By Khaled Musilhy, SAP
Change is the only constant and some changes leave an everlasting footprint. Leaving no country as an exception, COVID-19 is one such phenomena that brought nearly 100 million people in its direct periphery in January 2021, casting its influence on billions of lives.
Adapting to change is a prerequisite to survive and succeed in a global business environment. The recent past has accelerated momentum in digital transformation, impacting and influencing two specific groups:
Governments have positioned digitalization as a priority, infusing it into their transformation initiatives. The pandemic has fueled the need for digital transformation of Governments which is leading to an accelerated adoption of digital processes.
Businesses have been embracing the new normal of working virtually. Companies are looking for solutions and applications to operate efficiently in an ‘online’ environment.
As the world goes ‘online’, the addressable software market is expected to rise by 2024 to a whopping 436 billion Euros. While an average CAGR of 9.4% is expected until 2024, China will maintain a constant CAGR on the level of 17% between 2019 and 2024. As per OECD, many economies have a long recovery curve. As per the current projection, it might be only in 2022 that the 2019 output levels are regained.
Acceleration of digitalization
Governments have been challenged with this looming uncertainty and are facing difficult trade-offs owing to the health and socio-economic challenges. The pandemic has accelerated existing digitalization plans. Waves of change in terms of issued legislations and ongoing changes to the existing ones have been set in motion.
On one hand, countries are grappling to maintain the national income and look for different sources of income in parallel, and on the other, they are trying to employ measures such as tax arrangements to help businesses survive under the pressure of limited business opportunities and low profit margins.
While Governments need to help severely affected industries cope with the situation, they are also vested with the responsibility to extend cooperation across their regional borders. A research by the International Monetary Fund shows that global businesses have seen reductions of 20-25% of net revenue overall with some sectors like tourism being down nearly 65%.
The magnitude of the pandemic can be felt in the data published by the World Health Organization in July 2020 via the COVID-19 Law Lab. This data was released to shed light on the global COVID-19 regulatory measures and laws that countries have implemented in response to the pandemic.
Searching for the right cloud solution
Having touched upon the repercussions of the pandemic, the next question rises as to how Governments and Businesses can tackle these challenges. Both sectors are searching for the right products and solutions that are online, legally complaint and provide a role-based access in the local language. The answer to these needs can be summed up in one word: Cloud.
Businesses trying to expand their operations beyond known markets are in a constant look out for suppliers who are cost-efficient. It might so happen that these suppliers are based in quarantined pockets of the world and the foreign trade rules are influenced by regional and political factors.
The pandemic has also resulted in a multi-dimensional surge in product localization. The elevated levels of changes in regulations have led to frequent product changes. Different business scenarios in countries translate to specific localized features and also bring about need for language coverage. These are a few amidst the many challenges that ‘online access’ brings with it.
Moving to the cloud also comes with high expectations in terms of availability and pre-configured products. Adding ‘legal compliance’ and ensuring these changes are delivered meticulously is a specialized task to be taken up by software vendors. Here is how SAP tackles the crisis with product localization, for example.
As the pandemic brings forth a pressing need for businesses to ride the ‘online’ wave, what remains a solace is the intelligent framework that software solutions provide to make this transition a success. Creating the right partnerships in such challenging times makes all the difference.