More Chinese businesses take a technology driven vs business-driven approach
Hong Kong, 29 Oct 2015 - PwC’s 7th Annual Digital IQ Survey has found that more than half of business leaders in China (56%) are confident in their organisation’s digital vision and capabilities, which was higher than the global average.
The survey, which explores the ability of organisations to use technology in driving business value, also found that when it comes to executing digital vision, 55% of respondents in China spend more than 10% of their revenue on digital investments.
In terms of analysis, almost half of all respondents in China consider their data analytic skills to be ‘highly developed,’ higher than the global average of 40%. In contrast, when asked to gauge how effectively data is put to use in driving business value, only 16% of respondents in China responded with confidence, notably lower than the global average of 26%.
"It’s not so surprising to see companies rate their digital maturity positively in China. Mobile and social media use have become ubiquitous with consumer spending and online behaviours. However, the low recorded confidence in using data to drive strategies may serve as a signal for companies to reassess how sustainable current approaches to digital investments are. Based on the feedback, we think there could be significant scope for companies to more closely align their digital strategies with revenue growth." Said Scott Likens, PwC China and Hong Kong Digital and Analytics leader.
The survey identified that Technology Architecture and Design is considered to be the most important digital skill for business success by respondents in China (76% vs 40% globally). Conversely, more global respondents prized data analytics skills than Chinese respondents (40% vs 25%), which indicates a notable difference in how digital skills are prioritised in China.
In China, digital budgets are focused mainly on IT, sales and marketing, while the average global spending is broader, spread over customer service, operations and enterprise functions (such as human resources, finance, risk and compliance).
"To improve their competitiveness, companies should look at balancing investments between technological architecture and data analytics. Digital investments that span right across an enterprise - beyond the traditional IT focus - create more agile processes that enable companies to pivot towards a culture of technology and customer innovation." Noted Adam Xu, PwC China Strategy& Digital Consulting Lead Partner.
Findings also highlight the current prominence of technology in forming business strategies, with 67% of respondents taking a technology-driven approach by adopting new and emerging technologies that can impact business performance. In addition, fewer companies in China characterise their approach as being business-driven compared to the global average (18% vs 32%).
"Embracing the potential of data to drive digital strategies will be a critical success factor and while the majority of companies are already confident in their digital capabilities, they are not yet using their data optimally. Looking ahead, there are clear opportunities for companies to invest in digital technology strategically, particularly in high-impact areas such as automation and digitisation of business channels." Added Mr. Likens.