The IDC Data and AI Pulse: Asia Pacific 2024 study, commissioned by SAS, has uncovered a growing divide between AI leaders and followers among organisations in the Asia Pacific (APAC) region.
While nearly half (43 per cent) of the surveyed businesses plan to increase AI investments by more than 20 per cent in the next 12 months, only 18 per cent consider themselves AI leaders, leaving a gap between the top AI innovators and those lagging behind.
AI leaders are focused on long-term transformational goals, with 32 per cent prioritising new revenue growth, 31 per cent targeting increased operational efficiency, and 26 per cent aiming to boost profits.
In contrast, AI followers are concentrated on short-term outcomes, such as improving customer service (27 per cent) and expanding market share (25 per cent).
Shukri Dabaghi, senior vice president, Asia Pacific and EMEA Emerging at SAS, noted, “The disparity in target outcomes between AI leaders and AI followers demonstrates a lack of clear strategy and roadmap. Where AI followers are focused on short-term, productivity-based results, AI leaders have moved beyond these to more complex functional and industry use cases.”
Chris Marshall, vice president of Data, Analytics, AI, Sustainability, and Industry Research at IDC Asia/Pacific, echoed these insights, stressing the need for businesses to align their AI strategies with long-term business value to avoid the “gold rush” mentality.
He warned that inflated expectations of AI’s potential return on investment (ROI) could lead to disillusionment for some.
Generative AI’s role expanding in 2024
Generative AI, which accounted for only 19 per cent of AI investments in 2023, is set to grow to 34 per cent by 2024.
The report shows that while businesses are drawn to generative AI’s potential, they continue to invest in predictive and interpretive AI technologies. Spending on AI across APAC is projected to reach USD 45 billion in 2024, rising to USD 110 billion by 2028.
Skills gap and industry trends
A major challenge facing AI adoption is the skills gap, particularly in industries like healthcare (41 per cent), government (38 per cent), and insurance (32 per cent).
Despite this, sectors such as banking are successfully deploying AI for liquidity risk management and financial crime analytics, while insurance focuses on fraud detection and intelligent pricing.
The healthcare sector is increasingly using AI for cost containment, and governments are leveraging AI for social benefits integrity and emergency response.
Country-level AI adoption trends
China, India, and Japan are leading AI adoption in the APAC region, with China showing the largest growth in AI projects (59 per cent) over the next 12 months.
However, countries like Japan, Australia, and South Korea face national challenges due to a lack of skilled AI talent.
The IDC study concludes that businesses looking to maximise AI’s potential must develop in-house capabilities, strategically manage AI investments, and plan for long-term implementation to ensure sustained returns.
The full report, “Data and AI Pulse: Asia Pacific 2024,” is available through an eBook.
