22% of companies in Korea have not started digital innovation
'Cyber Security' Dominates Digital Transformation Investment

On January 31, Dell Technologies released the 'Digital Transformation Index' report, which surveyed the status of digital innovation among companies worldwide.
This report contains a comparative analysis of the overall status of digital innovation and key issues among companies worldwide.

According to the report, the proportion of domestic companies that responded they have not yet started digital innovation was higher than the global average, and confidence in the future was found to be significantly low.

The Digital Transformation Index survey was conducted by Dell Technologies in collaboration with Intel, targeting over 4,600 corporate C-level leaders in 42 countries worldwide. Leaders of large and medium-sized enterprises from a total of 12 diverse industry sectors, including manufacturing, telecommunications, finance, and healthcare, were included in the survey.

Dell Technologies first released the results of a survey of 100 domestic companies last October and compared the past and present status with a report published under the same title in 2016.


Global Digital Innovation is Moving Forward, Though Slow
As a result of classifying the degree of digital innovation of the surveyed companies into five levels, it was found that companies around the world have taken a step further toward digital transformation compared to 2016.

Digital leader companies that have completed digital innovation (Group 1) accounted for 5% of the total, the same as in the previous survey, but Group 2, which is achieving a relatively high level of digital innovation, increased from 14% to 23%.

Group 3, which is in the process of gradual digital transformation and is in the stage of planning and investing for the future, and Group 4, which has started a low level of digital transformation, accounted for 33% and 30% respectively, decreasing by 1% and 2% with no significant difference from the previous survey.
The survey found that the 5th group, which had no plans for digital innovation, decreased significantly from 15% to 9%, indicating that many companies have jumped into digital transformation.

In the domestic case, Digital Leader Group 1 and the following Group 2 accounted for 4% and 22% of the total, respectively, and GloThere was no significant difference from the bee average. Groups 3 and 4 tied at 28%, which is slightly lower than the global average.

A notable difference was observed in the five groups that had not even started digital transformation. The domestic five groups stood at 22%, which was significantly higher than the global average of 9%.

This trend was also reflected in the sense of crisis among domestic corporate leaders.

91% of domestic companies responded that their company would "struggle to meet changing consumer demands within the next five years," a significantly higher response rate compared to the global average of 51%.
When asked about the outlook for the next five years, 85% of domestic respondents answered that "we will have to prove the value of the company anew within the next five years," which was significantly higher than the global average of 49%.

Only 9% of domestic respondents expected their companies to 'lead rather than be dragged along by transformation.' This figure is significantly lower than the global average of 46%.

Meanwhile, when global respondents were divided into 12 industry groups, the industries with relatively high levels of digital innovation in self-assessments were found to be telecommunications, IT, and financial services, in that order. On the other hand, the public healthcare sector ranked at the lowest level, and the manufacturing and insurance industries also had a high proportion of low scores.

When classified by country, business leaders in emerging markets tended to rate their companies' levels of digital innovation higher than those in developed countries. Among 42 countries, India, Brazil, and Thailand rated their digital innovation maturity the highest, followed by Mexico and Colombia.

Korea ranked in the lower tier, tied with Singapore for 37th place. Japan was rated the lowest for digital innovation, followed by Denmark, France, and Belgium in the bottom tier.


Digital Innovation Obstacles Perceived by Companies Worldwide
When asked about the biggest obstacle to digital innovation, companies worldwide cited 'personal data protection and cybersecurity (34%)' as the top priority. This item ranked 5th in the previous survey, but its ranking has risen sharply over the past two years.
'Lack of budget and resources (33%)' ranked second by a narrow margin, followed by 'lack of adequate personnel and expertise (27%)', 'frequent changes in laws and regulations (25%)', and 'immature digital collaboration culture (24%)'.

On the other hand, domestic respondents cited 'lack of budget and resources (41%)' as the top reason, and similar to global trends, 'personal information protection and cyber security' (31%), 'lack of adequate personnel and expertise' (31%), 'immature digital collaboration culture' (28%), and 'frequent changes in laws and regulations' (25%) ranked highly.

Regarding global companies' efforts for digital transformation, the most frequent response was "using digital technology to accelerate the development of new products and services," selected by more than half of all respondents (51%).

Following this, 49% of respondents answered that they "establish a security and information protection environment across all devices, applications, and algorithms," and 46% answered that they "invest in enhancing employees' digital capabilities, such as coding education." In particular, investment in digital capabilities increased significantly compared to 27% in the survey conducted two years ago. The overall rankings were also relatively similar in the domestic market.

Domestic companies responded in the following order: 'establish a security and information protection environment across all devices, applications, and algorithms (44%)', 'use digital technology to accelerate the development of new products and services (41%)', and 'invest in enhancing employees' digital capabilities, such as coding education (40%)'.


If you invest in digital transformation? 'Cyber Security' is dominant
When asked about investment plans within the next three years, cybersecurity was cited as the top priority, regardless of whether the companies were domestic or international. Following that, companies worldwide responded that they would invest in IoT, building multi-cloud environments, and AI.

In contrast, it was found that in Korea, following cybersecurity, many companies are investing in AI, multi-cloud environment building, IoT, and VR/AR.