AIBP Networking: Fostering Sustainable Innovation in Philippines

In our recent AIBP Working Group discussion in Manila co-hosted with The Villar Group, the participants weighed in their views on having fit-for-purpose technologies and how a people-centric approach is crucial in various digital transformation journeys.

A huge thank you to Jesse Divinagracia Jr. Francisco Castillo Migu Macale Marla Garin-Alvarez Yoly Crisanto Charlie Valerio Alexander G. Seminiano Evelyn Salagubang Robert Marlon T. Pereja, MBA Kellda Centeno Carlo Malana John Voltaire Madriaga Rose Estampador Aleine Leilanie Oro Marianne Rapadas Jester Saimon Cadevida, RCE Willie HuiKhaye Manalansan for joining us for durin gthe session.

Some highlights:

Fit for Purpose: It's Not Always About the “Sexiest” Technologies

In the race to digital transformation, it's easy to get caught up in the allure of cutting-edge technologies. However, the most advanced tools aren’t always the best fit for every organisation. The key lies in implementing technologies that are "fit for purpose," tailored to meet the specific needs and capabilities of the organisation.

A People-Centric Approach to Technology Implementation

A successful digital transformation goes beyond technology; it places people at the centre. Focusing on internal customers and future-proofing skills is crucial. After all, even the most sophisticated technology is useless if employees don't know how to use it.

The Philippines' median working population age is about 25 years, one of the youngest in Southeast Asia. This young workforce needs to be equipped with the necessary skills to leverage the digital tools their organisations use. This is where HR plays a pivotal role. In many conglomerates, HR departments are represented on tech councils, ensuring that technology implementation is aligned with employee development and organisational needs.

Obsolescence of Tech and People

Technology evolves rapidly, leading to the obsolescence of both tools and skills. Continuous learning and self-education are essential for employees to stay relevant and effectively use new technologies. Balancing the adoption of new tech with the upskilling of people ensures that organisations remain agile and competitive.

Mismatch in Expectations Among Enterprises and Vendors

A significant challenge in digital transformation is the mismatch in expectations between enterprises and technology vendors. Albeit increasing costs, the value derived from vendors’ products sometimes remains stagnant or even decreases. This lack of innovation is particularly evident in certain ERP and CRM systems which were brought up throughout the candid sharing.

While we have seen stock prices of tech firms increase in the last 5 years, was there similar growth for companies in other industries too?

This chart compares the performance over the past five years of the NASDAQ Composite (NQ=F) and the Dow Jones Industrial Average (DJIA, DOW=F).

This chart compares the performance over the past five years of the NASDAQ Composite (NQ=F) and the Dow Jones Industrial Average (DJIA, DOW=F).

From the chart, it is evident that the NASDAQ Composite, represented by the blue line, has significantly outperformed the Dow Jones Industrial Average (purple line) over the past five years. The NASDAQ's growth is primarily driven by its high concentration of technology companies, which have seen substantial appreciation in their stock prices due to their future growth potential and pivotal role in digital transformation. Although The Dow includes tech firms, its growth has been comparatively subdued, indicating that while blue-chip companies have progressed, the pace has been slower than the high-growth tech giants leading the NASDAQ.

The rising cost of technology has remained a pressing issue, which doesn’t always correlate with improved performance, as we have seen in the graph. Enterprises are investing heavily in digital tools, but if these tools fail to deliver, it results in wasted resources and unmet goals. It’s crucial for organisations to critically assess the value they receive from their tech investments and push vendors for more innovative, cost-effective solutions.

Balancing technology and people is the cornerstone of a successful digital transformation. By focusing on fit-for-purpose technologies, investing in employee skills, and managing short-term/ long-term tech investments effectively, organisations can navigate the complexities of the digital age and achieve sustainable growth.

Stay tuned for more insights, as we will be back in Manila for AIBP’s annual Conference & Exhibition on 17 and 18 September. If you'd like to find out more, do feel free to reach out to us aibp@industry-platform.com