Businesses in the GCC stand to gain benefits from digitalization

A joint study conducted by Siemens and the Ideation Center at management consultancy Strategy&, part of the PwC network, has emphasized the benefits businesses in the GCC stand to gain from digitalization and outlined a roadmap of how they can undertake a fully holistic approach to embarking on digital transformation.



Senior executives from Siemens Middle East and Strategy& launched the `Preparing for the digital era: the state of digitalization in GCC businesses’ report at Dubai’s 3D-printed Office of the Future, highlighting key findings from the joint study intended to help encourage the progress and evolution of digitalization among the region’s businesses.

Of the 300 companies surveyed, 60 percent believe that digitalization has the potential to create new business models or lead to a more open culture of innovation. However, only 3 percent of organizations believe they are at an advanced stage of their digital transformation process, with only 18 percent using the cloud and 30 percent using big data and analytics specifically.

The study found GCC companies are lagging behind their government and consumer counterparts when it comes to using digital technologies.

Economic and social benefits

For example, GCC governments have acknowledged the economic and social benefits of digitalization, incorporating them into their ambitious strategies.

Saudi Arabia’s Vision 2030 and National Transformation Plan 2020, Smart Dubai, Qatar’s Connect 2020 ICT Policy, and Oman’s digital strategy e-Oman all stress the importance of the use of digital technologies.

GCC consumers are among the most tech-savvy in the world. Qatar the UAE and Bahrain have more than 100 percent smartphone penetration rates and young people across the region are playing an important role in influencing development of new technologies.


Digital archiving

“Governments and consumers in the GCC have been rapid adopters of digital technologies and our report tells us the benefits of digitalization are widely acknowledged by the majority of organizations,” said Dietmar Siersdorfer, CEO, Siemens Middle East and UAE.

He added: “However, many companies in the region have some catching up to do, and our research suggests there is still work to be done to encourage the understanding that digitalization is a transformation journey, requiring a holistic approach. Companies must develop a business strategy for the digital age, and finding the right partners is essential.”

The GCC region is taking great strides towards economic diversification and digitalization is a key driver of globally competitive businesses, industry and infrastructure. The GCC is in a position to fully embrace the disruptive potential of digitalization across all sectors, he said.


Though GCC company executives show great enthusiasm for going digital, many are still coming to grips with its full meaning and potential. In general, executives have a narrow view of digitalization which often ignore the far-reaching benefits that moving towards digital can bring, such as problem solving, reinventing business models, reimagining the customer experience, inspiring trust and accelerating change.

The fact that many organizations have a partial understanding restrains the uptake of digital technology and obstructs the formulation of effective strategies.

Samer Bohsali, partner with Strategy& in Dubai, said: “Executives in the GCC are excited by digital. They recognize its benefits, such as stronger customer orientation and increased efficiency, which is vital in an era of budget constraints. Many companies, however, perceive the process of going digital as the adoption of a specific technology, rather than a transformation journey.”

While many organizations are gradually building technology capabilities, some lack the vision and the necessary leadership to drive their digital transformation. Taking practical steps forward can often be beset by internal obstacles, be they cultural, organizational, people-related or financial.

Investment allocation

For example, 40 percent of companies in the region have allocated less than 5 percent of their total investments to digitalization activities. Only 37 percent of companies have a strategy for going digital and less than 1 percent of companies have a chief digital officer.

There is also work to be done on the infrastructure and regulation front, as well as tackling skill deficiencies in areas such as data analytics and human-centered design, which are vital for the development of the region’s digital ecosystem.



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