Technology

Jumping on the generative AI bandwagon: Study finds many companies risk disruption


MANY companies are in danger of being disrupted rather than becoming disruptors in the age of artificial intelligence (AI), according to a global study by MIT Technology Review Insights (MITTR).

Amidst the buzz around generative AI following the surge of interest in OpenAI’s ChatGPT in 2023, the use of this technology by companies remains largely experimental and confined to specific areas like automating low-value tasks. 

This limited application hinders businesses from leveraging the full potential of generative AI for transformative outcomes, offering only modest gains and minimised risks.

The report for the study was produced in partnership with Telstra International, the global arm of leading telecommunications and technology company Telstra. MITTR polled 300 business leaders across Asia-Pacific, the Americas and Europe on how their organisations are implementing – or planning to implement – generative AI technologies, along with the barriers to effective deployment.

The respondents mostly manage information technology, data and data engineering-related functions, representing a broad spectrum of industries including financial services, consumer goods, manufacturing, technology, logistics and media.

Geraldine Kor, managing director and head of Global Enterprise at Telstra International, noted this global study sheds light on companies’ readiness to tackle the challenges to adopt generative AI effectively.

She said: “As the world becomes increasingly digitised and human-to-machine interactions flourish, being able to process data to drive informed real-time or near real-time business decisions is paramount. When implemented successfully, this proficiency will be a game-changer for most organisations, and will distinguish leaders from followers.”

To succeed in the evolving digital landscape, companies need to integrate AI into their everyday operations and culture, says Geraldine Kor, managing director and head of Global Enterprise at Telstra International. PHOTO: TELSTRA INTERNATIONAL

However, she points out that the challenges lie in building end-to-end capabilities to handle large datasets, accurately contextualising the data for business value and ensuring the responsible and ethical application of AI.

Kor added: “Despite inevitable variations in IT infrastructure and budgets across South-east Asia, we find this to be true for most organisations embarking on their AI journey.”

Companies expect to accelerate generative AI use

The survey found that many firms appear to underestimate the challenges of adopting such advanced technologies. This puts them at risk of being outpaced by more agile or forward-thinking competitors.

Although a sweeping 78 per cent of respondents view generative AI as a competitive opportunity rather than a threat – with just 8 per cent seeing it as a risk – the actual adoption rates tell a different story.

In 2023, while 76 per cent of surveyed companies had engaged with generative AI in some capacity, only 9 per cent had adopted the technology extensively across their operations. 

This points to a significant gap between the aspiration to innovate and the practical application of AI technologies within these organisations.

Looking to 2024, survey respondents have ambitious plans to broaden the scope of generative AI applications, anticipating that its use will more than double in areas like customer experience, strategic analysis and product innovation. 

Industry-specific applications are also expected to grow, with IT coding, supply chain management, and financial services compliance cited as key areas of focus.

Roadblocks to rapid AI adoption 

However, the readiness of companies to effectively deploy and harness the potential of generative AI remains questionable. A lack of foundational IT infrastructure and capabilities is a significant barrier. 

Only a small fraction of respondents feel that their companies have the necessary data volume, data accuracy and storage infrastructure conducive to the rapid adoption of generative AI. According to the MITTR report, those with the most experience in rolling out generative AI have even less confidence in their IT capabilities than their peers.

Moreover, multiple non-IT hurdles could stymie the successful implementation and scaling of generative AI. Key issues include regulatory and compliance challenges, inadequate cybersecurity measures, restrictive budgets, and a competitive environment that may not always support rapid adoption. 

Cultural resistance to innovation and a shortage of necessary skills further complicate the landscape.

SOURCE: THE MIT TECHNOLOGY REVIEW INSIGHTS SURVEY 2024

While generative AI holds the promise of significant business transformation and competitive advantage, the extent to which companies are prepared to leverage this potential varies greatly.

The coming years will be critical in determining whether businesses can move beyond the hype and initial experimentation to truly capitalise on the disruptive capabilities of generative AI. 

Commenting on the state of generative AI in Singapore, Laurence Liew, director of AI Innovation, AI Singapore, said: “Singapore, like most countries, is still in the early stages of adopting generative AI, with the technology only recently becoming available in productivity suites suitable for a wider audience.”

He added that effective implementation of generative AI requires access to real datasets, AI engineers and computer infrastructure, among others.

“Companies face a dilemma in accessing the necessary hardware today. Choices include outright purchase and pay-as-you-go outsourcing, both of which carry their own risks. Additionally, data quality, storage and talent remain bottlenecks for effective deployment.”

Maximising the potential of AI and data responsibly

Companies looking to expand their AI infrastructure and capabilities – particularly in Singapore and South-east Asia – can stand to gain by partnering with a technology provider that understands what it takes to navigate the complexities of digital transformation. 

Telstra International is helping organisations to boost their digital experience capabilities via numerous product and service offerings. For instance, it offers AI and data envisioning customer workshops that examine a company’s existing processes, identify gaps and co-create solutions aligned with business objectives.

Investing in AI-driven technologies is now crucial for companies to gain a competitive edge. PHOTO: GETTY IMAGES

Geraldine Kor, managing director and head of Global Enterprise at Telstra International, emphasises the importance of both integrating AI “proactively and holistically into all facets of your business” to optimise performance and efficiency, as well as “fostering a forward-thinking mindset among employees of all levels”. 

“Put simply, smart and strategic investments in AI-enabled machine-to-machine and human-to-machine technologies to deliver compelling digital experiences is now central to companies’ competitive advantage,” she adds. 

Telstra continues to invest in its data-driven and AI-fuelled capabilities. Furthermore, the company has co-developed a series of ethics principles and standards with the Australian government. It has also partnered with other telcos and businesses globally to establish ethics frameworks.  

Kor says: “The use of data with AI can significantly enhance how we live and work. But it’s important we balance leveraging this potential while reducing potential risks. Getting this right will let us deliver better outcomes for our people, our customers and society.”

What Telstra International does

  • Telstra is a leading telecommunications and technology company with a proudly Australian heritage and a longstanding, growing international business. Today, Telstra International has over 3,000 employees based in more than 35 countries outside of Australia, providing services to thousands of business, government, carrier and over-the-top (OTT) customers.

  • Telstra International empowers businesses with innovative technology solutions including data and IP networks, and network application services such as managed networks, unified communications, cloud, industry solutions, integrated software applications and services. 

  • These services are underpinned by its subsea cable network, with licences in Asia, Europe and the Americas and access to more than 2,000 Points of Presence (PoPs) in more than 200 countries and territories globally.

Read the full MIT Technology Review Insights report titled “Generative AI: Differentiating Disruptors from the Disrupted”



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