Thirty-seven per cent of regional heads of businesses in the UAE and Saudi Arabia fear they will be left behind if they miss an investment to digitalise in the coming years and nine in ten of those surveyed say they will struggle to meet changing customer demands in the next five years, according to Dell Technologies Digital Transformation Index (DTI).
“The next digital era has arrived and it’s reshaping the way we live, work and conduct business,” said Mohammed Amin, senior vice president in Middle East, Turkey and Africa (META) at Dell EMC.
“We’ve talked about being on the cusp of tremendous change for some time now. That’s no longer the case. Genuine transformation needs to happen now, and it needs to be radical.”
Global spending on the technologies needed to drive digital transformation in businesses is forecast to exceed $1.1 trillion (Dh4tn) in 2018, an increase of 16.8 per cent over the $958 billion spent in 2017, according to International Data Cooperation.
Such investments are being made across a variety of sectors and in ways that can improve both customers’ experiences and companies’ bottom lines. Grocery stores, for example, are offering home delivery via an app and using consumer preference data to suggest products. Almost half of the UAE’s chief executives in the retail industry intend to start using artificial intelligence in the next two years, as they are increasingly influenced by technology to enhance the retail store experience for customers, according to a KPMG report from August.
Twenty-eight per cent of the Middle East’s chief executives expect their markets to be reshaped by digital transformation over the next five years, which is ahead of the global average of 23 per cent, according to the consultancy firm PwC, which added that 30 per cent of the region’s chief executives believe that technology has completely reshaped competition in their industry in the last five years.
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“Digital transformation spending across the META region is expected to surpass $32bn by 2021 as companies are now looking to change and drive change,” said Arun Khehar, senior vice president – business applications, East Central Europe, Russia, Middle East and Africa at Oracle.
“But the question is how? This is possible only with new ideas, customer focus, an action plan, and the best modern technologies.”
Oracle, whose regional clients include Apparel Group, Aldar, Dubai Duty Free, Emirates NBD and Emirates Transport, has been helping Middle East businesses drive major digital transformation. It will be showcasing interactive demos of its latest cloud innovations such as artificial intelligence, blockchain, machine learning, and more at the upcoming GITEX week in Dubai.
While many regional organisations are embracing their digital transformation journeys, many fail to even start. With the majority, up to 90 per cent, of businesses facing major barriers to digital transformation, only 4 per cent of businesses in the UAE and Saudi Arabia can be categorised as digital leaders, according to DTI.
However, experts believe that enhanced awareness and increased expenditures could benefit the small and medium enterprises in the region, which tend to move faster.
“Increased awareness among SMEs has made the roadmap of digital transformation easier for this category of businesses. Their flexible nature eliminates the traditional roadblocks and hurdles of change management towards new system adoption,” said Nisith Naik, chief executive of Centra Hub, a Dubai-headquartered digital transformation solutions vendor.