Google has evaluated Vietnam’s digital economy as the fastest-growing in the Southeast Asian region. According to statistics from the Ministry of Information and Communications, the contribution of the digital economy accounts for approximately 14.26% of the GDP.
This affirms Vietnam’s potential and valuable human resources in research and development in fundamental sciences, data, and information technology to carry out digital transformation. It makes a substantial, effective, and sustainable contribution to the country’s growth, not relying on the exploitation and utilization of natural resources.
What is digital transformation?
Digital transformation refers to the process of using digital technologies to fundamentally change how businesses operate and deliver value to their customers. It involves the integration of digital technology into all aspects of an organization, resulting in a profound shift in how the organization functions, serves its customers, and creates and delivers products and services.
Digital transformation is not just about adopting new technologies; it’s about reimagining how businesses create value, interact with customers, optimize operations, and stay competitive in an increasingly digital world. It is a strategic imperative for organizations to remain relevant and thrive in the modern business environment.
The current state of digital transformation in Vietnam
The current state of digital transformation in Vietnam is one of rapid growth and innovation. The government is committed to making Vietnam a digital-first economy, and there are a number of startups and tech companies in Vietnam that are leading the way in digital transformation.
Here are some of the key trends in digital transformation in Vietnam:
- The rise of e-commerce: E-commerce is growing rapidly in Vietnam, and is expected to reach $100 billion by 2025. This is being driven by a number of factors, including the increasing popularity of online shopping, the growing middle class, and the increasing availability of smartphones and other internet-enabled devices.
- The growth of fintech: Fintech is another rapidly growing sector in Vietnam. This is being driven by the need for more efficient and convenient financial services, as well as the increasing availability of mobile banking and other digital financial services.
- The adoption of cloud computing: Cloud computing is becoming increasingly popular in Vietnam, as businesses look to reduce costs and improve efficiency. The government is also investing in cloud computing infrastructure, in order to support the growth of the digital economy.
- The development of artificial intelligence (AI): AI is still in its early stages of development in Vietnam, but there is a growing interest in the technology. AI has the potential to be used in a variety of applications, such as healthcare, education, and manufacturing.
The government is playing a key role in promoting digital transformation in Vietnam. The government has launched a number of initiatives to support digital transformation, such as the National Digital Transformation Program. The government is also providing incentives for businesses to invest in digital technologies.
Find out more: Vietnam’s Digital Transformation Plan Through 2025
COVID-19 pandemic has accelerated the pace of DX in Vietnam
According to a survey conducted by IBM Technology Group, the COVID-19 pandemic has contributed to accelerating the digital transformation process by up to 5 years. This demonstrates the ‘urgency’ of digital transformation, with its achievements being remarkable advancements in science and technology.
The need for remote work and learning: The pandemic forced many businesses and organizations to adopt remote work and learning solutions. This has led to an increased demand for digital technologies, such as video conferencing, cloud computing, and e-learning platforms.
The growth of e-commerce: The pandemic has also led to a surge in e-commerce activity. This is due to the fact that people are avoiding going to physical stores and are instead shopping online. The growth of e-commerce has created new opportunities for businesses to use digital technologies to reach customers.
The adoption of contactless payments: The pandemic has also led to an increased adoption of contactless payments. This is because people are looking for ways to reduce the risk of infection by touching cash or credit cards. The adoption of contactless payments has created new opportunities for businesses to use digital technologies to process payments.
The use of digital health solutions: The pandemic has also led to an increased use of digital health solutions. This is due to the need for people to access healthcare services without having to go to hospitals or clinics. The use of digital health solutions has created new opportunities for businesses to use digital technologies to improve healthcare delivery.
The development of government digital services: The pandemic has also led to the development of new government digital services. This is due to the need for governments to provide services to citizens without having to physically interact with them. The development of government digital services has created new opportunities for businesses to provide IT solutions to the government.
Challenges to digital transformation in Vietnam
Regarding challenges, there are three major obstacles to digital transformation, including: the determination of organizational leadership; costs, time, and resources; and the appropriate approach to digital transformation for the organization. Information security is the fourth challenge for the business community.
Therefore, in the context of Vietnam’s shortage of highly skilled technological and automation workforce, disseminating standardized global information and knowledge helps each business increase its maturity in thinking and skills as it delves deeper into the global supply chain. This is the first necessary condition for businesses to prepare themselves for implementation in practice.
The application of digital transformation to businesses will require consultation, visionary guidance, and collaboration from experts to develop specific strategies and planning tailored to the scale and needs of each unit. This process not only helps carry out digital transformation in line with the resource-specific characteristics of each business and each stage but also contributes to minimizing risks and avoiding waste to the environment and energy as businesses expand in scale.
In conclusion, Vietnam’s digital transformation story is one of promise and progress. It’s a story of a nation harnessing the power of digital technologies to drive economic growth, enhance competitiveness, and improve the lives of its citizens. As Vietnam continues to navigate its digital future, it serves as an inspiring example of what can be achieved when determination meets innovation in the quest for a brighter, more digitally connected tomorrow. The journey has just begun, and the world watches with anticipation as Vietnam charts its course into the digital age.