APAC firms see data security as key barrier to digital transformation

With digital transformation high on most business agendas these days, Asia-Pacific companies have expressed concerns that data security and legacy systems will hinder their progress.

Some 35 percent viewed the potential failure to secure sensitive data as a key barrier to their organisation's digital transformation, according to new research commissioned by CenturyLink and conducted by 451 Research. The study included interviews with 613 decision-makers from businesses, with at least 500 employees, across Singapore, Australia, China, Hong Kong, India, and Japan. Similar surveys were conducted in the North America--encompassing US and Canada--and Europe, which included Austria, Switzerland, Germany, and the UK.

Another 34 percent of respondents in Asia-Pacific expressed concerns that inflexible IT systems or the lack of operational agility would hinder their digital transformation efforts, while 31 percent cited the inability to migrate legacy IT and business applications to the cloud.

Other perceived barriers included the lack of funds to support digital transformation initiatives, implementing business change management, resolving organisational silos and outdated work practices, and difficulties in managing data growth.

Regardless of the potential challenges, the study found that 57 percent in Asia-Pacific already had a formal strategy in place to lead their organisation's digital transformation. This was higher than 47 percent in Europe and 45 percent in North America.

Asked about drivers for their digital transformation, 44 percent of Asia-Pacific respondents pointed to the desire to improve customer experience, while 43 percent cited risk management, and 41 percent highlighted the goal to slash operational costs.

The journey to get there, though, could prove long, considering the complexities and potential barriers that needed to be resolved. Some 63 percent projected that it could take between three and six years to complete an organisation-wide digital transformation initiative, while 7 percent said this might stretch more than seven years.

Businesses, though, were willing to put in the resources to push through their digital transformation, regarding such efforts as long-term and strategic.

According to Agatha Poon, 451 Research's Asia-Pacific services research director, companies in the region would have top-level executive support for their digital transformation, with 69 percent expanding their budget to drive business benefits and gains from these initiatives.

CenturyLink's Asia-Pacific managing director Gery Messer said: "In a global business economy dominated by disruption, reinvention, and escalating threats, speed to market is of the essence. While it's encouraging to see the majority of enterprises in Asia-Pacific have begun digital transformation projects, the complexity that surrounds their journeys can result in significant roadblocks."

Messer added that organisations should simplify the basic steps behind their digital adoption, so they could focus their resources on driving innovation and customer experience.

According to the study, more than one-third of Asia-Pacific respondents said their industry had experienced major disruption in the past three years and anticipated increased level of disruption over the next three years by digital technologies, such as mobile apps, Internet of Things (IoT), automation, and intelligent software.