‌New research: Only 23% of Southeast Asian companies are transformative in their AI adoption

AI's maturity is polarised, with more AI leaders emerging in Singapore, while Malaysia and Thailand remain in early and mid-stages of development

While the hype for AI to revolutionise businesses is strong, the IDC Data and AI Pulse: Asia Pacific 2024 study, commissioned by SAS, found that only 23% of organisations in Southeast Asia are transformative in their AI adoption. This refers to organisations with a longer-term investment plan in place and are using AI to transform markets and customers by creating new business models as well as product and service experiences.

"The IDC Data and AI Pulse: Asia Pacific 2024 study is an important snapshot of how hundreds of large organisations are approaching adoption and implementation of AI, highlighting the leaders and followers across industries,” said Chris Marshall, Vice President of Data, Analytics, AI, Sustainability, and Industry Research at IDC Asia/Pacific. "These insights give us the opportunity to unpack the barriers to successful AI implementation, allowing businesses to make wiser investments into these new and emerging technologies without being caught up in the gold rush".

Three Southeast Asian countries were included in the study – Singapore, Malaysia, and Thailand. The survey found that the top reasons that lead to AI failure among these respondents are untrustworthy or poor quality of data (40%), followed by privacy concerns or compliance limitations (38%), as well as the inability to access data due to business restrictions (36%).

The report also highlights that the challenges they face are typical of early adopters, such as the lack of specialised skilled personnel (41%), managing costs associated with AI development and deployment (30%), and lack of clear evaluation criteria for AI solutions (29%).

According to the report, Singapore stands out as a regional leader in AI adoption, while Malaysia and Thailand are emerging as a promising AI market, with an aim to harness AI's potential to improve operational efficiency, boost profitability, and have a strong emphasis on achieving cost savings. Both Malaysia and Thailand take a wait-and-see approach, observing the evolution of AI technologies and use cases before introducing dedicated AI policies.

"Across Southeast Asia, we observe differing levels of AI maturity; while more leaders in the field are emerging in Singapore, businesses in Thailand and Malaysia are still in the early to mid stages of adoption. While consumer access to generative tools made AI feel magical, the actual implementation of AI into an enterprise environment requires a strong data foundation and structured process for organisations to reap the benefits of AI in an effective and responsible way. Data is the foundation of AI. If the data is polluted, the AI results will be skewed. This is why we are helping organisations generate clean and reliable data for AI through our data ingestion and preparation capabilities," said Amir Sohrabi, Regional Vice President & Head of Digital Transformation for Korea & ASEAN region.

Methodology

The study, conducted in June 2024, includes 101 enterprises across Singapore, Malaysia, and Thailand. Leaders were surveyed to examine their AI investment decisions, how they want AI to transform their organisations, challenges to deployment, and their approaches to managing these processes to achieve trusted AI outcomes.