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FINAL REPORT
SUBJECT: DIGITAL TRANSFORMATION
Group’s name: Group 4
Lecturer: Dr. Vo Phuoc Tai
Year: 2023 - 2024
Class:BUS1128E.B06E
Ho Chi Minh City, 2023
FINAL REPORT
SUBJECT: DIGITAL TRANSFORMATION
Class:BUS1128E.B06E
Group’s name: Group 4
Date of submit: 8/1/2024
Group’s members:
Full name Assigned tasks Contribution (%)
Đồng Quốc Hưng Abstract + Chapter 1 100%
Ngô Phúc Vĩnh Huy Chapter 2 100%
Nguyễn Bảo Thiên Anh Chapter 3 100%
Nguyễn Trần Trúc Loan Chapter 4 100%
Châu Diệu Quân Chapter 4 100%
Hà Ý Đình Chapter 5 100%
ABSTRACT
I n today's modern world, digital transformation is an indispensable part of
every country and every business existing on this Earth. According to Microsoft,
digital transformation is a business innovation driven by the explosion of cloud,
artificial intelligence (AI) and Internet of Things (IoT), providing new ways to
understand, manage and transform for their business activities. Digital transformation
is also understood as applying advances in digital technology such as cloud
computing, big data, etc. to all activities of organisations and businesses to bring
efficiency. High productivity, promoting revenue and brand development.Digital
transformation is not simply changing the way of doing work from traditional manual
work (taking notes in books, in-person meetings, etc.) to applying technology to
reduce human effort. In fact, digital transformation plays a role in changing business
thinking, operating methods, organisational culture,... There are many reasons leading
to digital transformation, as well as the technology and tools applied by many
businesses in their own change process. Digital transformation is an inevitable part of
the country in general and businesses in particular. It brings many benefits in terms of
customer experience, business strategy, etc. However, besides those benefits, digital
transformation also brings many disadvantages, such as dependence on technology,
security risks. network security,.. In addition to understanding the benefits and
disadvantages of digital transformation, businesses need to find appropriate solutions
to improve systems, build more reasonable business strategies, and improve customer
experience. ,.. to bring profit to the business itself.
HAPTER 1. OVERVIEW OF DIGITAL TRANSFORMATION. CONTEXT
C
OF DIGITAL TRANSFORMATION AND THE REASONS WHY LEADS TO
DIGITAL TRANSFORMATION IN BUSINESSES
1. Overview of Digital Transformation
Digitaltransformationistheintegrationofdigitaltechnologiesintoallareasof
a business, leveraging technologies to fundamentally change operations, business
models and deliver new values. for customers of that business as well as speed up
businessactivities.Digitaltransformationisalsoachangeinthecultureofbusinesses,
requiring businesses to constantly change, test new things and comfortably accept
failures. In Vietnam, the concept of "Digital Transformation" is often understood as
the process of changing from a traditional business model to a digital business by
applying new technology such as Big Data, Internet for of things (IoT), cloud
computing (Cloud) ... to change operating methods, leadership, work processes,and
company culture.
Notonlydoesitplayanimportantroleinbusinesses,butdigitaltransformation
alsoplaysanimportantroleinotherareasofsocietysuchasgovernment,massmedia,
medicine, science…Reports from major market research companiessuchasGartner,
IDC...allshowthatdigitaltransformationreallybringsmanybenefitstoallaspectsof
business operations: from management to research. , business… The most
recognizable benefits of digital transformation for businesses are cutting operating
costs,reachingmorecustomersforalongerperiodoftime,andleadersmakingfaster
and more accurate decisions thanks to the system. Timely and smooth reporting
system,optimisingemployeeproductivity...Thesehelpincreaseoperationalefficiency
and enhance the competitiveness of organisations and businesses.Digital
transformation also contributes to increasing labour productivity. Microsoft research
showsthatin2017,theimpactofdigitaltransformationonlabourproductivitygrowth
was about 15%, by 2020, this number will be 21%.
In general, according to market analysis and research experts, the 5 ultimate
goals that digital transformation businesses aim for include: Increasing speed to
market; Strengthen competitive position in the market; Promote revenue growth;
Increase employee productivity; Expand your ability to attract and retain customers
2. Context of digital transformation
Today, the rapid development of new digital technologies has been affecting all
aspects of human society. Using new technology, each individual can more easily
build a daily schedule for work, entertainment, living, etc., access products at more
reasonable prices, and participate in social networks. new, better educational
opportunities and fewer manual labour jobs as job trends have changed.
For companies and organisations, new technologies mean creating more
efficient machines, better products and even new, more optimised business models
that lead to increased revenue. , enhancing competitiveness, ultimately creating a
foundation for improving labour productivity.
or a country in general, digital transformation creates more new jobs, more
F
efficient use of resources, increased exports and improvements in the fields of health
care and transportation.
The impacts on individuals, businesses, organisations,... and society in general
create influence and promote each other's development, for example, people will
choose digital technologies more often, increasing their productivity. By increasing
individuals' digital skills, companies will have access to a better-skilled workforce. If
companies and organisations soon improve competitiveness, create new jobs as well
as secure existing jobs, it will bring benefits to individuals and the country in general.
Digital Transformation creates huge potential for commerce, industry and
society in general, it is supported by a series of new interconnected technologies
processed by computers (including the ability to process large amounts of data (Big
Data) and use sensors, robotics, 3D printing and artificial intelligence across
industries. These technologies have made certain jobs easier, perform tasks that were
previously impossible, and design better services and products.
3. The reason why lead to digital transformation in business
Digital transformation in businesses is the process of changing thinking and
applying technology and digital to improve the efficiency of production and business
activities, increase revenue and enhance the competitiveness of businesses. Including
the use of software, applications, information systems, artificial intelligence (AI),
Internet of Things (IoT), cloud computing,... to collect, analyse data, automatically
Automate business and management processes.
What led to digital transformation? There are many reasons why businesses are
required to conduct digital transformation as soon as possible. That is:
- Competitive pressure:Threats from new entrants, and existing
competitor forces. Companies and corporations transform their
operations to stay competitive.
- Environmental and Sustainability considerations:Digital
transformation enables remote work and collaboration, reducing the
need for extensive travel and its associated environmental footprint.
- Working efficiency:Services and catering are currently one of the
leading growing industries with a large customer base.
- Cost efficiency:Digital transformation can enable organisations
streamline processes, reduce costs, and improve productivity through
digital transformation.
- Changes in general needs:Change in transportation. For instance we
used to walk barefoot, then use horses and carriage, then use engine
vehicles.
- Enhance internal connectivity: Digital transformation supports
connecting all employees in different departments, helping employees
interact and exchange work with each other more.
xample of business digital transformation: The famous pizza chain Domino's
E
began operating in the 1960s and has made a strong shift when implementing digital
transformation. In 2021, according to Marketing Week, 91% of Domino's sales came
through digital channels. In 2021, when traditional business operations seemed to go
bankrupt, the CEO at that time tasked the technology team with helping customers
with smartphones easily order pizza in 17 seconds. From there, the Domino's app was
born, making deliveries even easier because of its e-bike and automated delivery
services, which brought in $4.36 billion in revenue in 2021 for this business.
The importance of digital transformation in businesses:
- Performance and efficiency increase:Deploying technologies
contributes to reducing errors and speeding up the process of bringing
products to market. Meanwhile, business processes are improved thanks
to digital technology, thereby helping to increase productivity and
business efficiency.
- Maintain business competitiveness:Digital transformation in the 4.0
revolution has become a matter of survival for most businesses. Now it
is no longer a choice, but a sooner or later thing to stay competitive.
- Enhance customer experience:Today's customers have many changes
in their expectations and purchasing trends, they demand personalization
and this requires digital transformation. Personalization helps improve
customer experience, making customers feel special to the business.
CHAPTER 2. TECHNOLOGIES DRIVE TO DIGITAL TRANSFORMATION.
- Machine learning:is a technology that evolved from artificial
intelligence that involves the use of algorithms and statistical models to
enable computers to learn and improve their performance on a specific
task. ML can be integrated into systems to predict trends, optimise
production processes, and personalise user experiences.
- Robotic Process Automation: is a form of business process automation
that is based on software robots or artificial intelligence agents. It is
sometimes referred to as software robotics. RPA is used to automate
tasks such as data entry, invoice processing, and data verification.
- Decision Support System:an information system that supports
business or organisational decision-making activities. DSS can be used
in healthcare for diagnosis and treatment planning based on clinical
data.
- Executive Information System:also known as an executive support
system, is a type of management support system that facilitates and
supports senior executive information and decision-making needs. It
provides easy access to internal and external information relevant to
rganisational goals. EIS can help CEOs make strategic decisions based
o
on business data and market trends.
- Automated Management System:is an intelligent program that tracks,
analyses and alerts the users automatically and acts as a one-stop-shop
for all of their after sales services and support needs. Companies can use
AMS to automate inventory tracking, ordering, and project
management.
- Automated Decision System:is the process of making a decision by
automated means without any human involvement. These decisions can
be based on factual data, as well as on digitally created profiles or
inferred data. Banks use ADS to make decisions on loan approval based
on credit data and customers' financial history.
CHAPTER 3. ANALYSIS OF DIGITAL TRANSFORMATION TOOLS (BIG
DATA, AI, IOT, ELASTIC CLOUD...)
1. Elastic Cloud
Elastic Cloud, often associated with Elastic Cloud Enterprise (ECE) or the
Elastic Stack, refers to a cloud-based service offered by Elastic that provides a
scalable and managed environment for deploying and running Elastic products such as
Elasticsearch, Kibana, Logstash, and others. The Elastic Stack is widely used for
various purposes, including search, logging, analytics, and monitoring.
Usage:
Search and Analytics: Elastic Cloud is commonly used for powerful search
capabilities and analytics. Elasticsearch, a key component, is a distributed search and
analytics engine that allows users to explore and analyse large volumes of data in
real-time.
- Log and Event Data Processing: Organisations use Elastic Cloud to centralise,
analyse, and visualise log and event data. Logstash, another component of the
Elastic Stack, facilitates the collection, processing, and enrichment of log data.
- Monitoring and Observability: Elastic Cloud is employed for monitoring
applications and infrastructure. Metrics and logs can be collected and
visualised in real-time to gain insights into system performance, errors, and
user behaviour.
- Security Information and Event Management (SIEM): Elastic Stack, when
deployed on Elastic Cloud, is utilised for SIEM purposes, helping organisations
detect and respond to security threats by analysing and correlating
security-related data.
Advantages:
- Scalability: Elastic Cloud provides scalable infrastructure, allowing users to
easily scale their resources up or down based on demand. This ensures optimal
performance and cost efficiency.
- M anaged Service: Elastic Cloud is a fully managed service, meaning that
Elastic takes care of infrastructure management, maintenance, and updates.
This allows organisations to focus on using the Elastic Stack for their specific
use cases rather than managing the underlying infrastructure.
- Ease of Deployment:The cloud-based nature of Elastic Cloud simplifies
deployment. Users can set up Elastic Stack components without dealing with
the complexities of infrastructure provisioning and configuration.
- Flexibility:Elastic Cloud supports various deployment scenarios, including
multi-cloud and hybrid cloud setups, providing flexibility for organisations
with diverse infrastructure requirements.
Disadvantages:
- Cost:While the managed service aspect can be advantageous, it also comes
with associated costs. Organisations need to consider pricing models and
ensure that the benefits outweigh the expenses.
- Dependency on Internet Connection:Elastic Cloud relies on an internet
connection, which might be a disadvantage for organisations with strict security
or compliance requirements that limit internet access.
- Limited Customization:The managed nature of Elastic Cloud may limit the
level of customization compared to self-hosted deployments. Organisations
requiring highly customised configurations may find some constraints.
- Data Security Concerns:Organisations dealing with sensitive data may have
concerns about data security in a cloud environment. It's crucial to understand
and address security measures provided by Elastic Cloud.
2. Big Data
Big data refers to extremely large and complex sets of data that traditional data
processing applications are inadequate to handle efficiently. This type of data is
characterised by the three Vs: Volume (large amounts of data), Velocity (high speed at
which data is generated and processed), and Variety (diverse types of data, structured
and unstructured).
Usage:
- Business Intelligence and Analytics:Big data is used to extract valuable
insights from large datasets, helping organisations make data-driven decisions
and identify trends, patterns, and correlations.
- Healthcare:Big data is applied in healthcare formanaging patient records,
predicting disease outbreaks, personalised medicine, and analysing treatment
outcomes.
- Finance:Financial institutions use big data for fraud detection, risk
management, algorithmic trading, and customer analytics.
- E -commerce:Big data analytics is used to analyse customer behaviour,
optimise pricing, improve supply chain management, and enhance the overall
customer experience.
- Social Media: Platforms use big data to analyse user interactions, personalised
content recommendations, target advertising, and gain insights into user
preferences.
- Manufacturing:Big data helps optimise production processes, monitor
equipment health, and enhance supply chain efficiency through predictive
maintenance and quality control.
Advantages:
- Informed Decision-Making: Big data analytics enables organisations to make
more informed and strategic decisions based on insights drawn from a
comprehensive analysis of data.
- Improved Efficiency: Organisations can optimise processes,streamline
operations, and improve overall efficiency by leveraging big data to identify
areas for improvement.
- Innovation:Big data facilitates innovation by uncoveringnew opportunities,
predicting trends, and supporting research and development efforts.
- Competitive Advantage:Companies that effectively harness big data can gain
a competitive edge by understanding customer needs, market trends, and
adapting quickly to changes in the business environment.
- Personalization:Big data allows for personalised experiences, whether in
marketing, customer service, or product recommendations, leading to improved
customer satisfaction.
Disadvantages:
- Privacy Concerns:As big data often involves the collectionand analysis of
massive amounts of personal information, privacy concerns can arise, leading
to ethical and legal challenges.
- Security Risks:Handling large volumes of data posessecurity risks, including
the potential for unauthorised access, data breaches, and cyber-attacks.
- Costs:Implementing big data solutions can be expensive, requiring
investments in infrastructure, technology, and skilled personnel. Small and
medium-sized enterprises may find it challenging to bear these costs.
- Complexity:Managing and analysing big data can becomplex, requiring
specialised skills and tools. Integration with existing systems may also pose
challenges.
- Data Quality:The quality of big data can vary, and organisations need to
address issues related to data accuracy, completeness, and consistency to ensure
reliable insights.
3. I nternet of Things (IoT)
The Internet of Things (IoT) refers to a network of interconnected physical
devices, vehicles, buildings, and other objects embedded with sensors, software, and
network connectivity. These devices can collect and exchange data, providing
opportunities for automation, monitoring, and data-driven decision-making.
Usage:
- Smart Home Devices:IoT is widely used in smart homes, where devices such
as thermostats, lights, security cameras, and appliances are interconnected for
remote monitoring and control.
- Industrial IoT (IIoT):In industrial settings, IoT is used for monitoring
equipment health, predictive maintenance, optimizing operations, and
improving overall efficiency.
- Healthcare:IoT devices, such as wearable fitness trackers and medical
monitoring devices, enable remote patient monitoring, medication adherence
tracking, and real-time health data collection.
- Smart Cities:IoT is employed in urban planning to enhance infrastructure,
manage traffic flow, monitor air quality, and improve public services.
- Agriculture:IoT is used in precision farming, where sensors monitor soil
conditions, weather patterns, and crop health, optimising irrigation and
resource usage.
- Retail:Retailers leverage IoT for inventory management, supply chain
optimization, and enhancing the in-store shopping experience through
connected devices.
Advantages:
- Efficiency and Automation:IoT enables automation of various processes,
leading to increased efficiency and reduced manual intervention.
- Data Collection and Insights:The vast amount of data generated by IoT
devices allows organisations to gain valuable insights, helping in better
decision-making and predictive analytics.
- Improved Quality of Life: In the context of smart homes and cities, IoT
contributes to a better quality of life by providing convenience, energy
efficiency, and improved services.
- Cost Savings:IoT can lead to cost savings in variousindustries through
predictive maintenance, optimised resource usage, and streamlined operations.
- Enhanced Safety and Security: IoT devices contribute to improved safety and
security through surveillance, monitoring, and alert systems in both industrial
and consumer contexts.
Disadvantages:
- Security Concerns:IoT devices can be vulnerable tosecurity breaches, and
their interconnected nature creates potential entry points for cyber-attacks.
- Privacy Issues:The vast amount of data collectedby IoT devices raises
concerns about user privacy, as personal information may be at risk of
unauthorised access or misuse.
- Interoperability Challenges:Compatibility issues between different IoT
devices and platforms can hinder seamless integration and communication.
- Complexity and Technical Challenges: Implementing and managing IoT
systems can be complex, requiring specialised skills. Technical challenges,
such as device configuration and maintenance, may arise.
- Scalability Issues:As the number of IoT devices increases, scalability
becomes a concern, particularly in terms of network bandwidth, data storage,
and overall system capacity.
4. Artificial Intelligence (AI)
Artificial Intelligence (AI) refers to the development of computer systems that
can perform tasks that typically require human intelligence. These tasks include
learning, reasoning, problem-solving, perception, natural language understanding, and
speech recognition. AI encompasses various subfields, including machine learning,
natural language processing, computer vision, and robotics.
Usage:
- Virtual Assistants:AI is used in virtual assistantslike Siri, Google Assistant,
and Alexa, which understand and respond to natural language commands,
perform tasks, and provide information.
- Machine Learning Applications:AI, especially machine learning, is
employed in applications such as recommendation systems (e.g., Netflix
recommendations), fraud detection, and predictive analytics.
- Autonomous Vehicles:AI plays a crucial role in thedevelopment of
autonomous vehicles, enabling them to perceive their surroundings, make
decisions, and navigate without human intervention.
- Healthcare:AI is used for medical image analysis,drug discovery,
personalised medicine, and predictive analytics to improve diagnosis and
treatment.
- Customer Service Chatbots:AI-powered chatbots are used in customer
service to provide instant responses to queries, handle routine tasks, and
enhance customer support.
- Gaming:AI is used in gaming for creating intelligentnon-player characters
(NPCs), adapting gameplay based on user behaviour, and enhancing the overall
gaming experience.
Advantages:
- Efficiency:AI systems can perform tasks faster and more accurately than
humans, leading to increased efficiency in various domains.
- Automation:AI enables the automation of repetitive and mundane tasks,
allowing humans to focus on more creative, complex, and strategic aspects of
their work.
- Data Analysis and Pattern Recognition:AI excels at analysing vast amounts
of data, identifying patterns, and extracting valuable insights for informed
decision-making.
- 24/7 Availability:AI systems, such as virtual assistants and chatbots, can
operate 24/7, providing round-the-clock availability for services and support.
- Innovation:AI fosters innovation by enabling thedevelopment of new
applications and solutions that were previously thought to be impractical or
impossible.
Disadvantages:
- Job Displacement:The automation of tasks by AI has the potential to displace
certain jobs, leading to concerns about unemployment and the need for
retraining the workforce.
- Bias and Fairness:AI systems can inherit biases present in the data they are
trained on, leading to biassed outcomes and discriminatory behaviour, which
poses ethical challenges.
- Lack of Creativity and Intuition: While AI excels at certain tasks, it currently
lacks the creativity, intuition, and nuanced understanding that humans possess
in complex and ambiguous situations.
- Security Concerns:AI systems can be vulnerable toattacks, and the use of AI
in cyber-attacks raises concerns about the security of systems and data.
- Ethical Concerns:The ethical implications of AI,including issues related to
privacy, accountability, and the responsible use of AI, raise important societal
questions that need careful consideration.
5. Blockchain
Blockchain is a decentralised and distributed ledger technology that enables
secure and transparent recording of transactions across a network of computers. It
consists of a chain of blocks, where each block contains a list of transactions, a
timestamp, and a reference to the previous block. Once a block is added to the chain,
it is difficult to alter, ensuring the integrity and immutability of the recorded
information.
sage:
U
- Cryptocurrencies:Blockchain is most well-known for its use in
cryptocurrencies like Bitcoin. It serves as the underlying technology that
enables secure and decentralised transactions without the need for
intermediaries like banks.
- Smart Contracts:Blockchain facilitates the creationand execution of smart
contracts, which are self-executing contracts with the terms of the agreement
directly written into code. Ethereum is a prominent blockchain platform
supporting smart contracts.
- Supply Chain Management:Blockchain is utilised for enhancing
transparency and traceability in supply chains, allowing stakeholders to track
the origin, shipment, and condition of products in real-time.
- Identity Management:Blockchain can be used for secureand decentralised
identity management, reducing the risk of identity theft and providing
individuals more control over their personal information.
- Voting Systems:Blockchain can improve the transparency and security of
voting systems by providing a tamper-resistant record of votes, reducing the
potential for fraud.
Advantages:
- Decentralisation:Blockchain operates on a decentralised network, eliminating
the need for a central authority. This decentralisation enhances security, reduces
the risk of single points of failure, and promotes trust among participants.
- Security:The use of cryptographic techniques and the distributed nature of the
ledger make blockchain highly secure. Once a block is added to the chain,
altering the information within it is extremely difficult.
- Transparency:All participants in a blockchain network have access to the
same information, promoting transparency. This transparency can be especially
valuable in industries where trust and accountability are crucial.
- Immutability:Once data is added to the blockchain, it is nearly impossible to
change or delete. This immutability ensures the integrity of the recorded
information.
- Efficiency:Blockchain can streamline processes by reducing the need for
intermediaries, automating transactions through smart contracts, and providing
a single, shared version of the truth.
Disadvantages:
- Scalability:Some blockchain networks face challengesin handling a large
number of transactions simultaneously, leading to scalability issues. This can
result in slower transaction speeds and increased costs.
- E nergy Consumption:Proof-of-Work (PoW) consensus mechanisms, used in
some blockchain networks, are associated with high energy consumption. This
has led to environmental concerns and efforts to explore more energy-efficient
alternatives.
- Regulatory Uncertainty:The regulatory environmentsurrounding blockchain
and cryptocurrencies is evolving, leading to uncertainties and potential
challenges for businesses and users.
- Complexity:Implementing and managing blockchain technology can be
complex and requires specialised skills. This complexity can act as a barrier to
adoption for some organisations.
- Lack of Standardisation:The lack of standardisedprotocols and
interoperability among different blockchain platforms can hinder collaboration
and communication between networks.
HAPTER IV. THE DIGITAL ENTERPRISE (THE CONFLUENCE OF
C
ELASTIC CLOUD COMPUTING, BIG DATA, AI, AND IOT DRIVES
DIGITAL TRANSFORMATION)
I. Introduction
The digital transformation of finance and accounting has ushered in a new era of
technological innovation, reshaping conventional practices and offering a plethora of
benefits to businesses. This study aims to delve into the specific advantages associated
with the integration of digital financial tools for payment processing, invoicing
automation, and financial analysis, elucidating their implications for modern finance
and accounting operations.
The adoption of digital tools has revolutionised traditional financial processes, leading
to enhanced efficiency, improved accuracy, and greater decision-making capabilities.
By leveraging these tools, organisations can streamline their operations, optimise cash
flow management, and gain valuable insights into their financial performance.
A. Definition of digital financial tools
Digital financial tools encompass a wide range of technological applications and
platforms designed to facilitate and optimise various aspects of financial management,
transactions, and analysis. These tools leverage digital technologies to streamline
traditional financial processes, enhance efficiency, and provide real-time insights into
financial data. Examples of digital financial tools include electronic payment systems,
online banking platforms, financial management software, digital invoicing solutions,
automated accounting systems, mobile payment applications, and advanced financial
analytics and reporting platforms.
B. Importance of integrating digital financialtools in a company
In essence, digital financial tools encompass any electronic or software-based solution
that enables individuals and businesses to conduct financial activities, manage
transactions, analyse financial data, and make informed decisions within a digital
e nvironment. These tools have reshaped the landscape of finance and accounting,
offering unprecedented capabilities for optimising cash flow, automating routine tasks,
improving financial visibility, and enhancing overall financial management practices.
II. Subtopics
A. Payments
1. Electronic payment systems
Electronic payment systems are ways of making financial transactions using electronic
devices. They include methods like credit/debit cards, mobile payments, online
banking, digital currencies (like cryptocurrencies), and various other technologies.
These systems offer a faster, more convenient, and secure way to handle money
compared to traditional methods. Examples include using a credit card for online
shopping, paying with a mobile app, or transferring money between bank accounts
electronically.
2. Mobile payment solutions
Mobile payment solutions are methods of making financial transactions using mobile
devices. These solutions leverage the capabilities of smartphones and tablets to offer
convenient, fast, and secure payment options.
Mobile payment solutions are ways to pay using smartphones. They include mobile
wallets like Apple Pay, QR code payments, and apps for sending money to friends
(like Venmo). You can also pay by tapping your phone on a card reader or use your
fingerprint for security.
3. Benefits of digital payment methods
These methods make it easy to shop, transfer money, and pay for things using your
mobile device. It benefits both the consumers and businesses.
Benefits for Consumers:
-Convenience:Mobile payments provide a quick and easy way to make transactions.
Users can pay for goods and services with a simple tap or scan, reducing the need to
carry physical cash or cards.
-Accessibility:Mobile payments are widely accessible, requiring only a smartphone
and an internet connection. This accessibility is especially beneficial in areas where
traditional banking infrastructure may be limited.
-Security:Many mobile payment solutions use advanced security features such as
encryption, tokenization, and biometric authentication (e.g., fingerprint or facial
recognition), enhancing the security of transactions.
-Transaction Tracking:Users can easily track theirspending through mobile banking
apps, which provide detailed transaction histories. This helps in budgeting and
financial management.
-Rewards and Discounts:Some mobile payment apps offerrewards programs,
cashback, or discounts for using their services. This incentivizes users to adopt mobile
payment methods.
Benefits for Businesses:
- Increased Sales:Accepting mobile payments can lead to increased sales as
customers appreciate the convenience and speed of transactions. This is particularly
relevant in fast-paced environments like retail and hospitality.
-Cost Efficiency:Mobile payments can be more cost-effective for businesses than
traditional payment methods. There may be lower processing fees, and businesses can
save on the costs associated with handling and processing cash.
-Enhanced Customer Experience: Mobile payments contributeto a smoother and
more efficient customer experience. Shorter wait times at the checkout and easy
payment options can lead to higher customer satisfaction.
-Reduced Fraud Risk:Advanced security features in mobile payment systems can
reduce the risk of fraud compared to traditional payment methods. For example,
tokenization protects sensitive card information during transactions.
-Marketing Opportunities:Mobile payment apps often provide opportunities for
businesses to engage with customers through targeted promotions, loyalty programs,
and personalised offers.
-Streamlined Operations: Mobile payments can streamlinebackend operations,
reducing the need for manual handling of cash and providing businesses with more
accurate and efficient transaction records.
Overall, mobile payment solutions offer a win-win situation by providing users with
convenient and secure payment options while offering businesses opportunities for
increased efficiency and improved customer relations.
B. Invoicing
1. Electronic invoicing systems
E-invoicing, also known as electronic invoicing systems, refers to the method of
electronically transmitting an invoice in a designated standardised format. The
utilisation of this standardised format by both the sending and receiving systems
allows for the exchange and identification of data. Additionally, because e-invoices
contain invoice data in a structured form, they can be automatically imported into the
buying organisation’s accounts payable system.
. Automated invoicing processes
2
The number of processes varies depending on the complexity of the system and/or
requirements of the organisation. However, an automated invoicing system typically
has these key processes:
Invoice Generation, Validation and Evaluation:
· Processing tools will check for incoming invoices and information (E.G. Create
accurate and detailed invoices with customer information, products/services,
quantities, and prices.)
· Validate data to ensure accuracy and compliance.
Recording:
· Processing tools will keep track of every invoice sent and uses invoice’s
purchase order to create a record.
Audit:
· Maintain an audit trail for transparency and accountability.
· Handle errors and exceptions in the invoicing process.
· Some softwares even ensures payments meet taxation rules.
Payment:
· Tool will track the buyer's payment method. It will also keep track of when any
invoices arrive, allowing it to send payment reminders.
3. Advantages of digital invoicing
· Reduce costs and improve cash management to capture more early payment
discounts.
· Customer Relationship Improvement (Timely and consistent communication
with customer)
· Time efficiency (E.G. Configure workflows to address specific requirements.)
· Enable faster, more accurate payment processing.
C. Financial analysis
1. Data visualisation tools
Data visualisation refers to the graphical depiction of data and information. Through
the utilisation of visual components such as charts, graphs, and maps, data
visualisation tools offer a convenient means to observe and comprehend patterns,
outliers, and trends in data. Additionally, it provides an excellent way for employees
or business owners to present data to non-technical audiences without confusion.
In the realm of Big Data, data visualisation tools and technologies play a crucial role
in the examination of vast amounts of information and the subsequent formulation of
data-informed decisions.
. Financial reporting software
2
Many financial reporting software incorporate data visualisation tools in help users
interpret complex financial data much easier. These tools are commonly employed to
streamline and automate the creation, analysis, and distribution of financial reports
within an organisation. Additionally, they have the capability to offer valuable insights
that contribute to the decision-making process and financial management. (Several
noteworthy software examples include Microsoft Power BI, Tableau, and IBM
Cognos...)
. Role of digital financial analysis in decision-making
3
Understanding of an organisation’s financial health is crucial to all administrators and
managers. Digital financial analysis will help with decision-making in collecting mass
data, give real-time financial insights, risk management, provides and forecasts future
s cenarios… All these processes are streamlined, processed quickly to ensure timely
and most accurate in the decision-making process.
III. Benefits of integrating digital financial tools
A. Increased efficiency and accuracy
Automation: Digital tools eliminate the need for manual data entry and processing,
reducing the likelihood of errors and increasing overall efficiency.
Real-time Processing: Transactions and account updates occur in real-time, providing
users with up-to-date information on their financial status.
B. Cost savings
Reduced Transaction Costs: Digital transactions often have lower fees compared to
traditional methods, such as wire transfers or paper checks.
Paperless Transactions: Going digital reduces the need for paper, printing, and
postage, contributing to cost savings and environmental sustainability.
C. Improved cash flow management
Budgeting Tools: Many digital financial tools offer budgeting features, helping users
track and manage their spending more effectively.
Financial Planning: Users can leverage tools for financial planning, investment
tracking, and retirement planning.
D. Enhanced data security
Encryption and Authentication: Digital financial tools employ robust security
measures, including encryption and multi-factor authentication, to protect user data
and transactions.
Fraud Protection: Real-time monitoring helps detect and prevent fraudulent activities,
offering an additional layer of security.
IV. Challenges of implementing digital financial tools
A. Initial setup and integration
There are many reasons why organisations and businesses still use legacy systems that
are incompatible with modern digital solutions. First, replacing old systems can be a
time-consuming and expensive process. Second, many organisations and businesses
feel satisfied with what they have and are afraid of applying new technology tools and
processes because investing in a new digital solution requires time to train users and
takes time to adopt.
B. Employee training and adoption
The shortage of human resources to support digital transformation is considered one
of the main challenges. Therefore, it is necessary to assemble a cross-functional team
of skilled people to create a leadership team. This team will help create a digital
transformation vision that aligns with your business goals.
Building a digital transformation advocacy group can help organisations take a more
proactive approach to digital initiatives that focus on the interests of everyone.
. Data privacy and compliance
C
Data is considered the lifeblood of the digital economy in general and digital banking
in particular. Additionally, businesses, law enforcement and consumers all need new
mechanisms to build digital trust in business, risk management and compliance. In the
process of digital transformation, in protecting safety, trust, privacy as well as ethical
issues related to data will succeed in the financial sector
D. Cybersecurity risks
Finance is inherently fertile land for high-tech criminals to illegally exploit because
the application of technology in professional activities accounts for up to 90%. To
successfully transform digitally, it is necessary to focus on resources first, including
encouraging cybersecurity experts to participate in the digital transformation process
right from the project planning stage. With the current trend of digital transformation,
it is necessary to build a flexible risk control strategy with the goal of being able to
prolong and restore business operations as soon as possible when risks that disrupt
operations occur. financial operations
V. Case studies/examples
A. Company A: Successful implementation of digital payment systems: MOMO
MoMo is the leading unit in Vietnam in providing application services. Mobile
e-wallets, over-the-counter (OTC) and money transfer services on payment platforms.
After 3 years of acceleration, MoMo's ecosystem has linked with 22 banks compared
to 5 banks before 2017. MoMo has also developed a network of 10,000 business
partners in areas such as finance and banking, insurance, money transfer, payment,
entertainment, e-commerce, shopping, transportation and food services... MoMo's
network reaches more than 100,000 payment acceptance points
MoMo wallet currently has tens of millions of users, of which about 3.5 million reside
in remote areas. In particular, MoMo has become the leading financial application on
the Android platform and is also one of the most downloaded applications on the
Vietnam App Store.
The attractiveness of the e-Wallet market and MoMo's increased application of
technology and provision of many financial services have attracted many investment
funds, estimated to be about 140 million USD, helping MoMo build its foundation.
digital payment infrastructure, technology investment to promote financial inclusion
and ecosystem expansion.
B. Company B: Streamlined invoicing processesthrough digital tools : MISA
melnvoice
MISA meInvoice is a reputable electronic invoice software chosen by the
Government, Tax authorities, businesses, organisations and individuals. The first and
only electronic invoice software in Vietnam applying Blockchain technology to ensure
safety, security and anti-counterfeit invoices in the world.
What makes MISA meInvoice the most popular electronic invoice software today is
the ecosystem of software from accounting to businesses: MISA accounting software,
s ervice accounting software , declaring - submitting tax returns, digital signatures,
processing input invoices,... all the applications that accounting needs as well as
reasonable electronic invoice prices. All of these ecosystems help businesses and
accountants integrate and connect best
C. Company C: Improved financial analysis andreporting using digital tools :
Song Ba Ha Hydropower Joint Stock Company (SBH)
Since 2017, SBH has deployed and used enterprise resource planning software (ERP:
Enterprise Resource Planning), with 17 modules on financial management, taxes,
accounting, salaries, materials, and finances. fixed assets, contracts... in the
Company's governance.
The company has been applying a number of other support software shared in
EVNGENCO2 such as: Management reports (BI), Management of materials and
equipment warehouses using QR Code technology. The implementation of operating
modules and business processes is increasingly stable, helping the preparation of
monthly, quarterly, semi-annual and annual financial reports to progress ahead of
schedule, meeting the requirements for exploitation and inspection. High level of
control and management
In addition, SBH also applies many innovative initiatives in the field of finance and
accounting such as: (i) using input invoice management tools that automatically
connect with the invoice validity lookup system of the General Department of
Taxation to minimise tax accounting errors; (ii) make information disclosure reports
with the Hanoi Stock Exchange directly on the CIMS Information Disclosure System
application (instead of sending it manually by post as before); (iii) synchronise data
from the CIMS information management system with the internal website to publish
information at the same time on the Stock Exchange and the Company's website
I. Future trends in digital financial tools
V
A. Artificial intelligence and machine learning in financial analysis
In the financial industry, digital transformation has contributed new changes, bringing
people to great conveniences. Digital transformation has brought about new
improvements in the financial industry, allowing individuals to enjoy greater
convenience. This rapid advancement—particularly the use of AI and ML in the
financial sector—has spurred new trends in the use of technology in a variety of
fields, including prediction, phone payments, and payment applications financial
patterns.
At the 2023, according to Finance Industry Information Technology Conference
recently organised by the Department of Financial Informatics and Statistics (Ministry
of Finance), Deputy Director Nguyen Viet Ha, said that in recent times, the
implementation Deploying and investing in the application of information technology
with focus on professional activities and in reforming administrative procedures of
nits under the ministry has contributed to well performing assigned tasks and
u
gradually forming electronic finance, towards digital finance.
Especially, TPBank has enterprise successfully digitally transforms the financial
analysis:
Established in 2008, TPBank operates mainly in the field of providing financial
products and services. Facing the changes in the world and the crisis of the epidemic,
TPBank decided to implement the digital transformation strategy that the bank has
been pursuing for a long time. Currently, banks use artificial intelligence and other
modern technologies such as: Machine Learning, Deep Learning or Optical Character
Recognition (OCR).
Picture: TP Bank representative received the IDG Vietnam Award
(Source: The TP Bank Official website: tpb.vn)
The bank has also deployed nearly 300 virtual robots - applying akaBot's RPA
automation technology - in internal operations to shorten process processing time,
optimise customer experience and free up labour. motivating customers. With digital
transformation efforts like successful digital transformation businesses in the market,
TPBank has won the title of "Excellent Digital Transformation Enterprise" for three
consecutive years awarded by the Vietnam Digital Communications Association.
There are some advantages and disadvantage of using Artificial intelligence and
machine learning in financial analysis:
Advantages:
Reduces the complexity of paperwork: Because financial confirmation procedures are
quite complicated and require a long wait (must be sent by courier or post office
between relevant agencies), if there are important documents that need to be done
urgently, it is difficult to complete them in a short time.
Customer service and personalization: Financial institutions are using AI and ML to
provide personalised financial advice, customer support, and tailored product
recommendations based on individual financial behaviours and preferences.
redit scoring and lending decisions: AI and ML algorithms are being used to assess
C
creditworthiness and make more accurate lending decisions by analysing a wide range
of data points, leading to more inclusive and fair lending practices.
Portfolio management and investment analysis: AI and ML are being used to analyse
investment opportunities, optimise portfolio allocation, and provide insights into
market trends, helping investors make more informed and data-driven decisions.
Disadvantages:
Over-reliance on data: AI and ML models require large amounts of high-quality data
to produce accurate results. If the data is incomplete, biassed, or of poor quality, it can
lead to inaccurate or unreliable analyses.
Regulatory and compliance challenges:The use of AIand ML in financial analysis
may raise regulatory and compliance challenges. Regulators may require transparency
and explainability in the use of AI and ML models, and there may be concerns about
the potential for biassed or discriminatory outcomes.
Security and privacy risks:AI and ML systems maybe vulnerable to security
breaches and cyber-attacks, especially when handling sensitive financial data.
Ensuring the security and privacy of data used in AI and ML models is crucial to
mitigate these risks.
Human oversight and accountability:While AI and MLcan automate many aspects
of financial analysis, human oversight and accountability are still essential.
Over-reliance on automated systems may lead to a lack of human judgement and
accountability in decision-making processes.
Ethical considerations:The use of AI and ML in financialanalysis raises ethical
considerations, particularly regarding the potential for biassed outcomes or unintended
consequences. Ensuring fairness and ethical use of AI and ML technologies is a
critical concern.
To sum up, the use of AI and ML in financial analysis is expected to continue growing
as these technologies offer the potential to improve efficiency, accuracy, and
decision-making in the financial industry. On the other hand, it is also important for
organisations to carefully consider these disadvantages and implement appropriate
safeguards and controls when using AI and ML in financial analysis to mitigate these
risks.
.
B Blockchain technology for secure and transparent transactions
The use of blockchain technology for secure and transparent transactions in financial
analysis is a growing trend. In some cases, this is driven by the desire for increased
security, transparency, efficiency, and innovation in the financial industry. As the
technology continues to mature, its potential to transform financial transactions and
analysis is becoming increasingly recognized.
Blockchain application trends at world banks during the digital transformation
process:
ransactions in digital currency (cryptocurrency) - A great effective intermediary in
T
cross-border transactions and procedure management transactions. Blockchain
application is identified as a B2B (business-to-business) solution in the financial
industry that is being taken seriously.
Some leading banks in Blockchain application, including JPMorgan, have ONYX
blockchain and are testing this technology for mortgage payments in May 2022. Link
is a Blockchain application that uses the ONYX Blockchain platform to enable
financial institutions and business users to perform secure peer-to-peer data transfers
with greater speed and control. The most significant benefit of using Link is
integrating the tool into any platform via the exposed API. It's a great starting point
for innovating how organisations communicate and share valuable data. JPMorgan
Blockchain solution reduces payment processing and verification time for large
payments. Currently, 382 banks are using JPMorgan's Link platform to exchange data.
Blockchain application trends at Vietnam during the digital transformation process:
In Vietnam, although there is no clear legal framework on Blockchain and
cryptocurrency, the Vietnamese Government is researching legal issues surrounding
the Sandbox mechanism for Blockchain applications. Blockchain is still in the early
stages of development and the extent of change this new technology can create in the
financial sector depends on overcoming current technical limitations and enhancing
acceptance by interested parties. Government documents mentioning Blockchain
include: Decision 2117/QD-TTg dated December 16, 2020, Decision 942/QD-TTg
dated June 15, 2021, Decision No. 810/QD-NHNN dated May 11, 2021.
However, Vietnamese commercial banks have researched Blockchain early on as a
technology solution for financial activities. In 2018, VietinBank, VIB, TPBank tested
interbank money transfer using Blockchain. In 2019, HSBC applied Blockchain in
international payments in the Vietnamese market by letter of credit (L/C) transactions.
As of the end of February 2021, there are 5 more Vietnamese commercial banks -
BIDV, HDBank, VietinBank, MBBank and Vietcombank. For Vietcombank, they have
a quick plan to apply Blockchain on the VCB Digibank Digital Banking platform,
developing VCB Rewards service - a gratitude program for individual customers.
Thanks to Blockchain technology, the entire process of point accumulation and gift
redemption is stored and automatically updated on VCB Digibank, allowing
customers to proactively look up point accumulation history and redeem gifts.
Currently, Vietcombank is researching to expand Blockchain applications, cooperating
with Fintech companies.
Picture: The applications of blockchain for secure and transparent transactions.
(Source: Tapchinganhang.gov.vn)
lockchain, the distributed ledger technology behind cryptocurrencies like Bitcoin,
B
offers several advantages and disadvantages for financial analysis and transactions:
Advantages:
Security:Blockchain provides a secure and tamper-resistantway to record
transactions. Each transaction is cryptographically linked to the previous one, creating
a chain of blocks that cannot be altered without consensus from the network. This
makes blockchain an attractive option for secure financial transactions.
Transparency:The decentralised nature of blockchainensures that transaction records
are transparent and accessible to all participants in the network. This transparency can
enhance trust and accountability in financial analysis, as it allows for real-time
verification of transactions without the need for intermediaries.
Smart contracts:Blockchain supports the use of smartcontracts, which are
self-executing contracts with the terms directly written into code. Smart contracts can
automate and enforce the terms of an agreement, streamlining financial transactions
and reducing the need for intermediaries.
Tokenization of assets: Blockchain enables the tokenization of assets, allowing for the
representation of real-world assets as digital tokens on a blockchain. This can
facilitate the trading and transfer of assets, potentially opening up new opportunities
for financial analysis and investment.
Disadvantages:
On the other hand, there are several drawbacks for Blockchain technology for secure
and transparent transactions:
While blockchain technology offers significant advantages for secure and transparent
transactions in financial analysis, there are also some potential disadvantages to
consider:
calability challenges:Blockchain networks can face scalability issues, particularly in
S
public blockchains, where the number of transactions per second is limited. This can
hinder the ability to process a high volume of financial transactions in a timely
manner.
Energy consumption:The process of validating andadding transactions to a
blockchain (often referred to as mining) can be energy-intensive, particularly in the
case of proof-of-work consensus mechanisms. This can lead to environmental
concerns and high operational costs.
Regulatory uncertainty:The regulatory landscape surroundingblockchain technology
is still evolving, and there may be uncertainty about how existing financial regulations
apply to blockchain-based transactions. Compliance with regulatory requirements can
be a challenge for organisations utilising blockchain in financial analysis.
Governance and consensus issues:Blockchain networks require agreement among
participants on changes to the network's protocols and rules. Achieving consensus can
be challenging, especially in public blockchains with a large number of participants,
and disagreements can lead to network forks and disruptions.
Integration with legacy systems:Integrating blockchain technology with existing
legacy financial systems and processes can be complex and costly. Legacy systems
may not be easily compatible with blockchain, requiring significant investment in
integration and migration efforts.
Security vulnerabilities:While blockchain is oftenheralded for its security, there have
been instances of security vulnerabilities in blockchain implementations, such as
smart contract exploits and 51% attacks on certain blockchain networks. Ensuring the
security of blockchain-based financial transactions requires ongoing vigilance and
robust security measures.
In short, it is important for organisations to carefully consider both the benefits and
drawbacks above and weigh them against the potential benefits when evaluating the
use of blockchain technology for secure and transparent transactions in financial
analysis. Addressing these challenges through technological advancements, industry
collaboration, and regulatory clarity will be crucial for the widespread adoption of
blockchain in financial analysis.
C. Integration of digital financial tools with other business systems
The integration of digital financial tools with other business systems is a critical
aspect of modern financial management. Seamless integration enables businesses to
streamline processes, improve efficiency, and gain better insights into their financial
data. For successful system integration and data consistency, strong APIs, data
standards, and data governance procedures are essential. Businesses should also assess
the adaptability and scalability of digital financial tools in order to meet changing
integration requirements as they expand and change. There are some key
considerations and examples below of integrating digital financial tools with other
business systems:
nterprise Resource Planning (ERP) Systems:Integrating digital financial tools with
E
ERP systems allows for the seamless flow of financial data across various functions
such as accounting, procurement, inventory management, and human resources. For
example, integrating a digital accounting software with an ERP system enables
automatic synchronisation of financial transactions, chart of accounts, and financial
reporting.
Customer Relationship Management (CRM) Systems:Integrationwith CRM
systems allows businesses to link financial data with customer interactions, sales, and
marketing activities. This integration can provide insights into customer payment
behaviour, revenue forecasts, and customer lifetime value. For instance, integrating a
digital payment processing tool with a CRM system enables tracking of customer
payments and invoicing details.
Inventory and Supply Chain Management Systems:Integratingfinancial tools with
inventory and supply chain management systems can optimise cash flow, inventory
valuation, and procurement processes. For example, integrating a digital inventory
management system with financial tools enables real-time tracking of inventory costs,
valuation, and cost of goods sold.
Human Resources and Payroll Systems:Integration withHR and payroll systems
facilitates the management of employee expenses, payroll processing, and benefits
administration. For instance, integrating digital expense management tools with HR
systems enables seamless reimbursement workflows and expense reporting.
Business Intelligence and Analytics Platforms:Integratingfinancial tools with
business intelligence and analytics platforms provides comprehensive insights into
financial performance, trends, and forecasts. This integration enables the consolidation
of financial data from various sources for advanced reporting and analysis.
E-commerce and Payment Processing Systems:Integrationwith e-commerce
platforms and payment processing systems enables businesses to streamline online
transactions, reconcile payments, and manage revenue streams. For example,
integrating digital payment gateways with financial tools facilitates automatic
reconciliation of online sales and payment data.
Compliance and Regulatory Reporting Systems:Integrationwith compliance and
regulatory reporting systems ensures that financial data is accurately reported and
aligned with regulatory requirements. This integration can automate regulatory filings,
tax reporting, and compliance checks.
VII. Conclusion
A. Recap of the importance and benefits of integrating digital financial tools
Integrating digital financial tools with other business systems offers numerous benefits
and plays a crucial role in modern financial management. This is essential not only for
optimising financial processes, gaining valuable insights, and ensuring regulatory
c ompliance but also ultimately contributes to improved operational efficiency, better
decision-making, and enhanced financial management for businesses.
If financial companies and banks can integrate digital transformation into business and
financial activities, this is a strong and powerful weapon to be able to compete with
competitors in times of great innovation. Technology is becoming more and more
advanced (jobs can be lost, businesses can collapse at any time). It is necessary to
devise appropriate digital transformation integration strategies for the following
benefits:
Streamlined Processes:Integration allows for theseamless flow of financial data
across various business functions, streamlining processes such as accounting,
procurement, inventory management, and human resources.
Improved Efficiency:By automating data transfer and synchronisation, integration
reduces manual data entry, minimises errors, and saves time, leading to improved
operational efficiency.
Enhanced Insights:Integration provides comprehensive insights into financial
performance, customer payment behaviour, inventory valuation, and other critical
metrics, enabling better decision-making and strategic planning.
Better Financial Reporting:Integrated systems ensureconsistent and accurate
financial reporting by consolidating data from multiple sources and providing a
holistic view of the organisation's financial health.
Optimised Cash Flow Management:Integration with inventory,procurement, and
payment systems helps optimise cash flow, track expenses, and manage revenue
streams more effectively.
Regulatory Compliance:Integrated systems facilitateautomated regulatory filings,
tax reporting, and compliance checks, ensuring that financial data is accurately
reported and aligned with regulatory requirements.
Seamless Customer Interactions:Integration with CRMsystems enables businesses
to link financial data with customer interactions, sales, and marketing activities,
enhancing customer relationship management.
Cost Savings:By reducing manual effort, minimising errors, and improving
operational efficiency, integration of digital financial tools can lead to cost savings for
the organisation.
Enhanced Data Security: Integration ensures that financial data is securely transferred
and stored across systems, maintaining data integrity and protecting sensitive financial
information.
B. Call to action for companies to embrace digital financial tools for growth and
success.
Embracing digital financial tools is essential for companies to thrive in today's
fast-paced and competitive business landscape. To encourage companies to adopt
these tools for growth and success, the following call to action can be emphasised:
" Maximise Your Potential: Embrace Digital Financial Tools for Sustainable Growth
and Success"
In today's dynamic business environment, the adoption of digital financial tools is no
longer just an option – it's a strategic imperative. To propel your company towards
sustainable growth and lasting success, it's time to fully embrace the power of digital
financial tools.
Efficiency and Agility: Digital financial tools streamlineprocesses, automate tasks,
and provide real-time insights, empowering your teams to operate with unparalleled
efficiency and agility.
Data-Driven Decision-Making:Harness the power ofdata by integrating digital
financial tools with your business systems. Gain comprehensive insights into financial
performance, customer behaviour, and market trends, enabling informed, data-driven
decision-making.
Competitive Edge:Companies that leverage digital financial tools gain a competitive
edge. By optimising cash flow, improving cost management, and enhancing financial
reporting, you position your business for success in a rapidly evolving marketplace.
Scalability and Adaptability:As your company grows,digital financial tools offer the
scalability and adaptability needed to support your expansion. Whether it's managing
increased transaction volumes or integrating with new business systems, these tools
evolve with your organisation.
Security and Compliance:Protect your financial dataand ensure regulatory
compliance with robust security features and automated reporting capabilities inherent
in digital financial tools.
Joining the ranks of forward-thinking organisations that are harnessing the
transformative power of digital financial tools. The future of your company's financial
success starts with this crucial step. This call to action emphasises the transformative
impact of digital financial tools and encourages companies to seize the opportunity for
growth and success by embracing these technologies.
HAPTER V. POSSIBLE SOLUTIONS FOR DIGITAL TRANSFORMATION
C
AT ENTERPRISES AND RELATED ISSUES
1. Advantage of Digital Transformation in Business
Digital transformation brings about numerous advantages for businesses,
enabling them to adapt, innovate, and thrive in the rapidly evolving digital landscape.
Such as:
- Increased Efficiency:Digital transformation automates manual processes,
streamlining operations and reducing the time and effort required to perform
tasks. This efficiency boost leads to cost savings and improved productivity.
- Enhanced Customer Experience:Businesses can leveragedigital
technologies to personalise interactions, provide seamless customer journeys,
a nd offer targeted products and services. This results in higher customer
satisfaction and loyalty.
- Data-Driven Decision Making:With digital transformation,organisations can
collect, analyse, and leverage data to make informed and strategic decisions.
This data-driven approach allows for better insights into customer behaviour,
market trends, and operational performance.
- Innovation and Agility:Digital transformation fostersa culture of innovation,
enabling businesses to quickly adapt to changing market conditions, embrace
emerging technologies, and stay ahead of competitors. Agile methodologies
and practices are often integral to this transformation.
- Improved Competitive Positioning:Businesses that embrace digital
transformation are better positioned to stay competitive in their respective
industries. They can capitalise on new opportunities, respond to market
changes, and differentiate themselves from traditional competitors.
- Global Reach and Market Expansion:Digital technologiesbreak down
geographical barriers, allowing businesses to reach a global audience.
E-commerce, digital marketing, and online platforms enable companies to
expand their market presence beyond traditional boundaries.
2. Disadvantage of Digital Transformation in Business
hile digital transformation offers numerous advantages, it also comes with its
W
set of challenges and potential disadvantages. It's essential for businesses to be aware
of these issues and proactively address them. For instance:
- Costs and Investments:Implementing digital transformationinitiatives can
require significant upfront investments in technology, training, and
infrastructure. Small and medium-sized enterprises (SMEs) may find it
challenging to allocate resources for these expenses.
- Resistance to Change:Employees may resist adaptingto new technologies
and processes, fearing job displacement, a learning curve, or uncertainty.
Overcoming resistance and fostering a positive mindset toward digital -
transformation is crucial for success.
- Integration Challenges:Integrating new digital toolsand technologies with
existing systems can be complex. Compatibility issues, data migration, and
interoperability challenges may arise, leading to disruptions and delays.
- Cybersecurity Risks:As businesses become more digitally connected, they
become potential targets for cyber-attacks. The increased reliance on digital
platforms requires robust cybersecurity measures to protect sensitive data and
maintain customer trust.
- Data Privacy Concerns:With the collection and analysisof vast amounts of
data, businesses must navigate privacy regulations and address concerns about
the ethical use of customer information. Mishandling or misuse of data can lead
to legal and reputational consequences.
- Dependency on Technology:Relying heavily on digitaltechnologies makes
businesses vulnerable to disruptions caused by technical issues, system failures,
or cyber threats. Downtime can have significant consequences on operations
and customer satisfaction.
3. Solution for business
uccessfully navigating digital transformation requires a strategic and holistic
S
approach that addresses technological, cultural, and organisational aspects. Some
recommend solution:
● Optimise operating processes:Businesses can choose digital transformation
solutions to control resources and materials, helping administrators utilise
resources effectively and avoid waste. Digital transformation can also be
applied to manufacturing processes to increase productivity and efficiency.
● Integrating multi-channel sales system:The benefits of digital
transformation help businesses develop more sales channels, not just limited to
1 or 2 channels like traditional businesses. Nowadays, businesses can easily
connect with many channels such as offline stores, websites, hotlines,
e-commerce platforms, social networking sites, etc. This expands the ability to
reach customers and bring benefits. More diversity for businesses.
● Create an impressive experience:Putting customers at the centre, businesses
need to pay attention to their emotions and needs during the experience design
process. The goal is to leave an impression and make customers remember
your business at every stage.
● Build a unified digital business platform:Administrators can incorporate
digital transformation into their business processes. The digital business system
will act as a bridge between the company's current infrastructure company, new
business processes and streamline them. This combined with the necessary
technological capabilities will help ensure success in digital transformation.
● Testing new ideas:Before expanding new ideas, businesses need to deploy
Digital PoC or Proof of Concept. This is a short-term project used to test and
test new ideas on a small scale. Once the testing and testing process is
complete, businesses can evaluate the impact, investment benefits, and
potential of the idea.
REFERENCES
h ttps://tnmt.danang.gov.vn/bai-viet/chi-tiet?id=2237&u=chuyenoisolagivaquantrongnhuthena
otrongthoiaingaynay
http://snnptnt.kontum.gov.vn/tin-tuc/chuyen-doi-so-nganh-nong-nghiep/chuyen-doi-so-boi-ca
nh-va-thach-thuc.html
https://www.pace.edu.vn/tin-kho-tri-thuc/chuyen-doi-so-trong-doanh-nghiep
https://vti-solutions.vn/machine-learning-chia-khoa-cho-san-xuat-4-0/?utm_term=machine%
20learning&utm_campaign=VTI_Solutions_SEO&utm_source=adwords&utm_medium=ppc
&hsa_acc=1357479733&hsa_cam=20369191816&hsa_grp=155903584493&hsa_ad=682484
433337&hsa_src=g&hsa_tgt=kwd-12096910&hsa_kw=machine%20learning&hsa_mt=b&hs
a_net=adwords&hsa_ver=3&gclid=Cj0KCQiAtOmsBhCnARIsAGPa5yZAFRoZMIHDOXE
Y7dzQQ-0qL9246ifWA1CQq9sR5w24zkH2zexrb10aAmSZEALw_wcB
https://1office.vn/giai-phap-chuyen-doi-so
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