IBM banking on cloud, AI to drive digital transformation

IBM Thailand, the local unit of the US tech giant, is highlighting its cloud and artificial intelligence (AI) technologies as a way to help drive business transformation to ensure organisations thrive following the Covid-19 crisis.

“Over the past four months, Covid-19 has accelerated Thailand’s digital transformation, which was earlier expected to take shape over three years,” Patama Chantaruck, vice-president for Indochina expansion and managing director of IBM Thailand, told the Bangkok Post.

The pandemic has forced organisations, including those in the business, government and education sectors, to proceed with stress tests for their business and financial models as well as management of their operations and workforce, she said.

Organisations need to revisit their business mission, vision and value and consider whether they still cater to customer needs.

They have to ensure their approaches help diversify sources of income while operations are able to continue efficiently, said Ms Patama.

To respond to these needs, IBM is focusing on its services, including multi-cloud service management as a business, commonly engaging in 3-7 cloud services.

With the support of effective multicloud services, businesses are 44% faster to develop new applications, while 38% of the IT infrastructure cost can be saved, she said.

“IBM is the world’s largest hybrid cloud provider and our cloud service revenue continues to increase,” said Ms Patama. “In fiscal 2019, the company’s cloud service revenue reached US$21.2 billion, up 11% from a year before.”

IBM also helps modernise applications to run on cloud services or support mobile work, as well as help businesses extend the lifespan of their IT equipment to help them save on costs.

She said IBM’s service business will help the company increase recurring revenue amid the crisis, even as customers appear to postpone their IT projects.

The service revenue, which accounted for 60% of IBM’s earnings last year, is expected to rise to 70% this year, with the rest coming from the company’s products.

IBM is gearing up for cloud delivery models, which represent a specific combination of IT resources, to allow broader use cases for cloud services.

The company is also tapping into AI and cybersecurity services with an aim to reach out to more customers, including small and medium-sized enterprises (SMEs). IBM recently collaborated with Advanced Info Service, the country’s largest mobile operator by subscribers, for cloud delivery services.

IBM partnered with Internet Thailand Plc to support AI technology, helping radiologists detect tuberculosis from chest X-ray images, marking the first use of computer vision technology in X-ray imaging interpretation in Thailand.

The company also works with Samart Corporation Plc to provide cybersecurity services.

She said IBM realises the potential of AI in automation processes and preventive maintenance tasks. For example, AI technology can help detect engine malfunctions. AI can also be used in the livestock industry by detecting animals that are ill.

“Preventive measures could help save losses that could occur from operation disruption,” said Ms Patama.

The global supply chain has become a priority during the pandemic and IBM has a strong supply chain network of 800,000 suppliers, which can be recommended to customers, she said.

IBM has software for automation and AI for some specific jobs, doing the work instead of humans, leaving employees to focus more on higher return work.

“Employee productivity could increase 30-40% because of this,” said Ms Patama.

She also urged policymakers to realise the importance of local trade platforms for SMEs, which could support business-to-business, business-to-government and business-to-customer approaches and concern all connected with supply chains.

“The trade platform will enable the country to have its own data insight as data is now the new oil,” said Ms Patama. “The platform needs to be open and secured, as well as support the exchange of data.”

‘‘ Covid-19 has accelerated Thailand’s digital transformation, which was earlier expected to take shape over three years.

PATAMA CHANTARUCK Managing director, IBM Thailand