Up to 18% of small and medium-sized businesses (SMBs) in Vietnam are investing in Cloud computing, which allows them to build mass-scale computing power and minimize information technology (IT) requirements and physical storage, according to the “APAC SMB Digital Maturity Index,” released by global tech firm Cisco on April 4.

Luong Thi Le Thuy, general director of Cisco Systems Vietnam, speaks at the Cisco Connect Vietnam 2019 in Hanoi on April 4. Cloud computing is the top technology that small and medium-sized businesses in Vietnam are focusing on for investment 

Based on a survey of 1,340 respondents across the 14 major economies in Asia Pacific, the digital maturity of SMBs was evaluated across four business dimensions: the application of technology, digital transformation strategy and organization, processes and governance, and lastly, the capability to source, manage and retain the right talent to enable their digital transformation.

Taking these dimensions into account, SMBs in ASEAN, with the exception of Singapore, were classified into the “digital indifferent” stage of digital maturity. At this stage, companies’ digital efforts are often reactive to market changes, rather than driven by a proactive tactical approach.

As SMBs in Vietnam begin their digital transformation journey, it is not surprising that Cloud computing is the top technology they are investing in, accounting for 18% of the total.

This aligns with the trend of Cloud adoption across the region as the technology allows SMBs to scale rapidly as and when required and without significant upfront capital investment in IT infrastructure.

Vietnamese SMBs are also adopting cybersecurity technologies, with 12.7% of respondents listing it as one of the top three technologies for investment.

Having the right IT infrastructure in place is critical to meeting the evolving needs of SMBs in Vietnam and ensuring their long-term success. Local SMBs recognize its importance, and 10.7% of respondents say they are investing in IT software and hardware upgrades.

Luong Thi Le Thuy, general director of Cisco Systems Vietnam, was quoted by the Vietnam News Agency at the Cisco Connect Vietnam 2019 in Hanoi on Thursday, noting that SMBs in Vietnam are digitalizing rapidly and harnessing the power of technology to expand revenue streams and reach a wider pool of customers beyond their geographical borders.

“With the support of the Government and corporations, SMBs will truly propel Vietnam’s economy to the next stage of growth,” she said.

However, local SMBs are also facing hurdles in digital transformation. Respondents said they are being held back by the lack of digital skills and talent (17%), the lack of insight into operational and customer data (17%) and the lack of a robust IT platform (9%).

The survey also found that government initiatives have a clear impact on SMB digitalization in Vietnam.

The majority of respondents (64%) claim they are aware of government initiatives that support SMBs and have already benefitted from them. Another 30% are aware but have not taken part in these programs.

The index suggests a raft of recommendations that can accelerate the digital transformation experience of SMBs in Vietnam, such as investing strategically, leveraging a well-defined digital transformation strategy and roadmap or finding a trusted partner with experience working with and within the SMB ecosystem.

SGT