The Role of Digital in Accelerating Economic Diversification

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There is no industry in the world that has been unaffected by the COVID-19 pandemic. However, for some organizations that had already implemented digital technologies, they were able to pivot their business and ride the waves of change, disruption and uncertainty brought about by the pandemic.

Businesses won’t succeed in the new digital age just by providing their old products and services through a digital medium. Organizations need to think about making digital transformation a core operating principle for everyday business transactions, integrated and embedded into the organization’s DNA.

The role of digital technologies

For businesses involved in moving and distributing goods around the country or the world, the pandemic of 2020 has shown how important it is to have digital technologies to support planning, managing, and executing distribution operations. Over the last few decades, supply chains have increasingly become global value chains, where goods and services production cycles span multiple countries.

If you think about it from a basic level, business is continually evolving and finding new markets. So why should we not be doing the same with processes, whether manual or replacing them with newer digital technology?

Having modern solutions to manage inventory and provide full traceability allows suppliers to protect the integrity of their supply chains. In addition, those businesses that had implemented software to handle product returns were able to cope with the surge of online returns that accompanied the surge in online purchasing.

Innovation-driven by digital technologies will increasingly power the competitive edge for companies in the market. The roles of the future would be built on a triad of skills – domain/functional skills, digital skills, and professional skills.

Economic diversification

COVID-19 could mark a turning point in how people work. The pandemic is transforming peoples’ approach towards work, mobility, and flexible working models. Digital transformation could be a strong lever in organizations’ response to the current crisis, and give them an opportunity to re-align their business/operating models to the rapidly changing business landscape.

Economic diversity includes products, workforce skills, and capabilities to address the local and international marketplace and while there is no silver bullet, anything that enhances the customer experience while reducing the working capital will be vital in gaining a competitive advantage.

Digital networks increase communication as well as allow people, regions, and nations to collaborate and share information aimed at fostering growth and sustaining development. For developing countries, external knowledge enhances the economy’s readiness to diversify output, create employment opportunities, and improve competitiveness.

Expanding tech budgets to include remote IT support, reliable cloud software, and online collaboration tools is something companies need to prioritize moving forward. Businesses can also start prioritizing investments in technology that can draw data, automate workflows, personalize at scale, and powerup a flexible and adaptable workforce Ensuring that employees have all the resources required regardless of their physical location is crucial in a COVID-impacted world.

Digitalization can also spur the development of other new technologies, such as cloud-based systems to access ERP, incorporating artificial intelligence (AI) as digital assistants to improve interactions with customers, and predictive analytics to help plan.

The potential payback of these technological developments is that they can contribute to job creation, as well as encourage other allied industries to diversify, including logistics, infrastructure, and payments – boosting both the information and financial economy.

Technology has changed the pace and reach of business and if anything, I expect to see more and more digital transformation trends emerging during lockdown and beyond.

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