CHINA'S DIGITALLY MATURE COMPANIES STAY RESILIENT POST COVID-19
New research by Accenture, the world’s leading global professional services company, has revealed that only a small number of Chinese companies stayed resilient and competitive against COVID-19 impact. These companies are able to achieve success because of their sustained and successful digital transformation efforts.
This is the third consecutive year that Accenture has conducted the China Digital Transformation Index research in collaboration with China Industrial Control Systems Cyber Emergency Response Team (CICS-CERT).
The research studied nearly 400 Chinese companies across nine industries and found only 11% of companies surveyed can be designated as Digital Transformation Champions, have successfully digitized their businesses and achieved stronger performance in both their operations and innovation.
According to the research, aside from these Champions, most Chinese companies still lag in digital maturity though some responded flexibly and overcame a few challenges brought by the crisis. However, there is a clear lack of digital integration and interoperability across production, operation and organization due to inadequate long-term digital strategy in many companies.
For example, most Chinese companies have started to adopt digital tools and methods such as remote working and online channels in their operations. However, only 39% of companies have fully deployed cloud services, while just 22% use real-time data to adjust and optimize production.
“In times of crisis, the Champions have demonstrated strong resilience and capabilities to keep innovating their businesses. However, most Chinese companies are threatened not only by the pandemic and market uncertainties, but also by their digital immaturity,” said Wei Zhu, chairman of Accenture Greater China and a member of Accenture’s Global Management Committee.
The research found that the Champions are recovering from the crisis faster and are achieving better financial performance.
By embedding digital solutions across their operations, these companies achieved a higher degree of integration and collaboration, which helped to improve the level of insights, rapid response and decision-making – allowing them to better outmaneuver uncertainties.
As a result they were able to achieve competitive advantages: 63% Champions returned to their pre-crisis levels of productivity within three months, compared with 47% of other companies; 74% of the Champions expected to achieve positive revenue growth in 2020, compared with fewer than half (49%) of other companies.
The study also found that there are different drivers for digital investments. Many of the companies surveyed would steer digital transformation in more pragmatic ways, with 85% saying they would like to acquire some tangible results within 12 months of their digital investment.
“The digital economy is growing fast in China. Companies with top-notch digital maturity can better manage risks and navigate market changes. When applying new technologies, Chinese companies should build up digital proficiency across their core business and processes. They also need to prioritize agile innovation to meet customer expectations, unlock the potentials of technologies and adapt to challenging business environments,” added Wei Zhu.
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