The Asia-Pacific region largely avoided the rising inflation and recession plaguing Europe and North America in 2022. However, next year is likely to be different as fallout from the global economic slowdown spreads.
Geopolitical friction, global economic pressures, and post-pandemic challenges will all have an impact on an APAC that is even more regionally focused in terms of trade and tech strategies, according to Forrester’s Asia Pacific 2023 Predictions.
Yet despite embracing technology-led solutions designed to improve the lives of customers, companies will struggle to keep pace with rising customer expectations concerning omnichannel experiences and environmental, social, and governance (ESG) commitments.
To accelerate growth, APAC firms will also sharpen their regional focus by investing in opportunities that reduce their dependence on global solutions. For example, in 2023, expanding cross-border commerce, investing in digital industrial platforms, and leveraging emerging technologies will all be major growth drivers for technology companies.
Other Forrester Predictions for 2023 include:
- Regional cross-border commerce will grow by 20 percent. Key economies in the region such as China and India are embracing modern payment networks and the Regional Comprehensive Economic Partnership (RCEP) agreement will further boost cross-border commerce. Additionally, modern cross-border payment networks are poised to replace the 50-year-old SWIFT system, which the region still uses as its payment infrastructure.
- Adoption of in-region digital industrial platforms will rise by 30 percent. Among regional business and tech leaders who view using platforms as a high priority, 43 percent use industry-specific cloud solutions. The region’s manufacturing, construction, utilities, and other industrial firms currently account for 45 percent of the global industrial sector and these companies are expected to lead industry cloud adoption to deliver sustainable customer value.
- Process intelligence will revive 20 percent of failing robotic process automation (RPA) programs. Most large firms in the region have adopted RPA over the past five years, yet many struggle to identify high-value processes to automate. APAC currently accounts for 11% of the global market for process intelligence, however as many as one in five firms in the region are expected to adopt process intelligence solutions to reinvigorate stalled or flatlining RPA programs in 2023.
- Four in five new omnichannel programs will fail. Firms are reprioritising face-to-face customer experiences following the pandemic lockdowns as a way of improving quality of service. However, the siloed nature of most of these efforts will result in disconnected initiatives that don’t meet customer demands for real-time personalised services across channels.
- At least 50 APAC firms will be penalised for performative ESG efforts, with five facing severe regulatory fines. Consumers across the region are forcing companies to publicly commit to ESG standards, but pressure to act quickly will lead some to overstate their actions. Offenders could face penalties of US$10 million or more as APAC regulators follow their US and European counterparts and clamp down on greenwashing.
“The past two years have challenged us all to be resilient, creative and adaptive,” Forrester VP and Research Director Michael Barnes says. “In 2023, successful business leaders must sharpen their focus and stay true to their customer-obsessed mission and values.
Geopolitical tensions and the global economic slowdown are forcing firms across Asia Pacific to find new growth drivers and lead with purpose in the face of growing uncertainty. Most will struggle, however, to find a balance between investing in transformation and growth while simultaneously embracing environmental sustainability, operational reliability, and employee empowerment.”
To learn more about what’s ahead of technology, security & risk, sustainability, digital, customer experience and marketing leaders in Asia Pacific, join the Predictions 2023 Sydney event on 7th of December and explore this resources page for the latest insights. Get ahead of shifting market dynamics and prepare your organisation for new opportunities and growth in the new year.