The Philippines' digital journey in 2018 was a combination of both highs and lows but digital transformation nevertheless continues to bring exciting times ahead in the country with more and more businesses and organizations embracing the process recognizing the significant value that it brings.
An IDC study commissioned by Microsoft predicts that digital transformation will contribute US$8 billion to the Philippines’ GDP by 2021, with approximately 40 per cent of the GDP will be derived from digital products or services, and contributing a growth rate by 0.4 per cent annually.
Here's a recap of the top digital transformation highlights in the Philippines in 2018:
PH retains 10th ranking in Asia DX index
The Philippines ended the previous year retaining its 10th ranking in the Economist Intelligence United (EIU)’s 2018 Asian Digital Transformation Index.
According to EIU's released white paper, the Philippines scored 12.8 landing the 10th spot among the 11 countries included in the index, outpointing only Indonesia that scored 12.2. Singapore remained on top of the ranking scoring 78 followed by Japan with 63.5 as it moved a notch. Only South Korea declined in the index sliding two notches to 4th overall.
The EIU index measured digital transformation in terms of three areas — "digital infrastructure, human capital and industry connectivity". The Philippines ranked 11th in digital infrastructure with a score of 9.7, slipping one notch. Its performance in terms of human capital remained stagnant at 9th overall with a score of 20.4. The country slipped two notches to last place in terms of industry connectivity scoring 11.3.
Data showed only 4 per cent of homes and buildings in the Philippines have superfast connectivity, compared to Singapore's 97 per cent; mainland China, 77 per cent; and Hong Kong, 74 per cent. The report also indicated that telecommunication professionals in the Philippines only account for 1 per cent of the work force, while Singapore and Hong Kong account for 8 per cent and 5 per cent, respectively.
PH lands 56th place in 2018 World Digital Competitiveness Ranking
Six months before the Asia DX Index release where it retained its 10th rank, the Philippines finished 56th place out of 63 countries included in the 2018 World Digital Competitiveness Rankings of the Switzerland-based International Institute for Management Development (IMD).
The ranking was topped by the US, followed by Singapore, Sweden, Denmark, and Switzerland. The Philippines dropped 10-place in 2018, its biggest drop in the past 6 years. At the bottom of the rankings are Colombia (59th), Peru (60th), Mongolia (61st), Indonesia (62nd), and Venezuela (63rd).
In the Asia-Pacific, the Philippines only finished 12th among 14, dropping one place from last year's 11th place standing. The World Digital Competitiveness Ranking ranks countries according to 3 factors: knowledge, technology, and future readiness.
Reports said the drop in the digital rankings mirror the drop in the 2018 World Competitiveness Yearbook (WCY) Rankings, also published by the IMD. The Philippines dropped 9 places from 2017's 41st to the 50th in the latest rankings, the biggest year-on-year decline over the last decade.
Philippine fintech roadmap 'Road to 20 by 2020' launched
In October of 2018, the Philippine fintech roadmap dubbed "Road to 20 by 2020" was formally launched by PLDT-owned FinTQnologies Corp in partnership with the Bangko Sentral ng Pilipinas (BSP) and a host of financial organizations.
The roadmap is a multi-stakeholder campaign aimed to prepare financial institutions for their own digital disruption through the Digital Transformation Accelerator Program (DTAP).
Included also in the initiative are the Chamber of Thrift Banks (CTB), the Rural Bankers Association of the Philippines (RBAP), and the Microfinance Council of the Philippines (MCPI).
Among the main objectives the campaign wants to achieve by the end of 2020, are:
• Assimilate 20% of financial institutions to PesoNett and InstaPay;
• Leapfrog digital financial transactions to 20% from 1%;
• Reduce unbanked LGUs to 20% from 35%; and
• Bring 20 million unbanked and underserved Filipinos to formal financial system.
Unionbank bags IDC's '2018 Digital Transformer of the Year' award in PH
Union Bank of the Philippines (Unionbank) was hailed by IDC as 2018 “Digital Transformer of the Year” at the second IDC Digital Transformation Awards (DXa) in the Philippines held last September in Makati City.
IDC recognized six other companies for excellence and leadership in their DX efforts, namely: ALLCARE, Manila Electric Company (MERALCO), Asian Hospital and Medical Center, Unilab Inc and PhilhealthCare Inc (PhilCare), who won as Digital Disruptor, Talent Accelerator, Information Visionary, Operating Model Master and Omni-Experience Innovator, respectively. PhilCare was also awarded for displaying great masteries under the Information Visionary and DX leader categories.
Among the seven winners that later on competed with winners from other Asia Pacific countries at the reional finals in Singapore last October 25, PhilCare won as one of the "13 Outstanding Digital Leading Organizations" at the Regional IDC Digital Transformation Awards 2018.
PhilCare was named Asia/Pacific Omni-experience Innovator of the Year for its HeyPhil App, a first in the local HMO industry that uses Artificial Intelligence to function as a virtual agent that allow ailing members skip the usual long queues and slow turnaround time to acquire the Letter of Authorization (LOA) forms often required to consult with a medical professional.
IDC DXa recognizes organizations that have significantly disrupted the market or have transformed it, using digital and disruptive technologies.
DX takes spotlight in CXO summit in Cebu
The digital transformation journey of local companies took center-stage last November during the first MSI-ECS CXO Innovation Summit held at the Mactan Shangri-la Hotel and Resort in Cebu organized by tech distributor MSI-ECS.
The conference gathered the top tech brands and their officials who dispensed valuable advice and guidance to local CIOs (chief information officers) and chief technology officers (CTOs) for their digital transformation strategies.
Among those who spoke at the conference were Lope Doromal Jr., chief technologist at IBM Philippines; Herns Hermida, business group lead for cloud and enterprise business at Microsoft Philippines; Nap Castillo, manager for systems engineering at Fortinet Philippines; and Arnie Alvarez, modern data center lead at Dell EMC Philippines.
At the confab, MSI-ECS president and Jimmy Go revealed that the enterprise market in the Philippines continues to grow even as the consumer tech segment appears to be slowing down. He noted cloud computing usage is expanding very fast as more local firms are now adopting cloud solutions.
Alvarez, a veteran IT practitioner, presented that the Internet is disrupting every industry but a lot of opportunities are also emerging.
PH government launches DX-themed national ICT summit
The Department of ICT (DICT) conducted its yearly national ICT summit last June dubbed “Empowering the Filipino through Digital Transformation,” participated in by a good mix of participants from the public and private sectors.
Held in Davao City, the event showcased the government’s ICT-powered programs such as the National Cybersecurity Plan, the National Broadband Plan, Free Wi-Fi Access in Public Places, the National Government Portal, and the National ID system. These projects and initiatives show the accelerating adoption of new technologies that would transform the bureaucracy into an efficient, transparent, trusted, and citizen-centered service system.
DICT noted connectivity, ubiquity, trust, and interoperability are key to digital transformation. And to fully roll out its programs, it appealed to the private sector for close collaboration of government with other stakeholders like the academe and industry players.
The DICT’s development of the National ICT Ecosystem Framework hopes to address the following strategic thrusts: participatory e-governance, industry and countryside development, resource sharing and capacity building through ICT, improved public links and connectivity, ICT user protection and information security, and enabling a sustainable ICT environment. It is envisioned for these to bridge the gaps between innovations and policies.
Conglomerate, insurance, restaurant firms embrace digital transformation
Local conglomerate JG Summit Holdings Inc (JGSHI), restaurant chain Pages Holdings Inc (PHI), and Malayan Insurance Corp (MICO), were some of the well-publicised digital transformation adopters in 2018.
JGSHI collaborated with Microsoft and SAP to upgrade its employee experience and customer experience, respectively. MICO chose Oracle to guide them through their digital journey, while PHI also tapped SAP to boost productivity and business visibility.
PHI executive vice president John Pages said the food and beverage industry is a highly dynamic industry that requires the company to adapt to changing customer tastes and service preferences. By using a business management software, PHI expects to have quicker access to accurate financial and operational reports for informed decisions.
MICO's DX strategy to deliver better services to its customers was to avail a disaster recovery solution to provide an enhanced data back-up and strong connectivity with their existing applications and systems.
As for JGSHI, its digital transformation decisions were part of its vision to be the leading digital conglomerate in the country.
"Customers in today’s digital shift expect great service experience among all platforms. The challenge for us now is to effectively use the latest technologies that would support a more immersive and interactive customer experience," Gokongwei said.
JGSHI's project to move to the cloud platform was meant to further enable its employees to transform their environment into a digital workplace. The diversified conglomerate envisions a New Culture of Work where employees will be introduced to the Modern Digital Workplace which will empower people across the organization to achieve more by enabling better communication, collaboration, and sharing of information from computers to mobile phones in a single cohesive platform.