New research commissioned by IBM found that Singapore companies see positive promise of AI, and a growing interest in investing in AI to drive ROI and innovation going forward.
The study found that 52% of IT decision makers (ITDMs) in Singapore have made some progress in executing their AI strategy, and 37% indicated significant progress. In 2024, more than half (54%) of ITDMs said they are currently achieving positive ROI from their AI projects, 33% are breaking even, and 9% are seeing negative returns.
Conducted by Morning Consult and developed in collaboration with Lopez Research, the study surveyed more than 2,400 IT decision makers (ITDMs) globally, with 217 respondents from Singapore.
The study revealed the motivations behind AI investments in Singapore. ITDMs are motivated by innovation (29%) over return-on-investments (ROI) (24%) when implementing AI pilots.
In measuring ROI from AI achievements, Singapore ITDMs are looking at productivity savings (63%), more rapid innovation (61%), and faster software development (58%).
When implementing AI pilot projects, Singapore companies faced challenges in data quality and availability (54%), integration with existing systems (46%), and skill gaps among employees (42%).
Tan Siew San, General Manager and Technology Leader, IBM Singapore, commented: “We have seen enterprises in Singapore actively experimenting with AI, particularly in the wake of genAl’s rapid advancement.
“I believe the time for hype is now over. 2025 will be a crucial time where companies seek to understand how their investments are paying off. Our study highlights how enterprises would look to put more strategic focus on reaping higher AI returns. Talent, open-source models and hybrid-by-design are critical areas to unlock innovation in AI.”
“As organizations begin to implement AI at scale, many are placing greater stock in success metrics such as productivity gains, in part because traditional hard-dollar ROI have yet to show up on the balance sheets,” said Maribel Lopez of Lopez Research.
“Yet, they continue to rapidly advance their AI strategies, with no sign of slowing down. Companies seem to now recognize the value of defining specific use cases and optimizing AI projects. They are leveraging hybrid cloud strategies and open source to drive AI innovation and deliver financial returns.”
Further study findings provide a glimpse into organizations’ AI priorities for 2025. 57% are planning to increase their investment in AI, 35% would maintain their current level of investment, and 6% are planning to reallocate AI spend across different or other IT projects.
In allocating AI investments, ITDMs are focusing on IT operations (56%), products and services innovation (43%) and data quality management (39%). When asked what strategic changes will be made in 2025, surveyed ITDMs identify hiring specialized talent (51%), using more open-source (44%), and using cloud-managed services (41%).