- COVID-19 prompts traditional companies to speed up digital transformation
- 90% of Hong Kong companies expect AI will improve operational efficiency
- Hong Kong and Macau companies have greatest competency in information and cybersecurity
A majority (72%) of companies surveyed in Greater China believe that AI will have a significant impact on their industries within the next five years. The finding is part of the report published today, Artificial Intelligence in Greater China: Hong Kong and Macau — Outlook for 2020 and Beyond, conducted by EY and sponsored by Microsoft.
The report finds that COVID-19 has further strengthened the role of AI in everyday life and even more so to businesses and operations in times of widespread disruptions and has accelerated companies’ willingness to look into AI solutions.
Before the pandemic, online retail shops trying to break into the Hong Kong market were often met with resistance by consumers, due to the unique customer experience physical shops could provide. However, that culture has changed as brick-and-mortar businesses have resorted to technology and AI to assist operations when social interactions were minimized. “COVID-19 has shifted the retail culture from brick-and-mortar to digital-to-door, and has completely reshaped business and consumer perceptions and experience toward online shopping,” said Eric Chia, EY Greater China Consulting Markets Leader.
Over half of the surveyed enterprises believe that the most relevant use of AI for their business is to predict business development trends and improve potential business results.
“Since the COVID-19 outbreak, we have seen Hong Kong businesses across industries accelerate their digital transformation to become more agile. These are turbulent times but our customers have been already integrating AI into their businesses. To be successful in this AI era, businesses must make AI a core part of their strategy and develop a learning culture. Only with the right tools, digital skills and mindset can Hong Kong businesses unlock the full potential of AI to drive innovation and ensure further growth. Microsoft is committed to empowering Hong Kong businesses on this journey,” said Cally Chan, General Manager of Microsoft Hong Kong and Macau.
Most (90%) Hong Kong companies believe that AI will improve operational efficiency leading to an increase in business value. In addition, companies said they may increase investment in emerging technologies such as cloud, AI and IoT to promote digital transformation, which will drive IT spending growth after 2020.
Across all the Greater China markets surveyed, Hong Kong and Macau companies have the greatest competency in information and cybersecurity. Companies are making an effort to increase their capability in this area, especially those in the financial services industry, following the release of the Hong Kong Monetary Authority’s new framework – GTFD in November 2019, on the use of AI in FinTech and banking and covering cyber and fraud risk management.
AI has also become a new target of investment in Hong Kong. Between 2009 and 2019, over US$465 million was invested in AI companies in Hong Kong. Machine learning technology was the most important investment theme, likely due to its wide applicability across a range of business sectors.
With mature infrastructure, positive business environment, world-class financial services, and a highly skilled workforce in Hong Kong, the opportunities for AI development are many. “We are seeing more AI unicorns and major Internet companies listing in Hong Kong. There is a high chance AI can become the second most competitive advantage of Hong Kong after financial services,” Chia explained.
As digital transformation continues to speed up and there are more successful cases and scenarios of AI applications, traditional companies should move faster to apply AI in order to stay relevant and competitive, according to the report.
“Companies can start by examining the potential benefits of AI to their business step by step, define what success is, and then push for business transformation with a wider adoption of AI. Meanwhile, traditional companies should also conduct self-assessment and benchmark themselves against leading companies as their AI maturity keeps increasing,” added Gary Gu, EY Greater China Consulting Data and Analytics Competency, Digital and Emerging Technology Competency Leader.
To learn more about AI assessment tool, please visit:
https://ai-ey.microsoft.com/UI/EN/assessment.html
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Notes to editors
About the survey
116 companies in Greater China across seven industries (professional services, manufacturing & resources, ICT & media, financial services, health, retail and infrastructure & transport) participated the survey. Input from 105 online survey results were gathered and 42 one-on-one interviews with corporate executives were conducted from September 2019 to April 2020. For more information about the survey and the report, please visit
https://ai-ey.microsoft.com/UI/EN/feedback.html
About EY
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This news release is issued by the EY China practice, a part of the Ernst & Young global network.
