ITEM: Many companies in APAC are banking on harnessing customer-generated data to understand their preferences and behavior to serve them better. Just one problem: customers are generating so much data that companies can’t keep up with it all. And that’s largely because they don’t have the skillsets to deal with it.
That’s according to research released earlier this year from EY, which says that responding to changing customer needs is the most significant customer experience challenge that companies in APAC face.
Ironically, the problem isn’t a lack of data. With consumers becoming more adept at using technology since the pandemic, huge volumes of data have been generated to allow companies to better understand their customers and tailor their products and services.
But while about half of respondents in APAC (46%) acknowledge that customer needs are changing rapidly, they’re struggling to track those changes despite the wealth of data available. Less than a fifth of respondents (16%) said they’re leveraging data to be predictive, drive innovation and continually improve every aspect of the business.
And that’s despite the fact that meeting changing consumer needs is the top reason given by 40% of respondents for undergoing digital transformation in the first place.
APAC firms aren’t ready for data deluge
In fact, says the EY report, over half of respondents (57%) place data and analytics at the top of their priority list for technology investment, followed by cloud (49%), IoT (44%) and artificial intelligence (35%). EY says respondents view these four technologies as “the digital foundation for a successful transformation”. They’re also the technologies that respondents expect to account for the largest share of investment and deliver the most value over the next two years.
Part of the problem is that the surge in digital services usage driven by the COVID-19 pandemic has essentially generated vast amounts of data that enterprises weren’t prepared to handle, says Jason Pang, partner for Consulting – Data and Analytics at Ernst & Young Advisory.
“The scale and volume of data generated during the pandemic can be overwhelming for companies that do not have the necessary technology and skills to convert this data into useful insights,” he says.
Pang puts an emphasis on the “skills” part, as 63% of respondents said they face a major employee skills gap in finding, combining and analyzing the data. (In Singapore and Thailand, the figure is 76%.) Notably, 42% of respondents indicated that data and analytics is the most important digital and technology-related skill that an organization needs for its transformation.
Bridging the digital talent gap
Most respondents (70% in APAC overall, 80% in Singapore and Thailand) agreed that the ongoing “Great Resignation” has made talent acquisition more difficult. That’s left them with little choice but to turn their focus on reskilling their remaining employees instead of hiring experienced people. However, that’s not going well, either – 46% of APAC respondents named ineffective upskilling or retention programs as the biggest internal challenge to their reskilling plans.
Gaurav Modi, EY Asean and Singapore consulting leader, says that enterprises need to take a multifaceted approach to bridge the digital talent gap.
“They need to be proactive with change management and new experience design for employees, implement a holistic digital talent strategy to retain existing staff and attract new talent to secure required skills,” Modi said. “Participating in digital ecosystems to access skills and outsourcing to a trusted strategic partner are also pathways to accelerate access to capabilities.”
That said, this also has to be done in the context of a holistic transformation strategy, says Pang.
“For a successful transformation that delivers long-term value, companies and technology leaders need to prepare their business holistically, invest in the right technology and data strategy, prioritize the right use cases, and most importantly, putting humans and change management at the heart of the transformation.”