What do state and business agencies do in the digital transformation?

By November 21, 2018 blog No Comments

The seminar “Digital Transformation: Opportunities and Challenges” provided visitors with an overview and targets that we have to face in 4th industrial revolution.

On November 1, in Hanoi, the Vietnam Digital Media Association organized a seminar on “Transformation: Opportunities and Challenges” to provide an overview on the situation of digital transformation in 4th industrial revolution in Vietnam, and outlines the specific objectives that state agencies, as well as businesses and citizens need to capture.

Opening speech at the seminar, Mr. Nguyen Minh Hong, Vice Minister of MIC, President of Vietnam Association of Small and Medium Enterprises emphasized the importance of digital transformation at the present. “Vietnam is not standing out of the 4th industrial revolution in the world, and all sectors and industries need to change in order to be able to adapt to the development of technology,” said the minister.

“Digital transformation is no longer the business of any organization or business, but all of them must accept the change, and if they do not change, they will be left behind, and may threaten to their existance, “Vice Minister Nguyen Minh Hong said.

What is the concept of a digital transformation?

At the seminar, Mr. Nguyen Thanh Phuc, Head of the Department of Informatics – Ministry of Information and Communication gave a speech on the process of digital transformation, starting right from the concept that is still confused by the name.

Knowing only the name of the digital transformation, but the world has a lot of concepts. For example, according to Gartner, digital transformation is the use of technology to change the business model, creating new opportunities and revenues. As for Microsoft, they have come up with the concept of digital transformation: rethinking how people organize data, and processes, to create new values.

Digital transformation is a holistic and comprehensive change involving the fields of life, society, changing the way we live, work, interact with each other.

After studying many different concepts, Nguyen Thanh Phuc said that digital transformation must first be associated with clear objects, people, businesses, and government agencies.

Particularly people, digital transformation is the process that changes the way we live, work, trade with one another. For businesses, digital transformation is the use of digital technologies and data to change the business model, change the process of providing products and services, create new products and services. For state agencies, digital transformation is the process of changing people’s experience with the services provided by the state, changing the process, model and mode of operation of state agencies.

Mr. Nguyen Thanh Phuc also evaluates the process of digital transformation that is happening in Vietnam, only that it lacks a comprehensive approach, complete in terms of a country.

What should state agencies do in the digital transformation?

In terms of state agencies, adaptation and change in 4th industrial revolution play a decisive role in the success of the process.

At the seminar, Nguyen Thanh Phuc said, “The urgency of digital transformation is reflected in a study conducted in 2017 by Microsoft that said the process brought about a 6% increase in GDP.”

“Based on many other studies, we can see that countries that are interested in digital transformation can achieve over 5%, and if we do not care then we are still at a normal level,” said Nguyen Thanh Phuc.

For state agencies, according to Nguyen Thanh Phuc, the goal and challenge is to switch from a closed data system to open data, to create a data sharing connection.  This serves as a precondition for promoting digital transformation of the enterprises, as well as for the people to be convenient.

“Just when I was in Singapore, I found that they used the user data submitted for urban transport planning. For example, which area is densely populated, and which ones often have traffic jam, … from which to implement measures such as arranging how many buses in a residential area is reasonable”.

In addition, when implementing digital transformation, state agencies must also use a data analysis system, possibly from AI, to digitize input sources so its no longer depend on administrative documents.

“As a result, we will eliminate many unnecessary intermediary steps, contributing to the speed and effectiveness of this activity.”

What about businesses?

Digital transformation also contribute to increased productivity, and according to Nguyen Thanh Phuc, this is a factor that Vietnam always pay attention. “We are developing at a lower productivity than the average GDP growth of the country”.

For business objects, the digital transformation as presented, is summarized as the transition from a traditional business model to a digital business model. Typical examples are car reservation services, online car rental, hotel reservations, or e-commerce units.

For some businesses, digital transformation can be understood as the application of integrated chips on the product from which to put into the IoT cycle. In addition, digital transformation is also a transition from traditional production processes to data modeling and robotics, AI.

“In the near future, we will see factories that have no more workers,” said Nguyen Thanh Phuc, “This is something that can be done when robots become more popular and cheaper.”

Apart from the practical and urgent objectives for the two main subjects, government agencies and enterprises in the digital transformation, The seminar also recorded many contributions, sharing about experiences from speakers and guests of the event.

The seminar agreed with the view that Vietnam is indeed facing a great opportunity to be in line with major countries, but it is accompanied by real challenges for all, from the people, businesses, to the goverment.

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