The country has taken great strides to make the citizen experience today more convenient by putting government transactions at the fingertips of everyone who has a smartphone. We are finally catching up with our ASEAN neighbors.

However, when you visit any major city in the Philippines today, you will likely see different signs of digital progress. New cell towers rising above coconut trees, mayors cutting ribbons for "Free Wi-Fi" zones in plazas, and perhaps a press release about a new shipment of laptops for the local government unit.

On the surface, it looks like the Philippine countryside is digitizing. But look closer. You will likely find that the "digital" data on farm yields is trapped in a spreadsheet on a single computer, inaccessible to the trade office next door. Visit a rural health unit, and you will see patient records that are digitally encoded but cannot be shared with the nearby provincial hospital.

We are building "Digital Islands" connected by fiber optics but separated by an even deeper barrier: antiquated structures.

The Philippines is standing at the edge of a historic shift. The global economy is being reshaped by artificial intelligence, automation, and data-driven decision-making. Yet in our countryside, most of the institutions tasked with preparing communities for this future remain stuck in structures and mindsets designed for a bygone era. They are becoming the single biggest chokehold on our progress. They continue to treat Digital Transformation (DX) as a hardware project rather than a survival strategy. Unless we act decisively, these outdated organizations with outdated mindsets will become structures that stifle innovation and hold back regions from participating in the AI economy.

These regional institutions were built to coordinate development when progress meant pouring concrete and laying irrigation pipes. Their rigid structures discourage collaboration across sectors and make experimentation nearly impossible. In a world where digital transformation demands agility and integration, these structures are not just inefficient—they can be the antithesis of progress.

Instead of enabling innovation, they sometimes reduce development to compliance exercises. But innovation does not thrive on paper alone. It thrives in environments where leaders can test new ideas and scale what works.

Compounding the structural problem is a dangerous misconception among many regional leaders: that digital transformation is about technology alone. Internet access, data centers, and e-government portals are essential, but they are only foundational. True digital transformation is about rethinking how we govern, deliver services, and, most importantly, empower citizens.

Without this broader vision, technology simply digitizes inefficiency. A slow, paper-based process becomes a slow, digital process. A siloed agency becomes a siloed database. The result is not transformation—it is stagnation dressed up in modern hardware.

Digital transformation must be understood as a lens that cuts across every initiative. Farmers can use AI-driven analytics to adapt to climate change. Small businesses can access markets through e-commerce platforms. Local governments can deliver transactional and social services more efficiently with digital workflows and become more transparent with open data. Citizens can be empowered through access to information and opportunities that were previously out of reach. Treating digital as a “sector” rather than a philosophy is a recipe for irrelevance.

The AI economy will not wait for the Philippines to catch up. Automation, machine learning, and data-driven decision-making are already reshaping industries worldwide. To prepare, the country must embed digital transformation into every regional development initiative.

This means that regional development institutions must shift from siloed, hierarchical structures to collaborative, networked governance that encourages cross-sector integration. Stakeholders, most especially the local leaders, must be trained to understand digital transformation as institutional change, not just tech adoption. Digital strategies must be embedded across agriculture, health, education, and governance, making them inseparable from development initiatives. And finally, digital initiatives must respond to the actual needs of rural communities, not just infrastructure targets.

The countryside is where digital transformation can have the most profound impact. It is where inclusion, resiliency, and empowerment are most urgently needed. To ignore this is to consign millions of Filipinos to permanent disadvantage. This is not about modernization for its own sake. It is about survival in a global economy already reshaped by AI. The question is not whether digital transformation will happen—it is whether the Philippines will be ready to participate.

We should seize this moment, reform our institutions, and embed digital transformation across every regional initiative. As they are set up right now, they were designed for a different time. If they are not reimagined for the digital age, they will become barriers rather than engines of progress. Digital transformation is not optional, not sectoral, and not tomorrow’s problem. It is today’s imperative.

The future will not wait. Neither should we.

(The author is an executive member of the National Innovation Council, lead convener of the Alliance for Technology Innovators for the Nation (ATIN), vice president of the Analytics and AI Association of the Philippines, and vice president of UP System Information Technology Foundation. Email: [email protected])