Silos are a key barrier to digital transformation, say Malaysia's C-suite

As the Malaysian government doubles down its efforts on driving the digital economy forward, a new study by Workday revealed key challenges to digital transformation.

According to the study titled “Digital Dysfunction in Asia Pacific”, almost half (49%) of C-level executives in Malaysia have said organisational silos as a key challenge.

This frustration was echoed by other business leaders surveyed, including 73% of HR leaders and 54% of IT leaders who highlighted silos as a key barrier to transformation.

When it comes to barriers to cross-functional collaboration, 47% of C-level executives cited a lack of common technologies and shared metrics as key barriers, with 34% saying their organisations need to invest more in technology.

About half (52%) of C-level executives also noted that their digital transformation initiatives are uncoordinated, with 73% of HR departments lacking implementation plans for digital transformation, along with 50% of finance teams and 38% of IT teams.

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 organisation to stay competitive in a disrupt-or-be-disrupted world. 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.”

When it comes to quantifying the return from their digital transformation initiatives 69% of C-level executives in Malaysia said they do not currently have a balanced scorecard approach to align and measure digital transformation initiatives.

From the perspectives of HR and finance leaders, almost all (93%) of HR leaders and 80% of finance leaders agreed that an integrated HR and finance technology solution is needed for greater visibility. One in five (20%) finance teams and 13% of HR teams in Malaysian companies had systems which are fully integrated and have been successfully transformed.

60% of C-level execs in Singapore saw silos as a challenge 

Over in Singapore, a similar situation can be seen, with 60% of C-level executives viewing organisational silos and conflict between departments as key challenges for digital transformation. HR leaders feel the most pain (87%), followed by finance leaders (58%) and IT leaders (50%).

Similarly,  93% of HR leaders and 50% of finance leaders say an integrated finance and HR technology solution is important for greater visibility, despite 83% of finance leaders and 80% of HR leaders saying their processes are not fully integrated across departments. This reveals a need for investment in digital transformation to improve efficacy.

The study titled “Digital Dysfunction in Asia Pacific” was conducted in partnership with IDC Asia Pacific, 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.

Daniel-Zoe Jimenez, AVP & Head of DX, Future Enterprise & SMB, IDC Asia Pacific, said: “The key theme that comes through in this research is the lack of collaboration and integration among different functions across the region. Digital transformation is a team sport and requires strong support from the top and close collaboration among team members, from HR and finance to IT and digital teams. Key investment in the right technologies will help both increase employee and finance visibility and drive cross departmental collaboration, accelerating digital transformation success.”

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