AI Adoption to Soar in Asia Pacific and Japan

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IDC Asia/Pacific revealed in its 2023 FutureScape regional event that by 2028, 80% of CIOs will leverage organizational changes to harness AI, automation, and analytics – driving agile, insight-driven digital businesses.

The rapid and expansive growth of AI in the digital business landscape emphasizes the widening application of AI and the challenges and considerations for its effective implementation. In fact, IDC predicts that by 2026, tech providers will allocate half of R&D, staffing, and CAPEX investments to AI/automation, resulting in CIOs struggling with aligning vendor selection and IT operations priorities with new use cases.

As AI evolves from handling specific tasks to broader applications, the need for data-centric infrastructures, skill transformations, and trust is further emphasized.

A digital-first strategy is paramount for organizations seeking sustained growth. Companies are compelled by market demands to grow digital business models and strengthen digital capabilities. IDC predicts that spending on digital technology by organizations will grow at 4X the economy in 2024 – an increase to IDC’s prediction for 2023.

Additionally, by 2027, 80% of CEOs will assert that their C-suite technology leader’s primary function should be to invest in digital-first initiatives, according to an IDC prediction.

“Worldwide, many organizations have already achieved a certain level of DX, asserting their dominance in the digital sphere. Under the guidance of digital-first CIOs, these organizations have demonstrated their capability to improve toplines, bottomlines, and greenlines using digital technologies,” says Sandra Ng, GVP & General Manager for IDC Asia/Pacific Japan research.

The rise of GenAI promises new opportunities for companies to leverage AI. AI is viewed not just as a tool but a game-changer, poised to revolutionize business productivity and open new revenue avenues.”

IDC sees a three-phased evolution of AI adoption in the region from 2023-2028, from productivity enhancements in 2023, progressing to customer engagement by 2024 and introducing new business models by 2025. By 2028, IDC predicts that 10% of top A2000 companies will experiment with AGI systems that will have a transformative effect on society and create significant opportunities and threats.

As the world enters this new chapter in the digital business era, IDC predictions provide a playbook for technology vendors and technology buyers in their journey. Central to these predictions is the accelerated integration of AI and specialized hardware and software, establishing New World Tech Order 2.0 that redefines business strategies and operations. This transformation is characterized by the following predictions for Asia/Pacific Japan:

• Infrastructure Turbulence (CPU vs GPU): Application Development 1.0 to 2.0 – By 2027, 60% of enterprise developers will use GPUs and other specialty processors to enhance development for machine learning, AI video editing, 3D modeling, simulations and digital twins.

• Interwoven IT: Intelligent Core to Edge – With Gen AI as a catalyst, by 2027, 30% of enterprises will rely on interwoven digital infrastructures across cloud, core, and edge to support dynamic, location-agnostic workflow priorities.

• Self-Discovery, Healing Software: Autonomous Workflows – By 2026, 2/3 of A2000 businesses will leverage a combination of generative AI and RAG to power domain-specific self-service knowledge discovery, improving decision-making by 50%.

• AI-Influenced Products: Tech-Created/Enhanced Product Design and Development – By 2027, 45% of enterprises will have mastered the use of generative AI to co-develop digital products and services leading to double the revenue growth compared with their competitors.

• Data Act: The Digital Identity Benchmark – By 2026, 25% of organizations will utilize AI to enhance data privacy through use of data anonymization, encryption, anomaly detection, and privacy-preserving ML techniques like differential privacy.

“As the digital age accelerates, the Asia-Pacific region stands out as a frontrunner in embracing digital transformation. AI emerges not just as a tool but as a transformative force, reshaping industries and introducing new paradigms of growth. The future is digital, interconnected, and AI-driven,” ends Ng.