Resilience in the New Economy: A Post-AFEEC 2021 Reflection
The Asian Family Enterprise Excellence Conference or AFEEC 2021 that ran from June 25 to June 26, 2021 is over.
There’s still a lot of noise about the topics. A lot of sharing and likes over social media.
Participants who actually joined have access to the recordings at least until the end of July. For those who really want to access all of the recordings beyond July, can actually pay for a subscription. Just visit the event log-in page.
The session on the Resilience in the New Economy was opened by Adrian Ding, Chief Empowering Officer of Maximum Impact.
Adrian introduced the topic and speaker James Wong of SAP BusinessOne.
James opened the session by introducing an economic study by SAP in collaboration with Oxford University.
Before I get to the meat of my reflection, I need to touch on the topic of digital transformation because James Wong’s talk was as much about digital transformation as it was about resilience.
So what is digital transformation? According to Amdocs, a cloud services provider and SAP:
Digital transformation is as much a cultural and business transformation as it is a technological one. It is a fundamental rethinking of customer experience, business models, and operations. It's about finding new ways to deliver value, generate revenue, and improve efficiency.
Reading between the lines, resilience and digital transformation seem to be intrinsically linked.
James’ insights about resilience stems from a joint economic study between SAP and Oxford University.
Objective of the SAP Oxford Economic Study
The objective of the study was to understand the opportunities and challenges faced by various SMEs across Southeast Asia in the area of digital readiness and resilience. The study encompasses 2000 executives across 19 countries with 400 across Southeast Asia.
The key area of focus of the study is customer experience, organizational transformation, and technology utilization.
In between listening to James and reading the queries from the audience in the chat box, some points in the talk are worth mentioning and mulling over.
The talk really focuses on digital readiness and resilience. The economic study covered 2000 respondents across 19 countries of which around 400 represented Southeast Asia.
The key focus of the survey was in the areas of customer experience, organizational transformation, and utilization of technology.
Customer Experience as Key Focus of SMEs
James Wong discussed the need to focus on customer experience.
45% of SMEs feel that improving customer experience is a priority in the next 3 years more than growth, increasing profits and reducing costs. Customer experience should focus on service followed by product excellence.
The factors that matter in customer experience in order of importance from high to low are: personalized experience (58%), high quality products and/or services (54%), data protection (52%), competitive pricing (50%), seamless experience across all channels (49%), then sustainable practices (48%).
61% of SMEs believe that technology will be used for process efficiency by reducing errors, risks, and costs.
As to what technologies will be used in process efficiency will be mostly driven by the enterprise's level of maturity.
The study did highlight interesting findings.
Key Findings of the Economic Study
Key finds of the study:
- Businesses are struggling to keep up with shifting and increasing customer needs.
SMEs are facing challenges in finding, hiring, training, and keeping talent. Even if they do succeed in attracting the right talent, retaining them is a constant challenge. Those that are undergoing digital transformation, are always addressing the issue of retaining IT talent.
- High quality customer experiences are increasingly harder to achieve in an ever changing marketplace.
SMEs are faced with the reality of maintaining a high quality customer experience because customers now have better access to information to find answers and address their very particular needs. Information is not only accessible for quick decision making, it is also increasing customer expectations. This is driving the preference of SMEs to focus on customer experience rather than production or customer service efficiency.
- Many small and mid-size enterprises are playing catch up on their digital transformation
Majority of SMEs are still playing catch up in terms of their digital transformation. The mix of cost and availability of talent has made it difficult for SMEs to bridge the gap between what they need and what they can have in terms of technology.
- A targeted focus on data and specific digital tools is needed to support long-term strategy.
SMEs need to focus on how to use their data to adapt to changing times in the context of work from home (WFH), social media, e-commerce, and increasing use of mobile phones shaping customer experience. Data is critical for making business decisions.
Working with families in business, I have seen first hand some of the insights of James Wong in action in family enterprises.
Some of our clients already have SAP BusinessOne as a central platform for productivity and resource planning.
The challenges of retaining talent and culture in family enterprises plus underlying sentiments about digital transformation from among first generation founders is affecting organizational wide implementation of their SAP BusinessOne.
I have observed that family enterprise decision-makers are not leveraging the BusinessOne dashboard for their operational and strategic decision-making.
After James’ presentation and talk, Professor Ricardo “Ricky” De Vera gave his two-cents on digital transformation trends among family enterprises.
As a panelist, Professor De Vera reinforced some of the insights delivered by James.
Guided by Adrian Ding’s opening question about growth areas in Asia, Professor De Vera opened up about cautious optimism in the point of view of most economists.
The professor then enumerated the growth areas in Asia.
- Any activity in health or sciences.
- Retailing focused on basic needs.
- Logistics or those focus on movement of goods.
- Food specially on vegetables and livestocks. The manner and dining experience however will be changing and challenging.
Adrian touched on technology.
Family businesses are putting their data in digital format which had resistance in the past.
According to the professor 80% to 90% of enterprises in Asia are family businesses but only 50% are in the first step of digitalization.
Professor De Vera declared that the first and second generations in family enterprise are already driving and supporting digitalization.
The pandemic has seen families migrating to the use of technology for meetings.
Professor De Vera mentioned that there will be 5 major drivers in the family enterprise:
- Succession must now be accelerated. The founders will be retiring. Who will be taking over?
- Redesign of work processes and embracing technology. SMEs will seek out partners who can provide practical technologies for family enterprises.
- Long-term orientation. Professionally run corporations look at growth on a quarterly basis while family run businesses look at growth in terms of generation legacies which are long-term.
- Creation of more value for the family business. At the end of the day, the family business is not just about getting revenue. It’s the dream of giving the children the opportunity to run the business. The dream of giving the family a legacy.
- Family businesses connect more to their community.
SAP BusinessOne
SAP BusinessOne is trusted by over 80K companies across 150 countries that uses its applications in accounting, customer relations management, inventory management, supply chain management, and purchasing.
In Southeast Asia, SAP has 6K customers in more than 30 industries across 13 countries. Industries served include professional services, discrete manufacturing, wholesale distribution, and the public sector.
James showed cases of technology adoption and transformation using SAP like Ben Foods, Love Bonito, Pasture Pharma, etc.
If you have joined the Asian Family Enterprise Excellence Conference or AFEEC last June 25-26, 2021, you should have a link to the videos of the sessions by now.
Check your email. Or check out the video recorded sessions now by logging in here.
SMEs are facing challenges in finding, hiring, training, and keeping talent. Even if they do succeed in attracting the right talent, retaining them is a constant challenge. Those that are undergoing digital transformation, are always addressing the issue of retaining IT talent.
SMEs are faced with the reality of maintaining a high quality customer experience because customers now have better access to information to find answers and address their very particular needs. Information is not only accessible for quick decision making, it is also increasing customer expectations. This is driving the preference of SMEs to focus on customer experience rather than production or customer service efficiency.
Majority of SMEs are still playing catch up in terms of their digital transformation. The mix of cost and availability of talent has made it difficult for SMEs to bridge the gap between what they need and what they can have in terms of technology.
SMEs need to focus on how to use their data to adapt to changing times in the context of work from home (WFH), social media, e-commerce, and increasing use of mobile phones shaping customer experience. Data is critical for making business decisions.
