Changing business behaviour key to TCS growth in the Philippines
- 30 March, 2020 08:34
Shiju Varghese (TCS)
On paper, the Philippines represents a market on the cusp of widespread digital adoption, operating as a country open to emerging technologies and welcoming of innovation.
While such an observation carries credibility - endorsed by analyst sentiment and customer case studies - the reality is often quite different. Despite best intentions, CIOs remain grounded by legacy technology, hampered by tightly-controlled budgets and blocked by a resistance to change at boardroom-level.
Add in current concerns related to Covid-19 - and the subsequent lockdown of large parts of the country - and customer ambitions are expected to be impacted further as priorities shift from innovation to resilience.
Yet despite such challenging market times, the Philippines is expected to stay the course and once the Covid-19 dust settles, continue to embrace new ways of doing business, leveraging technology to change behaviours and drive transformation.
For IT services giant Tata Consultancy Services (TCS), plans are in place to help customers capitalise on such potential in 2020 and beyond.
“Our key priority this year is to partner with and enable local enterprises to adopt IT automation,” outlined Shiju Varghese, country head of Philippines at TCS. “More than half of the organisations in the Philippines are expected to upgrade to some form of IT automation this year, with a focus on cloud.
“The majority of the IT spend will go to upgrading legacy IT infrastructure. We will continue to focus on IT-enabled solutions, consulting services, cyber security solutions and cloud services for our priority industries - banking and financial services, retail, telecommunications and manufacturing.”
In a wide-ranging interview with Channel Asia, Varghese said TCS priorities align with evolving market trends in the Philippines, driven by customer efforts to modernise infrastructure to realise digital transformation ambitions.
“Most companies are increasing budgets to upgrade outdated IT infrastructure and we see them migrating to cloud services and utilising cyber security solutions,” Varghese reaffirmed.
Acknowledged as a key challenge for Filipino businesses, Varghese said keeping legacy IT infrastructure running can expose organisations to increased risks, such as system downtime, security threats, increased cost and low productivity.
“Another key challenge is growing security concerns,” he added. “Concerns around data security are cited as the biggest barrier to adopting new digital technologies, however improved data security is the biggest benefit reported from cloud adoption.”
At an organisational level, Varghese also accepted that a “traditional corporate culture” can act as a large barrier to change, a process in which business blocks technological advancement.
“At times, acceptance and buy-in from the executive level could pose an obstacle as well,” he said.
In response, Varghese advised leadership figures to adopt the four behaviours of Business 4.0, a framework designed by TCS to help businesses capitalise on the promise of the Fourth Industrial Revolution. Specifically, the four behaviours span driving mass personalisation by being intelligent; creating exponential value by being automated; leveraging ecosystems by being agile and embracing risk through the cloud.
“These behaviours go beyond technology, categorising the fundamental mindset shift TCS believes business leaders need to make to transform and thrive,” Varghese explained.
“Companies who exhibit these behaviours have strong technology adoption and are more likely to have developed capabilities in automation, artificial intelligence, the Internet of Things and blockchain, for example.
“We guide organisations to shift mindsets and adopt these attributes and provide technologies such as robotic process automation (RPA), chatbots, speech and text analytics as well as intelligent analytics and cloud solutions using an agile method.”
According to IDC, at least 30 per cent of Filipino businesses will achieve "digital determination" by 2020, backed by the ability to “visualise" how the markets and customers will change. This is while "reinventing themselves" to better respond to the needs of future stakeholders through new and emerging technologies, capabilities and business models.
“To be digitally determined, Philippine organisations require more than just resilience; they need a 'blueprint' that consists of a unified enterprise strategy, a long investment plan based on the principle that digital is inherently valuable to the business, and a single digital platform to scale technology innovations,” assessed Sudev Bangah, managing director of ASEAN at IDC.
“But aside from these technical aspects, digital determination involves having the will to make the required organisational and cultural changes to better adapt in today’s digital transformation age.”
As outlined by Varghese, TCS recently shaped the digital transformation roadmap of a local telecommunications provider, alongside streamlining critical business processes.
The end result was 100 per cent business continuity and system availability, a 50 per cent reduction in manual processes and a 25 per cent faster period-end management reporting. This is in addition to a 20 per cent improvement in monitoring and reporting due to effective capex and opex control.
“We also created an IT strategy roadmap and information system plan for a utilities company to support progress and enable the organisation to align operations with global best practices in the utility industry,” Varghese added.
The project, which was recognised by CIO100, also resulted in improved operational reliability and significant enhancements in customer service, business process and operational efficiency.
Likewise, TCS recently migrated the finance operations of real estate organisation Ayala Land to SAP S/4HANA, in a first of its kind implementation in the Philippines.
Headquartered in Makati - the financial centre of the Philippines - Ayala Land goes to market as a large sustainable estates developer through a mix of properties such as residential, retail, office, hotels and leisure developments.
Listed on the Philippines Stock Exchange, the business was seeking to deploy a “quick and responsive” finance platform capable of catering to a larger user base across all subsidiaries, in addition to supporting future growth ambitions.
As a result, Ayala Land partnered with TCS to “simplify business operations and accelerate its cloud-led digital transformation journey”.
“This business transformation initiative laid a strong foundation to bring the company’s subsidiaries onto a common platform for integrated business operations,” Varghese said. “The company accelerated financial closures with 80 per cent faster processing time and has improved visibility of cash positions to run its business operations far more effectively.
“We also helped one of the largest banks in the Philippines to define a clear enterprise architecture view of its IT landscape, for end-to-end visibility of IT components. This enabled them to roll out new offerings, increase market share and improve customer centricity, in line with the bank’s growth strategy and thereby, keeping them ahead of competitors.”
By 2020, and according to IDC, 40 per cent of Filipino CIOs are expected to initiate a digital trust framework that goes beyond preventing cyber attacks and enables organisations to "resiliently rebound" from adverse situations, events and effects.
“Cyber security is the main focus of the banking and financial services industry,” assessed Varghese, while referencing that more than 60 per cent of Filipinos do not currently have bank accounts. “Combined with the rise of online shopping, e-wallet operators are focusing on e-commerce and cyber security solutions.”
Furthermore, the Department of Information and Communications Technology (DICT) recently allocated PHP5.2 billion in 2020 to support its efforts in rolling out interconnectivity and data security programs.
“With the government planning on installing free Wi-Fi in public places and fund free Wi-Fi in state colleges and universities, telecommunication companies are relying on cloud to improve business processes to be able to meet demands of the industry,” Varghese added.
Leveraging more than 11 years experience in the local market, the Philippines office represents TCS’ fastest growing market outside India, growing at over 40 per cent annually during the past five years.
Housing more than 4800 employees, TCS operates across three offices in Bonifacio Global City, Metro Manila and Angeles in Pampanga, an economic hub three hours north of Metro Manila.
For Varghese, this has allowed TCS to enhance delivery capabilities to customers across Asia Pacific and the rest of the world with the Philippines currently servicing a blend of local and global clients.
“2019 was a year that witnessed strong business growth, the addition of a talented workforce and an active engagement in the community we serve,” Varghese recalled. “The dynamics in the technology industry are changing and our projects have increased significantly as we respond to demands for digital transformation.
"It is encouraging to see more customers resonating with our Business 4.0 framework. The strongest attribute of a successful technology provider is the ability to see beyond technology and identify the fundamental mindset that business leaders should develop to transform and thrive in this day and age."