Businesses Fast-Tracking Digital Transformation

November 10, 2020

As the GCC countries have commenced easing Covid-19 lockdown restrictions, digital transformation has become a necessity in bringing a sense of normalcy to the economy, facilitating business continuity, and helping preserve jobs. There is no doubt that the pandemic has changed the way businesses communicate, and interact with suppliers, regulators and third parties. Covid-19 has heightened consumers’ reliance on digital channels to access information, services, and products. As a result, one of the crucial advantages of Covid-19 has been the acceleration of a changed mindset to fast-track digital transformation by businesses to meet the consumers’ demand. Digital transformation is now applied across operations, supply chain, IT, HR and finance. It is also improving employees’ ability to work from home.

The push for digital transformation is not new to GCC countries as each of them have previously implemented digital initiatives in their vision statements aimed at achieving economic diversification. Among the GCC countries, the UAE has been the regional leader in digital transformation and currently, the UAE’s digital economy contributes 4.3% to its economy, which is anticipated to reach US$ 63.8bn by 2023. The UAE launched several digital projects as part of its Vision 2030 such as the Smart Dubai 2021, Abu Dhabi Economic Vision 2030, the UAE Strategy for Artificial Intelligence (AI), and Blockchain Strategy 2021. AI also played a vital role in controlling the spread of COVID-19 in the UAE. Moreover, the Dubai government aims to lead the MENA region in Blockchain by 2020, by adopting this technology, the UAE government expects to transfer 50% of government transactions into the Blockchain platform by 2021.

Digital transformation is a key part of KSA’s Vision 2030. As digital transformation accelerates in several businesses during the COVID-19 pandemic, there is likely to be a need for over 1 million jobs in the next five years.

Bahrain has been adopting new technologies to streamline government as well as private sector business operations. The kingdom is also expected to introduce regulations for e-commerce businesses that support its national digital transformation strategy.

In order to stay competitive in the current pandemic scenario, going digital is the only solution for businesses in the GCC. As consumers in the GCC are highly tech savvy, businesses have acknowledged that going digital can be lucrative. Businesses are also aware that technologies such as 5G improve data-speed transfers, increases efficiency and flexibility, and AI boosts productivity. Businesses are also migrating operations to powerful cloud platforms to a higher degree than earlier. This is expected to enhance business productivity, improve security and make more informed decisions using data analytics. Cloud providers are adding new services and capabilities to garner the attention of companies that range from AI to 5G.

The only challenge for businesses adopting digital transformation will be to find highly skilled tech workforce. The GCC has a skills gap in software engineering, product design, digital marketing, and data analytics. In order to overcome this gap, businesses should upgrade training programs to equip their workers with the best skills. Also to overcome this challenge, GCC companies are partnering with foreign tech companies and software vendors to access the necessary skills for digitisation. A number of GCC businesses are looking to European companies for expertise in AI solutions, cloud computing, and data analytics.

As digital transformation seems to be the only “silver lining” for businesses in the GCC countries during the pandemic, spending on these technologies will amplify as the benefits have outweighed the drawbacks. Digital transformation is expected to bring in strategic partnerships between the public and private sectors, leading to new employment opportunities. This trend is likely to continue post-Covid-19 period with increasingly more services rendered online for consumer utilisation.

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