Strong leadership and high flexibility enable the nation's large companies to hold their own in the world market, but delays in power transfers and poor information technology (IT) deployment may chip away at their competitiveness, a report said yesterday.
The report was conducted by a government-funded research unit, the Institute for Information Industry (
The institute conducted in-depth interviews with 35 high-level officials in the service, manufacturing and banking sectors between April and August.
"The study found that first, strong leadership contributes to an efficient policy-making process," said Victor Tsan (
According to the institute's report, 43 percent of the companies surveyed are led by entrepreneurs and their family members.
The concentration of power in these families' hands, however, may hamper these companies, because many of them neglect to cultivate successors, Tsan said.
As for corporate strategy, the survey found that 63 percent of the enterprises could be considered "swift followers" of market precursors, which means they can quickly capitalize on certain promising services or products that were developed by other industry pioneers.
"The strategy could be a second advantage for local companies, as it reflects an elasticity in operations and a sharp sense of the market's pulse," Tsan said. "However, over emulation of other's successful business models will reduce innovation ability, which is now a key to various industries."
The study found that except for the banking industry, which uses information technology as a strategic tool and basis for competitiveness, other sectors merely use IT for daily operations or assistance systems.
They don't understand how IT can help to strengthen competitiveness and differentiation, Tsan said, while a shortage of IT specialists and resources also hampers efforts to improve the situation.
Angel Li (
Over half of US enterprises do this already to lower costs and improve efficiency, Li said at the press conference.
"Less then 15 percent of companies in Taiwan consign part of their operations to outsourcing firms, but I believe the figure will gradually go up," she said.
Although a high percentage of local companies have realized the benefits of outsourcing their non-core businesses, Li said it will take some time to build up confidence in such an operation model, especially given the concern over information security.
Li cited statistics of the market research firm IDC, which indicated that the Asia-Pacific region will become the world's largest BPO market by next year, with an annual growth rate of 42 percent.
IDC said Taiwan's BPO market will amount to US$554 million by 2005.
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