A study by Workday, a global leader in enterprise technology for finance and human resources, has found that Malaysian companies are leading in APAC in quantifying the return from their digital transformation initiatives, with 58% of C-Level executives seeing measurable returns. In contrast, only 47% of companies in Singapore and 34% in Japan had seen returns. However, when looking at the key challenges to digital transformation, almost 49% of C-level executives in Malaysia see organizational silos or an environment where a company’s departments do not share operational information with one another as a key challenge. 

Frustration with organizational silos was also felt by the other business leaders surveyed, with 73% of HR leaders and 54% of IT leaders in Malaysia highlighting this as a key barrier to transformation.

The study titled “Digital Dysfunction in Asia Pacific” was conducted in partnership with IDC APAC, and looks at the barriers to digital transformation from the perspectives of 1,000 C-level Executives and business leaders in HR, Finance and IT.

52% say that their digital transformation initiatives are uncoordinated

Another challenge cited was that when it comes to measurement, more than two-thirds or 69% of C-level executives in Malaysia say they do not currently have a balanced scorecard approach to align and measure digital transformation initiatives. 47% of C-level executives also cite a lack of common technologies and shared metrics as key barriers to cross-functional collaboration, with more than one third or 34% stating their organizations need to invest more in technology.

In addition, more than half or 52% say that their digital transformation initiatives are uncoordinated, with three quarters or 73% of HR departments lacking implementation plans for digital transformation, along with half 50% of finance teams and 38% of IT teams.

 Meanwhile, from the perspectives of HR and finance leaders, almost all 93% of HR leaders and 80% of finance leaders agree that an integrated HR and finance technology solution is needed for greater visibility — the highest in the APAC region. One in five or 20% finance teams and 13% of HR teams in Malaysian companies have systems which are fully integrated and have been successfully transformed — which was similar to other countries in the region.

Rob Wells, President, Workday Asia, said, “As Malaysia’s digital economy rapidly expands it is great to see that local companies are keeping pace and leading the region in their efforts to digitally transform. Despite this success, there still remains work to do to break down company silos to effect change at an enterprise level. Investments in technology can help companies disassemble information silos and reimagine the business in a way that allows an organization to stay competitive in a disrupt-or-be-disrupted world.”

He added that the advent of cloud technology in Financial and HR management will allow business planning to be more strategic, collaborative and real-time, especially if brought together in one single system for maximum benefit.

The findings are significant given they come at a time as the Malaysian government has announced commitments to digitalization this year and driving the Malaysian digital economy forwards. Malaysia’s digital economy is projected to contribute 21% of its GDP by 2022. The research clearly points out that the lack of collaboration and integration among different functions across the region is missing which is a necessary element for digital transformation.