Home Technology & Digitalisation 2022 Outlook: Digitalisation in Asia

2022 Outlook: Digitalisation in Asia

Darren Thayre
How can Asian companies turn the digitalisation corner and what are some defining trends that will play out in Asia in the new year?
An interview with
Head of Innovation, Global Strategic Initiatives at Google

We are kickstarting 2022 with short conversations with some of our regular contributors about their outlook for the new year.

Here, we speak with Darren Thayre, Head of Innovation, Global Strategic Initiatives at Google, about digitalisation in Asia in 2022, and key themes that will play out in the region.

Unravel: Will 2022 be as much about digital transformation as 2021 was? 

Darren Thayre: I believe one thing that COVID has done is to accelerate the impetus for a shift to digital services. This is a multi-year endeavour in most cases and therefore I still believe the majority of firms that embarked upon this journey during 2020/2021 will still have some way to go to reach their initial goals.

Having said that, I never like to think of digital as a fixed destination – you only need to look at consumer behaviour, advances in technology and new startups to see that this isn’t one of those times where you can tick a box and say “we are digital now, we can relax”.

Instead, I would think of digital as a critical organisational muscle, one that you need to continually hone, and my advice is to constantly look for change opportunities and execute them little and often, so that you can avoid such large multi-year change endeavours in the future. 

We have to strip away all of the buzz words and ambiguity and remind ourselves that digital is just a mechanism to engage with and delight customers. 

Digital prowess is not the end goal; admittedly it can be a good leading indicator of progress, but the real goal is still to connect with and delight those customers. 

Let’s not lose sight of that.

Unravel: Do you think small Asian businesses have turned the digitalisation corner? Why or why not?

Mr Thayre: I look at this in two ways. First, those businesses that were previously not online or couldn’t work remotely – I think Asia has done an incredible job over the last couple of years of closing this gap. Second, are those same businesses offering a best-in-class digital experience, with unique business models to delight customers? I think this is where there is still a huge opportunity. 

I think there are some shining lights in the region, with some of the most high-growth unicorns in the world coming from this region, and doing really unique things. 

I would just say today those firms are the minority and the rest of the businesses will need to take that next leap, in order to really differentiate and delight their customers. 

Unravel: What is your prediction about the adoption of cloud across developing Asia? Will it see a surge? What are some key challenges?

Mr Thayre: Cloud is not new to Asia, there are success stories in every country, but we are now starting to see the adoption really accelerate and the sophistication of cloud usage is evolving too.

I think banks by and large have been laggards, with many dipping their toes in the water before fully committing; however, we know that to see the full benefits of cloud you need a programmatic approach – which we are now starting to see across the region. 

I see 2022 being the year of AI across the region – many firms have built core data skills, they have gotten familiar with cloud and they are ready to really take advantage of the AI opportunities in front of them.

Key challenges? I would call out two. The first is skills – firms need a holistic programme to attract and retain top talent, they need to grow talent from within and invest in strategic partnerships. Second, all of us have many distractions these days, personally and professionally. Every firm has more initiatives ongoing than they can typically handle, so we need to find a way to prioritise these cloud programmes so you can extract the intended value from them. I still see a lot of enterprises with high cost-to-income ratios, and IT plays a big part of that, but it takes a concerted effort to course correct that area. 

Unravel: What will be a few of the defining digitalisation-related themes to play out in Asia in the next year?

Mr Thayre: I would call out three.

1. The Metaverse. We are going to see an increasing number of immersive experiences coming online in 2022 across Asia. Markets like Japan and China are already leading the way.

We will see adoption across gaming, wellness/fitness, collaboration and e-commerce. The proof-points and platforms are already there, we are going to see huge technology advances and rapidly increasing adoption in 2022.

When you think about the components of the metaverse such as semiconductors, hardware/wearables, and platforms and the like, Asia is perfectly poised to play a leading role. 

2. I saw a quote the other day that I loved from John Chambers. He said: “The super-fast will crush the fast”. I’ve been saying for a long time that digital is a great leveller for size and financial backing, and that speed is the key currency. The firms that can work in cycles of weeks and months, rather than quarters and halves, will achieve a much stronger product/market fit and rise to the top.

3. It’s tempting when you think about digital or innovation, to add net new initiatives, it makes sense when there are just new capabilities that you don’t have. However, I think a critical part of this journey is to explore what you need to stop doing. This is harder, it requires a really honest appraisal of those products/markets etc, that maybe shouldn’t be part of your future. 

Maybe you aren’t market-leading in those areas or they are areas of declining demand. I think as part of a digital journey it’s just as important to have a plan to identify these areas and deprecate them over time, elegantly so customers aren’t impacted.

Don’t think of this as a thankless task, instead treat the people driving these initiatives as heroes, heroes that are freeing up resources and funds so that you can invest in the new transformative areas.

I like to think of digital as a balance sheet and everybody does very well with the new initiatives side of the balance sheet. We need to get more disciplined around what we remove, so that we can eradicate “technical debt”, or the things that might be holding you back or creating distractions.

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Darren Thayre
Head of Innovation, Global Strategic Initiatives at Google

Darren is a digital transformation subject matter expert. He has worked with large enterprises all over the world on their digital plans and change programmes. He heads up Digital Transformation and Digital Ventures for Google across Asia-Pacific, Japan and China. Darren can now call upon the vast Google and Alphabet resources to help customers with their transformation journey. Previously Darren led a consulting transformation team in Amazon Web Services, where he was responsible for some of their largest digital transformations globally.

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