Study: Nearly one-third of HK businesses see talent gaps as top barrier for digital transformation

Only 7% of businesses in Hong Kong are identified as digital transformation leaders compared to 11% for APAC businesses, while nearly one-third of surveyed businesses named their top barrier as talent gaps, according to the latest research by DBS.

The findings were based on a global survey conducted between June and August last year, gathering views of 1,225 executives from commercial and finance or treasury teams across 22 markets in APAC, Europe and the United States, of which 100 of them were from Hong Kong.

The research revealed that the top three goals for businesses in Hong Kong to achieve digital transformation include improving collaboration across functions and teams (35%), improving customer experience (34%) and increasing efficiency (33%). Close to half (47%) believe that the ability to take decisions quickly is the most important element to support successful digital transformation from a corporate culture perspective, followed by shared adoption of a strategic vision (37%).

Despite the strength of Hong Kong’s digital infrastructure, Hong Kong has a relatively small number of leaders in digital transformation (7%) in comparison to other markets in Asia, such as Indonesia, Vietnam, mainland China, Singapore and Taiwan. However, 33% of respondents are classed as “developing leaders”, suggesting that the city’s overall proportion of transformation leaders may expand in the years to come.

Some Hong Kong businesses surveyed also identified alienating their customer bases (34%) as their top barrier to transform at speed, perhaps due to economic uncertainty amid growing inflation worldwide. They are equally concerned that an unclear organisational strategy can be impacting their transformation efforts, which explains why the shared adoption of a strategic vision is high on the list of priorities for a successful corporate culture. In addition, gaps in talent is seen by 32% of respondents as a challenge.

The survey also explored the growing role that treasury and finance are playing in enabling change and innovation. Cloud technology (67%) is seen as the most important tool for transforming these two business functions, a trend supported by Hong Kong’s high number of data centres. This strong network capacity and data infrastructure may also explain why advanced analytics (50%) is gaining traction.

In addition, businesses found it difficult to establish a strong, productive relationship between the finance or treasury and commercial or sales teams (59% Hong Kong vs. 47% global average). A significant challenge in this respect is that the teams take different approaches to risk (38%) and have competing priorities (35%). To avoid conflict and maximise effectiveness, business leaders should strive for closer alignment and identify shared objectives.

“Competition for talent in the digital technology space continues to grow. Therefore, it is important for business leaders to nurture and develop Hong Kong’s next generation of technologists. This will not only help businesses accelerate their digital transformation goals and retain their very talent, but also expand the city’s pool of leaders in this area,” said Wallace Lam, managing director and head of institutional banking Group, DBS Bank Hong Kong.

Don't miss: DBS names new MD and head of institutional banking group for HK

Boris Chan, managing director, head of global transaction services, Institutional Banking Group, DBS Bank (Hong Kong), said, “COVID-19 has accelerated the drive for digitalisation, and particularly for SMEs, which account for 98% of businesses in Hong Kong. Though many SMEs have been able to adapt to and thrive in a rapidly changing business environment, many are struggling to transform at speed mainly caused by uncertain business environment, and an unclear organizational strategy. Treasury, commercial functions and business leaders should collaborate, align and define a clear strategic vision which encompasses the use of data analytics, AI, and even blockchain-enabled platforms to function more effectively and efficiently.”

Related articles:

DBS names new MD and head of institutional banking group for HK
DBS Asia Capital names Lindsay Chu as new CEO
DBS brings back content marketing web series Sparks for third edition
DBS and CNNIC team up to launch campaign in digitalisation and sustainability