Singapore-based businesses are enthusiastic about AI, trialling the most AI applications and prototypes internationally.
However, they’re lagging behind the rest of the world when it comes to mature adoption.

Ahead of AI Summit Singapore this September, we conducted a study to assess where enterprise end users based in Singapore are with artificial intelligence adoption, in comparison to the rest of the world, and to gauge their attitudes towards AI technology.

447 businesses took part: a quarter based in Singapore itself, half in the wider Asia Pacific region, and another quarter further afield. More than half of the companies we spoke to are large enterprises with 1000+ employees; a third are small-to-medium businesses with less than 250 staff. A third reported annual revenues of over US $500m; a quarter under $1m.

The results detailed in this report offer an informative snapshot of how AI adoption is progressing in Singapore put in a wider international context, and where we can expect it to head in the years to come.

Singapore-based end users are enthusiastic about AI but are lagging behind in terms of mature adoption. Two thirds (70%) have already allocated budget for AI projects, split evenly between those planning full scale AI rollouts across their businesses, and those only with smaller pilots in mind. Yet just 14% of Singapore businesses can boast to having mature AI in place in their businesses, compared to 24% of businesses surveyed internationally.

A significant majority of Singapore-based businesses (78%) see increased productivity as one of the main benefits to adopting AI. This is followed by improving the user/customer experience (69%), transforming business and operational models (67%) and reducing operating costs (64%). These views are broadly in line with those of businesses based across the rest of the world.

Singapore-based businesses see the cost of deployment and lack of AI skills and expertise amongst staff as the biggest barriers to AI adoption. This is reflected in the fact that just 35% of Singapore companies believe the bulk of their AI knowledge base rests in-house, with 32% relying on external service providers and another 32% saying they currently have no access to AI expertise at all.

However, an overwhelming majority of Singapore businesses (82%) want to take ownership of their AI knowledge base by developing their in-house capabilities within five years. Nearly three quarters (72%) expect to achieve this goal.

Singapore based businesses seem more than happy to put their money where their mouth is when it comes to AI adoption. More than two thirds (69%) have already allocated budget to AI projects, with a relatively even split between funding for full roll outs (35%) and small pilots (34%).

The proportion of Singapore-based end users with budget allocated for roll out is slightly higher than the average across all countries surveyed (33%). A majority of Singapore businesses (70%) are planning to introduce AI by 2022, in line with the figure across the rest of the world.

However, despite the enthusiasm we found for AI, Singapore-based businesses lag behind the rest of the world on current use of the technology. Just 8% told us they regularly use AI applications, and just 6% said they were at a stage where advanced AI had become fundamental to their operations. The average across the rest of Asia Pacific and beyond on both counts was 12%.

Despite having less mature AI, more Singapore-based businesses (30%) are currently trialling AI applications than average (23%); similarly, 18% are in the process of testing prototypes, compared to 15% internationally. Fewer Singapore businesses (27%) told us they currently did not use AI but were evaluating its impact, with a mean average of 30%

Our survey found users and service providers in broad agreement about the key benefits of AI for enterprises: increased productivity, improved UX/CX, business model transformation and reduced operating costs.

Everyone agreed that the potential to increase productivity was the biggest opportunity offered by AI, with more than three quarters of Singapore-based and international end users and service providers picking it out as the key benefit.

Singapore businesses seem more enthusiastic about the potential for AI to transform user experience and customer journeys, with 69% naming that a key benefit compared to 62% internationally. By contrast, just 56% of service providers highlighted this.

Service providers rate the ability to reduce operating costs as marginally more important than their clients, with 69% of providers mentioning it compared to 64% of Singapore-based end users. By contrast, two thirds of Singapore companies (67%) are excited by the prospect of AI transforming their business and operating models, 10% more than the number of service providers that picked this out.

Compared to service providers, end users see improved speed to market (43% v 33%) and improved bottom line growth (37% v 26%) as more important benefits of AI. 

Preliminary research suggested that stakeholders see a large number of potential barriers to the successful adoption of AI. We therefore provided a list of options, asking survey participants to rank their top three, and then taking a mean average position to assess how significant businesses and service providers viewed these barriers in relation to one another.

Our findings suggest that the biggest perceived barriers to AI adoption are the cost of deployment, lack of data and a lack of AI expertise internally among staff. Cost of deployment ranked as the number one barrier across all of our participant groups, with the lowest mean position across Singapore-based businesses, international businesses and service providers.

In terms of raw numbers rather than averages, lack of AI expertise among staff ranked as almost as big a concern as cost among Singapore businesses. 51% ranked it in the top three, compared to 42% who did so for deployment costs, although 29% put deployment costs first compared to 15% who ranked lack of internal expertise their top concern.

Data issues were split into a lack of data and a lack of mature data. Singapore businesses saw lack of all forms of data on AI as a marginally more significant barrier than companies from the rest of the world, with a mean ranking of 1.6 versus 1.78. This was reversed by a smaller margin for lack of mature data, Singapore businesses giving it a mean score of 2.05 versus 1.92 from international businesses.

Singapore-based businesses are by and large very happy to work with service providers on their AI adoption plans. Just over a third (34%) said they would work with any type of AI service provider, compared to an average of 30% internationally. Working with small tech providers (18%) and a blend of small and large providers (20%) proved popular amongst Singapore-based respondents. Just 4% said they had no wish to work with third party AI specialists.

However, willingness to work with service providers does not translate to wishing them to take the full weight of AI deployment and management long term. On the contrary, we found Singapore end users very keen to boost the levels of expertise they have in AI in house, and through that take control of their AI assets.

In the here and now, we found Singapore businesses view themselves as less self-sufficient when it comes to AI knowledge and expertise than their international peers. Just over a third (35%) said the majority of their organisation’s AI expertise lies in-house, compared to 43% of companies from the rest of the world. 32% of Singapore businesses said they rely on service providers for most of their AI expertise, compared to 27% internationally.

But three quarters of respondents in Singapore (75%) told us that they would like to take ownership of their AI knowledge base and bring expertise in-house. This rises to 81% of businesses when asked where they would like their AI expertise to come from in five years’ time. Both figures are almost identical to the average from the rest of Asia Pacific and beyond.

On the whole, Singapore companies are confident of achieving their goal. 72% told us they expect to bring most of their AI knowledge base in-house within five years.