One of the biggest sources of disruption businesses had to face was the constant evolution of technology and how quickly, if at all, they ought to adopt new tools. Now that society has taken a step towards recovery, it is almost comforting to find that we are in familiar territory.
Technology once again features prominently in our corporate woes, especially as reports surface of data breaches in big retailer chains compromising the information of thousands or of widespread financial cybercrimes amounting to Php 1 billion in client losses . To top it off, the Philippines has recently ranked 6th with the most volume of cyber-attacks according to LexisNexis Risk Solutions’ Cybercrime Report . Cybersecurity remains on top of any corporation’s digital agenda, and even in our own we have implemented a cybersecurity awareness program, which we call the Vigil@nt Training Program, for all our staff. But the economic landscape has changed to the point where boardrooms also started considering what else technology can do for them beyond securing their sensitive data.
In the recent past, we can see a significant shift in attitude. As early as 2019, a Grant Thornton survey reported that disruptive technologies and innovations were top of mind for board directors. At the time, the primary concern was whether companies that fail to include IT talent in their leadership or keep up with tech trends still had relevance in an increasingly digital world . Jump forward two years later and a recent Tricor survey has found that 80% of global board directors believed the onus of leading the company’s digital transformation fell on their shoulders, with roughly 60% and above actively exploring new digital tools in the different countries surveyed.
Artificial intelligence (AI), cloud services, the internet of things (IoT) – Big Tech carries with it opportunities to improve a corporation’s scale, source, and scope according to McKinsey . But how can boards help usher in a digital renaissance?
Signs of a lasting digital shift
First, board directors need to understand what Big Tech does and how they can implement it to suit their needs. In one important aspect, it is obvious to see how technology and digitalization have become intrinsically entangled with how we do business.
As if to fulfil Inanc Balci’s prophecy that the Philippines is due to become an e-commerce hotspot, the industry alone contributed 3.4% or about Php 599 billion to the country’s 2020 gross domestic product (GDP). In line with and necessary for this growth, digital payments and logistics also saw equally significant improvements, thus allowing ordinary individuals and small businesses easy and affordable access to tech-enabled solutions, such as fulfilment automation services , that help drive sales.
From purchase and procurement to door-to-door logistics, different systems of Big Tech have embedded in the online retail experience and thus made every step of the process more efficient, cost-effective, and satisfying for both the supplier and the consumer. Likewise, they can offer certain advantages to ease a company’s operations too, depending on which technologies boards choose to implement.
Data-driven decision-making
As AI has matured and evolved, so too has our understanding of its business benefits. The new best practice is to allow AI to fill multiple roles within a company in order to achieve scale, efficiency, and improvements to that company’s bottom line . In terms of top-level strategies, AI’s ability to learn and absorb massive amounts of data – from business metrics, movements in the market, customer profiles, risk management procedures, etc. – allow board directors and members of the C-suite to make well-informed decisions at a faster pace.
For example, there exists tools that can analyse and simulate possible risks in enterprise management and the likelihood of their occurrence. In the same vein, certain customer relationship management platforms provide aggregate customer data; the proper utilization of which would help companies find better touchpoints with their customers and make more persuasive sales.
Automated processes
Combining AI with robotic process automation (RPA) and a slew of other technology leads to automated processes. Directors might find it in their best interest to automate certain steps in their value chain as it cuts down on menial tasks and gives companies the ability to scale and deliver to a larger customer base.
With the holiday shopping rush around the corner, the benefits of automation may have probably become more apparent to retailers. In the case of the more progressive countries, beyond having actual robots transport products across warehouses, which many companies in the Philippines are not capable of in any case yet, automation and AI can be seen in the systems that allow companies to track shipments in real-time and estimate deliveries, keep accurate watch on inventory and restock without manual input, and predict demand for products to allow for further preparation , among others.
Language processing in internal management
Lastly, natural language processes (NLP) combine AI with linguistics to discern information from swathes of communication data. It has the capability to detect emotion from emails, documents, and other modes of discourse. So far, it has seen real-world use by identifying real feelings from employee surveys and providing actionable insights that better the company’s management style and work culture. Further, NLPs have led to the development of Organizational Network Analysis (ONA) which has the potential to detect employee performance and even fraud by scanning internal communications.
Barriers to adoption
Before choosing to adopt any sort of technology though, board members need to conduct ample research on their own needs and capabilities. Cost is always a factor, with analytics and predictive insight tools easily averaging at least $50 for every user per month, but so too is talent. In a Tricor survey, while most board directors looked positively on more digital adoption for their companies, a whopping 94% admitted they needed more training on new technology while only 58% received such training at the time. In addition to internal risk, board directors in the Philippines need to plan their digital transformation while weighing the country’s budding cybersecurity regulations against the online threats that plague it.
Realistically, there is a long road ahead before corporations can take full advantage of Big Tech. But as with everything else modern and digital, board directors need to take the first steps towards digital governance or else risk lagging in a race that already started without their notice. Hence, talking big tech in the boardroom should become part of the regular agenda.
As published in The Manila Times, dated 08 December 2021
