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Manufacturing enterprises increase their competitiveness thanks to digital transformation

Production activities at Dien Quang Hi-tech Factory. Photo: Mai Huong

Success through digital transformation

According to Vo Tan Thanh, Vice President of the Vietnam Confederation of Commerce and Industry (VCCI), digital technology can help businesses save costs, increase efficiency, improve product and service quality, attract new customers, and retain existing customers. Specifically, digital technology will improve the ability to manage and check the entire production process while optimizing the use of resources such as machinery, equipment, raw materials and labor to reduce waste and increase productivity. Along with that, improving the flexibility and adaptability to the market and customer needs by applying flexible production methods.

Sharing about the successful digital transformation in the business, a representative of Ba Huan Joint Stock Company said that, as a supplier of poultry eggs, accounting for about 30% of the domestic market share, aspires to "transform" into a digital agriculture business. The enterprise signed a comprehensive cooperation agreement with a technology group to deploy the SAP ERP S/4HANA enterprise resource management system project.

This system helps Ba Huan Joint Stock Company manage the breeding process from the hatchery, feed factory, egg farming and harvesting to the processed food factory and management product distribution; build an interactive portal with sales agents to make products reach consumers more conveniently.

Similarly, the digital transformation application of Langbiang Farm Co., Ltd. has helped businesses manage all accounting, financial, purchasing, warehouse, and traceability systems for tracking, and managing the entire life cycle of vegetables and flowers. In the future, Langbiang will expand production, complete the data system and build a detailed growing area code system, connecting the traceability system. International customers can easily check and evaluate the origin and origin of agricultural products not only from Langbiang but also Vietnam.

Thang Loi Co., Ltd (VICO) has established a digital transformation department, applying many technologies, modern digitization, and transforming all enterprise data deployed to the cloud computing platform. The operation system is integrated into a modern platform, which can control data, control and analyze the central operating room. The company also conducts sales on e-commerce platforms. In 2022, despite many difficulties, this business still recorded an expected revenue increase of 16%. The proportion of revenue from international contracts increased from 30% (2021) to 50% (2022). In which, there are international orders worth more than US$ 10 million.

Many challenges

Although digital transformation will improve the efficiency, productivity and competitiveness of businesses and business households in all economic sectors, it faces many challenges. According to a survey by the Enterprise Development Department (Ministry of Planning and Investment), in 2022, the number of businesses undergoing digital transformation shows signs of increasing. Many businesses have also set aside specific budgets for digital transformation. Despite the improvement, businesses applying digital transformation to production and business activities are quite fragmented. Businesses digitally transform only to meet immediate needs, but do not have a connection between solutions.

The survey shows that nearly half (48.8%) of businesses used to use some digital transformation solution, but do not continue to apply it. More than 35% of surveyed enterprises have digitized data and processes, but mainly put data, documents and papers from "hard copies" into "soft copies" stored on the system. Only 2.2% of surveyed enterprises have mastered technology and management software for data analysis and automation to make decisions in production and business. However, businesses face difficulties in the process of using technology.

Therefore, businesses need to be proactive and make more efforts for digital transformation. At the same time, the State also needs to create an environment, institutions and programs to support businesses to increase argumentation to promote production and business activities.

On what businesses need to do for successful digital transformation, Mr. Nguyen Dinh Giang, Director of Rochdale Spears Technology Company, said it is necessary to choose a solution, an appropriate enterprise resource planning software is very important. In particular, that solution needs to be consistent with the goals set by the business, in line with the future development of the business, helping businesses plan effective budgets, apply new technologies and access new technologies or self-implementation.

In addition, according to experts, the rapid and comprehensive explosion of digital technology brings diverse choices but also contains many risks and challenges in the application process. Therefore, understanding, evaluating and choosing appropriate and effective technology is the most important task in the digital transformation process of businesses.

Vincent Tang, Vice President of Epicor Corporation of America, in charge of the Asia region for global enterprise software, said that businesses cannot only purchase applications for digital devices and technologies, but more importantly, must renew thinking, innovate business models, establish a governance model based on digital technology.