Thai firms not embracing AI to enhance business, losing out benefits

A recent study by the Boston Consulting Group (BCG) has found that consumers in emerging markets including Thailand are generally among those who are particularly open to and excited about AI, particularly Generative AI (GenAI), indicating a higher likelihood of consumers adopting AI more in their daily lives.  

But in Thailand, the leading global management consulting firm that has an office in Bangkok sees a very different trend when it comes to the adoption by businesses where few companies have embraced AI and even those who do have done so in a slow and piecemeal manner.

“Unfortunately, most of them only scratch the surface of the AI’s vast potential, depriving themselves of benefits it offers,” Isada Hiranwiwatkul, Managing Director and Senior Partner, and Head of BCG Thailand, said in an interview.

In his analysis of the Thai companies’ passive adoption of AI, the Massachusetts Institute of Technology (MIT)-educated executive pointed out the lack of IT resources, low adoption from the workforce and security concerns are prime reasons often cited by them.

He advocated Thai companies embracing AI in a holistic way across the organisation, embedding AI into every area, including budgets, processes, roles, and culture, while following the principles of responsible AI.

There are three stages of how AI can add business value to the companies, namely using ‘deploy, reshape and invent,’ he elaborated.

Deploy: This is to deploy AI tools in various activities of the companies.

Reshape: Fundamentally change the way things are done using AI. 

Invent:  Invent a new business model applying AI.

According to BCG, deploying GenAI tools can quickly deliver broad, diffuse productivity gains of 10% to 20% across the enterprise; while reshaping processes and functions with GenAI is capable of delivering 30% to 50% gains in efficiency and effectiveness; and inventing new customer experiences, services, and offerings with GenAI—and even build new business models around it—to bring ambitious revenue goals within reach.

Isada noted: “What I found is many Thai companies are only looking at deploying AI tools to replace or augment some activities.

“To do this, they would pick and choose the tool to deploy depending on the size of the business, and that may be hard to justify. 

“What companies should be looking at is how to fundamentally reshape how things are done using AI.”

Isada cited the example of a fully personalised AI-powered solution rolled out by a global cosmetics brand, that offers individual, in-depth beauty advice, and skin diagnostics, among others.

It reshapes customers’ journey and offers them consultations that normally salespeople provide online in a highly immersive way, he explained.

“We should not be looking at a few tools, but how a suite of AI can perform the functions differently—and usually with AI, and this could help with improving productivity and efficiency, as well as in cost reductions.”

Isada emphasised the need to first upskill the leaders of Thai companies and then upskill the workforce so that they are confident in their abilities to use AI to its fullest potential, in line with their business objectives.

Secondly, companies should also have an AI strategy, entailing transformative changes that they will do and what AI use cases will help them achieve those objectives.

“AI is no longer just an enabler to the business. It is the way to do the business. It is the way to build competitive advantage,” he added.

Businesses also need to invest in people transformation and change management, because this would help employees adapt to new ways of working, which would require the development of new skills and mindset, as they shift away from routine tasks to perhaps more strategic roles and responsibilities.

Isada said BCG’s approach to AI solutions is different from others as it does not focus only on algorithm or technology but combines algorithm, data and technology with business process transformation to unlock the value to the clients.

Greater productivity and impressive new revenue streams—not to mention long-term competitive advantage—will go to the organisations that can put AI to work today, he concluded.

In addition to delivering solutions through leading-edge management consulting, technology and design, and corporate and digital ventures, BCG, with a global workforce of 32,000 at the end of 2023, has become a leading AI technology solutions provider.

Advising clients regarding AI has been BCG’s top corporate priority since 2015.

BCG noted that starting in late 2022, GenAI became a topic top of mind for CEOs and other senior leaders across all sectors.

In 2023, BCG performed hundreds of GenAI projects for industry-leading clients.

BCG X, the innovative technology build and design unit of BCG, has capabilities in AI / GenAI, bringing together more than 3,000 BCG tech experts.

BCG X has nearly 50 patents and patents pending designed to deliver integrated, end-to-end solutions that maximize impact at scale.

BCG is collaborating with many of the world’s leading global technology companies, including AWS, Google, IBM, Microsoft, Salesforce, SAP, and several AI-centric enterprises such as OpenAI, Anthropic, Articul8, LangChain, and Palantir, to help clients strategically deploy AI / GenAI and digital solutions.

In 2023, BCG invested heavily to train the firm’s consultants to harness AI / GenAI internally, including a range of proprietary tools for knowledge management and content creation.

Isada said demand for BCG’s services accelerated in the second half of 2023 and grew further in the first quarter of 2024, with GenAI being a strong driver of growth.