Experiences of both companies that are leading or lagging in the artificial intelligence path show that in the prevailing hybrid IT environment, the more unified and reliable your data, the more likely AI initiatives are to be successful, according to NetApp.
“AI is only as good as the data that fuels it,” said Pravjit Tiwana, general manager and SVP of cloud storage at NetApp.
The intelligent data infrastructure company has released its second annual Cloud Complexity Report based on results from a quantitative study done in March 2024.
NetApp partnered with Savanta to conduct the study, which covered more than 1,300 tech and data executives at businesses in 10 markets — United States, United Kingdom, France, Germany, Spain, Australia, New Zealand, India, Singapore, Japan.
“APAC leaders today recognize the efficiency and innovation gains offered by AI. However, the data shows adoption variations between industries and geographies in the region,” said Matthew Swinbourne, CTO cloud architecture at NetApp Asia Pacific.
“Whether companies are AI leaders or AI laggards, optimising IT environments before deploying AI must be top of mind to see the best return from investment,” said Swinbourne.
The study found that there is a clear divide between AI leaders and AI laggards across several areas.
In terms of regions, 60% of AI-leading countries (India, Singapore, UK, US) have AI projects up and running or in pilot. Meanwhile, 36% in AI-lagging countries (Spain, Australia/New Zealand, Germany, Japan).
In terms of industries, technology leads with 70% of AI projects up and running or in pilot, while banking and financial services and manufacturing follow with 55% and 50%, respectively. However, healthcare (38%) and media and entertainment (25%) are trailing.
In terms of company size, larger firms (with more than 250 employees) are more likely to have AI projects in motion, with 62% reporting projects up and running or in pilot, versus 36% of smaller companies (with fewer than 250 employees).
Further, both AI leaders and AI laggards show a difference in their approach to AI. Globally, 67% of companies in AI-leading countries report having hybrid IT environments, with India leading (70%) and Japan lagging (24%).
AI leaders are also more likely to report benefits from AI, including a 50% increase in production rates, 46% in the automation of routine activities, and a 45% improvement in customer experience.
“The rise of AI is ushering in a new disrupt-or-die era,” said Gabie Boko, chief marketing officer at NetApp. “Data-ready enterprises that connect and unify broad structured and unstructured data sets into an intelligent data infrastructure are best positioned to win in the age of AI.”
Rising IT costs and ensuring data security are the two of the biggest challenges in the AI era, but they will not block AI progress. Instead, AI leaders will scale back, cut other IT operations, or reallocate costs from other parts of the business to fund AI initiatives.
In APAC, 34% of companies said AI projects have already increased IT costs. 60% of respondents cited “increased cybersecurity risk” as their top concern, while 31% said they are reallocating funds from other business areas to manage AI project costs.
In APAC, the proportion of companies which will have more than 50% of their cloud deployments supported by AI-driven applications will increase 15% between 2024 and 2030. Two-thirds (67%) of AI leaders here plan to enhance their CloudOps automation over the next year, while data security investments are expected to jump 21% from 37% in 2023 to 58% in 2024.
