SA companies piloting AI technologies

SA’s overall investment in AI is significant, at 46%, with US$1.6 billion invested over the past 10 years, a Microsoft commissioned report reveals.

Johannesburg, 12 Jun 2019
Read time 4min 20sec

New research reveals that artificial intelligence (AI) pilots and experimentation are now prolific across South African companies, with businesses showing a willingness to embrace AI and experiment using new technology.

In fact, 46% of South African companies say they are already actively piloting AI within their organisations. This is according to a recently released AI Maturity Report in South Africa – commissioned by Microsoft and conducted by EY.

The country’s enthusiasm to pioneer new AI solutions is the result of an open culture towards AI. At least 25% of South African companies consider themselves highly competent in their willingness to experiment with, and learn about, new technologies – compared to just 14% across the region.

Businesses are experimenting with a range of different technologies, including chatbots, robotic process automation and advanced analytics. Sixty-seven percent of local organisations pinpointed machine learning as the AI technology most useful to them, followed by smart robotics and biometrics.

“Many AI experts argue that it’s not simply a lack of technical skills that slows the progress of AI, but also a greater need for a culture of experimentation. Though AI is in its early stages of development in South Africa, it bodes well for AI maturity in the country that businesses are actively experimenting with exciting new AI use cases,” says Lillian Barnard, managing director at Microsoft.

One of three top investors in the region

South Africa’s overall investment in AI is significant, with US$1.6 billion invested over the past 10 years. In fact, together with the UAE and Turkey, SA was one of three countries in the region with the highest AI investment activity in the past decade.

The bulk of this investment went towards IOT and social media, followed by planning, scheduling and optimisation, as well as smart mobile.

High expectations for the future

When it comes to the future benefits of AI, companies across the MEA region are highly positive – and perhaps none more so than South African organisations. Ninety-six percent of local businesses expect to gain significant financial benefits by using AI solutions to optimise their operations.

The top use cases for AI listed by companies surveyed include automation (83%) and prediction (70%). Use cases in question include a broad range of applications, from increasing employee productivity to predicting customer churn or consumer conversion rates and proactively managing machinery downtime.

Road to AI maturity

Though 42% of South African businesses say AI is one of their digital priorities, not a single company indicated that it was their most important priority. Instead, there are a number of core competencies South African companies feel they still need to address in terms of AI maturity.

While data management scored well as a competency in SA (almost a third of companies consider themselves highly competent), businesses typically rate themselves as only moderately competent when it comes to leadership capability.

Combining AI with emotional intelligence is another significant challenge for local companies, with many respondents citing concerns around human-machine interaction, and how AI outputs should be integrated with operational processes and the people involved in those processes.

AI agenda needs to filter down

Perhaps most importantly, discussions around AI need to take place across all levels of South African businesses. While 83% of organisations report direct involvement at the C-suite level, this number is significantly lower (29%) at a non-managerial level.

Currently, 54% of companies rate impact on personnel as the top business risk in implementing AI. While South Africa’s unemployment rates are high, understanding of AI is low. This typically means that much of the workforce’s excitement around AI is quickly replaced by fear of job losses.

“To realise the true value of AI, organisations need to understand the scope and risks specific to them. Then they need to define the value and capabilities needed to integrate, activate and incorporate intelligent, robotic and autonomous capabilities. We hope that this study, which we are proud to have partnered with our alliance partner Microsoft, opens doors for South African organisations to use AI to improve business processes and accessibility for non-technical users,” says Brian Lewkowicz, lead on Intelligent Automation at EY Africa.

As such, companies should implement change management to help employees across the organisation understand that AI helps enhance productivity and can reduce the amount of time they spend on menial tasks.

“Microsoft has always believed that AI strategy should be designed with people at the centre. When companies opt for a ‘people first, technology second’ approach, human capabilities are extended and people can spend more time on creative and strategic endeavours so, ultimately, companies achieve more,” says Barnard.

To download the full report on South Africa’s AI outlook, click here.