DIGITAL

TRANSFORMATION
AND ARTIFICIAL
INTELLIGENCE
Lecturer: Nguyễn Thế Đại Nghĩa
Email: [email protected]
Phone/Zalo/Viber: 0936385487
 2

CONTENTS
• Definition of Digital Transformation
• The role of Digital Transformation
• Focus areas of Digital Transformation in enterprises
• The current context of Digital Transformation at home and
abroad
• New technologies in Digital Transformation
 3

DEFINITION
• Digital Transformation is defined as "the integration and
application of Digital Technology to improve business efficiency,
management efficiency, capacity and competitiveness of
enterprises, then create new values.
 4

DEFINITION
• "A fundamental rethinking of customer experience, business
models, and operations. It’s about finding new ways to deliver
value, generate revenue, and improve efficiency." - SAP
 5

DEFINITION
E-BUSINESS
“Investment in technology is not synonymous with
Digital Transformation”

TEC
HN OLO
GY?
??
 6

DEFINITION
DIGITALIZATION E-BUSINESS
DIGITAL TRANSFORMATION

The process of using digitized The process of using digital

information to make established ways technologies to create new or modify
of working simpler and more efficient existing business processes, culture,
and customer experiences to meet
changing business and market
requirements.
This reimagining of business in the
digital age is digital transformation.
 7

THE ROLES OF DIGITAL TECHNOLOGIES

• Companies that are able to incorporate digital
E-BUSINESS
technologies into products and processes
become nimble.
• Software is easier to modify than retooling a
factory.
• Going after a new set of customers online is
easier than going to their homes or convincing
customers to travel to your stores.
Digital
• Unlike humans, AI systems and RPA can work Disruption
24/7 without benefits, raises or arbitration.
 8

AWARENESS
E-BUSINESS

Source: Cisco & IDC 2020

 9

THE ROLES OF DIGITAL TRANSFORMATION

• increased efficiency and • increased responsiveness

productivity • greater innovation
• better resource management • faster time to market
• more resiliency
• increased revenue
• greater agility
• continued relevancy
• improved customer engagement
 10

FOCUSES AREAS IN ENTERPRISES

E-BUSINESS

Source: Digital transformation progress by industry (Fujitsu 2019)

 11

GLOBAL CONTEXT
E-BUSINESS

Source: Priority of enterprises when implementing digital transformation (BDO 2019)

 12

GLOBAL CONTEXT
“The future will belong to companies that put technology
at the center of their outlook, capabilities, and leadership
mandate” – according to McKinsey survey, May 2021
 13

KEY CHALLENGES

Source: Most significant challenges facing the industry (E&Y, 2020)

 14

VIETNAM AND ASEAN CONTEXT

E-BUSINESS

Source: Key barriers in Digital Transformation for businesses (VCCI, 2020)

 15

VIETNAM AND ASEAN CONTEXT

• More than 60% of businesses are using accounting
E-BUSINESSsoftware, of

which nearly 200,000 businesses are using Misa accounting

software.
• Over 200,000 businesses are using E-Invoicing software from
many different suppliers
• Almost all businesses have equipped and used digital signatures
• Online tax declaration software, online social insurance declaration
are applied in the vast majority of businesses in Vietnam.
 16

TECHNOLOGY-DRIVEN IN DIGITAL TRANSFORMATION

• If you’re a car manufacturer, which one isE-BUSINESS

your business value?
✔ Producing a car or Providing a transport service for your
customer
• Which valuation is more important for your business?
✔ Intellectual Property of the transmission design or self-driving
AI algorithms and relating data
=> The leadership team must really have a certain understanding
of the technologies
 17

TECHNOLOGY-DRIVEN IN DIGITAL TRANSFORMATION

• Elastic Cloud Computing E-BUSINESS

• IoT
• AI
• Big Data
 18

TECHNOLOGY-DRIVEN IN DIGITAL TRANSFORMATION

• Cloud Computing: Cloud computing is a general term for anything that

E-BUSINESS
involves delivering hosted services over the internet. These services are
divided into three main categories or types of cloud computing: infrastructure
as a service (IaaS), platform as a service (PaaS) and software as a service
(SaaS).
• Cloud computing works by enabling client devices to access data and cloud
applications over the internet from remote physical servers, databases and
computers.
 19

TECHNOLOGY-DRIVEN IN DIGITAL TRANSFORMATION

 20

TECHNOLOGY-DRIVEN IN DIGITAL TRANSFORMATION

• IoT: describes the network of physical objects—“things”—that are embedded with sensors,
E-BUSINESS
software, and other technologies for the purpose of connecting and exchanging data with
other devices and systems over the internet. These devices range from ordinary household
objects to sophisticated industrial tools (Oracle)
• Applications of IoT:
✔ Use sensors to detect which areas in a showroom are the most popular, and where
customers linger longest;
✔ Drill down into the available sales data to identify which components are selling fastest;
✔ Automatically align sales data with supply, so that popular items don’t go out of stock.
✔ Smart housing: https://www.youtube.com/watch?v=NjYTzvAVozo
 21

TECHNOLOGY-DRIVEN IN DIGITAL TRANSFORMATION

E-BUSINESS
 22

TECHNOLOGY-DRIVEN IN DIGITAL TRANSFORMATION

• AI: From fantasy to reality…
E-BUSINESS
• A Space Odyssey (2001) : HAL (Heuristically programmed Algorithmic computer)
✔ Play chess (search)
✔ Read clips (image/speech recognition)
✔ Engaged in conversation with humans
✔ Go mad
• AI (Steven Spielberg): a robotic boy
✔ Intelligent as a human being
✔ Feel emotions
• It is the science and engineering of making intelligent machines, especially intelligent computer
programs. It is related to the similar task of using computers to understand human intelligence,
but AI does not have to confine itself to methods that are biologically observable (John
McCarthy, 2004)
 23

TECHNOLOGY-DRIVEN IN DIGITAL TRANSFORMATION

Source: DifferentBetween.net
 24

TECHNOLOGY-DRIVEN IN DIGITAL TRANSFORMATION

• Big Data: data that contains greater variety, arriving in increasing volumes
E-BUSINESS
and with more velocity.
• Three Vs of Big Data:

Source: Oracle
 25

CASE STUDY
Study the case of GAP Inc. and:
• State the objectives
• Issues need to be solved
• Evaluation of the solutions
• Recommendation
• Implementation
Group of 4 – 5 person
Give a 5-min presentation
 DIGITAL
TRANSFORMATION
AND ARTIFICIAL
INTELLIGENCE
Lecturer: Nguyễn Thế Đại Nghĩa
Email: [email protected]
Phone/Zalo/Viber: 0936385487
 CHAPTER 2:
ARTIFICIAL INTELLIGENCE AND
DIGITAL TRANSFORMATION
 29

CONTENTS
• Concepts of Artificial Intelligence, Evolution and Components
• Main trends of Artificial Intelligence
• Some common problems
• Artificial Intelligence and Big Data
• Artificial intelligence in the context of Digital Transformation
• An overview of an Artificial Intelligence strategy in the Digital Age
 30

OVERVIEW
• A branch of computer science that is concerned with the automation of
intelligent behavior. (Luger)
• But, a more fundamental problem…
What is “intelligence”?
Can intelligence be inferred from observable behavior, or does it require
evidence of a particular internal mechanism?
Can intelligence be measured?
 31

OVERVIEW
• Traditional Computer Science: logical-based, scientists are trained to think
about algorithms, which are a sequential steps to solve some problems, then turn
it into a language that computer can understand.
• Example: data management, network connection, searching, etc…
• https://www.youtube.com/watch?v=_N2iIB_bLXA
 32

OVERVIEW
• WHAT IS INTELLIGENCE?

It is difficult to define, but could be observed in the real world

• Observe behaviors of the humans: solve problems, use tools,
cooperate, communicate, recognize voices/objects, think logically,
learn things, be adapted to environments, create art works, invent
things…
• Observe behaviors of the other creatures
• Observe mechanisms of the world (non-creatures)
 33

OVERVIEW
Artificial Intelligence: At its simplest form, artificial intelligence is a field, which combines
computer science and robust datasets, to build systems that are intelligent and can simulate
human intelligence.
Weak AI:

 Artificial intelligence is the study of systems that act in a way that to any observer
would appear to be intelligent.
Strong AI:
 Artificial intelligence involves using methods based on the intelligence behavior of
humans and other animals to solve complex problems.
 Try to mimic humans or living organisms
 34

OVERVIEW
IBM Deep Blue, 11 May 1997
defeat world champion of chess
IBM Watson: Question Answering Feb 2011
defeat human champion
natural language processing, information retrieval
Apple Siri (Google voice), since 2011
Speech recognition, natural language processing
Google automatic driver, 9 May 2012
sensor, classification, planning
 35

OVERVIEW
• AI can be done by: Machine Learning (ML), Deep
Learning (DL), etc…
• ML: is about finding knowledge within data. It is a
subset of AI, which allows machines to learn from
data they’ve used in the past and experiences—with
zero specific programming
• DL: is a specific class of Machine Learning
algorithms which are using complex neural
networks.
 36

MAIN TRENDS
E-BUSINESS
 37

MAIN TRENDS

Mining sectors having big potential for implementation of AI (Hyder el at, 2019)
 38

KEY CHALLENGES
E-BUSINESS
 39

KEY CHALLENGES
E-BUSINESS

Source: Hyder et al, 2019

 40

ARTIFICIAL INTELLIGENCE AND BIG DATA

E-BUSINESS
 41

AI AND DIGITAL TRANSFORMATION STRATEGY

• Customer Services: classification, recommendation engines, Chatbot
E-BUSINESS
• IT and Security: facial recognition, fingerprint scanners, generating complex
password for protection
• Sales: predicts potential prospects, get the right ads to the right people, fix
prices
• Business Operations: automating workloads, preventing outages, analyzing
data for business insight
• Human Resources: streamline onboard process, employee self-service
portals
 42

AI AND DIGITAL TRANSFORMATION STRATEGY

E-BUSINESS
New technology or software doesn’t instantly provide ROI.
You must develop a change management strategy that
focuses on those end-users that will be using these
technologies, ultimately driving adoption of these new
applications.
 43

CASE STUDY
Study the case of GROW Inc. and:
• State the objectives
• Issues need to be solved
• Evaluation of the solutions
• Recommendation
• Implementation
Group of 4 – 5 person
Give a 5-min presentation
 DIGITAL
TRANSFORMATION
AND ARTIFICIAL
INTELLIGENCE
Lecturer: Nguyễn Thế Đại Nghĩa
Email: [email protected]
Phone/Zalo/Viber: 0936385487
DIGITAL TRANSFORMATION AND ARTIFICIAL
INTELLIGENCE :
STRATEGIC IMPLEMENTATION IN DIGITAL
TRANSFORMATION
 47

CONTENTS
• GENERAL PROCESS OF DIGITAL
TRANSFORMATION
• FIVE-STAGE APPROACH – A MODEL FOR
YOUR DIGITAL TRANSFORMATION
• WHAT HAVE YOU LEARNED FROM THEM?
 48

CHALLENGES
Five stages of individual Digital Transformation:
1. Deny
2. Fear
3. Angry
4. Enjoy
5. Addict
 49

CHALLENGES
The most popular challenges:
1. Employee’s fear
2. Manager’s resistance
3. Revenue loosing from non-digital customer segments
4. Performance reduction in regular tasks
5. Lack of synchronization
 50

GENERAL PROCESS
Step 1: STRONG AND PROPER AWARENESS
Step 2: BUILD-UP STRATEGY AND IMPLEMENTATION
PLAN
Step 3: DEFINE TECHNOLOGY FOUNDATION AND
BUILD UP DIGITAL CAPACITY
 51

PROPER APPROACH
Managing strategic transitions
• Adopting strategic systems requires changes in
business goals, relationships with customers and
suppliers, and business processes
 52

BRIDGE

Bridging the gap between A BUSINESS AND

ITS CUSTOMERS and with THE CHANGES
taking place in the business environment
 53

BRIDGE
Why?
How much you need to change?
How long you need to change?
=> The only way is to step outside
the business and have a more
objective, holistic view
 54

BRIDGE
How?
Approach the information and environment outside to
bridge the gap between supply capacity and market
demand:
• Enhance competitive edge
• A consensus view between leaders
=> Bridge the gap to fill the gap
 55

BRIDGE
Expect?
• Proof from current situation of you competitor
• Understanding your customer
• Knowledge about the technologies
• Vision for the Digital Transformation Strategy
• A group of Digital Transformation Leaders
 56

UNCOVER
Uncovering an organization's HIDDEN
roadblocks, USEFUL assets, and NEEDED
resources for planning and prioritizing rooms
for Digital Transformation
 57

UNCOVER
Why?
Digital doesn't cover up the
organization's problems, it helps
us solve them
=> Find barriers to Digital
Transformation, which hidden
within your employees, processes,
and platforms
 58

UNCOVER
How?
• Determine the ultimate goal for each project
• Balance the number of projects with resources, budget, and
space
• Leverage Digital Transformation Leaders
 59

UNCOVER
Expect?
• Internal barriers
• Expected resources
• Personal outcome
• Needed human and their skills
• Connection between departments
 60

ITERATE

Using SHORT LOOPS, TEST with customers and

IMPROVE based on the leaders' perspective to
find INNOVATION that should be disseminated
 61

ITERATE
Why?
• Ensuring performance
measurement
• Optimizing resources
• Making decision promptly
 62

ITERATE
How?
• Building up
• Examining
• Learning
• Improving
• Iterating
 63

ITERATE
Expect?
• Project group collaboration
• Prototype
• Outcome and evaluation
• Valuation
• Success approach
 64

LEVERAGE

Leverage success to ACCESS GREATER

RESOURCES, leverage influence and space to
DEVELOP NEW SOLUTIONS, new ways of doing
things, and MORE FORWARD THINKING
 65

LEVERAGE
Why?
Taking advantages from
previous success will help
you:
• Making decision become
easier
• Where and When to keep
developing
 66

LEVERAGE
How?
• Fully focus on the preparation to optimize the
success of the previous stage
• Carefully evaluate your resources best use for
 67

LEVERAGE
Expect?
• Influence and win more consensus view
• Promoting success
• Determining favorable areas for expanding
• Competition
 68

DISSEMINATE

Systematically disseminating INNOVATIONS and

new ways of working to thrive in making the new
business environments FAMILIAR
 69

DISSEMINATE
Why?
• Gradually increasing the
scale in all business fields
• Achieve sustainable
adaptability in a changing
and complex environment
 70

DISSEMINATE
How?
• Officialize new ways of working
• Offer new reward structure
• Put the new model into the daily operations of
the business
 71

DISSEMINATE
Expect?
• New improvements are implemented continuously
• Flexible systems for expanding in all areas
• Specific reward criteria encourage employees
• Formalize new processes, continue to invest strategically
 72

WHAT HAVE WE LEARNT FROM?

“The big risks bring the big rewards. Don't be afraid to fail,
instead develop a healthy fear of losing because you were
afraid to take a risk”
 DIGITAL
TRANSFORMATION
AND ARTIFICIAL
INTELLIGENCE
Lecturer: Nguyễn Thế Đại Nghĩa
Email: [email protected]
Phone/Zalo/Viber: 0936385487
 CHAPTER 4:
ORGANIZATIONAL CAPACITIES
 76

CONTENTS
• THE THREE PILLARS OF DIGITAL
TRANSFORMATION
• THE ROLE OF TECHNOLOGY IN DIGITAL
TRANSFORMATION
• AI & BIG DATA: OPPORTUNITIES AND
CHALLENGES FOR FIRM PERFORMANCE
 77

THE THREE PILLARS OF DIGITAL TRANSFORMATION

1. Improving the core

2. Building new business models
3. Developing digital capabilities
 78

IMPROVING THE CORE

Use digital technologies to enhance the core products/services

and improve the current processes.
• Introduce new features
• Enhance customer experience
• Redesign business processes to improve the effectiveness
and save resources
 79

IMPROVING THE CORE

• Digital technologies enable the collection of large datasets

▫ Understand customer preferences
▫ Optimize revenue management
▫ Utilize capacities and profits

 Improve business performance and customer satisfaction

 80

BUILDING NEW BUSINESS MODELS

• New technology competitors enter to the market while current

competitors are developing new services.
• New business models can be built in two ways:
▫ Build a new company adopting the new technology and platform
▫ Invest in start-ups or other companies like a venture capital fund
 81

BUILDING NEW BUSINESS MODELS

• New business models offer a variety of services and connect
these new services to the core business of the firm.
▫ Example: Deutsche Bahn, the German railway company, offers
customers high-speed train service to cover long distances and
ride pooling service for the first or the last mile.
• Must have a clear investment map to focus only on related
markets.
• Expect that new business models will cannibalize core
business.
 82

DEVELOPING DIGITAL CAPABILITIES

IT Innovation New work-

Data
Infrastructure ecosystem styles
 83

DEVELOPING DIGITAL CAPABILITIES

Data
• Data platform helps improve products/services and processes.
• All business units can access a data platform easily and use it
seamlessly.
• Leverage AI & machine learning to actually make use of data
 84

DEVELOPING DIGITAL CAPABILITIES

IT Infrastructure – Hardware & Software
• Build your own requires a team with diverse skill set; choice of
software tools; both risks and possible benefits
• Outsourcing: Hiring vendors to provide services involved in
building your system and site
• Take advantage of cloud computing services  Rapidly scale
and adapt data via standardization
• Combine public and private cloud computing
 85

DEVELOPING DIGITAL CAPABILITIES

Innovation ecosystem
• Develop programs to bring innovation inside
▫ Build prototypes and scale them
▫ Cooperate with start-ups or large tech companies to improve
processes and develop new products or services
▫ Hold a entrepreneurship program to create entrepreneurs within a
company
▫ Create products in a dev-ops environment as tech firms do
 86

DEVELOPING DIGITAL CAPABILITIES

New work-style
• Work-style: the collection of behaviors and attitudes that you
apply to your tasks and relationships in the workplace
• Work in teams: cross-functional, agile teams
• Not only IT or business teams  Integrated teams that have
much more ownership in the final product.
• Eliminate silos effect
• Leverage external forces
 87

DEVELOPING DIGITAL CAPABILITIES

Agile methodology
• Manage a project by breaking it up into
several phases
• Constantly collaborate with stakeholders and
continuously improve at every stage
• Teams cycle through a process of planning,
executing, and evaluating
• Continuous collaboration with team
members and project stakeholders
 88

ROLE OF TECHNOLOGY
• Technology is not the same as digital transformation
• Technology is just the first step, the engine, the solution that is
nowadays necessary in the process of the digital
transformation of an organization.
• Technology as a driver of digital transformation:
▫ The customer requires immediate and fast communication.
▫ The need of disintermediation has emerged.
▫ The development of supplier technology infrastructures requires
the alignment between the supplier and the firm
 89

ROLE OF TECHNOLOGY
• Technology as an enabler of digital transformation:
▫ Digital technologies allows organizations to easily adapt business
processes and drive higher levels of innovation.
▫ The use of technologies requires an IT strategy in full compliance
with business objectives.
• Technology gives us the means. It’s what we want to do with it
that matters. Changing business processes and corporate
culture are just as vital to your success.
 90

IMPACT OF AI ON FIRM PERFORMANCE

Opportunities
• Monitor and analyze marketing data across all the media
channels (Acquisio)
• Track competitors over different channels like websites, social
media, and apps (Crayon) to provide detailed analysis of
competitors’ changes in marketing planning like price changes,
PR activities.
 91

IMPACT OF AI ON FIRM PERFORMANCE

Opportunities
• Make use of Big Data by providing tools for business that can
be fitted in every data producing workflow and provide close
insights.
• Integrate to CRM platforms to analyze real-time data in order
to provide predictions as well as recommendations based on
business processes and customer data.
 92

IMPACT OF AI ON FIRM PERFORMANCE

Challenges
• Computing is not that Advanced: AI techniques utilize a lot of
processing power due to increasingly complex algorithms and
large data volumes.
• AI has not been able to create trust among people because
they don’t understand how the decision was made by AI. Do all
AI’s decisions are perfect?
 93

IMPACT OF AI ON FIRM PERFORMANCE

Challenges
• Lost of data privacy and security: Machine learning systems
depend on the data which is often sensitive and personal. These
systems can become prone to data breach and identity theft.
• Algorithm bias: AI’s level of goodness or badness depends on
the much data they are trained on. Bad data is often associated
with, ethnic, communal, gender or racial biases.
• Data scarcity
 94

IMPACT OF BIG DATA ON FIRM PERFORMANCE

Opportunities
• Better insight into customer preferences, buying behavior and
sentiment
• Increased intelligence on market trends, products and competitors
• Agile supply chain operations that can react quickly to problems
and new business needs
• Recommendation engines that are better tuned to the interests of
customers
 95

IMPACT OF BIG DATA ON FIRM PERFORMANCE

Opportunities
• Data-driven innovation in product development and other business
functions
• Support diverse analytics use cases with the same data sets
• Operational improvements, such as lower costs and proactive
equipment maintenance
• Ensure data and analytics platforms can meet future business
needs.
 96

IMPACT OF BIG DATA ON FIRM PERFORMANCE

Challenges
• Technical challenges: selecting the right big data tools and
technologies and designing big data systems so they can be
scaled as needed
• Data management challenges: from processing and storing large
amounts of data to cleansing, integrating, preparing and governing
them
 97

IMPACT OF BIG DATA ON FIRM PERFORMANCE

Challenges
• Analytics challenges: ensuring that business needs are
understood and that analytics results are relevant to an
organization's business strategy
• Program management challenges: keeping costs under control
and finding workers with the required big data skills
 DIGITAL
TRANSFORMATION
AND ARTIFICIAL
INTELLIGENCE
Lecturer: Nguyễn Thế Đại Nghĩa
Email: [email protected]
Phone/Zalo/Viber: 0936385487
 CHAPTER 5:
Impacts of Digital Transformation and AI to
business models
 101

CONTENTS
• 5.1 Digital transformation and business model
• 5.2 Impact of AI in changing traditional business
models
• 5.3 Corporate culture of digital transformation
• 5.4 Recommendations for businesses in digital
transformation
 102

5.1 Digital transformation and business model

1. Map out the current business model

2. Engage with the transformation opportunities
3. Derive the necessary changes
4. Make sure you’ve hit your target
 103

The Business Model Canvas

• Nine key elements comprise the basic building blocks of a business; their
positions on the canvas illuminate how they affect one another.
104
 105

5.2 Impact of AI in changing traditional business models

 106

5.2 Impact of AI in changing traditional business models

 107

5.3 Corporate culture of digital transformation

1. Set The Expectation

2. Work Out A Communication Plan
3. Promote The Idea Of Change
4. Establish Metrics And Goals
5. Get Employees Involved
 108

Barriers to Digitalizing
organizational culture
 109

5.4 Recommendations for businesses in digital transformation

1. Vision and implementation are inseparable bedfellows

2. Small failures are the safest learning tool
3. Transformation often starts in the mundane