On September 29th, 2019 the Political bureau of Communist Party of Vietnam promulgated the Resolution No. 52-NQ/TW, on a number of policies on the nation’s proactive involvement in the Fourth Industrial Revolution. In which the eighth policy promotes digital transformation in Communist Party organ, State& government bodies, Vietnamese Fatherland Front, political and social organizations:
- Pioneering in the implementation of strong digital transformation in the Vietnamese Communist Party organs , National Assembly, Government bodies, Vietnamese Fatherland Front, socio-political organizations, ensuring unity, interconnection and synchronization.
- To build digital databases of the Government and all levels of authorities, creating conditions for all citizens to update necessary information about the operation of the state apparatus. Investment in the construction of infrastructure for data collection, management and Internet-based transactions in state agencies.
- To attach importance to building a contingent of cadres, civil servants and public employees to meet the requirements of the Fourth Industrial Revolution; standardize and strengthen the contingent of state management officials at all levels. Clearly define functions, tasks, coordination mechanism among state management agencies in digital transformation implementation. Completing administrative processes and procedures in line with digital government operations, minimizing direct transactions
According to Resolution No. 52-NQ/TW:
Specific targets through 2025: To keep a spot in the top three ASEAN countries in the Global Innovation Index (GII) rankings. To build digital infrastructure facilities up to the advanced standards of the ASEAN with Internet broadband covering all communes and digital economy accounting for 20 percent of GDP. Labor productivity will increase by over 7 percent per annum on average. To basically complete the digital transformation in the Party and state agencies, Vietnam Fatherland Front committees and socio-political institutions. To become one of the four leading ASEAN countries in the United Nations’ e-government index ranking. To have at least three smart urban areas in three key economic regions in the north, middle and south.
Specific targets through 2030: To keep a spot in the top 40 countries in the world in GII rankings. To ensure that the 5G mobile network will cover nationwide and all people can access broadband Internet services at low cost. Digital economy will account for 30 percent of GDP. Labor Productivity will increase by 7.5 percent per annum on average. To complete the formulation of an e-government. To form smart urban chains in the northern, central and southern key economic regions, step by step connecting them with regional and global smart urban networks.
Vision toward 2045: Vietnam will become one of the leading centers of manufacturing, smart service, startup and innovation in Asia, which has high labor productivity and is capable of mastering and applying modern technologies to all fields of socio-economy, environment, national defense and security.
Opportunities and challenges of Digital Transformation in businesses in Vietnam
Vietnam has an open economy that is increasingly deeper and broader integrated in the world economic and S&T flow. In recent times, Vietnam has entered into a series of new-generation free trade agreements (FTAs), along with Free Trade Agreements, agreements on standardization and recognition of standards, quality, and conformity. There is a fierce competition between Vietnam and the members of the agreements that force Vietnamese businesses to compete with domestic and foreign businesses. Not only with the export and domestic consumer goods , we also see that even traditional industries such as agriculture and transportation in Vietnam are also facing competition from startups coming from the overseas which applied smart digital technologies such as amazon, facebook, uber, grab ... Customer service must be faster, accurater, and at the same time, the prices must be down based on the connection platform and economic sharing and Vietnamese enterprises cannot stand outside that trend. Vietnamese businesses would like to integrate deeper and broader and would like to stand in the global supply and value chain. So they must take into account the future technology shifting and be ready for the management and operation of digital platforms. They even have to be one step ahead or else the entire market will be lost to strong competitors.
According to the leading experts in digital transformation consulting sector of the National University of Singapore, depending on the size of the businesses (big enterprise, small and medium enterprise - SMEs and microenterprises), depending on the sector of the business and the short, medium and long term growth goals, Vietnamese businesses will have to convert digitally according to different processes and ways . During the time of digital transformation implementing , most of businesses often encounter many difficulties and challenges. The first is that the interprises employees must grasp the application of digital advancements, followed by the willingness to pay and invest in an efficient and appropriate information technology infrastructure. That underpins the digital transformation and the majority of the population must be ready for the use of smart devices for their consumption connectivity needs. In this regard, Vietnam has an advantage when the growth rate of internet, mobile phones, and smart communication devices is often higher than that of other countries in the region.
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The traing course " Developing Digital Government Strategies", sponsored by Initiative for Integration (IAI) Program for the Vietnamese Government bodies at the Vietnam-Singapore Cooperation Center (Photo: VISTIP)
In the digital transformation process, service providers for Vietnamese SMEs need to provide solutions and platforms to help businesses save costs and time to optimize efficiency in applying technology in order to support business tasks accordingly. Enterprises must understand their own core needs.
Not only large processing and manufacturing enterprises have to transform digitally, but businesses that have a great influence on the whole society and belong to the daily needs of the people will have to move as soon as possible such as: Logistics, sea and air freight forwarding and insurance, financial technology, banking and financial services, manufacturing, distribution, food production and trading, ...
According to the leadership of CMC technology Corporation at the Vietnam Business Summit 2019, Vietnamese businesses should focus on human factors, objectives, processes, platforms and main service ... Digital transformation process consists of 3 phases: 1) determine the core values of the organization and the enterprise; 2) accelerating digital transformation with pilot projects that take control in digital technology; 3) scaling up digital transformation for the whole operation, and improving capacity synchronously so that the entire enterprise becomes " digital enterprise".
The most suitable solution for businesses is to approach solutions that can solve immediate problems, then step by step take control in technology and continuously improve the model to avoid being out of date in a short time. Due to the rapid development of technology, The digital transformation between the public and private sectors should also be synchronized with the same platform so that sharing the database connection will be convenient, To avoid overlaps and wasteful issues when the public and private sectors build a separate data system together.
The successful digital transformation for the public sector and business community following the specific targets until 2025 will be an effective step towards S&T integration in particular as well as Vietnam's economic integration in general.