Enhancing Digital Transformation for Responsible Production and Business

Enhancing digital transformation for responsible business and production is not only a need but also an essential condition in the integration period.

Digital transformation is an vital trend

Under the impact of the Fourth Industrial Revolution, digital transformation is a vital trend, a matter of survival for countries, organizations, businesses and consumers around the world, especially in the context of the COVID-19 pandemic. The benefits of digital transformation are recognized not only in the management and operation but also in serving data analysis and making very effective business decisions and strategies.

Affirming this, Mr. Krishnakanth Kodukula, General Director of Zamil Steel Vietnam, shared,

“Digital transformation has also made the delivery of our high-quality products faster and in an efficient manner. Recently, we have also invested in a cloud-based platform at a global level. The new platform will help with standardizing business processes, adopting best practices, converting to the Shared Services model, and using world-leading new technologies such as Artificial Intelligence, Robotic Process Automation, Augmented Reality, Big Data, and others. “

Nestle Bong Sen Factory Manager Urs Kloeti said that digital transformation has created positive impacts on the entire supply chain, improved product quality and consumer experience quality, supported sustainable farming and accelerated energy & water efficiency at Nestlé’s operations.

“It also supports us on our sustainability journey by reducing our down time by 60% and saving 10 million kWh of energy annually. The impact Digital Transformation has on Energy and Water reduction at our factories, is increasing rapidly, through accurate access to data and the use of Digital Tools to run our processes most efficiently,” added Mr. Urs Kloeti.

The effectiveness of digital transformation in businesses is huge. But, according to experts, digital transformation in businesses, especially small and medium enterprises, is facing many difficulties.

Ms. Bui Thu Thuy, Deputy Director of the Department of Enterprise Development (Ministry of Planning and Investment) said that most new businesses are in stages 1 and 2 - the digitization stage of the digital transformation process. Most small and medium enterprises face many difficulties in digital transformation. Specifically, 60.1% of enterprises faced difficulties in investment costs and digital technology application; 52.3% difficulties in changing business habits and practices as well as lack of internal human resources to apply digital technology; 45.4% lack of digital technology infrastructure; 40.4% lack of information about digital technology; 38.5% difficulty in integrating digital technology solutions; over 32% lack the commitment and understanding of the board of directors and business management.

Mr. Tran Minh Tuan, Director of the Department of Digital Economy and Digital Society (Ministry of Information and Communications), added that although there are new trends in the context of COVID-19, the proficiency level of most businesses in public applications is still limited. Digital technology is relatively limited, only applied in the field of sales, business administration and payment, but processing, manufacturing, supply chain management, and service provision are at a very low level.

“For successful digital transformation, it is necessary to optimize the system; process and implementation stages need to have order and regulations. It is necessary to build systems of quality standards, standards of inspection, control or reporting systems before softening, this requires more human thinking when using," said Mr. Tuan.

Advancing digital transformation

VCCI Vice President Vo Tan Thanh said it is necessary to promote digital transformation for responsible production and business. The "National Digital Transformation Program to 2025, with a vision to 2030" approved by the Prime Minister in Decision 749/QD-TTg dated June 3, 2020 has set quite specific goals such as: Developing digital government, improving operational efficiency and effectiveness. Vietnam will be in the group of 50 leading countries in e-Government by 2030, developing and improving the competitiveness of the economy, with digital economy contributing 30% of GDP, the proportion of the digital economy in each industry and field reaching at least 20%; and annual labor productivity increasing by at least 8%.

Currently, digital transformation has taken place in almost all types of businesses and at different levels. Governments and authorities at all levels are also making efforts to build e-Government toward Digital Government. More than 30 cities plan to build Smart City with new technology platforms.

The banking industry has researched and implemented an initial digital transformation strategy with IoT applications that allow customers to access and use banking services, connect with other digital ecosystems on the Internet platform. VPBank's Timo digital bank, TPBank's Live Bank, BIDV's E-Zone, etc.), or provide banking services through an application installed right on a mobile phone (Mobile Banking).

Military Industry-Telecommunications Group (Viettel) is a typical enterprise for the digital transformation of telecommunications enterprises in Vietnam. The Group has promoted digital transformation in governance in all fields: Information technology and digital services, high-tech industrial production, and logistics.

Vietnam Dairy Products JSC Vinamilk has digitally transformed from its corporate culture model. This company has applied an agile model to provide products to customers quickly. Digital transformation is carried out in most activities of administration, finance, human resources, international business and supply chain.

Very large-scale enterprises, possessing a diverse customer base like VinGroup, have built a unified customer management system like VinID, helping customers to integrate and manage information when transacting with businesses in many various services such as payment of household bills, electricity bills, shopping or resort services.

Survey results conducted by VCCI and VNPT at the beginning of this year showed that over 80% of business leaders think digital transformation is becoming more and more urgent; about 65% of business leaders expect to increase investment in digital transformation. High-priority solutions in business today are large-scale remote work, cyber security, e-commerce and marketing, and process automation.

The Southeast Asia Digital Economy Report 2021 predicts that Vietnam's digital economy will reach US$50 billion by 2025. This further confirms that digital transformation is becoming an important resource to promote socio-economic growth in Vietnam. 

By Thu Huyen, Vietnam Business Forum