Cisco: ‘Digitisation’ to be worth $96bn

Thailand’s digital transformation value is expected to reach US$96 billion (3.15 trillion baht) by 2022, driven by private organisations, says global technology firm Cisco Systems.

“The majority of firms in Thailand are still in the first stage of digital transformation, which is the enabling the digitisation process,” said Vatsun Thirapatarapong, managing director of Cisco Systems Thailand, who oversees the Indochina market.

The second stage is the ability to differentiate from others, while the third is the ability to define new services as a trendsetter.

Of the $96 billion, Cisco expects the private sector to make up $76 billion and the government $20 billion.

V C Gopalratnam, senior vice-president and chief information officer for Cisco Systems, said organisations must drive digital transformation within 18-24 months or risk being left behind by their rivals.

“Digital makes rapid changes, faster than we expect, meaning the transformation might be driven within 12 months,” he said.

Digital transformation assists the business process in becoming more automated, competitive and able to cope with rapid changes to bring forward the customer experience and empower employees.

There are five technology strategies that will be adopted for digital transformation. First is the use of multi-cloud services to serve different applications, both public and private models.

Second, with the rise of digital information, Cisco needs data analytics for insight of micro segmentation and personalised marketing.

Third, end-to-end information security needs to be embedded. Fourth, intelligent programmable and software define networking will play a bigger role due to the rise of Internet of Things (IoT) and 5G. The fifth strategy is to manage customers and employee’s experience by focusing on user experience and user interface.

“Millennials are causing a shift towards more temporary workers and contractors that make engagement and collaboration, including organisation structures, move to project-based systems that driven by enabling technology,” said Mr Gopalratnam.

Cisco is also in the middle of digital transformation to move from being a hardware to a software firm.

Mr Gopalratnam said the average IT spending in firms ranges from 1-3% of total revenue, so chief information officers need to spend wisely on digital transformation.

Mr Vatsun said in 2018, media and entertainment, technology/telecom, retail and bank and finance were the sectors most impacted by digital transformation.

Manufacturing, healthcare and education also face the biggest risk from digital adoption.

In the public sector, Cisco is interested in collaborating with the government’s IoT institute under Eastern Economic Corridor of Innovation, particularly in testing and training workforces.