S.Korean firms' digital transformation more than a step behind Western: Report

A research report has shown that the level of digital transformation among South Korean companies is lagging behind that of European and American counterparts by more than one stage.

The Korea International Trade Association (KITA) conducted a survey on domestic and foreign companies, dividing the level of digital transformation into five stages: "under preparation," "beginning to introduce," "in progress," "established" and "actively progressing."

The results revealed that domestic companies are 1-1.5 stages behind foreign ones in terms of digital transformation, according to the report published on Friday.

The survey targeted 515 domestic companies and 123 foreign companies participating in the Mobile World Congress (MWC) in Barcelona.

While responses from foreign companies indicated that their digital transformation stages were established (36.6%), in progress (27.6%) and actively progressing (23.6%), the majority of responses from domestic companies were in progress (39.8%), beginning to introduce (26.0%) and under preparation (22.9%).

Only 3.5% of domestic companies responded that they were "actively progressing."

Additionally, KITA conducted a survey on the progress of digital transformation, dividing it into a different set of five stages: "not progressing at all," "started but in slow progress," "average," "somewhat progressed," and "progressing very well." The results showed a gap of 1.5-2 stages between large enterprises and small- to medium-sized enterprises.

For large enterprises, the most common response was "somewhat progressed" (43.1%). However, as the size of the companies decreased, the number of responses indicating "not progressing at all" increased.

In particular, 60.8% of large enterprises had a dedicated organization and workforce for digital transformation, but enterprises of middle standing (44.8%) and small- to medium-sized enterprises (44.2% and 55.7%) were found to lack such organizations and personnel.

Write to So-Hyeon Kim at alpha@hankyung.com