The digital transformation discusses a business model motivated by “the changes associated with the application of digital technology in all aspects of human society.”
Generally, it is executed as a result of digitisation, i.e. the “ability to turn existing products or services into digital variants, and thus offer advantages over tangible product.”
The digitalisation has shifted the economy from a largely physical to a software-controlled economy and the information technology has become a fundamental part of industry and manufacturing. In this perspective, all these technologies like Internet of Things (IoT), big data, robotics, automation, cloud computing, artificial intelligence, mobility and others have, and will continue to have, a growing and powerful effect on the society, economy and environment.
These technologies increase productivity and efficiency; providing higher flexibility and diversity. Moreover, they change the business models, production processes, and the ways of working and collaborating. Also, they allow greater mobility, enable faster decision-making and delivery, and support higher standardisation, customisation and prosperity.
In terms of digitalisation and information communication technology, Pakistan lags far behind. In the Digital Evolution Index 2017, Pakistan was ranked 56th, while the size of its ICT industry was $3.5 billion. In 2016, the Huawei Global Connectivity Index evaluated 50 countries, where Pakistan stood 50th in the list.
On the World Economic Forum’s Networked Readiness Index, Pakistan is positioned at 110th.
Though India, Sri Lanka and China rank 91st, 63rd and 59th respectively on the index, also called the Technology Readiness Index that measures the tendency for countries to exploit the opportunities offered by ICT.
On the ICT Development Index 2016 by International Telecommunication Union (ITU), Pakistan was placed at 146th position and in 2017, it is at 148th, meaning to step back instead ahead. Pakistan is witnessing a healthy technological development, progress innovation and the rise of entrepreneurship using ICT.
According to the E-Government Development Index (EGDI) 2018, Pakistan ranks 148th. In the global connectivity index 2018, Pakistan is ranked 77th out of 79 countries. Pakistan is not an information technology powerhouse. It scores at two for ICT investment though the average score for these 79 countries is 4.4. Pakistan’s internet dispersion remains low, with the volume of mobile broadband services exceeding the fixed broadband sector of the market. For the year, the smartphone diffusion rate is persistently mounting while users’ experience in terms of affordability, cloud migration and broadband download speed had improved.
Apart from all that, it is a good indicator that in 2018, Pakistan announced its first-ever digital policy. The policy said, “Promote the use of technology in education, health, agriculture and other key socio-economic sectors. Encourage the use of ICT in public schools and ensure they are online and have a meaningful impact on the current education eco-system in a phased manner.”
Further, about e/m-commerce, it explained, “Enhance the current market size of e/m-commerce. According to some estimates, the market carries an enormous growth potential due to exponential growth in broadband subscribers from 3.7 million in 2013 to over 44.3 million in 2017 and increasing. With these growth trends projected to persist in the future, overseas investments will continue to grow in e-commerce.”
The digitalisation has shifted the economy from a largely physical to a software-controlled economy
The policy must be implemented in its true spirits, and the government should have a kind of assessment after a few years whether to know the policy is working or been implemented.
Pakistan has about 60 per cent of its 207 million population in the 15-29 years age group; signifying a massive human and knowledge capital. There are more than 2,000 IT companies and call centres. The number is increasing every year. There are over 0.3 million English-speaking IT professionals with expertise in the current and emerging IT products and technologies. Besides, more than 20,000 IT graduates and engineers are being produced each year. All this knowledge, companies and the human force need to be capitalised for the country’s social and economic benefits.
The digital transformation is often described as a new business model or a reshaping of existing business models. It is driven by several factors. Companies are vulnerable to these new technologies because it has broken down market barriers for new disruptive competitors (eg Careem, Uber, etc). Industries, such as publishing, media or music, had to undertake deep transformations, especially by digitising assets. New technologies are a door opener to an extended market. They need a company to regulate the business model accordingly. High and fluctuant anticipation from users with profound knowledge of new technologies users is determined to practice modified and cutting-edge technologies.
To conclude, Pakistan needs to organise and enhance all these skills, expertise and knowledge through stimulating a digital transformation in all walks of life so that maximum socio-economic benefits could be drawn out.
The writer is a freelance journalist