Artificial Intelligence in Middle East and Africa - United Arab Emirates Outlook for 2019 and Beyond - Microsoft ...
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Artificial Intelligence in Middle East and Africa United Arab Emirates Outlook for 2019 and Beyond How 112 Major Companies Benefit from AI R E P O R T CO M M I S S I O N E D BY M I C R O S O F T A N D CO N D U C T E D BY E Y
Contents Preface Foreword . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 06 Executive Summary - ‘At a Glance’ . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 08 Setting the Scene About this Report . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10 Rich Data . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13 Executive Perspective . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14 Participating Companies . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16 Bits & Bytes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18 Follow the Money . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20 Case Study . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22 Experts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23 Role of AI in Middle East and African Business A Strategic Agenda . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27 Among Friends . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 28 Push or Pull . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 29 Ready, Set... . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 30 AI Maturity Curve . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 32 State Your Business . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 34 Case Study . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 36 Business Benefits and Risks Another World . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 38 AI Here, There, Everywhere . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 40 Case Study . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 41 Use it or Lose it . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 42 Making AI simple . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 44 Case Study . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 47 Sector Benefits Landscape . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 48 Risky Business . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 51 Learn from the Leaders Capabilities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 53 AI Competency Model . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 55 Advanced Analytics . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 56 Data Management . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 58 AI Leadership . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 60 Open Culture . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 62 Emerging Technology . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 64 Disclaimer This report does not constitute a recommendation or endorsement by EY Agile Development . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 66 This report has been prepared by EY Consulting LLC (UAE) in accordance Consulting LLC (UAE) or Microsoft to invest in, sell, or otherwise use any of External Alliances . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 68 with an engagement agreement for professional services with Microsoft. the markets or companies referred to in it. To the fullest extent permitted by Emotional Intelligence . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 70 EY Consulting LLC (UAE)’s obligations to Microsoft are governed by that law, Microsoft and EY Consulting LLC (UAE) and its members, employees and engagement agreement. This disclaimer applies to all other parties. agents, do not accept or assume any responsibility or liability in respect of Case Study . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 73 this report, or decisions based on it, to any reader of the report. Should such This report has been prepared for general informational purposes only and readers choose to rely on this report, then they do so at their own risk. What’s next for you? is not intended to be relied upon as accounting, tax, or other professional advice. Refer to your advisors for specific advice. EY Consulting LLC (UAE) ©2018 EY LLP Limited All Rights Reserved. How to Get Started . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 74 and Microsoft accept no responsibility to update this report in light of Who to Contact from Microsoft . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 77 subsequent events or for any other reason. Contributors from EY . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 79 2 3
Artificial intelligence is already changing society and empowering people in new ways by enabling breakthrough advances in areas like healthcare, agriculture, education and transportation. As this technology continues to grow, we will work to deploy AI around the world ethically, inclusively, and with transparency to ensure that it works for everyone. — Brad Smith, President at Microsoft 4 5
Preface Preface Foreword We see AI as a tool to accelerate our customers’ digital AI can improve lives, transform communities, societies and transformation and growth journeys. nations with people at the center - in ways unimaginable to us. The UAE is already seen taking strides to succeed in this journey by achieving remarkable milestones. AI is fueling digital transformation across the Middle East & Africa today. It has the power to amplify human ingenuity and extend our capabilities, empowering us to achieve more. Artificial Intelligence is already improving our lives today and promises to change the world in ways unimaginable to us now. We firmly believe that AI can transform communities, societies and nations with people at the center, in ways unimaginable to us. The UAE is The AI maturity assessment study, conducted in five countries across MEA, already taking strides to succeed in this journey by achieving remarkable highlights the strategies adopted at different layers of an organization milestones – all the way from appointing the world’s first AI minister, to today and helps us understand their readiness in AI adoption, rate of embracing AI across every sector. Microsoft shares this vision as we have an impact and benefits from its implementations, as well as how AI is being ambitious goal to make AI accessible and valuable to every individual and approached on a practical level. This study is also a stepping stone in our organization. We are amplifying human ingenuity by infusing intelligence efforts to better understand the needs of our customers in the region and across all our products and services to extend their capabilities and make accelerate their growth journeys. them more productive to achieve more today – and tomorrow Samer Abu-Ltaif Sayed Hashish President - Microsoft Middle East and Africa Regional General Manager, Microsoft Gulf 6 7
Preface Preface Talk the talk, or walk the walk? The hype and excitement around AI is ubiquitous and UAE executives At a Glance clearly see the transformational potential that AI will have on their organisations in the next 3 to 5 years. With a significant number of companies still in the planning phase and yet to go beyond that, it is the companies that have been able to educate and expose their companies are self-rated as least mature, leadership and top management not just to AI technology, but also indicating that they are not yet thinking to development methodologies and associated dependencies, that about AI at this stage. have moved quickly to the front. AI is finding early traction around the customer agenda, although CFO’s are not being silent and are pushing Noticeable potential for AI in many AI solutions into the core operations to reduce costs and drive up corporate functions productivity. Most AI projects (predominantly machine learning, smart The most widely reported adoption of robotics and chatbots) are being executed out of specialist Digital and AI (at 47%) was in the IT/Technology IT teams as top-end skills are not freely available. The bigger constraint function, followed by R&D and by quite a margin lies in finding competent business analysts able to Product Development with 30%, and identify the use cases for AI and then architect solutions that will be Operations and Logistics with 20%. transformational for their companies. Executives are also focusing While the hype around AI and in 38% of organizations driving their AI still vague. The overwhelming majority, on developing strong digital foundations in data management, Interestingly, several functions are its potential role as a driver of agenda from the top down although however, expect AI to impact the core infrastructure, resource skills and experimental cultures which will be hardly using AI at all; most notably transformational change to businesses 95% of companies that were more of the current business with 71% of imperative if the excitement is to be converted to action and the true the Procurement function, where only and industries is pervasive, there are advanced in their AI agenda had a companies striving to improve their value of an AI-enabled organization is to be realized. At a national level 3% of the companies currently use AI, limited insights into what companies combined top down and Bottom up primary value chains and unlock short- the whole country is driving the AI agenda with direct support from the and Strategy with 3%. This is perhaps are actually doing to reap its benefits. model in operation. to-medium term benefits. With AI government with national strategies and programs focused on skills surprising, given the many use cases and This report aims at getting a deeper opportunities close to home as well as development and capability creation to create the required impetus. applicable solutions in these functional understanding of how companies Most benefits expected from pushing companies into totally new areas. currently manage their AI activities, ‘optimizing operations’, with domains in the future, it is perhaps and how they address the current ‘transforming products and not surprising that AI is receiving 8 key capabilities that are most challenges and opportunities ahead. services’ next in line attention as a key topic for executive important ‘to get AI right’ 89% of the respondents expect AI management. To get to the heart of this agenda, to generate business benefits by When asking the respondents to rank the importance of 8 capabilities to What sets the most ‘AI mature’ we received input from AI leaders in 112 companies, across 7 sectors and 5 optimizing their companies’ operations in the future. This is followed by Very few of the 112 companies consider themselves ‘advanced’ with enable AI in their businesses, Advanced companies apart? Analytics and Data Management countries in the Middle East and Africa, 71% that expect AI to be key in the AI emerged as the most important, with They see AI predominantly being driven from a combination via surveys and interviews. Below is the creation of new products and services Despite the sizable impact that AI Leadership closely grouped with the of technology push and business pull (57% of ‘more mature’ brief summary of what they had to say. through AI driven insights that enable companies expect from AI, only a top two. companies vs 38% of ‘less mature’ companies)*. tailored and personalized products, or very small proportion of companies, AI is a “hot topic” - but more so on processesing more complex data sets constituting 7% of the total sample, self- When self-assessing the capabilities They report using a combination of structured and unstructured C-level than in daily operations that drive new products to address the report that AI is actively contributing where the companies are least data for AI (53% of ‘more mature’ companies vs 42% of ‘less mature’ 80% of the companies respond that AI needs of a changing consumer market. to ‘many processes in the company and competent, they point to Emotional companies), and data from both internal and external sources (53% is considered an important topic on Surprisingly, the poorest showing at enabling quite advanced tasks today’ Intelligence and AI Leadership - defined of ‘more mature’ companies vs 37% of ‘less mature’ companies). the executive management level. This 63% was direct customer engagement. (referred to as ‘most advanced’ in this as the (lack of) ability to lead an AI is significantly higher than on the non- report). transformation by articulating a vision, They are looking to AI for insights to ‘transform products and managerial / employee level where AI AI is expected to impact entirely setting goals and securing broad buy-in services’ (82% of ‘more mature’ companies vs 64% of ‘less mature’ is only considered an important topic new business areas in the future Another 20% are in the ‘released’ stage across the organization. companies). in 26% of the companies. Interestingly, 28% of the companies expect AI to where they have selectively put AI to Board of Directors also came out lower have a high impact or a very high active use in one or a few processes To summarize, the challenge ahead They expect AI will help them ‘engage customers’ (75% of ‘more with only 37% of respondees reporting impact on business areas that are in the company. The majority, 55% of appears to be as much about culture mature’ companies vs 50% of ‘less mature’ companies). that AI is important to their board. This ‘entirely unknown to the company companies, are still only planning for and leadership as it is about data, strong executive sponsorship resulted today’, although the exact nature is AI or are in early stage pilots. 13% of analytics, and technology. * ‘More mature’ defined as companies that self-ranked as 4 or 5 on the maturity 5-scale, and ‘less mature’ defined as companies that self-ranked as 1 or 2. Only 7% Percentage of companies seeing ‘optimizing operations’ as top AI benefit: 80% of the companies 60% of the companies Companies expecting AI to have a high impact on 70% of companies ‘business areas that are entirely unknown today’ 89% of the companies are actively respond that AI is considered are using partners or alliances to are using AI in a ‘to using AI in ‘many processes and to enable advanced tasks’ ‘an important topic’ on the executive management level obtain the required capabilities 28% predict’ function 8 9
Setting the Scene Setting the Scene About this Report What’s new? Artificial Intelligence is not new - it has in, and how they are managing the how mature companies are in terms of Straight from the executives existed for decades: processing voice complicated process of adopting this adoption, and examining self-reported This report and extensive dataset Contributions from open-minded to text or language translation; real- new technology and deriving value competence levels regarding the adds new insights primarily into how and collaborative companies time traffic navigation; dynamically across business opportunities. capabilities required to succeed when leading companies are approaching We are extremely thankful for the time serving targeted advertisements implementing AI. AI on a very practical level. We hear and effort the many executives have based on personal data and browsing Perspectives, experiences, self- straight from executives how their put into participating in interviews history; predicting trends and guiding assessment, and benchmarks From the aggregate dataset we companies are addressing current and providing data for this study. investment decisions in financial From new surveys, interviews and case have been able to determine some challenges, and how they apply AI to We’re particularly appreciative of their institutions. The current developments studies gathered from approximately benchmarks across the covered unlock new value pockets. willingness to openly share experiences have been fueled by an exponential 112 companies, we provide a snapshot markets, which we compare to the and provide their perspectives on rise in computing power, increasing of the current state of AI in Middle UAE throughout the report. The report Based on the many interviews where the future of AI is heading. accessibility and sophistication of Eastern and African markets. This also covers a full spectrum of industry conducted, this report reveals some powerful algorithms, and an explosion includes analyzing AI’s relative groups which reveals interesting clear excitement and immense While this indicates a general interest in the volume and detail of data importance on the strategic agenda, insights. potential for using AI to bring new, in the AI topic, it also speaks to the available to feed AI’s capabilities. it’s expected impact and benefit areas, improved products and services to increasingly collaborative approach market, create exceptional experiences many leading companies are taking for customers and employees, and when entering new technology Reality vs. hype create ways to operate that enhance domains and embarking on journeys Only recently have we started to see performance across the board. into uncharted waters. more widespread, scaled adoption of AI across sectors, value chains and ecosystems. Yet AI technology is We learned that, regardless of which quickly approaching a point where it is use cases the companies pursue becoming a critical element in enabling and the role that AI currently has, companies across sectors to drive taking a strategic outlook to assess revenue, increase profits and remain the implications for the business Right now AI is the technology and responding accordingly are competitive. Even during an economic downturn investing in data makes driving a lot of buzz and interest, but increasingly seen as crucial for any executive agenda. sense as AI can provide significant cost advantages and We hear people in many companies understanding how to use it to drive real talk about AI. While the hype is efficiencies. business value is key. pervasive, not a lot of people fully understand its technological potential, —Emaar where it can create value or how to get — Etihad Airways started. This report provides a practical understanding of why companies in the Middle East and Africa are investing in AI, what they are investing 10 11
Artificial intelligence in Middle East and Africa Setting the Scene Rich Data Which sources of information is the study based on? AI can be a real game changer, if we introduce it with proper education and well explained This report combines multiple sources of data to determine why, where and We also present case studies of specific companies, both local Recognizing and mitigating potential survey and interview bias benefits for the business and ultimate how AI is currently being used in business. It provides an inside view across and international, to provide an understanding of what they are doing In terms of methodology, this report follows robust research design and protocol. Doing so minimizes potential beneficiaries. markets and sectors, combining local with AI and why, drawing on lessons and regional views. The quantitative learned and obstacles to be overcome bias, but does not eliminate it, as it perspective measures how advanced when putting AI to use for specific use is inevitable in market research. One companies are in terms of AI, and the cases and to derive value on a strategic potential type is social desirability qualitative perspective indicates how to level. and conformity bias, as the topic of AI receives lots of media and political — Etihad Credit Export Insurance develop the skills required to succeed with AI initiatives. We have received input Proprietary AI investment data attention. Response bias, including from over 100 participating companies in We have supplemented the primary extreme responding, cultural bias, and the form of interviews responses to our source input from the companies acquiescence bias (“yea-saying”), are online survey. with acquisition data from numerous potential factors as we ask respondents sources, to take the pulse of the AI to self-report on their respective Extensive online survey data from investment market in the Middle East companies’ experience. Therefore, business leaders in 112 companies and Africa. These insights help provide while this report follows best practice, We have surveyed people with a leading a picture of the wider AI ecosystem and some bias is possible. Nonetheless, role in managing the AI agenda in all its development in the region. with the combination of extensive the companies that have contributed survey data, interview data, investment to the study. This gives us an aggregate data, and expert perspectives, we With the rapid change in business the dataset that enables a perspective for each market and each sector, as well as AI expert perspectives With this wider understanding of AI believe the report provides a solid foundation for an indispensable view of executive experience with – and future dependency on data for decision making has comparative insights for the respective start-up acquisitions, partnerships, and company types, sectors, and countries in investment funding, we outline how plans for – AI in business. the Middle East and Africa. investments in AI are skyrocketing, never been higher, a reliable secure source of Qualitative in-depth interviews with where AI investment is taking place geographically, and which sectors are senior business executives data should always be available to meet the making bets. As we are on the cusp In addition, we conducted deep-dive of widespread change driven by AI, interviews to gain deeper, qualitative we also reached out to AI experts high demand. insights into how AI is affecting the executive agenda. Through conversations from academia for an outlook on AI technologies going mainstream, and with business leaders, we report on to gain an understanding of the macro where they expect AI will have an impact, scale of business effects that they how important AI is to their current and expect will materialize when looking — Arab Potash Company future business strategies, what benefits they hope to realize from implementing into a distant future. AI, and which capabilities they believe are key to advance AI maturity in their companies. The focus for companies shouldn’t be so much on developing an AI strategy, but rather ensuring business strategy is enabled by AI and machine learning. — Majid Al Futtaim 12 13
Setting the Scene Setting the Scene Executive Perspective Large group of respondents with Surveyed companies are well represented across each of Who are the respondents that have contributed to the study? a specific AI/digital role the five Middle Eastern and African markets Organizational function of respondents in Number of online surveyed companies per country the online survey The data approach used allows us Functional diversity to identify trends across industries The respondents cover very different UAE participants from senior and countries based on input from functions, of which the most common levels in the organisation various functional business areas. are designated IT/Tech/Digital The respondents interviewed 54 Consequently, we have captured departments, followed by General during the course of the survey a range of insights, learnings, and Management roles, then R&D/Product are all from senior positions a r ic perspectives from both strategic and Development and Strategy functions. within their organizations - 35% Af Jo th rd technical points of view. This functional diversity increases the u are directly from the C-suite So an breadth of the report, with insights and with a wide spread including Respondents almost exclusively in perspectives covering widely different CEO’s, CFO’s and CIO’s and the 24 26 senior level positions aspects of AI. remaining 65% are from top To ensure that these insights and 22 management including Executive perspectives are relevant at the Surveyed companies span multiple executive level, we surveyed and sectors Heads of AI who are at the heart of their organsations AI 112 online survey interviewed high-ranking officers The participating companies are spread agenda. With such diverse and 12 companies 11 with a responsibility for driving the AI fairly evenly across seven sectors, with senior resource respresentation 19 in total 7 20 agenda in their respective companies. the majority of companies belonging it provides key insights on how 6 of m Turke With 91% of respondents being to Professional Services (includes g do b ia y UAE companies perceive AI at K in ra di A either part of top management or Government Departments and Public S au present. the executive management team, Services), followed by Financial Services, IT/Tech/Digital General Management R&D/Product development Strategy Admin/Finance Sales & Marketing 23 their input is likely well attuned to Retail and Infrastructure & Transport. ICT the general perspective and overall & Media, Manufacturing & Resources, strategic direction of the companies and Health are represented to a lesser b te s d Ara they represent. extent. Emira Unite More than 100+ participants Majority hold a top management or executive position Number of participants interviewed Organisational level of person participating in the study for UAE and/or online surveyed in the study Seven major sectors covered in the study Representation of participating companies per sector category 21 of 100+ are UAE participants C-suite/Executive 39% 35% + 10% 7% 14% 32% Top Management Health Manufacturing & Resources Financial Services Professional Services (non-executive) 52% Pharmaceutical, Healthcare, Manufacturing, Banking, Insurance, Professional Services, Biotech Materials, Equipment Investments Hospitality, Public Services, Membership Organization, 65% Government Departments 12% 12% 13% Middle East and African UAE Management markets Level 9% Retail ICT & Media Infrastructure & Transport Consumer Products Technology, Transportation, Energy, & Retail Media/Entertainment & Telecom Construction, Real Estate Middle East UAE and African markets 14 15
Setting the Scene Setting the Scene 100+ Companies AB InBev, Adenium Energy Capital, Alinma Bank, University of Science and Technology, KSA Ministry Allianz Turkey, Amman Municipality, Arab of Finance, KSA Ministry of Health, KSA National Potash Company, Arçelik, Assan Bilişim, Health Information center, Life Healthcare, Aveng, Bankalararası Kart Merkezi (BKM), Majid Al Futtaim Holding, Medscheme, Migros, BCX, Bigen Group, Bridgestone, Cairo MTN Group, MultiChoice Group, Nader Amman Bank, Careem, CarrefourSA, Group, Nampak, Netmarble Turkey, Opet De Beers Group, Discovery Group, Petrolcülük A.Ş., Pharmactive, Publicis, dnata, Emaar, Erdemir, Etihad Quantum Global Solutions, Sasol, Savola Airways, Etihad Credit Export Foods Co., Setur, Smart Dubai, SMEC Insurance, Exxaro, First Abu Dhabi South Africa, Specialized Technical Bank, General Mobile, Harmony Gold Services (STS), Standard Bank, Super Mining Company Limited, Hashemite Group, Teknosa İç ve Dış Ticaret A.Ş., The University, Hello Group, Heriot-Watt ENTERTAINER, Total Marketing Middle University, Hikma Pharmaceuticals East, Transunion, Tüpraş, Türk Ekonomi PLC, Imam Abdulrahman Bin Faisal Bankası, Türk Hava Yolları Kurumsal University, Johnson & Johnson, Jolly Gelişim ve Bilgi Teknolojileri (THY), Tur, Jordan Ministry of Energy and TymeBank, UAE Prime Minister’s Office, Mineral Resources, Jordan Ministry of University of Jordan, Vacation Exchanges Labor, Jordan Ministry of Transport, Jordan International Trading as RCI South Africa, Payments and Clearing Company, Jordan Vakıf Emeklilik, WSP, Yapı Kredi Bankası, Zain Note: Certain participating companies requested to remain anonymous and are not included in the list above. Also, certain companies supplied perspectives for more than one surveyed country. 16 17
Setting the Scene Setting the Scene Bits and Bytes possibility of combining internal Companies are using a mix of Data Sources and Storage and external datasets in order to Solution: How are you primarily dealing with the computing demands produce even deeper insights. needed for AI? What technologies and data solutions are within the scope of the study? Machine learning was found to be Data Source: 1.Are you currently using unstructured or structured data the most useful. It is not clear from types in your AI process? 2.Are you currently using internal or external the study if this is because it is simply data sources in your AI process? the most common starting point before deploying more advanced AI can be defined as the ability of are currently not in common use by a combination of on-premise and technologies, or if it also in the a machine to perform cognitive companies in the Middle East and cloud architectures, with executives longer term holds the most wide and functions which are normally Africa (MEA). Companies surveyed are acknowledging that cloud will significant application potentia associated with humans. This includes currently focused on narrower and inevitably grow more dominant over reasoning, learning, problem solving, more specific use-cases that support time. and in some cases even exercising existing business. These efforts will Solution human behavior such as creativity. undoubtedly help companies build Machine learning capabilities that are necessary to The most commonly used AI Machine Learning and smart Advanced AI applications are not deploy more advanced AI solutions in technology among the surveyed robotics the most useful for UAE yet widespread the future. companies is machine learning. This companies 21% 35% 43% AI holds the potential to transform is inarguably due to its wide-ranging Companies ranked Machine In Cloud On premise Both business in a radical way given its wide Companies are using a combination applicability, making it relevant for Learning the highest (53%), with variety of use. Quite simply, business of on-premise and cloud solutions a variety of use-cases across the a strong emphasis on decision leaders need to understand AI in order Cloud based solutions are starting value chain. Of the different types of support solutions, and Smart to grasp the opportunities and threats to gain prevalence in the region to machine learning, the most common Robotics next in line (41%) as a the technologies pose. support AI solutions with both storage is supervised machine learning, natural entrant for more complex and on-demand computing given its where software is fed structured AI technology. With customer While companies acknowledge the flexibility to swiftly scale up and down data and finds patterns that can be interactions a key focus, Text significant potential of broader, to accomdate changing demand, used to understand and interpret Analysis came in an anticpated more advanced AI technologies variable costs structures and access to new observations. While companies 3rd position on 35% with many Data Source such as computer vision, speech larger datasets. Despite the advantages historically have primarily used internal of these being integrated in 29% 5% 43% recognition and virtual agents, they almost 43% of respondents utilise data for supervised machine learning, chatbot solutions across different Structured Unstructured Both most have now begun exploring the sectors, supported as well by Virtual Agents (29%) and Natural Language Processing A broad definition of technologies are included in this AI definition (29%). Despite lower rankings, Technologies included in the definition of AI used in this study all of the major AI technologies were represented, indicating experimentation across a wide Text Analysis spectrum and mirroring the Computational analysis of texts, trends across the Middle East and Natural Language Processing making it readable by other AI or Biometrics 34% 7% 39% computer systems. African region. Computer interpretation, Analysis of human physical and emotional Internal External Both understanding, and generation of characteristics – used also for identification written natural human language. and access control. Machine Learning leads the pack Which of the following technologies have you found to be most useful in your company’s deployment of AI? Virtual Agents Computer-generated virtual personas Machine Learning that can be used to interact with people A computer’s ability to ‘learn’ 61% 37% 36% 35% 32% 30% 23% 22% 16% in both B2C, C2B, and B2B contexts. from data, either supervised or non-supervised. Speech Recognition Neural Networks and Deep Learning 53% 41% 29% 35% 29% 29% 10% 12% 12% Enables computers to interpret spoken Machines emulating the human brain, language and to transform it into enabling AI models to learn like humans. written text or to treat it as commands for a computer. Computer Vision Gives computers the ability to Machine Smart robotics Neural Text analysis Virtual agents Natural Speech Biometrics Computer Smart Robotics “see” images similar to how learning networks and language recognition vision The combination of AI and robots to humans see. deep learning processing perform advanced tasks compared to traditional non-intelligent robots. Affirmative responses, Middle East and African Affirmative responses, UAE markets Note: Remaining percent ‘Don’t know’ responses 18 19
Setting the Scene Setting the Scene and it is also the leader in terms of other AI formats with cyber security the amount invested, being $3.4bn. and smart mobile beginning to gain Follow the Money The UAE invested strongly in 2016 and some real momentum. 2017, and whilst South Africa surged in 2011 and then showed a marked slow down in recent years, it remains a $2151 million invested in AI in UAE in the past decade How much is invested in AI in the Middle East and Africa? major player. Saudi Arabia is emerging UAE was not one of the first countries strongly again in 2018, and Jordan, although behind others in the region, in the Middle East and Africa to get is positioning itself to capitalise on started, but has strengthened notably Relative spend on AI opportunities in the immediate future. in more recent years and now lies in transactions across the region second place in terms of AI investment Based on value of transactions from Social media followed by IoT the across the surveyed countries. The 2008-2018 most popular AI investment investment spend in the past decade Social Media and IoT most $3459m Social media transactions account for totals $2151 million and is made popular 252 deals up of 160 deals. Social Media and Based on number of transactions Turkey $2151m 44% of the number of transactions, 160 deals with IoT in second place having 28% of Internet of Things transactions were from 2008-2018 UAE transactions. However, the position is by far the most significant, 84 and reversed when looking at the amount 42 transactions respectively, as the of investment, with IoT investment drive towards Smart Cities continues Denmark amounting to almost 60% of the total unabated. With a good spread across investment across the region, and a further 8 AI technologies including social media investment amounting Smart Mobile, Gamification and $1658m 134 deals to only 36%. The balance of the Machine Learning, there is every South Africa investment amount is shared across the reason to believe this investment Internet of things : $603m trend will continue to grow over the 263 transactions 87 deals next few years. Nigeria $585m $241m 37 deals 450 100 deals Social Media : Egypt Saudi Arabia Steady increase in Middle East and African AI investment 411 transactions $130m AI 400 companies invested into, transaction volume, selection of countries from the Middle East $177m 77 deals 5 deals Kenya and Africa (from 2008-2018)** $60m 350 Source: EY Embryonic Kuwait 62 deals Smart mobile : Data includes all transaction types including Mergers, Jordan Total 97 transactions Acquisitions, VC Funding Rounds, Angel/Seed Investments, $7m 300 investment JV/Alliances, Private Equity and Accelarator Funding. 7 deals $9.07bn $2m Morocco Number of Planning/scheduling/ 8 deals 250 transactions optimisation : Qatar 56 transactions 200 173 171 Middle East and African markets UAE 145 Machine learning : 150 123 32 transactions 100 91 78 60 51 50 Acquisition data for a selection of remained relatively quiet since with angel investors and seed funding are 24 AR/VR : 14 transactions countries in the region gives an the exception of one large deal for involved in a significant number of 11 2 0 indication of where money is being Saudi Arabia in 2018. Not only has the transactions, the total value remains invested in AI technologies. A very quantum of transactions increased over small by comparison, reflecting a 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 broad interpretation of AI was the past decade, but the relative size of cautious attitude to betting large Middle East and Africa Cyber security : considered, since most countries in the the deals has also been increasing over amounts in the high-risk/high-return 13 transactions region are in the very early stages of AI. time. arena of AI start ups. ** for a selection of 11 countries from the Middle East and Africa Gamification : 10 transactions Growth trend in the past decade Mergers and acquisitions account Investment activity greatest in There has been a steady growth trend for most of the investment Turkey, UAE and South Africa Blockchain : 7 transactions in AI investment over the past 10 years, The amount of funding coming from The greatest amount of investment Robotics / Automation : 6 transactions from a mere 2 transactions in 2008 to mergers and acquisitions ($3.9bn) and activity over the past 10 years is seen 171 transactions in 2018. Interestingly, corporate investment ($1.1bn) makes in Turkey, UAE and South Africa. The There is still concern that the models the two early starters in 2008 were up more than half of the total amount number of transactions in Turkey was aren’t mature enough to invest in. Chatbots : NLP : Image Recognition : Predictive analysis : 12 transactions 1 transaction 3 transactions 4 transactions Saudi Arabia and Egypt, but they invested in AI in the region. Although 252 out of the total of 929 transactions, Note: Several transactions in the dataset did not have publically disclosed deal values, suggesting that actual total values are higher than what’s shown above — dnata **Including governmental investment 20 21
Articificial Intelligence in the Middle East and Africa ( Case Study ) Setting the Scene Smart Dubai Expert Perspective What does the future look like according to AI analysts? Smart Dubai’s 2021 vision is for a city either typed or spoken in both Arabic initiative Smart Dubai implemented where all resources are optimised for and English, enabling users to interact a successful roadmap development maximum efficiency, where services easily from smart phones.approach across 20 government are integrated seamlessly into daily life departments, which started with and where people and information are In 2017 Smart Dubai opened its AI Lab, educating them on what AI is and how protected. Key to this is a Government to drive education and understanding it can be applied, before identifying 106 powered by world-class city- use cases where the processes wide shared services and and/ or the experience could We also spoke to a range of leading AI Agile culture enables AI This also ties in with the importance of infrastructure that will drive be improved. These were then experts from business and academia Culture was a recurring theme as well. partnering to get started and access significant efficiencies. assessed for whether AI could to gain insights into the kind of change It can either stifle forward momentum the expertise needed to use AI. While While there is internal change and value actually be used to optimise which we are on the cusp of, and the in organizations, or be the silver bullet partnering and collaborating solves As part of its strategy, Smart already being seen today, public visibility the process and whether good, role AI is expected to play as part of a that enables the potential of AI to be the perennial AI challenge concerning Dubai started looking will come soon. clean data was available to broader transformational wave. realized from top to bottom. the scarcity of talent, the significant into Artificial Intelligence power the solutions. Pilots for Some of the experts even argue that cost and substantial benefit that opportunities in 2015. It’s the 43 use cases are now being AI is entering the mainstream and it’s not only technical skills that hold can be gained from AI means that first initiative, launched in developed and will eventually here to stay up AI projects, it’s also the need for a organizations also need to be September 2016, was its AI- be rolled out by the relevant One thing was clear from the experts culture of experimentation. cognizant of building capabilities in- powered smart city advisor ‘Rashid’ of AI across government plus use case departments, with support from the lab. we spoke to: as far as the peaks and Companies that are more natively house for the long-term. which answers user requests online, based technology enablement for troughs of hype and technological digital or have gone down that road government services. As part of this leaps surrounding AI go, there is no understand the value of experimenting Finally, as AI develops, we are also doubt that we are living through a and iterating. They don’t think in going to see innovation and expertise particularly prominent peak, with traditional terms of committing spreading outside of the dominant no indication that the buzz nor the to year-long projects that need to clusters of the likes of Silicon Valley, potential will fade away any time soon. produce specific outputs, but rather to as governments, businesses and In a world increasingly dominated, explore and test ideas before scaling. universities increasingly invest in What next? disrupted and driven by innovative building knowledge, resources and tech powerhouses, large and small, it When it comes to AI, knowledge is capabilities. The Smart Dubai Office was formed in 2015 to oversee Dubai’s Smart Dubai’s vision is to make Dubai government completely is no understatement to suggest that power digital transformation and accomplish the vision of His Highness paperless and 100% digital by the end of 2021. Using emerging AI will be a chief protagonist in the Expert opinion also seemed unanimous Sheikh Mohammed bin Rashid Al Maktoum, Vice-President & technologies such as AI, Blockchain, Digital ID and others, Smart change transcending all elements of in that most people not directly Prime Minister of the UAE and Ruler of Dubai, to make Dubai Dubai is digitizing all city services and re-engineering business business in what has been labelled the involved with AI must still have quite the happiest city on earth. Collaborating with government and processes to ensure all of the city’s services are provided to Fourth Industrial Revolution. a basic understanding of what AI is private sector partners, Smart Dubai is consistently adopting latest residents and vistors through one digital platform. and what it can actually do. Therefore, technological innovations to provide more efficient, seamless, safe Business-minded people will drive the task is to educate and improve and personalised city experiences for residents and visitors. the transformation understanding, from C-suite leadership The AI experts confirmed some of teams to employees at the coal face. the key ingredients necessary for AI in organizations: a combination of domain and technical expertise, the appropriate technology, the right talent, and lots and lots of data. While letting tech-savvy individuals There’s a lack of knowledge, everyone’s aware of it - drive innovation is great for building Successful AI strategies and roadmaps always AI programmes aren’t just about deploying but what does it DO? understanding, true transformation will start with use cases and business value. new services, you need to keep the live ones not come until business people start up to date by continued input of new data, re- suggesting problems for AI to solve - — Adenium Energy Capital not the other way round. training and on-going maintenance. 22 23
Setting the Scene Setting the Scene Think about the sheer computing power that is getting Key insights on the potential distributed, and how it is creating rich experiences through our lives. In our homes and cars, in our cities and at work, across of AI* every industry, from manufacturing to health care—all will be transformed by data, cloud and AI. That’s the incredible *Global Leader’s views from the field opportunity in front of us. — Harry Shum, Executive Vice President , AI & Research, The full extent of the AI story remains in its early stages. What Microsoft we do know is that big data, computing power and connectivity are changing the industrial landscape. The opportunity rests in accelerating the digitization of businesses, making them If you have a ton of data, and your problem is one of classifying more data driven by building applications that deliver machine- patterns (like speech recognition or object identification), AI may assisted insights. well be able to help. But let’s be realistic, too: AI is still nowhere near as flexible and versatile as human beings; if you need a machine to — Mona Vernon, CTO, Thomson Reuters Labs read, or react dynamically, on the fly, to some kind of ever changing problem, the technology you seek may not yet exist. Intelligence is a really hard problem. AI will eventually transform many enterprises and industries. But — Gary Marcus, Founder & CEO, Geometric Intelligence [acquired by its pace of development has been affected by a lack of trust. Today, Uber] professor, NYU, contributor to The New Yorker and The New without mature risk awareness and the right frameworks and York Times controls, applications of AI have not evolved much beyond proofs of concept and isolated solutions. Though proper implementation of AI into business models still faces a number of questions around AI is a general purpose technology, so will eventually affect trust, understanding and appreciating the risks will ultimately all industries. However, this impact can be slowed by the lack allow businesses to position themselves to capitalize on it the most. of data in particular industries. There’s also more innovative cultures inside different organizations, that can either drive — Nigel Duffy, Global AI Innovation Leader, EY adoption or prevent it. — Marc Warner, CEO, ASI Data Science 24 25
Articificial Intelligence in the Middle East and Africa Role of AI in Middle East and African Business A Strategic Agenda Where is the AI conversation currently taking place? Role of AI in Everyone in the UAE is talking about investment, broader adoption and AI particularly relevant at higher AI, and this is from top to bottom in more successful implementations. organizational levels all organizations. 94% of companies Many UAE executives see AI as an 80% of regionally surveyed companies reported involvement at executive enabling function to their digital had AI as an important topic on management level, which is the agenda and integrate the capabilities the C-Suite agenda regardless of highest seen out of the companies that and initiatives - this approach has their degree of AI maturity - from Middle East and participated in the survey in the Middle assisted in getting some companies out cost-conscious CFO’s, to efficiency- East and African region. of the planning phases and up the AI focused Operations Heads, and CDO’s maturity curve. with customer-centric ambitions as AI is generating a buzz everywhere part of wider digitalization efforts. Although AI is a topic of discussion Non-managerial staff keen to ride On the other end of the spectrum, everywhere, a challenge remains the AI wave the AI agenda has not cascaded to convert these into deployed AI 35% of non-managerial staff in the UAE down through organizations to African Business solutions. Despite the strong desire companies surveyed are talking about the point where non-managerial to extend the AI agenda, many AI, which is higher than most of the levels (employees) are discussing it executives state the understanding other countries surveyed. However, at systemically, due mainly to a lack of of AI technologies and the potential grassroots level the experimentation knowledge, limited involvement in uses across their organizations is still and creation of pilot AI projects is pilot programs and fear of the impact lagging. When observing the more being hampered by inadequate on job security. mature companies in terms of AI, environments, limited funding as well one common factor is that AI is being as by insufficient ‘AI enabled’ business directly driven by the CEO’s, acting analysts who can identify the best use as a catalyst and resulting in greater cases for the cool tech. AI is an important topic on the C-suite level in particular There is a lot of hype surrounding AI at the moment, and few On what hierarchical levels in your company is AI an important topic? AI is in particular an doubt its potential. We examine how important AI is compared to important topic at the Executive Management level other digital priorities and where AI fits on the strategic agenda. S T R AT E G I C L E V E L 41% Board of Directors 37% We look at the impact of AI on the company’s core business, as level 94% well as on adjacent and new areas of business. Executive Management 80% level 41% We also examine the current AI maturity levels across sectors and Managerial level 50% markets, the potential drivers for deploying AI, and where AI is Employee 35% applied within organizations, across customer-facing functions, (non managerial 26% level) operations, product development, and internal business support. 0% 1% Other 0% DNK 3% O P E R AT I O N A L L E V E L Affirmative responses, Middle East and African markets Affirmative responses, UAE 26 27
Role of AI in Middle East and African Business Role of AI in Middle East and African Business Among Friends Push or Pull What is the importance of AI against other digital priorities? How is AI predominantly deployed into the organizations? With 18% of companies regarding engagement and fulfilment. Most It is always insightful to understand Regional Business and IT driving from the top down Future impact driving AI’s digital AI as the most important priority executives see this broadening out how AI is being orchestrated in As expected, given how prevalent AI is on the Executive management ranking compared to other digital priorities, very quickly off the learnings and organisations, either being driven agenda, most companies (38%) are managing their AI programs from Despite AI being in the early journey and a further 35% as highly experience gained from the early down from executive levels or the top down, directing the strategic direction as well as centralizing stages in this region, it has managed to important, there is no doubt that UAE projects, and integrating more fully bubbling up from the workforce innovation and pilot programs. The ideal is to accelerate and concentrate anchor itself to other digital initiatives executives see AI right up amongst across the value chain. and operations, and also to what the activities whilst avoiding duplication of effort across the organization as a peer or higher, with a significant their top digital agendas. Despite extent it is driven by IT vs Business. and unnecessary cost. Where strong digital cultures and technical 78% of respondents. This reflects the the high ranking, most experimental Foundations first In UAE the AI solutions are most capabilities exist, a hybrid of both top down and bottom up has enabled understanding that the future will AI programs are under-funded, Investing in AI technologies is definitely being driven Top down, functional use cases to be identified and to attract executive sponsorship be heavily influenced by AI and that compared to their digital peers, and exciting, but will not bear fruit unless and companies are very aware that and direct funding. The concentration of executive buy-in for AI has also it will become a major domain for this results in them taking longer based on solid foundations in the AI must be owned by the business driven a more integrated collaboration between business and IT, as both differentiation between competitors in to move out of pilot phase and into form of suitable infrastructure, rather than by IT. play their role in driving the AI agenda, with 43% of respondents adopting all sectors. This strength in ranking is production. good data, and well-understood this approach. caveated with the knowledge that AI is a business processes - UAE companies Top down vs bottom up relative newcomer to the digital stable, AI track is narrower than the are still actively developing these AI is being heavily driven Top Down other initiatives are significantly more digital highway foundations. It requires strong with the drive coming directly from advanced in their programs, and AI has Although there are sectors that are executive management to develop key positions such as CEO, CFO some catching up to do in terms of actual AI deployed and managed in a balanced way the early leaders including Retail, a strategic vision for AI that is able or CIO, and in some cases specific value creation. Cross dependencies How would you characterize the way AI is being managed in your company? How Telecommunications and the major to attract the required investment positions have been created, such between AI and broader digital initiatives would you characterize the way AI is being deployed in your company? Airlines, they are still only deploying in building the foundations, which as Executive Head of AI, to further is also contributing to AI being seen as AI solutions in rather narrow will take time and not always show the agenda. Given the number of an actual digital priority, more than just a organizational silos and not nearly as immediate benefits. It is only when companies still in Planning phase, Top Down Bottom up Both important topic. broadly as many of their other digital placed on top of these foundations the manner and speed with which initiatives. This is largely because that the real potential for AI can be these protagonists can acquire AI AI is still the new kid on the block realized in the form of improved knowledge and harness skills and and companies have targeted the customer engagement, business resources to start creating workable growth areas around their customer growth and cost savings. pilots to productionize, will Deployment Approach differentiate the winners and losers The majority consider AI is seen as one of many digital priorities - but not the most important AI to be important in the next few years. How important is AI relative to your company’s other digital priorities?? 38% 53% 16% 12% 29% 29% Technology push vs business pull The hybrid model of both business Avg. Score pull and technical push scored the 41% highest (35%) in the responses from Business Pull IT Push Both 26% 35% 23% 18% surveyed UAE executives. There is 13% 11% 14% 3.5 3.2 6% 10% a strong pull from the business for this new and exciting technology, but what is holding companies back 1 2 3 4 5 is the shortage of the right mix of skills. The technical expertise is Not important Important Most important there, but the ability to connect the AI is not formalised AI is one of many AI is the most important business ideas with the technical 23% 24% 22% 29% 43% 35% as a digital priority digital priorities digital priority skills is lacking as Solution Architects and Business Analysts are generally still building the understanding of Middle East and African markets UAE 15 Middle East and African markets UAE Note: Remaining percent ‘Don’t know’ responses what AI is all about and how it is Note: Remaining percent ‘Don’t know’ responses best deployed. 28 29
Role of AI in Middle East and African Business Role of AI in Middle East and African Business Ready, Set... What is the maturity of AI in different sectors? Most companies in Middle East and Africa still in Planning or Piloting stage The shift to becoming AI enabled scale. Across all sectors the number Financial Services have progressed the How would you describe your company’s general AI maturity? is a continuous journey with some of machine learning models directly most as a collective sector with 38% organisations further along the corresponds to those companies with of respondents in the Released stage, path than others. The vast majority high volumes of well managed data, and productionized AI use cases in ICT & Media 7% 40%46% 8% 45% 31% 8% of organisations surveyed have not strong foundational infrastructure and their daily operations. This sector’s run progressed beyond the early pilot where AI takes its place alongside their to the front has been fueled by fierce stages as they grapple with early other top digital priorities. market competition, accelerated starts Professional Services 25% 28% 11% 22% 14% 45% adoption issues. However, a few to AI programs and generally stronger organisations are definite leaders in Trends across the other sectors foundations in data management and their respective sectors, being beyond In the Retail and Consumer Products technology adoption. Financial Services 6% 25% 25% 38% 45% 6% the early formative stages and already sector, the majority of companies accelerating in the released stage of stated they don’t have the same ability Historically more conservative sectors maturity. And then there are those to leverage data as the information such as Retail, Manufacturing & organizations who consider themselves technology orientated sectors, and Resourcing as well as Infrastructure Infrastructure & 27% 27% 33%45% 13% to be advanced, in that they are are still trying to break out of the & Transport are yet to move to the Transport already applying AI technologies in the planning and piloting stage, due to next level, with the numerous pilots running of their business. complex legacy IT and a shortage still underway reflecting their slower Manufacturing & 12% 25% 50% 45% 12% Resources of relevant skills. There is a general technology adoption lead times. Experimenting with technology, but intention, with a few exceptions, across need use cases the Infrastructure & Transport and Surprisingly, given their data-rich and Health 27% 18% 27% 45% 27% The more technically-oriented Manufacturing & Resources sectors to customer-centric environment, the companies have no shortage of be behind the bleeding edge of AI and ICT & Media sector still has 46% of the interested staff members who are therefore look towards leveraging AI respondents in the Planned stage and Retail 8% 31% 38% 45% 23% experimenting with the AI technologies solutions from other sectors as ‘tested working hard to close the gap on the and running pilots. Despite this, solutions’, or buying them off-the-shelf sector leaders. almost all the companies in the study as they mature. These sectors also have indicated that they have difficulty in large workforces with the majority 0% 20% 40% 60% 80% 100% identifying use cases to support the in the low to unskilled category, business and provide a meaningful and cite the need to handle change None Planned Piloting Released Advanced return on investment to attract more management and worker reluctance funding. Those companies who are towards AI before they invest more more structured in their approach are heavily. The Health and Professional taking a strategic view of how AI can Services sectors are generally being We’re not the fastest region to give them a competitive advantage, held back by inadequate data on which Thought to Action in the UAE fully adopt new technology, due Although the hype is ubiquitous, AI maturity does not match up to the level of interest unless there and are directing AI initiatives in these to base their AI efforts, and are thus areas with more success. mostly in the planning phase. to fear and lack of trust in data is focused leadership at a senior executive level. There are some dominant sectors and we noted systems. some definite leaders and laggards within most sectors. The Airline industry has the broadest AI Some machine learning models in Everyone is in the race, but the pace application, especially in the customer space, even though they started very recently. Banks and production differs Telecommunications companies were the early starters, and continue to move forward at a steady pace — Total Marketing Middle East as data foundations improve and learnings are extracted from early projects. Only 6% of companies ICT&Media and Financial Services Regardless of sector, there are a few are the standout sectors where companies that are leading, a handful consider themselves to be Advanced, and 29% are in the Released phase with a few processes using AI in some companies have gone beyond that are bringing up the rear, and the a production environment. The majority of organizations (35%) consider themselves to be in the Planned experimentation, with machine vast majority that are in the Planning phase, which ties in with what the executives in the study report, where the direction of travel is clear but learning models running in a or Piloting stages somewhere in the converting this to actionable output remains a challenge. production environment, but these middle. are in narrow channels within the companies and not systemically at 30 31
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