Blog / Leadership & Transformation

What China Can Teach the World About Digital Transformation

In today’s post, we’re going over some of the steps China has taken to grow from a manufacturing powerhouse into an online retail hub. Read further to learn about Digital Transformation in China. For several decades, China has been a leading factory powerhouse in the world. But now the country is the world’s online retail hub, as well. In fact, the country is expected to surpass the US in 2020 to become the biggest retail market in the world, in spite of the volatile economic conditions caused by the COVID-19 pandemic. Retail sales are expected to hit $5.072 trillion in 2020. China boasts one of the world’s most sophisticated digital ecosystems, with over 800 million people actively using the Internet and 788 million individuals with smartphones. The fast-learning, industrious entrepreneurs are steering the fast-paced commercialization of digital enterprises in the country. According to tech analyst IDC, Chinese businesses will spend up to $1 trillion in digital transformation within the next three years. But what can the rest of the world learn from China when it comes to digital transformation? Read on to find out.The digital transformation in China is most commonly overseen by the Chief Executive Officer (CEO). This task is rarely left to the Chief Information Officer (CIO) or other top executives in the company. Despite the hierarchical nature of the country’s working culture, innovative CEOs are working closely with Chief Digital Officers (CDOs) to help turn their vision into a complete digital transformation program.Although China is popular for setting up copycat businesses, many forward-looking entrepreneurs have mimicked foreign models on a large scale, developing ground-breaking new products in the process. Innovations like bike-share systems along with Singles Day have seen western entrepreneurs replicating Chinese concepts. What’s more, the country generates more science and engineering graduates compared to the US and most of them work for top tech companies, creating offerings that match if not outshine those of western countries.Most Chinese companies have created a work environment that encourages employees to try new things, make mistakes, and draw lessons quickly to innovate faster. This approach has fast-tracked the digital transformation in China. The Chinese businesses test several prototypes with consumers before launching the most successful version. This approach is completely different from design-led transformation whereby the product version that has a greater potential for attracting more customers is identified through research. When carried out on a large-scale, the Chinese innovation approach is extremely fast but needs a lot of data and advanced digital technology. But leveraging this innovation approach, WeChat has transformed from a simple messaging application into a powerful ecosystem that provides reliable solutions to almost every customer problem.Chinese brands are striving to offer their customers better experiences by investing in intangibles like speed and convenience. These brands know that they are not just vendors of products, but important partners in assisting their customers to live more fulfilling lives. Harnessing the power of technology to enhance speed and convenience, China has built a powerful digital infrastructure. You can also digitize your business to take advantage of the numerous growth opportunities that the rapidly expanding global eCommerce sector has to offer. But first, you must see digital transformation as a key to unlocking not only value but also human potential. If after reading all that you're thinking of starting your own business in China, we recommend you to read one of our previous articles.You should also add the right talent to your digital transformation team to help you actualize your vision. And the best source of digital talent is China by the virtue of the massive success the country has realized in that sector. To avoid the headaches associated with hiring foreign employees, consider enlisting the services of a PEO with a proven track record in Asia. On top of helping you hire the best digital experts in China, a great global PEO will guarantee you a quick, steadfast, and compliant expansion into the country. They will also develop employment contracts for your global workforce and perform all HR responsibilities, allowing you to concentrate on the operational functions of your new company.Digital transformation is a solid and reliable tool to streamline business processes, take advantage of technology to improve engagement with customers and employees and provide unrivaled customer experience. China has built a comprehensive digital infrastructure and is already benefiting from it. Companies in the rest of the world must learn from China and redefine their digital transformation strategies if they’re to catch up.

Digital-led business is a well-led business! Get on board with Digital Tranformation!


Zigurat Global Institute of Technology