Asia Pacific (Apac) continues to thrive as a hub of innovation. According to a recent report by KPMG and HSBC, maturing technology-focused ecosystems in Apac are producing billion-dollar companies at a rapid rate, successfully transforming the region from a large manufacturing base into a vibrant digital economy.
Economic prosperity is also leading to shifting consumption patterns. A rapid rise in the region’s middle class — which is expected to grow from two billion to 3.5 billion by 2030 — has led to greater demand for manufacturers to service local needs. As incomes rise, the growing urban population creates inevitable demand for more goods and services, such as housing, utilities, transportation, food and infrastructure.
Several factors place constant pressure on businesses to continuously innovate: customer demands, new generations of digital-first workers, regulatory requirements and ESG goals, quality assurance, tighter data protection laws, and so much more.
In times of rapid change, firms accelerate to success by tapping technology that propels innovation. This is a strategy that Forrester Research has described as “mission critical”, concluding that businesses prioritising tech-driven innovation grow 2.6 times faster than those that do not.
Businesses leading transformation are turning to automation technology — including artificial intelligence (AI) and machine learning — to help meet the demands of not only business and government, but also of a growing urbanised global population. In fact, Gartner predicts that smart machines are only getting smarter, completing tasks previously reserved for humans, but also what was originally thought to be impossible for machines.
There is also a need for companies to accurately harness the deluge of data that gets generated daily, whether that’s e-commerce customer transactions, supply chain insights in manufacturing, energy usage at facilities, or live field data from a construction site. It is not enough just to acquire the data; it is about using it to make informed decisions that can shape lives, businesses and the environment. But what does that mean for Apac enterprises in the future?
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Are Apac businesses prepared to embrace the benefits of automation?
The argument for automation isn’t just about machines replacing tedious tasks; it’s so much more human-centred than that. This includes increasing worker safety in manufacturing, eliminating data silos for better teamwork, and supporting low-carbon innovation for minimal pollution and waste.
By reducing the need for humans to do jobs that are repetitive, dirty or dangerous, automation helps to unlock new worker and business outcomes that would otherwise remain undiscovered.
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In Apac, the rapid embrace of digital technologies has also propelled innovation through collaboration between various stakeholders. This is driving the creation of new products, services, and revenues for businesses of all sizes.
Moreover, as smart city projects flourish in the region, it is expected that tens of billions’ worth of new investments in infrastructure, construction, consulting, engineering and digital tools is anticipated — all enabled by stronger collaboration between governments, businesses and technology firms.
AI and automation are often seen as key enablers of innovation. They allow organisations to work more productively, sustainably and efficiently, which impact the overall bottom line performance positively.
There is also the potential to empower worker creativity with AI and approaches such as digital twins, generative design, and design for manufacturing and assembly and construction. As projects progress, efficiencies through automation in the design process provide measurable benefits in cost and efficiency downstream, as well as sustainability efforts.
Let’s take the construction industry as a case in point. As one of the biggest contributors to greenhouse gas emissions, this sector is responsible for 39% of all carbon emissions in the world. This needs to be addressed urgently, with approaches that include optimising the use of existing assets, a concerted focus on renovation projects instead of demolition jobs, and better circular models that leverage technology.
Technology adoption in the construction industry has also meant that the volume of project data has grown exponentially. However, capturing project data is not enough for strategic decision-making. In fact, “bad data” causes around 14% of all rework in construction globally and is estimated to have cost the industry US$1.8 trillion ($2.43 trillion)!
To prevent these issues, organisations need to implement formal data strategies to not only gain the most return on investment from their technology investments, but to also minimise project errors and overruns in construction costs, for example.
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German engineering firm TÜV SÜD embraced the benefits of a digital building lifecycle approach for its Asean headquarters in Singapore, which also houses the company’s Centre of Excellence. It utilises digital methods such as building information modelling, common data environments and computer-aided facility management towards both the construction project and the building, which spans 18,900 sq m (about 203,400 sq ft).
By combining technical expertise with digital technologies, TÜV SÜD achieved a working digital twin of the building, helping to save 50% in energy consumption and achieving the Building and Construction Authority’s Green Mark Gold standard.
However, not all markets across Apac are created equal in terms of preparedness for digitisation and automation. A study by Deloitte and Autodesk found that Japan, Singapore and Australia are the most prepared for the coming wave of automation, but India, Bangladesh and Pakistan are the most at-risk and least prepared.
While the gaps between markets may be substantial, there is also an immense opportunity to take proactive steps to address the need for automation and harness the benefits.
Fostering innovation in a digital economy
Digital innovation has been reshaping Apac’s growth potential for several years now and can be credited for pandemic recovery in South and Southeast Asia. The rapid expansion of the region’s digital economy has given rise to an extremely competitive innovation landscape, with the participation and collaboration of several sectors such as manufacturing, construction and financial services.
Even at a time of market volatility and recessionary conditions, the economic outlook for Apac is promising. According to S&P Global, economies in the region will continue to dominate global growth in 2023, supported by regional free-trade agreements and competitive costs. Even so, progress is a double-edged sword. The more we make, the more we increase the potential for negative impact — less limited natural resources, less skilled labour and more waste. Automation will be critical to help us meet market and consumer demand, while balancing production with a reduced negative impact on people and the environment.
When your business processes and ways of working are repeatable and predictable, innovation and managing sheer volumes of data can seem like a daunting and almost unnecessary challenge to the status quo. But the debates persist, particularly for traditional industries with established ways of working. Is automation your friend or foe?
While automation would reduce the number of employees required at a certain location or for a certain task, it can also increase the levels of skills required. What this means is that companies have a bigger push towards upskilling their employees and enhancing their digital capabilities, moving talent from jobs that are tedious and repetitive into roles that are dynamic and creative.
Indeed, technological change drives disruption. Apac has the world’s largest developing economies and is home to 60% of the global workforce. For the year ahead and beyond, the conversation for Apac enterprises has to move on from the negative associations of automation as being a disruption that is “high risk” or a “threat to jobs”, to one that is about eliminating data silos and creating new worker opportunities to help thrive in the future.
It’s imperative to note, however, that even as industries transform to become more automated and technologically advanced, effectively managing and harnessing the ensuing deluge of data is a strategic priority. After all, without data, investing in AI and automation would be futile.
Haresh Khoobchandani is the vice president of Autodesk Apac
