Emerging disruptors create opportunities for Asean’s essential industries
The rapid digitalization of the Asean’s (Association of Southeast Asian Nations) essential industries such as education, health care and supply chain amid the global pandemic has opened new possibilities for digital disruptors, according to a new study by Cisco and Jungle Ventures.
Titled Emerging Disruptors from the Global Pandemic, the report looks at the transformation of essential services in the region during COVID-19 and the models of successful disruptors.
It highlights how the national digitalization agendas of many Asean economies has helped ease the transition for the region’s organizations to remote operations and working during COVID-19. As a result, Asean is emerging as one of the fastest growing mobile-first economies in the world, with the development of a multiple digital-native platforms spanning essential sectors.
“COVID-19 has demonstrated our inherent human capacity to innovate at scale and with speed, when faced with disruption. Some of the hardest-hit sectors at the start of the pandemic like education, health care and supply chain logistics, were able to reimagine the future, implement innovative strategies and adopt an entrepreneurial and resilient mindset. We are now seeing large waves of innovation emerging which will cater to this new reality,” said Naveen Menon, president, Asean Cisco.
The report also showcases how changes in the global economy have contributed to the emergence of startups transforming and adapting industries and disrupting organizations. With the majority of the Asean’s economy still largely offline, this presents a large opportunity for technology startups. Recent data from Station F, one of the world’s largest startup campuses, shows that 18 percent of startups globally have made a pivot to address a new market since the start of the crisis and another 13 percent are considering a similar move in the next six months.
“Business disruption can be the trigger for innovation and many startups in Asean have been at the forefront of this digitization shift to fill the gaps and capture the new opportunities that have emerged. As one of the largest early and growth stage venture capital firms in Southeast Asia, we are excited to partner with Founders who are looking to solve these new, emerging, and very real challenges and build long-lasting, category-leading businesses,” said Amit Anand, founding partner, Jungle Ventures.
The paper provides deep analysis on how businesses in three key sectors—education, health care and supply chain and logistics—have responded to this crisis and adopted technology quickly and innovatively to minimize interruptions to their services.
Narrowing gaps in education
COVID-19 saw the shutdown of schools and learning institutes disrupting billions of students globally, including 160 million students in Asean, based on Unesco data. Teaching quickly moved online, but on an untested and unprecedented scale, making it challenging for teachers to adapt. Despite its 350 million internet users, technology infrastructure and internet connectivity, the prerequisites to enabling distance learning were not equally accessible in different locations and communities within Asean.
The report finds that many companies have yet to venture fully into a blended learning and online learning experience. But, some key disruptors have already emerged and are forecast to gain further prominence. One of them is Jarimatika Foundation, which focuses on upskilling homemakers to shape the minds and skills Indonesia’s next generation.
New normal in health care
The report shows that a shift to digital technologies forced by the pandemic can represent a turning point for legacy health care organizations that are willing to invest in new digital technologies and transform their models. Agility and innovation are two important advantages for disruptors entering the health care market.
Leading disruptors in this sector include, Homage, a Singapore startup that is leveraging the rising demand for preventive care amidst a growing ageing population in the country by introducing personalized, expert yet affordable care at home. Moving forward, the study finds health care professionals and industry players must continue to adopt and leverage digital technologies well after the world has won its fight against COVID-19. Public and private health care facilities will need to adapt, while governments should enact policies to support this shift. This has the potential to shape a new normal in health care where technology-enabled primary and preventative care delivery models will emerge as game-changers in the long term.
Transforming supply chain, logistics management
The global pandemic has seen countries and companies around the world grappling with their heavy reliance and high concentration of supply chains in certain regions. COVID-19 created ripple effects across the global economy and cemented the importance of supply chain visibility and network mapping.
Catalyzing innovation, positive change
The study recommends that building the right business and strategic workflows can help resolve issues in supply chain and logistics management. Some of the key technology players changing the logistics market are those offering digital procurement solutions through a valuable and seamless combination of software and services. Moglix, a Singapore based dedicated digital procurement platform emerged as one such company which enables manufacturing companies and their key sourcing partners to digitize the entire procurement workflow. While crisis control will never be fully automated, comprehensive supply chain visibility with real-time precise data will become a key success factor in the future.Changes in the global economy and the emergence of disruptors have demonstrated the need for startups to transform to adapt to and capitalize on the new growth momentum.
In addition, the report recommends that governments and policymakers in Asean need to determine how their respective countries can capitalize on opportunities to modernize essential industries. Enterprises in Asean that are looking to capitalize on and support this digital disruption need to also work with their ecosystem partners to enhance offerings.
“A multipronged approach involving close collaboration among governments, the public sector and private sector stakeholders is required to drive positive change in Asean’s startup ecosystem.
We believe in the value of an innovation ecosystem and remain committed to fostering and scaling high-growth technology startups across the Asean region,” said Rajiv Menon, head of Cisco Investments and M&A for Asia Pacific and Japan.
Cisco is an American multinational technology conglomerate headquartered in San Jose, California. It develops, manufactures and sells networking hardware, software, telecommunications equipment and other high-technology services and products.
Jungle Ventures is a Singapore-based venture capital firm that invests in early and growth stage startups and helps build tech category leaders from Asia.
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