Businesses in Saudi Arabia foresee that artificial intelligence (AI) and generative AI will lead to significant transformations across industries. However, hurdles such as the scarcity of skilled talent, data privacy, cybersecurity, and sufficient budgeting remain key issues impacting innovation enhancement.
Riyadh, Saudi Arabia – June 25, 2024: The Innovation Catalyst Study conducted by Dell Technologies revealed that generative AI and AI are poised to bring about considerable shifts in industries, according to participants from Saudi Arabia. An impressive 91% of institutions reported a high revenue growth exceeding 25% for the year 2023, while 75% reported low growth ranging from 1-5%, or consistent or reduced earnings compared to previous periods.
The study indicates widespread optimism about AI and generative AI, but readiness for rapid change varies greatly among institutions. Ninety-one percent of Saudi institutions feel competitively well-positioned with strong strategies in place. Conversely, nearly half (48%) are unsure of their industry’s trajectory over the next three to five years, and about eight in ten (78%) struggle to keep pace with this transformation. The participants flagged a lack of suitable talent (27%), data privacy and cybersecurity concerns (28%), and budget deficiencies (31%) as the main obstacles they face in driving innovation.
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Generative AI: Moving from Concept to Implementation
Participants in the study noted the transformative potential of generative AI, particularly in enhancing IT security (62%), boosting productivity (60%), and improving customer experiences (59%). They also recognize the need to overcome significant challenges (74%) and fear that generative AI might give rise to new security and privacy issues (84%). There’s a consensus that their data and intellectual property are too valuable to risk exposing to third-party accessible generative AI tools.
As organizations shift from contemplation to practical application of generative AI, 58% have started implementing it. With increased adoption, the focus is on understanding where risks lie and who bears responsibility. A vast majority (87%) agree that in case of any AI malfunction or undesirable behavior, the institution, not the machine, user, or public, should be accountable.
Mohamed Talat, Vice President for Saudi Arabia, Egypt, Libya, Levant, and Turkey at Dell Technologies, commented on the report, stating, “Generative AI is one of the major developments revolutionizing the tech landscape. Its adoption across different sectors in Saudi Arabia, from healthcare to finance, is driving innovation, enhancing efficiency, and unlocking new possibilities. With substantial investments in AI research and development, the Kingdom is poised to become a leader in the AI domain, fostering economic growth and improving citizens’ quality of life.”
Institutions Rise to the Challenge of Current Threat Landscapes
Cybersecurity remains a soft spot for institutions generally. The participants’ concerns are justified, with 91% affected by a security incident in the past year. Most (94%) adopt a zero-trust deployment strategy, and 86% have a specific incident response plan to recover from any cyberattack or data breach.
The top three issues highlighted by participants were malware, phishing, and data breaches. Phishing points to a broader problem emphasized in the report—the role employees play in the threat landscape. For example, 75% believe some employees bypass IT security guidelines because they impact efficiency and productivity, and 71% view insider threats as a significant concern. This underscores the need for focused training, positioning employees as the first line of defense for the institution.
Proper Tech Infrastructure Keys to Institutional Success
The study further reveals the crucial role of modern data infrastructure as technologies like generative AI accelerate and data volumes significantly increase. Investing in modern, scalable infrastructure is cited as the top improvement area for companies to hasten innovation. Most IT decision-makers (75%) prefer a local or hybrid model to tackle anticipated challenges with generative AI deployment.
Being able to share data across business functions is also a vital component of the innovation process, with only one in three participants (35%) currently able to transform data into real-time insights to support innovation efforts. However, responses indicate that institutions are addressing this challenge, with 91% stating that data is their most important differentiator, and their generative AI strategy must include using and safeguarding that data. Nearly half (42%) also expect that the majority of their data will be generated at the edge within the next five years.
Other Key Findings of the Study:
- Skills: About two-thirds (65%) report a current talent shortage needed for innovation in their field. The top skills and competencies required for the next five years include the ability to learn quickly and willingness to do so, proficiency in AI, and creative thinking.
- Sustainability: Forty-two percent believe that “driving environmentally sustainable innovations” is an important area needing improvement. Energy efficiency is high on the agenda, with 79% experimenting with solutions as a service to manage their IT environment more efficiently, and 73% actively moving AI inference to the edge to make it more energy-efficient (e.g., smart buildings).
- Positioning IT as a Strategic Partner: Eighty-one percent of business decision-makers currently have reasons to exclude IT decision-makers from strategic conversations, yet both sides acknowledge that strengthening their relationship is the second most important area for improvement.
