IDC’s new research titled ‘How Digital Transformation (DX) is Reshaping the IT Services Market in Malaysia’ indicates that Digital Transformation (DX) will experience positive growth in Malaysia, driven by the growing demand for organizations to create new revenue streams, reduce expenses, improve customer experience and stay ahead of competition. The research reveals that 34% of the organizations in Malaysia are currently undergoing Digital Transformation projects.

“Nowadays, enterprises in Malaysia are under great pressure to serve their increasingly demanding and digitally savvy customers. This in turn prompts them to relook at their DX strategy and make quick decisions in transforming their business processes to achieve business goals,” states Sreenath Kandarpah, IT Services Research Manager, IDC Asia Pacific.

As enterprises in Malaysia are faced with fierce competition and price war to win customers, digital technologies should be used optimally as a leverage to deliver superior customer service experience and create competitive advantage through product differentiation. However, enterprises in Malaysia are only at the early stage of DX adoption due to the lack of clear understanding. Therefore, a high percentage of organizations are still not prepared for the DX transition with most deciding to wait and watch.

According to a recent IDC survey, organizations in Malaysia are lacking the required internal IT skills and are increasingly interested in engaging with external service providers to build DX strategy and integrate DX solutions with their existing architecture. This indicates a growing opportunity for service providers to provide consulting and integration services in relation to DX.

IDC expects organization’s spending on DX solutions which encompasses Cloud, Mobility, IoT, Big Data and Analytics will grow by an average of 13% per year through 2020. Therefore, service providers need to take the lead role and drive industry specific DX solutions.

Apart from the lack of expertise in driving DX strategies in Malaysia, enterprises are facing challenges in building business cases and measuring return on investment (ROI) while leveraging digital solutions. This clearly indicates growth opportunities for service providers in creating awareness, building use cases, and delivering value to these enterprises.

This IDC Survey report summarizes the key factors, impact, challenges and IT Services trends driving Digital Transformations in Malaysia. In addition, clear guidance is provided to end users and service providers based on market trends.