Indonesia ahead of China in AI Adoption

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Indonesia ranks first in terms of AI implementation though China has been touted as an AI leader—alongside the US—globally.

Findings from a commissioned study conducted by Forrester Consulting on behalf of Appier titled Artificial Intelligence Is Critical To Accelerate Digital Transformation In Asia Pacific indicate that 65% of respondents from Indonesia have either implemented AI in their business or are expanding or upgrading their capacity.

Emerging economies lead in adoption

Among the eight countries surveyed, emerging economies lead in AI adoption.

China is ranked second (63%), followed by India (62%), while more developed economies are slower in AI adoption: South Korea (57%), Singapore (50%), Japan (47%) and Taiwan (44%).

However the gap is expected to narrow in the coming year: a higher percentage of respondents in mature economies reported plans to implement AI technologies in the next 12 months. Plans to implement AI technologies are highest in Australia (35%), followed by Singapore (31%) and Taiwan (28%).

Source: Forrester Consulting

Operation and customer engagement benefits

AI is poised to reframe both how businesses operate and how they interact with consumers, said Forrester, adding that the technology—broadly speaking—offers two primary types of benefits to companies.

The first type is operational benefits, including simpler and more efficient business processes, greater scale, and better risk prediction.

The second one is related to customer engagement and experience, including better products and solutions, faster innovation, and better insights into consumer behavior.

Of the two, businesses across the region expect to realize the greatest benefits from AI in business operations.

While 71% of respondents identify improved business efficiency as the benefit they most anticipated from implementing AI technology, 62% expect improved products or services, according to the research.

The lone exception is Singapore, where businesses see the greatest gains from AI accruing to customer engagement, the research firm noted..

In addition, firms expect AI to improve existing solutions and drive product innovation.

In markets such as Taiwan, South Korea and Indonesia, respondents prioritize driving innovation with AI, whereas those in Japan, Singapore and Australia want to use AI to improve their existing solutions, research findings indicate.

Challenges to slow AI adoption

While the upside of AI may be clear, there are still significant hurdles standing in the way of broader AI adoption.

More than 1 in 2 (53%) of Asia Pacific respondents stated that the biggest problem they faced in adopting AI is gathering and integrating big data, Forrester said.

Companies looking to adopt AI also struggle to overcome operational issues, such as building cross-functional teams to work with agility (51%), identifying the right data management and predictive analytics platforms (52%), sourcing data from the diversified channels (49%), and identifying the right technology or service partners (43%).