As digital transformation is considered a new engine for global growth during a COVID-ravaged era, more and more Chinese companies are also eyeing the trend as a valuable opportunity for new possibilities, global market research firm International Data Corp said.

IDC forecasts that by 2024, 51 percent of global IT budgets will go to digital innovation and digital transformation, while that number in China is estimated to be above 70 percent.

"During the past decade, we can see that there has been mounting enthusiasm and rising budget from both corporate and government levels, as well as more supportive policies for the sector of digital transformation," said Wu Lianfeng, vice-president and chief research analyst of IDC China, during an interview with China Daily. Wu added that the COVID-19 pandemic has largely accelerated the pace of China's digitalization, with the average time used to complete digital transforming moves shortened and the integration of digital technologies further deepened.

However, more challenges await the country as it deals with the new trend. "For those countries that started the shift to digitalization earlier than China, they now have relatively complete digital systems on the businesses level. By contrast, China's digital transformation is mainly focused on the consumer level, such as mobile payment, e-commmerce and video-streaming platforms. This means there still lies huge potential for the country's companies to accomplish their digital upgrade as a whole," said Kitty Fok, managing director of IDC China.

Fok made the remarks during the 2022 IDC Digital Transformation Summit in Beijing in October, adding that clearer and unified industry standards will help ease problems such as incompatibility between different companies and, therefore, greatly contribute to the general digital process.

She also added that there still exist gaps for certain industries — such as the traditional manufacturing industry — to go digitalized. They are in relatively disadvantaged positions due to a lower level of digitalization and need to keep up with the pace.

"We have noticed that an increasing number of manufacturers have been stepping up efforts in building their own cloud platforms. Some of them even later develop these platforms into public ones to serve inter-industry digital needs, which have become their new growth point. This sets a good example and provides new transforming ideas for the industry."

During recent years, industrial bellwethers such as Chinese construction machinery manufacturer XCMG Group and electrical appliance manufacturer Midea Group have all started to build their cloud and industrial internet platforms. They have not only become pathfinders to go digitalized themselves but also encouraged the transformation of a large number of small and medium-sized enterprises, who also face a series of challenges in the process due to limited budgets.

"For SMEs who are in their initial stage of digital transformation, it will be more efficient and economical to proceed with public cloud services providers instead of building their own ones," Wu said. "In addition, it might not always be a good choice for them to follow the cutting-edge trends like metaverse. In fact, SME leaders should set short-term, feasible and specific goals based on their situations, and carry out concrete actions with the idea of prioritizing digital deployment in mind." Wu added that more public policies from the government are also expected to further support enterprises' digitalization progress.

As is indicated in China's 14th Five-Year Plan (2021-25), the country will accelerate the digital transformation of its industries, and further promote the integration of digital technologies into the real economy to drive high-quality development. The Ministry of Industry and Information Technology also announced in August that it will strengthen its push to support three batches of around 4,000 to 6,000 key SMEs in conducting digital transformation before promoting their experiences to more SMEs.

lijiaying@chinadaily.com.cn