By 2021, digital transformation will add around $$9.6 billion to New Zealand’s GDP, and increase GDP growth by 0.7 per cent annually, according to a new study by Microsoft and IDC Asia Pacific.
The research, Unlocking the Economic Impact of Digital Transformation in Asia Pacific, predicts in the next four years, 55 per cent of the country’s GDP will come from digital products and services.
These products and services will be created through digital technologies, such as mobility, cloud, Internet of Things (IoT), and artificial intelligence (AI).
“New Zealand is on the digital transformation fast track,” says Russell Craig, national technology officer, Microsoft New Zealand.
“Organisations are increasingly deploying emerging technologies such as AI as part of their digital transformation initiatives, and that will accelerate growth even further.”
Microsoft says 1,560 business decision makers in organisations across 15 economies in the Asia-Pacific region, including 100 respondents in New Zealand, were interviewed for the report.
It says the survey highlights the rapid impact and widespread disruption that digital transformation is having on traditional business models.
“To remain competitive, organisations must establish new metrics, realign organisation structures, and re-architect their technology platform," says Shane Minogue, analyst, IDC Asia-Pacific.
The study found that while 95 per cent of organisations in New Zealand are going through their digital transformation journey, only 7 per cent can be classified as leaders.
Digital leaders are organisations that have a full digital transformation strategy in place, and benefit from an “ecosystem centric approach”. A full strategy refers to having mature and developed digital processes, people readiness and support systems in place.
These leaders are more concerned about competitors and emerging disruptive technologies. They place a great emphasis on data and using it to improve business decision-making, enhance products and services and create new business models. As well, they are looking at investing in emerging technologies such as AI and IoT.
“There is a pressing need for organisations to adopt a leader’s mindset to fully capitalise on the potential of digital transformation in the next few years,” notes Russell Craig of Microsoft.
“To do so, organisations need to grow their value by gaining new insights through new data sources and expanding their digital products and services,” says Russell Craig.
New Zealand respondents, meanwhile, felt that 89 per cent of jobs will be transformed in the next three years due to digital transformation, and 65 per cent of the jobs in today will be redeployed to higher value roles or reskilled to meet the needs of the digital age.
“The rise of digital transformation will affect the labour market where many types of jobs will evolve and change,“ says Craig.
“It is encouraging that 67 per per cent of respondents are confident that their young professionals already have future-ready skills that will help them transition to new roles,” says Craig.
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