High-growth APJ businesses leading the way in Generative AI adoption
Midmarket organizations across Asia Pacific and Japan (APJ) are embracing generative artificial intelligence (Gen AI) at a faster pace, particularly those with higher revenue growth. A recent SAP study of 12,003 businesses reveals that APJ midmarket companies—defined as having between 250 and 1,500 employees—that are experiencing high revenue growth are more likely to prioritize the adoption of Gen AI (94%) compared to those with lower revenue growth (86%).
Business AI is rapidly emerging as the biggest technological opportunity of the 21st century in Asia Pacific and Japan (APJ). This opportunity isn’t just for large enterprises; businesses of all sizes can benefit from AI innovations. These innovations go beyond image and video generation. They automate routine tasks, deliver rapid and actionable insights, and solve core business challenges more efficiently.
AI Adoption Leads Organizational Priorities in APJ
A recent SAP study surveyed 3,400 people across five APJ markets, revealing AI as a top priority for midmarket businesses. Standard AI applications, like machine learning for data analysis, predictive analytics, and Generative AI, hold high or moderate importance for 92% of businesses. Additionally, addressing cybersecurity threats and mitigating supply chain disruptions are also critical priorities (both 92%).
Expanding supplier and partner networks (43%) stands out as a key growth driver. However, AI takes center stage in transforming processes across organizations. Over half of APJ midmarket companies prioritize AI to enhance data security and privacy (52%) and support accurate decision-making (50%). Other transformative areas include developing new business models (48%), improving customer experience (48%), enhancing workforce training (48%), and optimizing supply chains (47%).
AI Already Delivering Value
While many businesses are planning for AI’s future, it is already creating real value today. Companies are using AI to create marketing and sales content, gather market intelligence, support app development and testing, and improve customer and vendor interactions (83%). AI has been integral to business processes for decades. SAP Business AI, for instance, is currently in use by over 27,000 customers, including thousands in APJ. With over 70 generative AI use cases launched last year and more than 100 planned by the end of 2024, AI will power 80% of the most common business scenarios.
Challenges to AI Adoption in APJ Midmarket
However, challenges persist in driving growth among APJ midmarket businesses. The study found that a lack of quality data (37%) and poor system integration (33%) are key internal obstacles to AI adoption. External challenges, such as supply chain disruptions (40%) and organizational siloes (33%), also pose barriers to growth.
Data quality is especially crucial for AI success. Midmarket businesses cite the main risks related to AI as acting on incorrect information (36%), difficulties in finding and retaining AI talent (34%), lack of transparency in AI-generated results (34%), and insufficient data size and quality (31%). High-quality and scalable data are essential for achieving the best AI outcomes, making it critical to partner with a technology provider that integrates AI capabilities into key business applications.
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