become increasingly important. Having the right cybersecurity protocol and IT infrastructure in place will not only empower SMBs to compete effectively with larger competitors, it will also enable SMBs to become part of the supply chains of large global companies,” said Roy.
The Index suggests a raft of recommendations that can accelerate the digital transformation journey of SMBs in Vietnam, such as investing strategically leveraging a well-defined digital transformation strategy and roadmap, or finding a trusted partner with experience working with and within the SMB ecosystem.
The Index highlights that more than 60 per cent of SMBs in Asia-Pacific have started to embrace digitalisation, driven by improved internet access and growing smartphone ownership.
These SMBs are redefining customer experience and expectations, disrupting sectors and in some cases creating entire new ones, while capturing investment and funding opportunities.
The Index, developed by IDC, is based on a survey of 1,340 SMBs across the 14 major economies in Asia Pacific: Australia, China, Hong Kong, India, Indonesia, Japan, Malaysia, New Zealand, Philippines, Singapore, South Korea, Thailand, Taiwan and Vietnam.
SMBs from multiple industries including financial services, manufacturing, construction and resources, public sector, services, Infrastructure, retail and wholesale, were surveyed.
