The View From Asia

Dealing with the challenge of digital disruption

Commentators from Asia News Network papers debate the merits and demerits of the technology revolution impacting everyone's lives. Here are excerpts:

'4.0 nation': Lessons for Thailand

Suthichai Yoon
The Nation, Thailand

If Thailand is serious about becoming a "4.0 nation", there are valuable lessons to be learnt from Estonia, a tiny country of 1.3 million people that has dramatically built itself into a digital wonderland.

Estonia is a 5.0 nation, while we are still groping for ways to hit 4.0.

An 80-strong delegation of high-level Thai executives is planning a visit there after hearing a talk on Estonia by its honorary consul-general Virachai Tejavichitr.

The most striking thing Thailand can learn from Estonia?

Bureaucracy can become a thing of the past. What if you could file your taxes in less than five minutes? Think about possessing one secure digital ID that works for healthcare, contracts, banking, voting and even train tickets.

"Imagine a paperless government. Imagine free Wi-Fi across the whole country. Imagine every stage of lawmaking made viewable online, even edit tracking on Bills. Imaging registering a new company in 18 minutes - from anywhere in the world," Mr Virachai said.

The disruption caused by technology has allowed competition to emerge from any industry. In the transport sector, for example, the emergence of online transport networks such as Uber, Grab and Go-Jek has led to unhappiness from conventional transport firms, especially taxi operators.  PHOTO: EUROPEAN PRESSPHOTO AGENCY

But of course, citizens must be given iron-clad assurance that their privacy will not be violated in this "open, smart and transparent society".

In Thailand, data remains tightly guarded by bureaucrats who still believe that holding on to information equates to power.

In Estonia, though, the law forces officials to provide information.

Estonia began its innovation drive after breaking away from the Soviet Union in 1991. Back then, it lagged behind Western nations in most aspects, especially technology. Natural resources were scarce. Space was limited. But the people of Estonia decided to turn these shortcomings to their advantage.

The Internet revolution was just beginning. The young nation could not afford a huge budget to invest in physical infrastructure, so chose instead to make a new start in Web-based services.

Former prime minister Taavi Roivas said Estonian citizens save 2 per cent of gross domestic product by signing things digitally.

The move also promotes democratic legitimacy. Online voting was introduced in 2005 for the first time. "Simple citizen-oriented solutions means more participation and more democracy," explained Mr Roivas. Estonian expats in 116 countries can now vote in an election.

Estonian tech leaders such as Digital Policy Adviser Siim Sikkut and chief information officer Taavi Kotka are also creating a whole new model of government. The keywords are "government as a service".

But has it all been plain sailing? Certainly not. There has been major public concern over privacy from the outset. In 2007, cyber attacks launched from Russia added to security concerns. Meanwhile, managing distributed information technology from a centralised office has proved challenging.

The secret of success was not to be distracted by initial obstacles. Estonia persisted: The cyber attacks prompted security innovations that shored up public confidence.

The next step was to leverage its digital advantages across its borders. Businesses and citizens from all over the globe were invited to join Estonia's digital community. The most striking move was to allow anyone in the world to become an "e-resident of Estonia".

In practical terms, that means businesses can register operations in the country and take advantage of its streamlined tax system and operations. The reactions have been overwhelmingly positive. According to official records, as of May last year, 631 new companies had been formed by e-residents. The target is to hit 10,000 new companies by e-residents operating digitally from or through Estonia in three years.

The new Estonian model of a global, virtual nation and government as a service is changing the way the country thinks of itself.

"Citizenship is not the most defining feature of us any more - rather, community feeling is," Mr Sikkut said recently.

"What we are keen to explore is to see how we can expand the community of Estonia to be global through being digital - to make us larger in the world than we would otherwise be."

Hong Kong banks should plug into AI

Peter Liang
China Daily (Asia)

To maintain its lead as the region's premier international financial centre, Hong Kong will need to get serious about pushing its banking industry to adopt artificial intelligence (AI).

AI will be a big leap forward from automation, which seeks to dehumanise the banking experience. Hong Kong banks have made tremendous progress in automating a range of services, helping cut overhead costs.

In addition, some major banks have moved many of their backroom operations to low-cost bases on the Chinese mainland and other regional economies. Most consumers are doing their banking online to save time and money.

Indeed, bank customers are getting used to automation. But that does not mean they will stop valuing the personal service and advice from bank staff. To satisfy customers' needs, banks in some developed economies are turning more and more to AI.

Mr Alan McIntyre of Accenture told the BBC that AI "will actually help banking become a lot more personalised, (taking) banking back to the feeling that people had when there were more human interactions". Instead of sitting down at the computer to log on to the bank's website, a consumer can contact a chatbot at the bank on one of the social platforms to do a range of transactions such as getting his account balance or making a money transfer. What's more, the robot at the other end of the line can offer advice and suggestions, depending on the customer's needs.

Hong Kong banks simply cannot afford to ignore (the use of ) this new technology to service their customers.

New face of business competition

Hermawan Kartajaya and Ardhi Ridwansyah
The Jakarta Post, Indonesia

The market is a meeting place for supply and demand. In the business world, the market is also like an estuary for changes that occur on the macro scale. The technological revolution further drives economic, political-legal and sociocultural changes, all of which culminate in the market.

Several Asean countries have experienced structural changes in the market, inevitably resulting in greater competition.

In a number of important industries such as telecommunications and banking, we have witnessed an influx of private players entering the markets, both indigenous and from outside the country.

The increasingly competitive business environment has encouraged players to continue to innovate and improve efficiency. The customer has largely benefited from this phenomenon.

And technology continues to evolve. However, the disruption caused by technology does more than eliminate the boundaries of competition between countries. Digitalisation has also rendered irrelevant the boundaries between industries. Competition today can emerge from any industry or sector.

Look no further than the hospitality industry. Hotels are not just competing with other hotels, but are also under threat from websites such as Airbnb, which simply aggregates a list of lodgings in a city that can be rented by users.

Conventional transport firms are also panicking in the face of a very real threat. The emergence of online transport networks such as Uber, as well as its other Asean counterparts - Malaysia's Grab and Indonesia's Go-Jek - has triggered a string of negative reactions from conventional transport organisers, especially taxi operators.

Governments have also come under pressure and face a unique dilemma. While these emerging online transport networks are growing increasingly popular among customers, the question remains whether they should be allowed to thrive at the expense of conventional transportfirms, which feel disadvantaged by the convenience and affordability of these alternative transport players.

Market disruption will undoubtedly continue as a consequence of the continuing development of digitalisation.

Business players must be prepared to adapt and governments, as the regulators, must also act intelligently to ensure policies do not hamper technological innovation.

  • The View From Asia is a weekly compilation of articles from The Straits Times' media partner Asia News Network, a grouping of 22 news media entities. For more, see
A version of this article appeared in the print edition of The Straits Times on April 15, 2017, with the headline 'Dealing with the challenge of digital disruption'. Print Edition | Subscribe