5 Challenges to Digital Transformation in UAE and How to overcome them
Most Middle Eastern countries have started embracing digitization, and UAE is most aggressively approaching digital disruption. Over the last few years, the latest technologies like Artificial Intelligence (AI), Analytics, and Robotic Process Automation in Dubai and Middle East regions are witnessing greater adoptions, helping them reinvent their business model to achieve significant operational and cost efficiencies. However, there are still some challenges for companies in UAE and Middle East in general for going digital and to stay relevant in today’s modern global market. Digital transformation in UAE is not just about technology but also about changing the way businesses operate and deliver value to customers.
1. Legacy Systems Hindering Modernization
Over the years, enterprises in UAE and Middle East may have amassed thousands of applications, and many might have become legacy. The problem with legacy systems is that many of these applications are too rigid to support a modern enterprise. Moreover, there may be a maze of undocumented and re-coded dependencies, causing quite a headache. Legacy systems are a major obstacle for businesses to become a connected business, hindering growth. Digital transformation in UAE faces this challenge particularly due to the dependency on traditional IT systems that lack agility and scalability.
Latest technologies like RPA offer some great benefits to help bridge the gap between legacy applications and modern ones. Powered by AI and natural language processing capabilities, modern RPA frameworks have become sophisticated frameworks capable of easily automating several manual, rule-based tasks done by human workforce. RPA being a non-invasive technology, can be integrated with the existing IT landscape. RPA can help automate the transfer of data to and from modern and legacy systems respectively to streamline the process.
2. Reluctance to Full-Fledged Digital Transformation
UAE and the GCC countries have started embracing the latest technologies and digital transformation initiatives, but still, the leadership in many organizations are reluctant to jump onto a full-fledged transformation journey. It is only a few companies that have started small as a Proof of Concept (POC) and then scaled up to an RPA Center of Excellence (COE) that reaps the full benefits of digital transformation in UAE.
Digital transformation challenges in UAE also include the reluctance due to the perceived high costs and the fear of disrupting existing business operations. Transformation can be achieved only through applying emerging technologies for improving efficiencies and streamlining functions such as accounting, administration, HR, Customer Services, Payroll, and others and scaling to an enterprise level. When companies can demonstrate greater commitment to going digital by setting a realistic budget and plan for digital transformation, the results can work wonders for the industries in the region.
3. Dealing with Internal Resistance to Change
Technology shift inevitably requires adapting to changing work dynamics. Many companies in the UAE and the Gulf region face resistance from the employees, managers, and even the leadership. Digital transformation in UAE is often met with skepticism as employees fear losing their jobs to automation or struggle to adapt to new systems.
The first step to deal with the change is to create a dedicated Digital Transformation department with a state-of-the-art technology infrastructure and consisting of people with the latest technology skillset. Further, bring employees from key functions to work with the Digital Transformation team to understand the work nature and experience the functioning. The next step is to encourage more digital adoptions in the processes, channels, and initiatives. By cultivating a digital culture and involving employees in the transformation journey, companies can overcome these digital transformation challenges in UAE more effectively.
4. Skills Gap in Emerging Technologies
Since UAE is at the heart of the technology shift in the GCC or even the world given its stature as a hub in the global economy, they have the leading role in proactively adopting some of the most advanced technologies at present. However, one of the significant digital transformation challenges in UAE is the lack of skilled workforce in emerging technologies such as AI, Machine Learning, Cloud Computing, and Intelligent Automation.
As new business models are emerging, the traditional ones are disappearing or being completely transformed. Some of the traditional jobs are being automated or being replaced by latest technologies like AI and Intelligent Automation. Moving towards a tech-enabled paradigm, being tech-savvy will be an essential requirement for every role, level in every industry, be it Information Technology, Energy & Petrochemicals, Travel & tourism, Trade & logistics, Manufacturing, Financial Services, Technology & Media communications, and others.
As the UAE economy grows, highly skilled tech-savvy workers will be increasingly in demand, especially those with skills in engineering, research and development, product design, and marketing in various industries. To overcome this challenge, investing in continuous training programs, collaborations with tech institutions, and encouraging a learning culture is essential for driving digital transformation in UAE.
5. Traditional Operating Models
Many companies in the UAE and the Middle East are still following traditional operating models. But the disruptors, the companies following lean and agile operating models, are biting at the heels of these traditional players. Though they have started developing disruptive business models, many are struggling because they are unable to fully align their models with these agile ones. Digital transformation in UAE demands a shift from conventional business processes to more agile, data-driven, and customer-centric models.
So, the best approach here is to implement the agile rollouts in phases, to make the process less overwhelming. Technology architecture, Business, IT, and operations need to be modern and flexible, and they must work together in different ways. By adopting a phased approach, companies can minimize disruptions and align their operations with the evolving digital landscape.
Conclusion
It is no secret that digital disruption has its multitude of perks, offering new opportunities and benefits for UAE or any country. Going digital, enterprises can realise some tangible advantages such as considerable efficiency gains and higher-quality outputs. The spending on digitalization projects in the UAE have significantly increased over the years. However, many companies are managing the projects in a traditional operating model, which increases the risks of adoption. Partnering with technology leaders and digital disruptors can help streamline the adoptions. If the digital transformation process is well-handled and the challenges are addressed, it needn’t be overwhelming and threatening. Since nearly all the major sectors and industries are affected by the technology shift, effective measures can help to counter the technological, economic, political and security related risks.
Want to gain further insights into our services and solutions or if you are looking to jumpstart your Digital Transformation journey, talk to our experts!
