As the Philippines embraces digital, how can CIOs respond?

As the Philippines adjusts to the ever-changing challenges of Covid-19 – evident through a renewed rise in stay-at-home orders – the nation is embracing digital at speed and scale.

Since lockdown in mid-March, the population has turned to technology en masse to overcome social and economic disruptions, emphasised through a sharp spike in digital payments, transactions and engagements.

Such a shift in mindset places the CIO at the centre of national change, as businesses reassess technology priorities, operational processes and business model frameworks.

“While digital transformation has always been on the agenda of the Filipino government and businesses, the pandemic has greatly accelerated the pace of this transformation,” observed Walter So, country manager of Philippines at VMware.

VMware

With the Filipino economy predicted to reach $28 billion GDP by 2025, forward-thinking CIOs are pressing ahead with plans to enhance digital transformation efforts in a move designed to strengthen resilience, accelerate innovation and reposition for future growth.

“Across verticals – ranging from education to healthcare – we have seen organisations of varying sizes adopt a digital-first agenda to support a sudden remote workforce during the past year,” added So, when addressing Filipino technology executives during CIO Executive Forum.

“Organisations that have made this transformation are well placed to support the remote workforce. Strengthened digital capabilities will also enable them with the speed, agility and scalability needed to adapt and thrive in the post pandemic environment.”

Despite the ongoing challenges of Covid-19 – both economically and socially – overall technology spending across the country has remained unchanged during the past 12-18 months.

According to Global Data findings, the majority of CIOs continue to allocate similar investment levels across different technology segments at pre- and post-pandemic stages. Specifically, the enterprise increased budget for digital transformation initiatives from 44 percent to 50 percent in 2020, emphasising a sizeable shift in business behaviour.

“But legacy infrastructure and the successful inculcation of a digital-first mindset remain key challenges for many local CIOs embarking on digitalisation,” So cautioned.

Since the start of the pandemic – and subsequent government lockdowns – Filipino CIOs have prioritised upgrading and updating organisational limitations within the context of technology, supported by a legacy refresh strategy to ensure continuity.

“After successfully stabilising business operations, CIOs must now catalyse a fundamental mindset shift within the organisation,” So advised. “The role of the CIO will become critical as technology leaders take a step back, rethink and embrace next-generation solutions to strengthen digital foundations and develop a holistic digital strategy.

“The key to achieving this is the ability to foster a culture of innovation that empowers the workforce with the right mindset and tools to rethink how they can continue to drive better digital experiences for employees and customers.”

Digital innovation in action

Since launching to the market almost 40 years ago, Union Bank of the Philippines has continually embraced an innovative mindset to empower entrepreneurs with technology-based products.

Fast forward to 2021 and the Pasig-based business is leading the way in driving digital banking adoption, aligned to the belief of president and CEO Edwin Bautista that “no one gets left behind”.

“Our journey towards sustainability was revitalised with our chairman’s key mandate – for the bank to become a technology company,” recalled Dennis Omila, CIO of Union Bank of the Philippines. “Since then, UnionBank has been at the forefront of digital transformation.”

As outlined by Omila – recently ranked no.7 in the CIO50 ASEAN 2020 – UnionBank’s digital transformation strategy is anchored around the three core pillars of technology, process and people.

“By fortifying these, we are able to deliver digital assets that provide a delightful customer experience,” Omila added. “We continue to trailblaze digital banking in the Philippines with the goal to power the future of banking for Filipinos.”

With such “radical transformation” starting more than four years ago, UnionBank views people development as a way of future-proofing the organisation in the months and years ahead.

“This creates opportunities for UnionBankers to thrive on collaboration and diversity by building a culture of innovation and committing to enhancing employee experience,” Omila said. “We surpassed the challenge of ‘digitise or perish’ and have decided to go agile to drive innovation everywhere to future-proof employees and compete in an environment of increasing complexity and disruption.”

Meanwhile at Philippine Airlines – operating in a sector severely impacted by Covid-19 – the pandemic has offered a silver lining through highlighting the need to accelerate on-going automation and digital transformation initiatives.

“Our drive for enhanced collaboration and efficiency was accelerated by most employees working from home,” acknowledged Wilson Go, CIO of Philippine Airlines. “We continued to operate and collaborate with automation also becoming more relevant as we became less reliant on paper.”

In addition, Go cited agile development and deployment as significant contributors in addressing ongoing business challenges created by the pandemic. This was exemplified by the One Stop Shop (OSS) approach created in collaboration with private sector partners and the Filipino government to improve passenger experience levels during testing upon arrival from overseas.

“Aside from making the process more orderly and efficient, test results were returned within 24-48 hours versus 96 hours or more prior to the OSS,” Go added. “This translates to significant expense savings and helped put our Kababayan back into the arms of their family sooner.”

Alongside enhancements from a testing perspective, Go and his department have also maximised the opportunity to update, upgrade, enhance and replace existing tools and applications.

“We intend to come out of this situation a stronger, better and more customer centric airline,” he stated.

Driving digital best practice

In looking ahead, So of VMware outlined six best practices for Filipino organisations to prioritise when driving digitalisation in 2021 and beyond, kick-started by a “lead with IT” philosophy.

“2021 will be a watershed year for organisations to achieve breakthrough innovations with new IT delivery models,” he advised. “The goal is to increase the speed of the organisation while fuelling business results without jeopardising future flexibility or resiliency.

“This is where cutting edge innovations come in to play to define the future business state, reshape long-term customer engagement models, expand the effectiveness of employees and even define marketplaces and industries.”

Secondly, a new approach to business continuity is required given current plans are generally developed for short-term disruptions with predictable outcomes and identifiable timelines.

“CIOs need a new approach to business continuity planning,” So explained. “One that can simulate multiple scenarios from a disruption perspective by capturing, integrating and analysing organisational data.”

Adapting to a permanent remote workforce environment also ranks as a leading action item for businesses, underpinned by strengthening governance policies, tools and practices to ensure applications, devices and networks are “secure by design”.

Fourthly, CIOs must continue driving strategic discussions towards building organisational resilience with the aim of measuring, monitoring and reporting on the business impact of IT. The aim? To build trust from leadership, stakeholders and employees.

“Adopt a people-first approach,” So added. “Filipino businesses must continue to focus on the mental health of employees with empathy, frequent communication and staff surveys. For IT staff, setting the right expectations for timelines on delivery and support will be crucial in the months ahead.”

Finally, So advocated the importance of businesses embracing the hybrid workforce in recognition that employees working in both the office and via remote teams will become the “new norm”.

“Filipino CIOs need to understand how this will shape the future and while cost reduction is a priority, decisions should be made according to overall business impacts,” he summarised.