Businesses in Thailand struggling to digitalize despite COVID impetus

The pandemic has had a transformative effect on the digitalization of companies across the Asia Pacific region, but 86% of Thai companies still count their businesses as among the disrupted. Despite the misgivings of many business leaders, the pandemic has unquestionably accelerated their digitalization efforts, with 72% of Asia Pacific respondents saying that the impact of COVID-19 has been a major accelerant, including almost a third describing it as transformative.

According to a business survey from Baker McKenzie, Riding the Next Wave - Digital Transformation Strategies in Asia Pacific, businesses said that they had faced an acceleration of business digitalization in the past year but also shared deep anxieties around the pace of keeping up with competitors and risks associated with digital transformation - from cybersecurity, effective adoption of technology to expected heightened regulatory scrutiny.

Thai respondents said that they are focusing their digitalization efforts into their distribution, sales channels and customer relationship management, but 32% have admitted mixed results of on-boarding and monetizing new technologies. 36% also said they are just about keeping pace at managing the risks of new technologies, including managing and protecting data.

When asked to list out the greatest risks Thai business are currently facing, they tackled this question from two aspects, namely technology risks and legal risks. While heightened regulatory investigations and theft of sensitive information topped both the technology and legal risk, Thai respondents had cybersecurity risks high on their radar, while also counting intellectual property breaches as another high legal risk.  

With the challenges posed by the ongoing global pandemic, 58% of Thai respondents said that they are falling behind with the technology to support remote working and more efficient processes.

Digital transformation is also driving deal making. In a previous report in this series focused on M&A trends in the Asia Pacific region, when asked what the key drivers of their own deal activity would be, more than half of all respondents (57%) cited acquiring new technology and associated expertise, which jumped to 74% of healthcare companies, 85% of financial institutions, and a full 92% of technology, media and telecoms companies. Therefore if companies are not able to build or lease solutions, they are clearly open to buying businesses to move up the digitalization curve.