Reaching for the digital summit

Reaching for the digital summit

From cloud technology to the Internet of Things, digitisation and artificial intelligence, Thailand's ascent to a high value-added economy offers myriad awards for those willing to scale those great technological heights

Connection between human and the virtual world will become more natural as the cyber-landscape  moves forward.
Connection between human and the virtual world will become more natural as the cyber-landscape moves forward.

Organisations in Thailand have a long way to go in their 2017 digital transformation journeys to keep pace with new innovations and disruptive digital technologies, as well as drive differentiation and their competitive positions.

Internet of Things (IoT), cybersecurity and artificial intelligence (AI) will be three particular trends that will gain real momentum and reshape the cyber landscape this year.

Meanwhile, cloud computing, social media, big data and enterprise mobility are increasingly becoming underlying technologies that will shape global technology adoption over the next several years.

Digitisation will be an important catalyst in driving Thailand's IT spending in 2017, with total expected outlays of 415 billion baht. That figure is set to reach 500 billion baht in 2018.

Orapong Thien-Ngern, general manager of Microsoft Thailand, together with Vatsun Thirapatarapong, managing director of Cisco Thailand and Indochina, have sat down with the Bangkok Post to give an overview of this year's technological trends in Thailand, as well as how digital transformation is affecting organisational culture.

Road to technology

One of the key positive factors benefiting the country's ICT sector is the government's guidance and market awareness to facilitate a digital economy. This is especially true when it comes to the government's Thailand 4.0 agenda, which lays out development plans for digital infrastructure, says Mr Vatsun.

"This will give rise to new opportunities for businesses throughout the value chain in the ICT industry and unlock an innovation-driven economy," he says.

For example, the goals to develop a high value-added economy by changing Thailand's traditional manufacturing to smart manufacturing, traditional small and medium-sized enterprises (SMEs) to smart enterprises, and traditional services to high-value services, will tap into digital technologies, including the IoT, cloud and big data analytics, to nurture smart, secure and connected communities that are innovative, forward-thinking and well-equipped to stay at the forefront of the competition.

Digital transformation

Global IT research firm IDC predicts that by 2020, 30% of the top 500 Thai enterprises will depend on digital products, services and experiences for the majority of their businesses.

More organisations are being transformed as businesses leverage cloud, analytics, collaboration, and the IoT to create their competitive advantages.

Multi-Cloud is also growing, with IDC saying more than 55% of enterprise-IT organisations will commit to multi-cloud architectures by 2020, driving up the rate of change in IT organisations.

Cloud technology will help Thai businesses improve their cost benefits, operational efficiency, time-to-market and scalability.

Organisations with cloud strategies will look to multi-cloud as it will improve overall enterprise performance and provide different structures to meet the needs of diverse partners and customers.

In addition, having two or more cloud services to support one's business will help mitigate the risks of widespread data loss or downtime.

IDC also says that big data analytics will be adopted more widely. Businesses will depend on big data analytics to understand their customers more than ever before.

Today, many companies are using platforms such as e-commerce, omni-channel marketing and social media to engage with their customers. The data generated via these channels can be collected and analysed so that businesses can create more relevant engagement strategies, make and deliver more personalised content and greatly enhance customer experience.

IoT adoption is steadily rising in Thailand and businesses are seeing it both as a tool to differentiate themselves from their peers and as a key factor in digital transformation.

According to IDC, 60% of the top 500 Thai companies have expressed interest in IoT.

The manufacturing sector is leading the way in IoT adoption as it not only greatly improves the efficiency of the production process, but also dramatically reduces downtime and maintenance costs.

Cybersecurity, meanwhile, needs to be at the heart of every business's digital transformation strategy. Although the investment in security has been rising, cyberattacks are also getting more sophisticated, rampant and damaging.

The Electronic Transactions Development Agency reported that Thailand had 4,300 cyberattack incidents in 2015, up from 3,300 in 2014.

As the number of endpoints in a company continue to increase due to IoT, mobility, cloud and other technology trends, the number of attack vectors that cybercriminals can exploit is also correspondingly increasing.

Companies will need an integrated threat-centric approach that delivers security across the entire IT infrastructure, and not just point products.

At the same time, companies will also need to shift to a smart and automated approach to detect, fight and prevent cyber-attacks.

By 2019, IDC said more than 30% of enterprises and cybersecurity environments in Thailand will use cognitive/AI technologies to address the rapidly increasing scale and complexity of cyber threats.

Mr Orapong says he believes that leading companies will begin injecting more intelligence into every unit of their businesses to better engage customers, empower employees, optimise business operations and transform the products and services they offer, thereby increasing agility.

"We foresee that AI will continue to gain prominence in 2017, giving rise to a new frontier of automation and breaking ground for real time and personalised messaging, powered by cloud computing technology," he says.

Small and medium-sized enterprises (SMEs) will be able to reinvent the nature of productivity and maximise their staff strengths by having these intelligent bots stand in for customer service representatives, while their human employees handle higher value roles.

As bots' natural language understanding grows, conversations will be the new platform of the future and such cognitive computing will certainly be something to keep an eye on in 2017.

Mr Orapong says IoT will also continue to solicit indelible support from industries worldwide.

With the proliferation of new technologies, organisations will continue to adopt and adapt new technological solutions that will drive business growth, and the onset of new IoT solutions will leverage AI and machine learning to interact with humans and their surroundings, such as drones, self-driving cars, and smart kitchens/homes, which will be increasingly integrated into daily living.

IoT will also push businesses a step further by offering them immeasurable insights into their customers. Organisations will be able to create, change and ensure that customers benefit from these insights, providing value to formulate that next big business strategy.

Key tech innovations

Mr Vatsun says digital disruption has the potential to overturn incumbent businesses and reshape markets faster than anything we have witnessed in Thailand and the world.

Four of today's top 10 incumbents in each industry will be displaced by digital disruption in the next five years.

The technology, media and entertainment, retail and financial services industries have already been particularly disrupted by digitisation.

On the other hand, digitisation will also bring about tremendous opportunities for businesses, he says.

Between 2015 and 2024, Mr Vatsun says there will be US$24 trillion (864 trillion baht) worth of economic value that can be derived from digital technologies in the global private sector.

Cloud, big data analytics and IoT are key technologies that will play vital roles in many organisations' digital transformation strategies and help them innovate new products and services, enabling disruptive new business models.

Mr Vatsun says digital transformation will become a top corporate priority for many in 2017 as Thailand continues to move towards Thailand 4.0.

IDC expects by the end of 2017, more than 50% of leading businesses in Thailand will have digital transformation as a corporate strategy and will appoint experts to oversee the digitisation journey.

But for organisations to fully realise the opportunities that digitisation brings, security needs to be at the heart of their digital transformation strategies.

Thai companies should view cybersecurity as a strategic advantage that not only protects business value but also enables new business value through innovation.

One of the biggest downsides to cybersecurity weakness is that it inhibits innovation.

An internal survey of Cisco found that cybersecurity risks have hindered innovation in organisations.

In addition, new business models and innovations are only sustainable if they are secure and consumers have confidence that their data is well-protected.

Organisations that have any doubt about their cybersecurity capabilities delay important digital initiatives and risk falling behind the competition of tomorrow.

Mr Orapong adds that we will see technology intertwined with our everyday lives like never before, with organisations undergoing their own digital transformations across the world. The technology framework which is taking shape for the future will revolutionise how we conduct business and take on new challenges in an increasingly digitalised economy.

For example, the introduction of mixed reality devices has transformed the way we live, engage and connect. In a mixed reality world, devices will be able to spatially map your environment, mixing real people, objects and environments into the virtual world.

As manipulating digital content becomes increasingly easy and more natural, this is likely to usher in a new frontier for digital collaboration and virtual workspaces, allowing for a more immersive environment for working remotely, improving collaboration in future workplaces and tackling organisational challenges anytime, anywhere.

The increasing intelligence of machines, especially in their growing grasp of natural human language, will pave the way to a world of conversational computing.

"Soon, we may come to treat computer systems as if they were human beings," says Mr Orapong, adding that services that rely on interactions between people and machines will become easier, more efficient and more natural, while smaller companies can turn to bots to achieve scale and grow.

Business direction for Cisco and Microsoft

Mr Vatsun says in 2017, Thailand was appointed as the Indochina regional hub for Cisco, which will also cover Vietnam, Myanmar, Cambodia and Laos.

Among these countries, Vietnam is a fastest growing market for Cisco in Indochina and it is one of the world's leading investment destinations. The nation is now rapidly advancing its technology sector to realise its goal of becoming a digitised country. Its government has further pledged to spend $112 million in the ICT sector by 2020.

For Cisco, smart cities, IoT and security are among some of the key focus areas in Vietnam.

Vietnam recognises the pivotal role that IoT will play in helping the nation realise its digital vision. The government has called on Vietnamese businesses and organisations to utilise IoT to enhance business efficiency, innovate and improve the quality of life for the people through projects such as smart cities, smart homes and smart traffic.

Cisco is already involved in a number of projects that are helping Vietnamese cities lay the foundations for their smart city vision by developing their ICT infrastructure and connecting their city functions.

On the other hand, Vietnam is also among the top 10 countries most exposed to cyberthreats.

According to the Vietnam Computer Emergency Response Team, Vietnam experienced 127,000 cyberattacks in the first half of 2016 alone. The most serious of these attacks happened in July, when two major airports were struck, affecting more than 100 flights.

As organisations, infrastructure and services become increasingly interconnected through IoT and smart cities, Mr Vatsun says the damage and impact of cyberattacks will only get more severe and extensive.

Organisations looking to leverage IoT cannot approach security as an afterthought but as the foundation of their IoT strategy. Organisations will need to have visibility across their entire networks and tap global threat intelligence to make better decisions, while also ensuring they have the capabilities to stop and remediate threats before, during, and after attacks.

Mr Orapong, meanwhile, says Microsoft's primary goal for 2017 is to become the No.1 partner of choice for businesses on the digital transformation journey.

"We want to be the most trusted adviser who guides our partners and customers in how to make the best use of their advanced technological capabilities," he says.

In the year ahead, Microsoft also expects security to be a big area of focus. With more than 1 billion people online in Asia-Pacific and more people and businesses using multiple devices to stay connected to the internet, cybercrime threats to security and privacy are rising and becoming more malicious and dangerous than ever before in our mobile-first, cloud-first world.

Cybersecurity will be crucial to building greater trust in technology to foster digital transformation, adds Mr Orapong.

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