AI increases productivity

By 2021, artificial intelligence (AI) will allow the rate of innovation of Filipino companies to increase by 1.7 times, and nearly double employee productivity gains in the Philippines, according to a study titled Future Ready Business: Assessing Asia Pacific’s Growth Potential Through AI

The study made by Microsoft and IDC (International Data Corp.) surveyed 109 business leaders and 100 workers in the Philippines

An article in The Manila Times which reported on the results is reproduced below as it will be of great interest to many businesses in many other nations, East and West

While close to 90% of business leaders polled agreed that AI is instrumental for their organisation’s competitiveness, only 45% of organisations in the Philippines have embarked on their AI journeys – yet those companies that have adopted AI expect it to increase their competitiveness by 1.5 times in 2021

“AI is the defining technology of our time that significantly accelerates business transformation, enables innovation, boosts employee productivity and ensures further growth – economies and businesses that have yet to embark on their AI journey run a real risk of missing out on the competitive benefits that are enjoyed by leaders” said Ricky Kapur, Microsoft Asia Pacific’s Enterprise and Partners Group general manager.

Why adopt AI?

For organisations that have implemented AI initiatives, the top five business drivers to adopt the technology were, in priority order:

  • Better customer engagements (27%)
  • Accelerated innovation (24%)
  • Higher competitiveness (16%)
  • More productive employees (10%)
  • Higher margins (8%)

“Last year, organisations that have adopted AI saw tangible improvements in those areas in the range of 22% to 44%” said Randy Roberts, IDC Philippines head of operations

“They forecast further improvements of at least 1.5 times in the three-year horizon, with the biggest jump expected in higher margins, accelerated innovation, and more productive employees”

The study evaluated six dimensions critical to ensuring the success of a nation’s AI journey – data, strategy, investments, culture, capabilities and infrastructure – it uncovered that the Philippines needs to focus on improving all areas, particularly its investments and data to accelerate its AI journey

“The Philippines needs to substantially improve its readiness – organisations’ leaders should make AI a core part of their strategy and continuously invest in this transformative technology for the long-term success, sometimes without immediate returns” Roberts said

Business leaders who are adopting AI face three top challenges:

  • Lack of thought leadership and commitment to invest in AI
  • Lack of skills, resources, and continuous learning programmes
  • Lack of advanced analytics or adequate infrastructure and tools to develop actionable insights

The study showed that, to move ahead on their AI journeys, businesses have to create the right organisational culture – a significant proportion of business leaders and more than half of workers surveyed believe that cultural traits that support AI journeys, such as risk-taking, proactive innovation, as well as cross-function partnerships among teams, are not pervasive today

“Overall, workers in the Philippines are more sceptical than business leaders about the cultural readiness of their organisations” said Roberts.

The study also found that business leaders and workers in the Philippines hold positive viewpoints about AI’s impact on the future of jobs – the majority (74%) believe that AI will either help to do their existing jobs better or reduce repetitive tasks

Kapur said: “Microsoft’s vision for AI is first and foremost about people – AI technology cannot progress without them – this means that millions will need to transform themselves into skilled workers as well as learners that an AI future needs – it is heartening to see that 88% of businesses prioritise skilling and reskilling of workers in the future – they plan to invest as much, or even more, in human capital than in new technology”

“The jobs of today will not be the jobs of tomorrow, and we have already seen demand for software engineering roles expand rapidly beyond just the tech sector – however, building an AI-ready workforce does not necessarily mean an acute need for technological skills”

The top future skills required by business leaders in the Philippines include digital skills, IT and programming skills, adaptability and continuous learning, as well as analytical skills

At present, the demand for these skills is higher than the existing supply

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