Wood businesses implement digital transformation

VCN - Digital transformation is a trend chosen by wood enterprises to increase production efficiency. However, each business is a story of its own, it needs its own solutions, and digital transformation is a long process that businesses need to have a plan and appropriate resource allocation for each stage to achieve effective results.
The timber industry needs more warning measures on trade remedies The timber industry needs more warning measures on trade remedies
Wood enterprises exporting perfunctorily due to dropping orders Wood enterprises exporting perfunctorily due to dropping orders
Exports to the US drop resulting in a decline of the growth momentum of wood industry Exports to the US drop resulting in a decline of the growth momentum of wood industry
Wood businesses implement digital transformation

High-quality personnel is the weakness of wood enterprises when implementing digital transformation. Photo: TL

Difficulty in personnel

The "Report on the situation of digital transformation of the wood industry 2022" conducted by Novaon Tech, the Vietnam Internet Association with the participation of the Handicraft and Woodworking Association of Ho Chi Minh City (HAWA), shows that up to 75% of enterprises evaluate that digital transformation will be a strong influence on the core competitiveness of enterprises in the next one to five years.

During the two years of the pandemic, digital transformation helped wood businesses reduce costs by 10%, while revenue grew by 10-20% and labor productivity increased by more than 20%.

However, the level of digital transformation of Vietnam's wood industry is at a low level. The report shows that 20% of businesses have yet to digitally convert any item, more than 56% of businesses have only partially converted and only 4.2% of businesses have digitally converted the entire operation process.

There are three reasons for this situation, which is the high initial cost; technology capacity and human resources have not yet met digital transformation and businesses lack professional partners, capable of consulting and providing good solutions.

Specifically, up to 82.5% of businesses are concerned about the initial cost being too high; 80% of enterprises lack professional partners with good consulting capacity and solutions with high competitiveness. Besides, 65% of enterprises face difficulties in skills, technology capacity and human resources.

In addition, in the process of digital transformation, wood industry enterprises also face difficulties such as leaders who do not have the desire to implement digital transformation, business strategies that have not set digital transformation as a priority, and there are too many customers.

With 30 years of experience in supplying machinery and equipment in the wood processing industry, Mr. Le Duc Hieu, Project Manager of Vi Dai Trading Company Limited (VETTA), assessed Vietnamese wood processing enterprises as not inferior to other countries in the region in terms of investment in single machinery. However, compared with large enterprises in the region and European enterprises, they lack the connection between single machines to be able to operate smart production lines.

Mr. Hieu pointed out that the problem of most wood processing enterprises in digital transformation today lies in human resources. “After decades of development and accumulation, Vietnamese wood enterprises have enough financial capacity to invest and buy modern machinery from Europe and accompanying software for smart production. However, not all enterprises have high-quality human resources to operate that smart chain," said Mr. Hieu.

Accordingly, out of ten businesses that buy machinery and equipment with accompanying software, only three can operate smart production lines. While the cost for the lowest investment in smart production software is VND3 billion, the package software can be up to VND10 billion. But according to Mr. Hieu, there are businesses that invest VND10 billion to buy machinery and software but cannot operate because of a lack of human resources.

Building on-site team

Mr. Nguyen Chanh Phuong, Vice President of HAWA, said that in the past, HAWA has communicated to businesses to understand where digital transformation begins and now HAWA has moved to the next step of making this journey.

Specifically, HAWA has started by building awareness among business leaders as well as building a group of CIOs (directors of information technology) to narrow the gap between business leaders and those performing the work of digital transformation. At the current stage, HAWA is introducing specific solutions for businesses with appropriate costs.

According to Mr. Nguyen Chanh Phuong, digital transformation depends on the vision and thinking of enterprises, there is no best solution, covering all businesses but only suitable solutions for the business group or just a specific enterprise.

The same is digital transformation, but businesses should not be mechanical and modeled after other businesses because they will not create different values ​​but also unintentionally put pressure on each other to compete.

As a manufacturer and exporter of interior and exterior furniture for major brands and distribution systems in Europe and America, Scansia Pacific Company started digital transformation 10 years ago.

Mr. Nguyen Hoai Bao, Vice President of Scansia Pacific shared that in order to transform digitally, enterprises must first standardize internal processes and then choose software solutions from external units. At this time, the difficulty lies in the fact that the software suppliers do not understand much about production and vice versa, the production staff do not have software expertise, so the interaction and exchange are limited.

Overcoming this difficulty, Scansia Pacific has built its own software development team and this works very well when it is able to quickly review and solve problems of enterprises.

Mr. Nguyen Hoai Bao shared the great benefits that Scansia Pacific has received thanks to digital transformation. “Anywhere, business leaders can open their phones to view reports, open applications on their phones to see the production situation every hour, every minute, where the goods are being produced. This is a great liberation for business leaders,” said Mr. Bao.

Mr. Bernd Kahnert, CEO of GCC Consultancy Co., Ltd. recommended that businesses should not be too greedy when implementing digital transformation but should do it step by step. "This is not a short-distance race, but a long-term marathon," said Bernd Kahnert.

Accordingly, businesses need to have the appropriate calculation and allocation of resources for each period to bring the highest benefits.

By Nguyen Hien/Quynh Lan

Related News

Unlock capital flows and create favorable conditions for investors

Unlock capital flows and create favorable conditions for investors

VCN - Talking with the press, Dr. Ngo Cong Thanh (Photo), Provisional Executive Committee member of the Vietnam Industrial Park Finance Association (VIPFA), said that it is necessary to open up capital flows and create conditions for investors to access key factors. Facilitate production and business factors and innovate investment promotion activities to more effectively develop industrial parks.
Businesses hunts for effective implementation of Resolution 02

Businesses hunts for effective implementation of Resolution 02

VCN - According to Dr. Nguyen Minh Thao, Head of the Business Environment and Competitiveness Research Department (CIEM), businesses long to administrative reform and business environment improvement, which also are the least expensive support package amid the shortage of support resources.
Businesses expect reforms to be effective, substantive and put into practice

Businesses expect reforms to be effective, substantive and put into practice

VCN - The restoration of the Reform Program to improve the business environment by issuing Resolution No. 02 dated January 5, 2024 to create pressure and arouse the motivation and spirit of reform for ministries, branches and localities.
Finance sector abolishes 40 administrative procedures

Finance sector abolishes 40 administrative procedures

VCN - The Ministry of Finance said that in the first two months of 2024, the Ministry of Finance issued four decisions announcing amendments and supplements and replacement of 21 administrative procedures; abolishing of 40 administrative procedures and issuing 10 new administrative procedures in the fields of tax and insurance.

Latest News

Import turnover of 19 commodity groups grows over 20%

Import turnover of 19 commodity groups grows over 20%

VCN – Most of major import commodity groups have high growth turnover compared to the same period in 2023.
Vietnam owns significant advantages in attracting FDI

Vietnam owns significant advantages in attracting FDI

VCN - In an interview with Customs News, Dr. Vo Tri Thanh, Director of the Institute of Branding and Competition Strategy, believed that the global minimum tax could affect global foreign direct investment (FDI) flows and the FDI attraction policies of each country. However, "in crisis lies opportunity", Vietnam still has significant advantages in attracting FDI.
Nearly 7,000 tariff lines of AKFTA product specific rules need to be transposed

Nearly 7,000 tariff lines of AKFTA product specific rules need to be transposed

VCN - ASEAN member states and the Republic of Korea (RoK) reached a consensus on the transposition of ASEAN-RoK Free Trade Agreement (AKFTA) Product Specific Rules from the Harmonised System Codes HS 2017 to HS 2022.
Vietnam needs to cook up stronger global rice brand

Vietnam needs to cook up stronger global rice brand

Although Vietnamese rice has a foothold in several fastidious markets, there is a long way to go to make it a stronger brand globally, according to insiders.

More News

Vietnam advised to fully tap CPTPP to boost exports to Canada

Vietnam advised to fully tap CPTPP to boost exports to Canada

The Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP) has opened up numerous opportunities for Vietnam and Canada to boost two-way trade, however, tax initiatives under the trade pact have not been tapped to the fullest extent by the Vietnamese exporters, said Vietnamese Trade Counsellor in Canada Tran Thu Quynh.
ASEAN, RoK agree on transposition of AKFTA product specific rules

ASEAN, RoK agree on transposition of AKFTA product specific rules

ASEAN member states and the Republic of Korea (RoK) have reached a consensus on the transposition of ASEAN-RoK Free Trade Agreement (AKFTA) Product Specific Rules from the Harmonised System Codes HS 2017 to HS 2022.
Opportunities for digital technology businesses to go global

Opportunities for digital technology businesses to go global

Finding solutions and directions to promote and develop Vietnamese digital technology enterprises is an important task, which will promote the stability and sustainability of the country's economy, heard a recent conference.
Vietnam, China eye stronger border trade

Vietnam, China eye stronger border trade

Border provinces of Vietnam and China should continue close coordination and enhance trade promotion between the two sides, stressed the recent talks between the management boards of the economic zone of the northern province of Ha Giang and the Malypo border economic cooperation zone of China’s Yunnan province.
Improve competitiveness and sustainable development of the seafood industry

Improve competitiveness and sustainable development of the seafood industry

VCN - In early 2024, seafood exports have prospered. This is the driving force that helps seafood businesses hope for a stronger recovery this year. Ms. Nguyen Thi Thu Sac, Chairwoman of the Vietnam Association of Seafood Exporters and Producers (VASEP) shared with Customs Magazine.
Business environment reform needs further promotion: expert

Business environment reform needs further promotion: expert

Resolution 02 issued by the Government creates pressure for the ministries, sectors and localities to make changes for the business community as well as the socio-economic development.
Singapore is the largest foreign investor in VN in Q1

Singapore is the largest foreign investor in VN in Q1

The disbursed FDI rose by 7.1 per cent in the first quarter to reach $4.63 billion, a signal that the disbursement will continue the positive trend, the agency said.
Thai Binh boosts investment, trade cooperation with Germany

Thai Binh boosts investment, trade cooperation with Germany

A delegation from the northern province of Thai Binh, led by Deputy Secretary of the provincial Party Committee Nguyen Khac Than, visited several localities and business organisations in Germany from March 25 to 27, in a bid to enhance trade cooperation with and attract direct investment from the European nation.
Lifting obstacles to develop industrial parks

Lifting obstacles to develop industrial parks

VCN - Attracting investment and developing industrial zones (IZs) and economic zones (EZs) is one of the important contents to implement the policy of developing a multi-component, open, attract investment and resources from all economic sectors to develop the country. In addition to the results achieved, there still limitations that need to be removed to draw investments to develop industrial parks and economic zones, including financial problems for industrial parks.
Read More

Your care

Latest Most read
Import turnover of 19 commodity groups grows over 20%

Import turnover of 19 commodity groups grows over 20%

VCN - According to the General Department of Vietnam Customs, in the first two months of 2024, the total import turnover of the country increased by 17.1% year-on-year to US$ 54.21 billion. The result is only lower than the record increase of the same per
Vietnam owns significant advantages in attracting FDI

Vietnam owns significant advantages in attracting FDI

VCN - Vietnam's economy has passed the most dangerous and difficult period and is now more stable. Inflation, exchange rates, and interest rates have decreased, bank liquidity has stabilized, and the stock and bond markets have experienced shocks and begu
Nearly 7,000 tariff lines of AKFTA product specific rules need to be transposed

Nearly 7,000 tariff lines of AKFTA product specific rules need to be transposed

ASEAN member states and the Republic of Korea (RoK) reached a consensus on the transposition of ASEAN-RoK Free Trade Agreement (AKFTA) Product Specific Rules
Vietnam needs to cook up stronger global rice brand

Vietnam needs to cook up stronger global rice brand

Although Vietnamese rice has a foothold in several fastidious markets, there is a long way to go to make it a stronger brand globally, according to insiders.
Vietnam advised to fully tap CPTPP to boost exports to Canada

Vietnam advised to fully tap CPTPP to boost exports to Canada

The Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP) has opened up numerous opportunities for Vietnam and Canada to boost two-way trade, however, tax initiatives under the trade pact have not been tapped to the fullest extent by the Vietnamese exporters, said Vietnamese Trade Counsellor in Canada Tran Thu Quynh.
Mobile Version