Chinese companies have more faith in digital

PwC has revealed its 7th Annual Digital IQ Survey, showing that companies in China are confident they understand the value of digital technology and are able to weave it into the fabric of their organisation.

They are positive about their deployment of technology with 90% agree or strongly agree with the statement “We proactively evaluate and plan for security and privacy risks”.

They’re also spending a significant amount on digital. Over half (56%) of the companies we surveyed in China are spending more than 10% of their revenue on digital enterprise investments; 10% are spending more than a fifth of their revenue on digital.

However, respondents from China are less confident around their use of data as only 32% agree/strongly agree that they “effectively use the data they capture”, compared with the global average of 65%.

They see location-aware data and mobile customer interaction data as most important to their competitiveness but are perhaps not making adequate use of other and new sources of data such as social media data, data from cloud-based applications and Internet of Things and sensor data, which may provide greater value and competitive advantage.

There are a number of areas where China’s results diverge from the global results.

Digital enterprise investments
In China, business leaders are spending the largest proportion of their digital budgets on IT and marketing. Globally, companies are also investing in IT and marketing, however they’re also spending more of their digital budgets than China in areas such as customer service, operations and within the enterprise functions (such as HR, Finance, Risk, Compliance. The majority of respondents from China are spending less than 10% of their digital budgets in these areas.

Core digital skills
Respondents in China were far more likely to identify Technology Architecture and Design as the most important digital skill (76% vs 40% overall). Globally, companies are placing more importance on data analytics skills (46% vs 35% in China).

Adopting new and emerging technologies
In China, most companies take a technology-driven approach (68%). They evaluate many new and emerging technologies that might have an impact on business performance. They’re less likely than the global average (18% vs 30%) to characterise their approach as being business-driven (ie. having a proactive and systematic approach to filtering technology based on defined business criteria).

Exploring and acting on high priority technology innovation
For companies in China, the primary way they explore and act on high priority emerging and disruptive technology innovations is through hiring a third party (40% vs 26%). Globally, companies are 3x more likely to use a dedicated innovation or lab group to explore high priority technology innovation, as compared to companies in China.

Dan DiFilippo, global and US data and analytics leader, said business leaders worldwide need to evolve their definition of digital and focus on being more business-driven.

“Moving towards a more dynamic, enterprise-wide definition of digital, with greater focus on customer facing technology activities, will deliver greater value.”