Singapore is boldly investing in artificial intelligence (AI), but companies are struggling to scale their enterprises as a whole, a new global study by the IBM Institute showed Thursday.
Research shows that despite the challenges facing accelerated technology adoption, the CEOs surveyed are committed to moving forward with AI solutions across the organization.
An annual IBM CEO survey survey of 2,000 CEOs worldwide, including 210 CEOs in ASEAN and Singapore, revealed that executive respondents expect AI investment growth to more than double in the next two years.
Meanwhile, half of Singapore's CEOs (52%) are actively recruiting AI agents and preparing to implement them on a large scale.
The study also showed a surge in AI investment, but the data infrastructure gap persists.
The study found that 80% of Singapore CEOs are more likely than 65% of global counterparts to prioritize AI use cases based on return on investment (ROI).
However, only 23% of AI initiatives have reportedly provided the expected returns so far, suggesting that discrepancies between investment priorities and outcomes have been realized.
Meanwhile, 58% of Singapore CEOs identify integrated enterprise-wide data architectures as critical for cross-functional collaboration, with 68% viewing it as the key to generating organizations' own data as the key to unlocking the value of AI.
However, organizations may be struggling to develop an effective data environment. Half of respondents (52%) acknowledge that the pace of investment has left the organisation fragmented technology that has been cut off.
“As AI adoption creates greater efficiency and increases productivity, the ultimate reward will only come to CEOs with the courage to embrace risk as an opportunity.
“We focus on what you can mean, especially when there's a lot of things you can't do,” commented IBM Vice President Gary Cohn.
“In cases of uncertainty in the business environment, using AI and enterprise data to identify where leverage is available is a competitive advantage.
“At this point, leaders who have not made progress by leveraging AI and their data are making conscious business decisions not to compete,” he added.
Abraham Thomas, managing partner at ASEAN IBM Consulting, said ASEAN business leaders need to invest in their long-term capabilities to stay competitive while pressured by AI to demonstrate ROI.
“This balanced practice is further complicated by the fragmented digital landscape of the region, with a range of national regulations and inconsistent standards for cross-border data flows.
“Singapore highlights the AI strategy across the country, and companies must follow suit by building the foundation for adaptable data and investing in talent that can turn AI ambitions into real outcomes,” he added.
The findings also show that CEOs face competing pressures for short-term ROI and long-term innovation.
Only 23% of Singapore CEOs report that the AI initiative has provided the expected ROI over the past few years, with 14% expanding the entire company.
Over half (52%) say their organizations recognize value from AI investments that generate more than cost savings.
77% have admitted to pushing investments in some technologies before clearly understanding the value that risk of lagging brings to an organization, but say that it's better to be “fast and wrong” than “fast and slow” when it comes to technology adoption.
Research shows that CEOs are also looking for more agility and budget flexibility.
58% admit that they struggle to balance existing operations with fundraising for investment in innovation in the event of unexpected changes.
62% say more budget flexibility is needed to take advantage of digital opportunities to drive long-term growth and innovation.
The CEO also believes that strategic leadership and professional talent are essential to unlocking AI values amidst the gap between expertise and skills.
75% of Singapore CEOs say that organizational success is directly related to maintaining a broad group of leaders with a deep understanding of strategy and authority to make critical decisions.
72% say differentiation depends on having the right expertise in the right position with the right incentives.
According to the CEO, about a third (32%) of the workforce will require retraining and/or reskilling over the next three years in Singapore, with 67% saying that organizations will use automation to address skills gaps.
48% say they are hiring for AI-related roles that didn't exist a year ago.
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