Digital transformation still cannot reach SMEs

Covid-19 has given a strong push to the digital transformation process in the last half of the year. However, this remains out of reach of small and medium sized enterprises.

‘Customer experience’, according to Nguyen Van Phi, CEO of Son Kim Retail, is one of the most important keywords in the retail industry.

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Son Kim on July 31 signed a contract with Hitachi Vantara Vietnam on comprehensive management, sales and business solutions for Son Kim Retial and Son Kim Mode.

The deployment of the ERP system (enterprise resource planning) is hoped to upgrade performance as well as competitiveness, and expand operation scale.

In early May, Loc Troi Group signed a contract with Citek on the deployment of SAP S/4HANA, an ERP system.

Prior to that, FPT Group last March signed an MOU on cooperation to step up digital transformation with three largest timber associations in Vietnam, including HCM City (Hawa), Dong Nai (Dowa) and Binh Duong (Bifa) wood processing associations.

“Enterprises in the woodwork industry have high interest in IT application and they want to optimize production, design and business with high technologies,” said Nguyen Chanh Phuong, deputy chair of Hawa.

Phuong told VnExpress that there would be as many 50 online showrooms to introduce wooden furniture products with 3D display.

The increased interest by Vietnam’s enterprises in digital transformation is reflected in large solution providers. FPT, for example, reported revenue of VND1.773 trillion from digital transformation services in H1, an increase of 65 percent.

The revenue from the sale of made-by-FPT products in the domestic market alone increased by 28 percent compared with the same period.

Viettel also reported that its subsidiaries providing digital transformation products saw revenue increasing sharply in February. Viettel Business Solutions Corporation reported a 111 percent growth rate, and Digital Viettel 107 percent.

However, while large enterprises have geared up with digital transformation, SMEs remain indifferent.

A survey by the Vietnam Software and IT Services Association (Vinasa) found that enterprises carrying out digital transformation accounted for 15 percent, while 99 percent of SMEs have problems in capital.

Nguyen Dinh Tue from the HCMC Union of Business Association (HUBA) commented that SMEs ‘are not in hurry about digital transformation’.

Tue thinks that SMEs still do not understand all the benefits that digital transformation can bring. Second, they don’t know about the costs and benefits from investments, so they do not make decisions. And they don’t know what they should do to start the digital transformation process.

Kim Chi

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