Artificial intelligence (AI) is the top technology investment area in 2025 for 67 percent of businesses in Singapore, Capgemini Research Institute said Monday.
The research institute said in its latest global reports that 75 percent of organizations in Singapore are expected to begin proof of concept (PoC) or completely adopt AI agents.
Meanwhile, over 60 percent of organizations in Singapore will deploy PoC for AI/generative AI in cybersecurity in 2025.
Almost one-quarter of organizations in Singapore will deploy partial scale AI-powered robots in 2025.
The reports also showed 70 percent of business leaders among large organizations in Singapore are planning to increase investments in sustainability.
60 percent have plans to increase investments in climate tech.
Meanwhile, 57 percent of business leaders among large organizations in Singapore have plans to increase investments in the supply chain.
More than half of the organizations (58 percent) are at an exploration stage with new-generation supply chains in Singapore that are agile, greener and AI-assisted.
Overall, 57 percent of business leaders in Singapore are optimistic about the outlook of their organization, and 58 percent plan to increase their organization’s investments in 2025.
Singapore is ranked the highest globally for the percentage of business leaders in large organizations that have plans to increase investments in customer experience (85 percent), and manufacturing/ops (72 percent).
Globally, US organizations are expected to outpace their peers in terms of tech investments in 2025, according to the report.
Besides, US business leaders are also more likely to feel they should invest more to be competitive (84 percent) compared to their European counterparts (64 percent).
In terms of technology investments, nearly three in four executives ranked AI/generative AI in their top three priority technologies in 2025 – and again, even more so in the US.
In a context where sustainability investment is more and more seen as a business value driver as well as an asset for compliance and efficiency, and increasingly impacted by geopolitics, 62 percent of executives (up 10 percentage points from 2024) are planning to increase their sustainability budgets, by 10.5 percent on average.
The priority areas are climate tech (72 percent of executives planning to spend more), including hydrogen, renewables, batteries, nuclear, and carbon capture.
Batteries are seen as the top climate tech investment in 2025, with over half of business leaders ranking them in their top three, in particular manufacturers and automotive companies – followed by solar energy.
Besides climate tech, the other top areas of increased investment in sustainability are sustainable research and development (R&D) and product development, biodiversity protection and restoration, and water conservation/management.
Much of business leaders’ confidence continues to focus on customer experience, followed by engineering, R&D, and innovation – with nearly eight in ten and nearly three quarters of executives now planning to increase investment in these areas, respectively.
However, the sharpest acceleration in investment is focused on supply chain transformation, where 63 percent say they will increase their spend in 2025 – up from less than half in 2024 – and by 9.4 percent on average.
New-generation supply chains will integrate AI and internet of things (IoT) to enhance efficiency, reduce waste, and support a business’s sustainability goals, as well as improve decision-making and reduce costs overall, according to the reports.
Overall, the reports found business leaders feeling more confident about the year ahead than they were 12 months ago – 62 percent are optimistic about their organization’s prospects for 2025, up 6 percentage points on the same time last year and 20 since 2023.
However, executives have more confidence in their own organizations than the global market at large, with 37 percent optimistic about the prospects for the global operating environment in the next 12-18 months, only slightly up on last year.
In the current uncertain market environment, 56 percent expect to prioritize cost reduction over revenue growth for 2025.
But executives realize that this change requires investment – half say that their organization plans to increase overall investment in 2025, with just under a quarter anticipating lower levels of investment compared to 2024, and the rest expecting no change.
“As we look to 2025, business leaders are navigating uncertainty with an attitude of confidence and resilience – two qualities that our research shows they are looking to instill in their organizations through technology investment,” said Aiman Ezzat, Chief Executive Officer at Capgemini.
According to him, technology has a key role to play to improve competitiveness and productivity, while reducing costs and making all-important efficiency gains.
“With a focus on innovation, supply chains and sustainability – which is increasingly being harnessed for its value-driving potential – leaders will set themselves up to succeed in an uncertain environment and build resilient, adaptable organizations,
“Crucially, this will help shape a more innovative, sustainable and inclusive global economy,” he added.
Globally, seven in ten executives are concerned about the impact of rising tariffs and bilateral trade disputes on their organization’s competitiveness.
Almost two thirds are also concerned about the impact of a potential global trade war on their organization’s operations and market access.
On that front, executives in Japan and China are the most concerned about rising tariffs and bilateral trade disputes, and the least about a potential global trade war.
To mitigate these risks and build resilience, most organizations globally are diversifying their sourcing and/or friend shoring.
Almost three in four executives are already de-risking their supply chains by investing in other emerging countries to reduce reliance on China, up from less than half last year.
In parallel, almost two thirds of them now confirm that friend shoring will represent a significant part their organization’s sourcing and production strategies in 2025 (up from 45 percent last year).
The Capgemini Research Institute surveyed 2,500 business leaders from 2,500 organizations across 17 countries in North America, Europe and Asia-Pacific.
The survey included nine industries and sectors: automotive; consumer products; banking and capital markets; insurance; retail; life sciences; telecoms, media and high-tech; manufacturing; and energy and utilities.
The survey took place from October 23 to November 20, 2024 – half of the sample as collected prior to the US elections, and half was collected after.
Across the total sample, 70 percent of respondents are from organizations with more than $1 billion in annual revenue and 30% are mid-sized organizations with $100 million to $1 billion in annual revenue.
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