Indonesia welcomes AI as it embraces digital disruption

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Indonesia has one of the highest number of internet users in the world, but its internet penetration rate is only 50.4 percent. This gap is partly why investment bank Morgan Stanley estimates that the country’s digital economy will hit US$2.7 trillion by 2027.

In particular, technologies like cloud services and artificial intelligence are expected to rise in importance in the coming years.

Organizations such as online marketplace Tokopedia, professional services firm Ernst & Young (EY), and insurer Asuransi Axa Indonesia have taken steps to scale up the rate of tech advancements in their infrastructure. These technologies may vary in nature, but they’re all designed to help the companies stay ahead in the ever-evolving digital ecosystem.

The future of technology

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“I think the Indonesian consumers will enjoy all kinds of breakthroughs next year,” predicts Aswin Tanu Utomo, vice president of engineering at Tokopedia. As the tech scene gets more competitive, companies will be “more driven than ever to bring ease of use and access and best-in-class experiences,” he elaborates.

Edwin Sugianto, COO of Asuransi Axa Indonesia, thinks that AI and big data could play an important role in the near future as more people turn to “tailored or personalized products and services.”

And as the government pushes for digital transformation, it will become more actively involved in the tech landscape, says Alex Cheung, associate partner for cybersecurity at EY Indonesia. He believes that “stronger collaboration between government and private enterprises” will speed up the digital transformation process.

Making use of AI

In the coming years, artificial intelligence is expected to be critical to the development of businesses. Enterprises that have introduced AI into their processes have gained an edge in terms of innovation in new products and services.

EY is taking the lead in this field, improving its cybersecurity system by working with Los Alamos National Laboratory, a US facility focused on cybersecurity, nuclear deterrence and energy security solutions.

Pathscan, a cybersecurity tool that uses machine learning to detect and remove potential threats before they happen, was introduced to EY’s network to protect the company’s digital presence. The tool was previously only available to government organisations, but EY integrated it into their systems in 2015.

“Unlike traditional security tools that look for malware or network signatures, Pathscan uses advanced data analytics and intelligence to proactively detect deviations from normal patterns of behaviour that are indicative of an intruder’s presence within the network,” says Cheung.

On the other hand, artificial intelligence is helping Axa perform manually intensive tasks via robotics process automation (RPA). The AI interacts with the business’ existing interface and applications and carries out processes automatically.

RPA, which has been in place at Axa for over a year now, “significantly improves the speed of our policy issuance,” explains Sugianto. It has helped the insurer serve more customers “with improved turnaround time, without the need for additional resources.”

Stumbling blocks

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While AI is set to have a big part in Indonesia’s digital future, issues such as relatively small talent pool and inadequate infrastructure can hinder progress.

The digital push in local enterprises is a fairly new thing, so it’s no surprise that the demand for talent is far greater than the available supply. Consequently, organizations can’t move as fast as they’d like and implement the changes they seek.

While Tokopedia’s Utomo believes in Indonesian talent, he also recognizes that “it’s increasingly difficult to find Indonesian talent that has the experience to take us to the next level.”

Sugianto also notes that some companies need to step back and evaluate if the technology they’re using actually serves the organization’s needs.

The Indonesian market “is influenced by trends in the global market and flooded by a wave of new technologies that might not be truly relevant and viable to be implemented straight away,” he contends. “Listening to the customers prior to introducing a new product, services, or technology is always recommended as the best practice.”

Cheung, Sugianto, and Utomo will be speakers at Indonesia Digital Economy Summit 2018, a conference that will highlight emerging technologies and enterprise solutions in Indonesia. Communic, Broadcast, and NXT Indonesia will be held from October 24 to 26, 2018. To sign up as an attendee, register here.