Digital transformation, a must for SMEs

Nguyễn Đình Thắng, deputy chairman of the Việt Nam Association for Information Processing., and the Việt Nam Digital Communications Association. VNS Photo

Digital transformation is no longer an option but a critical need for enterprises, particularly small and medium-sized ones, to survive in the Industry 4.0 era, especially amid the COVID-19 pandemic.

Vietnamese businesses are aware of the importance of digital transformation and have made some investment in it, but many companies are still in the planning stage.

Nguyễn Đình Thắng, deputy chairman of the Việt Nam Association for Information Processing, and the Việt Nam Digital Communications Association, talks to Việt Nam News about this and how to promote digital transformation among SMEs.

Why should SMEs go digital? What are the biggest challenges they face in the process of transforming?

The Fourth Industrial Revolution and COVID-19 pandemic force SMEs to transform; otherwise they will fall behind or disappear.

Enterprises regardless of whether big or small are required to go digital.

Digital transformation is the application of digital technologies to change administrative methods as well as production and better serve digital customers.

It requires a lot of effort and resources.

SMEs have encountered challenges in digital transformation due to their weak financial and human resources, and lack of knowledge of digital transformation and technology infrastructure.

But they are more nimbler than large enterprises, and so it is easier for them to decide to go digital than large ones.

They can use the latest technologies to gain a competitive edge over their competitors.

They can take advantage of the existing high technology infrastructure to approach customers using smart phones with 4G-5G, especially young customers. This is a huge market for SMEs to supply goods and services.

Enterprises must therefore reform and innovate for their own sake.

How do you assess the status of digital transformation by SMEs?

Vietnamese businesses are aware of the importance of digital transformation and have made some investment. However, their transformation has only just begun.

They realise that only by adopting online business platforms can they sell their products anywhere and at any time and achieve high efficiency without needing to expand their network of stores.

But at the moment only a few fields have really adopted digital transformation, especially in the sales and education and training.

A majority of SMEs see the necessity for digital transformation, but find it difficult to achieve it. They don’t know where and how to start and use which technology while their economic and financial capability is very limited.

What should be done to promote digital transformation among enterprises, especially SMEs?

Digital transformation is a journey that is fast or slow, and its success and failure depend primarily on the determination of all participants involved, especially the boss of the company.

To persuade Vietnamese firms to embrace digital transformation, the Government needs to create a legal framework that helps businesses innovate and mitigate possible legal risks.

Policies that encourage enterprises and create conditions for them to apply new technologies and digital transformation are needed, especially those that allow the testing of new Vietnamese products and technologies that still face legal obstacles.

The Government should promote and support the development of large technology enterprises, undertake propaganda to raise awareness in society about the benefits of digital transformation and digital technologies, and set basic standards for digital transformation to help businesses mitigate the risks involved.

The Government needs to invest in technology infrastructure that only it can, have policies to encourage and support creative start-ups and develop human resources for digital transformation.

Business groups, technology clubs and businesses that supply digital transformation services need to play a bigger role in advising and supporting enterprises seeking to go digital.

In my opinion, Vietnamese enterprises have the basic conditions to implement digital transformation immediately and it is a factor in accelerating the process of national digital transformation.

A prerequisite is that the Government creates conditions and Vietnamese enterprises are aware of the opportunity for digital transformation. Enterprises need to dare take drastic action to succeed and enrich their business and contribute to building a strong Việt Nam. VNS

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