A tech strategy now should focus on the business and the customer needs, culture focuses on risk learning and unlearning especially change management, organisational perspective focuses on governance, digital investment and others.
But how does Sri Lanka’s digital transformation journey look like?
These questions were discussed in detail at W.Media’s Digital Week South Asia panel discussion titled ‘Unbolting Sri Lanka’s Digital transformation opportunity’. Moderated by Rohan Mahalekam, Program Manager & Lead Agile Practitioner, Virtusa. The panellists included Eranga Perera, Head of IT, Jubilant Food Works Lanka Pvt. Ltd. Samila Fernando, Managing Director, Fastrupee Pvt Ltd and Zaheer Meeran, Head of IT, Habib Bank Limited – Sri Lanka.
In terms of capabilities Rohan Mahalekam pointed that it is important to focus on IT digital investment opportunities, data driven digital based decision making.
“Digital transformation is actually the adaptation of digital technology in order to transform the services and businesses by reducing human intervention. We live in a hyper connected ecosystem where a lot of data is being generated every minute. Since I’m from the retail background I had the opportunity to work with a number of data touch points in my previous work place and even here. In Jubilant foods we have Domino’s here in Sri Lanka, we use a number of data touch points from various systems. When it comes to sourcing the ingredients we use the customer ordering patterns and the data from the suppliers and everyone to do a forecast and the importation on time and the production on time.
We collect the data from the census to see the quality of where it is stored, when we are procuring items whether those are in proper condition. Even when we are transporting these products we use temperature sensors to see whether it is being transported properly”, said Eranga Perera.
He further added that there are various digital touch points and when it comes to customer experience. The main thing that they want to ensure is that the customer gets a proper product and the customer should be satisfied from their services and repeat purchases. He also pointed that they use data to also ensure that the quality of the product is the best.
While the pizza is being delivered the movement of the riders is also being monitored to check if the delivery is being made on time and if there are any mistakes they are worked upon and the services are improved further.
The customer experience on the digital platform matters a lot and latest technologies are being used. Cloud platforms are used to host the infrastructure mainly because sudden demands are experienced mainly in sales from time to time and in such times increasing the server capacities becomes important.
“Even in data centres we use a lot of touch points to measure the efficiencies and act upon the results. Additionally we also use data from our customer behavior for example how to browse through the menu what are the things that they look for and for how long do they look at a particular product, how fast is the decision making and others.
By looking at this data we target customers by segmenting on their behavior”, added Perera.
He further pointed out that one barrier that he sees in the digital transformation in Sri Lanka is the data cost for the consumer, in order to capture the data from time to time it is important that the customers are connected to digital platforms as much as they can. So high data cost is a barrier and if unlimited data packages are introduced then the bandwidths are low.
Digital transformation in Fintech
“Since I’m a traditional banker we never understand and realise what results the digital area can give than having a traditional manual process. For example, compared to 2020 and 2021 our internet user’s growth has exceeded 10.9 million. So imagine out of 21 million of our population they have 11 million users who use the internet.
This is a good opportunity for us to go digital as soon as possible. Further, the social media users from 2020 to 2021 we have 5.1 million additional social media users who use social media for their day to day activities. So that’s something which I have learned before I worked from my new project of a cash wagon, the information and digital data is very important to move our banking sector, let’s say fintech sector to have the opportunities of digital transformation which can be created soon if the data is used properly.
Giving another example, we have introduced this new concept called digital finance, we call it online lending. In Sri Lanka we have 35 percent unbanked population and almost 50 percent under bank population, which means sometimes people can’t use banks because they cannot prove their income, they don’t have any income or sometimes they get daily wages, these people are under banked. Unbanked is when there are issues with the previous records”, said Dr. Samila Fernando.
He further added that currently, there are 60 percent of people who cannot take loans from the banks or a finance company due to various processes in the system and this is something which needs to be thought about seriously.
“We launched digital finance called online lending which was introduced five years back and has changed the entire consumer finance sector as the customer does not need to go to a bank they can apply for loan via an online application which captures data, we capture customer’s movement and create a scoring system. The customer does not need a passport copy or security or guarantees information. It’s based on the data that you are entering and how we use the data and capture it in our model and give the result”, added Fernando.
He further pointed out that in Sri Lankan banking sector for a person to take a loan or a credit card facility it takes about one or two weeks maximum. But in their company the time for disbursement is half an hour for the first loan. This is how the data and the digital change is leading the industry. For a repeat loan one can enter the NIC and mobile number and take a repeat loan within five seconds. This is how digital and data driven finance unbolt their traditional finance sector to the next level.
It is important for the banking and finance sector to understand how they can go to the next level by introducing digital facilities.
Challenges in Digital Transformation
The challenges can be divided into several categories. The culture and the management, the people working in the organisations are not willing to take challenges they are adapted to the traditional environment. There is a fear that if they opt for a digital transformation then they might lose their jobs.
People are also expecting that this should come from a CEO or a board level, but it is important that everyone has their individual leadership skill to handle the process of digital transformation. But currently the people don’t have the required skills to handle the challenges. IT always puts in the effort in terms of the technical aspect, the experience of the customer and the expectations of the customer, these are not studied properly which leads to a poor customer experience.
“Not every customer is tech friendly as a result of which they might not like to interact with the AI environment, they are more willing to interact face to face. In terms of the investment, we are investing a lot in the digital transformation but what will be the ROI, if we are launching a 4 or 5 billion project the question here is will it give us the required returns, it depends on the customer and the efforts of the organisation working towards this implementation”, said Zaheer Meeran.
He further pointed that today we are moving towards an Office 365 environment. In Sri Lanka it is not possible to have a full-fledged cloud environment because it is important to have a backup set up. It will take a few years for Sri Lanka to reach that level.
It is a challenge from the regulatory perspective as they require arrangement for the backup if you move your environment to the cloud based application and it is clarified that Sri Lanka is currently not up to that benchmark. Then the regulatory gives feedback for the organisation to decide which application is critical and which is not and then decide about shifting to cloud. These are some of the challenges that are faced while going for a digital transformation.