Digital transformation faced with the lack of human resources | Company

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Today, even Prime Minister Pham Minh Chinh asserted that digital transformation is key to creating a powerful driving force for new innovations and laying the foundation for a modern economy. In the years leading up to the outbreak of the Covid-19 pandemic, only around 20% of companies were truly interested in digitizing their operations. However, the post-pandemic scenario forces most businesses to upgrade to the latest technologies and innovate in their ways of working.

Lack of human resources

At the first Industry Innovation Forum held in Ho Chi Minh City, Mr. Mai Huu Tin, Chairman of the Board of U&I Investment JSC, acknowledged that to integrate enterprises into the chain of global sourcing, there is a need for innovation across the industry. . To do this, it is necessary to determine that the union creates the right conditions for intelligent production.

Mr. Tin also said that the quality of human resources in Vietnam is still very low at the college level. Consequently, the culture of innovation in companies and the quality of human resources must become an important issue. Mr. Tin shared that even in consulting businesses, in theory everyone can read and understand, but in practice this is very difficult to implement, hence the need for small changes that will lead to the growth of businesses.

Several challenges plaguing the business community were also recognized and discussed at the recent forum. Mr. Do Phuoc Tong, Chairman of the Board of Directors of Duy Khanh Mechanical Company, said that his company had moved towards digital transformation seven years ago, but so far it was still not satisfied with its performance. status and needed to do more to strengthen the digital transformation. within the work environment.

Currently, one of the main challenges that small and medium-sized enterprises (SMEs) face in their efforts to transition to digital transformation and put the right technology into production operations is the severe shortage of human resources. As some mechanical industries operate with a low profit margin and have insufficient investment flow, they cannot completely take the digital transformation stage due to the lack of funds for qualified human resources.

A company representative said they invested $10,000 in a digital system within the company, but the cost of maintaining it was over 10% per year. As good data collection requires skilled operations personnel, it has now become difficult to operate this system, with the company representative and his partner working day and night to maintain and operate the digital system.

It is clear that digital transformation is not an easy decision for businesses, even for companies operating in big cities like Ho Chi Minh City. Difficulties do not only lie within companies, but there are also problems in finding a suitable consulting unit and providing appropriate solutions, especially for manufacturing companies.

The common issue reported by many companies in the Ho Chi Minh City Business Association is the process of finding a suitable consulting unit and providing the right digital solutions. Consultants often don’t understand how a business works, so they tend to provide the same solution for every industry group, even when the issues vary. There are too many difficulties that lead to many failures in the digital transformation process. Several reports show that up to 70% of companies that have embraced digital transformation have so far failed in their efforts.

The challenges and failures of digital transformation make it difficult to promote innovative ideas and integrate technology into the production process of Vietnamese companies. However, according to Asso. Teacher. Dr. Nguyen Anh Thi, head of the board of directors of the Ho Chi Minh City Hi-Tech Park, this process is also proving to be a great challenge for several companies around the world. According to a report by Innosight, about 75% of companies in the Standard & Poor’s 500 (S&P 500) stock index in the United States will be replaced by 2027 due to lack of technological innovation.

The challenges of digitization

Businesses quickly learn that digital transformation is rather a very difficult and complicated process. It is therefore now essential to find ways to simplify digital transformation so that more companies can adopt it without feeling the constraints of change. Ms. Pham Thi Ngoc Thuy, Executive Director of the Office of the Private Economic Development Research Council (Council IV) related two examples of digital transformation in enterprises that illustrate this point well.

The first example is that of Quang Ninh province, which has become a leading province in establishing a successful digital government. Ms. Thuy says that when she and her colleagues interviewed leaders in Quang Ninh province about the challenges of the digital transformation journey and building a digital government, her team received the response that the most difficult was the technology. Therefore, the level of staff readiness in the system itself was the first difficulty to be resolved. It finally took three years for Quang Ninh province to overcome several problems and solve the problems.

The second example concerns an industry that seems unrelated to technology and digital transformation, but is considered a company that has made great efforts in digital transformation, namely the wood manufacturing and processing industry. . During the two years of the Covid-19 pandemic, businesses were unable to hold meetings or even exhibit and struggled to sell their wares to overseas buyers. The timber industry then turned to using the zoom platform to meet and introduce new products and also sell its products to foreign buyers.

The Ho Chi Minh City Woodworking Association (HAWA) established the HOPE online exhibition platform. Now companies want to develop a team of CIOs with the same role as production managers to maintain their sales. Ms. Thuy shared that in their efforts, they realized that instead of supporting solutions such as digital management and digital marketing, they should focus on developing key people for the community in the timber industry. She believes the wood industry is gradually developing a network of CIOs and is encouraged that many business owners are increasingly interested in digital transformation.

The examples above show that the right trained staff plays a very important role in digital transformation. Therefore, solving the serious problem of shortage of human resources is the first and most important step. Along with this, financial resources also cannot be underestimated when implementing digital transformation. The fact that the resources of companies, especially small business groups, are very limited leads many to suggest that companies in the same industry should connect as they have similar digital transformation issues.

Once businesses are connected, they can find a suitable vendor to work with to deliver products that can be shared, which will reduce overhead. To do this, the role of associations will become very important in the future.

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