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The Impact of Digital Transformation in China

As in most of the world, the Chinese economy is undergoing a protracted period of digital transformation.


As in most of the world, the Chinese economy is undergoing a protracted period of digital transformation. But given the sheer scale of the economy and the huge strategic subsidies provided by the Chinese government, the country’s digital economy is having a global impact.


By Jing-Jing Lui, Director, Sheffield Haworth

作者刘晶晶 ,总监,Sheffield Haworth

Digital transformation has become an ever more vital part of national strategy in China since the country adopted its 14th five-year plan in March 2021. This was the same year that the digital economy accounted for almost 40% of China’s GDP, according to the China Academy of Information and Communications Technology (CAICT). The country’s strategic emphasis on building and extending digital infrastructure aims to boost computing power and reduce the cost of emerging technologies such as 5G, artificial intelligence (AI), blockchain, cloud services, and quantum computing.

自中国于 2021 年 3 月通过“十四五”规划以来,数字化转型已成为中国国家战略中越来越重要的一部分。同年,数字经济占中国 GDP 的近 40%。信息与通信技术学院 (CAICT)。该国对建设和扩展数字基础设施的战略重点旨在提高计算能力并降低 5G、人工智能 (AI)、区块链、云服务和量子计算等新兴技术的成本。

Chinese companies have taken up the challenge and are keen to accelerate – and profit from – this national push towards widespread digital transformation. According to Accenture’s 2021 Global CEO Survey, Chinese companies plan to invest in AI, machine learning, and automation, as well as to build more agile and resilient operating models and supply chains.

中国公司已经接受了挑战,并热衷于加速且从中获利——这种国家推动广泛的数字化转型。根据埃森哲 2021 年全球 CEO 调查,中国企业计划在人工智能、机器学习和自动化领域进行投资,并建立更敏捷、更有弹性的运营模式和供应链。

From this foundation, Chinese enterprises are looking to accelerate digital transformation by launching breakthrough digital products and services, innovating core processes, establishing more flexible supply chains, and becoming more customer centric. For example, in response to falling sales caused by the pandemic, fast fashion brand UR developed an e-commerce service covering 300 stores nationwide within 15 days.


What does digital-first strategy look like for Chinese firms?  


According to IDC’s most recent 2021 forecast, China’s total ICT market will reach $793.7 billion in 2022, an increase of 9.2% over 2021. This is faster than the growth of GDP, a trend that IDC believes is likely to continue. Digital transformation spending will reach $329.1 billion in 2022, an increase of 18.6% over 2021.

根据 IDC 对 2021 年的最新预测,2022 年中国的 ICT 市场总额将达到 7937 亿美元,比 2021 年增长 9.2%。这快于 GDP 的增长速度,IDC 认为这一趋势可能会持续下去。 2022年数字化转型支出将达到3291亿美元,比2021年增长18.6%。

Chinese businesses in 2022 are seeing strong demand for digitalisation, and broadly benefiting from excellent digital infrastructure, an accelerating pace of digital innovation, and the government’s huge digital stimulus plan. At the same time, Covid is still not over, leading to significant global supply chain tensions, geopolitical risks, and rising prices, along with increased cybersecurity risks, new demands for privacy protection, and an increasing shortage of digital skills.


Against this uncertain background, enterprises need to develop digital-first strategies that incorporate the following priorities:  

  1. Wireless connectivity
  2. Customer personalisation
  3. Digital twinning
  4. Edge data
  5. Domain intelligence
  6. Hybrid working and remote operations
  7. Data security and data privacy
  8. Software innovation


1. 无线连接

2. 客户个性化

3. 数字孪生

4. 边缘数据



7. 数据安全和数据隐私


Disney – an example of accelerated digital transformation


Disneyland in China is a great example of a company that has accelerated its digitalisation as a result of Covid. While the global parent company has announced the closure of 20% of its retail stores around the world and a strengthening of its e-commerce business, plus a focus on the Disney+ streaming service that already has around 95 million global subscribers, the Chinese theme park has launched its own app to improve the park experience.

中国的迪士尼乐园是一家因新冠病毒而加速数字化的公司的一个很好的例子。虽然这家全球母公司已宣布关闭其在全球 20% 的零售店并加强其电子商务业务,同时专注于已拥有约 9500 万全球订户的 Disney+ 流媒体服务,但中国主题公园推出了自己的应用程序来改善公园体验。

Customers can use the app to purchase park tickets online, arrange full-day park plans, check the estimated waiting times of park attractions in real time, schedule entertainment performances, browse maps online, and pre-order food. The app in turn will provide the park with high volumes of data around customers’ preferences and spending habits, allowing it to tailor its service offerings and select upsells to maximise its own profits while offering more personalised customer service.


Biggest data challenges facing Chinese companies


In China, the amount of data generated by large enterprises is growing at a rate of 40% to 60% per year. Naturally, this leads to a series of challenges around storing, managing, and analysing this data, including:


  • Synchronization requirements across different data sources

As datasets become larger and more diverse, integrating them into analytics platforms will be a huge challenge. This could create gaps that lead to misinformation and inaccurate analysis.



  • Importing large amounts of data into data platforms

Businesses and business units need to process large amounts of data daily, so data platforms must have the capacity to cope with this.



  • Risks of choosing new data management technology

One of the biggest challenges for data analysts is figuring out which data management technology works best for them without introducing new problems and potential risks.



  • Data storage and quality

Data storage is becoming another huge challenge for companies, from SMEs to the largest multi-national corporations. When a data warehouse tries to merge unstructured and inconsistent data from various sources, this can lead to data loss, inconsistency, logical conflicts, and data duplication, all of which can seriously undermine data quality.



  • Data security and privacy

Big data comes with serious challenges around data privacy and security. Big data analytics and storage tools leverage a variety of different data sources. This ultimately leads to a high risk of exposing the data, making it vulnerable.



  • The critical shortage of data analysts at all levels

With exponential data growth comes a huge demand for data analysts. Organisations need to hire data analysts with multiple skills because data analysis is a multidisciplinary profession. Another major challenge facing businesses is the lack of senior leaders and executives who understand data analytics. As a result, we’re seeing a severe and growing shortage both of skilled data analysts and executives who understand the discipline.



Asia-Pacific poaching digital talent from Europe?


Public data suggests that digital transformation has penetrated every major market and every major industry around the world. According to data from LinkedIn, digital talent is concentrated in manufacturing, financial services, consumer goods, and corporate services, with the top geographical concentrations of digital talent outside of ICT industries being Los Angeles, New York, Hong Kong, the UAE, and London. 

公开数据表明,数字化转型已渗透到全球每个主要市场和主要行业。 LinkedIn 的数据显示,数字人才集中在制造业、金融服务、消费品和企业服务领域,除 ICT 行业之外,数字人才最集中的地区是洛杉矶、纽约、香港、阿联酋和伦敦.

The flow of digital talent is also interesting. The top five global cities for attracting digital talent are Dublin, Berlin, Singapore, Shenzhen, and Milan, while Beijing, Nanjing, Guangzhou, Chicago, and Boston are in a state of net outflow of digital talent. Shanghai is the hub for the flow of digital talent in China. While North American and Asia-Pacific talent seems mainly inclined to internal flow, nearly half of digital talents in Europe are currently flowing to Asia-Pacific, which indirectly indicates the vitality of the digital economy in the Asia-Pacific region.