BUSINESSES need to adapt to the rapid growth of technology, particularly with the use of artificial intelligence (AI) and the shift toward digitalization. This is the focal point of KPMG’s 2024 tech innovation summit with the theme “Tech horizons: Unleashing the future of innovation.”
A future with AI
Microsoft Philippines Chief Executive Officer (CEO) Peter Maquera describes AI as a genie out of the bottle. AI continues to flock innovation discourse around the world, and there is nothing stopping it now. The only thing businesses can do is to adapt.
David Hardoon (left), chief executive officer of Aboitiz Data Innovation and senior advisor for Data and AI of Union Bank of the Philippines, and Noel Bonoan, chief operating officer and vice chairman of KPMG Philippinesd, discuss responsible artificial intelligence use during a fireside chat. CONTRIBUTED PHOTO
Students from the University of the Philippines – Diliman, Far Eastern University and Asia Pacific College showcase their innovative ideas at KPMG’s Academic Innovation Challenge 2024. CONTRIBUTED PHOTO
Rafael Dionisio (left), co-founder of MAD Travel, Circle Hostel and MAD Market, and Kristine Aguirre, advisory partner and environmental, social and governance lead of KPMG Philippines, discuss the use of artificial intelligence in environmental, social and governance initiatives during a fireside chat. CONTRIBUTED PHOTO
Rezbin Chief Executive Officer Mari Martirez is the 2024 Global Tech Innovator (GTI) Winner, who will represent the Philippines at the KPMG GTI finals. CONTRIBUTED PHOTO
Shown in the photo are (from left) Mike Guarin, panel moderator and KPMG Philippines Deal Advisory head; Dennis Velasco, chief executive officer (CEO) of Prosperna; Esel Madrid, senior vice president and head of Data Science and AI Center of Excellence of Security Bank Corp.; Mark Gersava, executive cabinet member of the National Innovation Council; Dick Chiang, CEO of DragonPay; and Tek Olaño, chief finance officer of GCash. CONTRIBUTED PHOTO
Filipino start-ups Rezbin, eTaily and Makarius Smart Learning showcase their businesses, applying tech in solving modern problems at the Global Tech Innovator Philippines 2024. CONTRIBUTED PHOTO
Presenting a study, Maquera states that 85 percent of executives across the world are planning to invest more in generative AI (gen AI).
The major factors for the 10 percent of these businesses are having a strong and quantified link between gen AI initiatives and business value, modern technology infrastructure, advanced data strategy, strong leadership support, and responsible AI guidelines and practices in place.
Some of the biggest opportunities for gen AI applications are customer service, risk and compliance, information technology, software coding, and security review and personalization. If used correctly, AI can increase productivity, improve accuracy, make work more efficient and connect with businesses better.
Worldwide, AI adoption is happening at a rapid scale. According to Maquera, 85 percent of Fortune 500 companies are using Microsoft AI, 60 percent of them use Microsoft 365 Copilot, 90 percent of them use Github and 50 percent of them use Power Platform with AI.
This trend is also seen locally with 86 percent of Filipino knowledge workers using gen AI at work, 83 percent of Filipino AI users bring their own AI to work, 70 percent of Filipino leaders say they will only hire someone with AI skills and 68 percent of Filipino leaders say they’d rather hire a less experienced candidate with AI skills than a more experienced one without. Meanwhile, 55 percent of Filipino leaders worry that their organizations lack a plan and vision to implement AI.
For Maquera, AI will be everywhere in the future as observed with the influx of Generative Pretrained Transformer and Copilot technology.
Maquera has also discussed the partnership between Open AI and Microsoft to create Azure Open AI Service. This will enable organizations and businesses to create their own gen AI models such as language, multimodal, fine tuning, image generation, and transcription and translation models.
To maintain responsible AI use, Microsoft aligns its efforts with the White House Voluntasry AI Commitments of safety, security and trustworthiness.
Partnering with Microsoft is KPMG, which has also unveiled its new gen AI technology KPMG Ask People, Performance and Culture; KPMG Quality and Risk Assist; and KPMG Tax Chatbot after years of ambitious digital transformation. These tools allow employees to focus their energy on more important tasks, allowing them to balance work and life.
KPMG Philippines Vice Chairman and Chief Operating Officer Noel Bonoan says: “This expanded alliance aims to enhance engagement and supercharge employee experience in a way that is possible, trustworthy and safe — a testament to KPMG embracing the future and our belief that AI is [essential] to unlock sustainability. In this way, we hope to be able to bear fruit [through] our people, clients and society. We believe that technology and innovation can catalyze business growth and help developing nations.”
“AI offers unprecedented opportunities, efficiency, innovation and growth. The direction of AI is not only for intelligent assistance that does not only perform tasks but also [to] learn and adapt,” He adds.
“At KPMG, since 2020 we have been heavily investing on new technologies, and just last year, we have developed generative AI and natural language processor tools to really help our professionals, especially in the core of our business, it’s really more on generating knowledge, providing helpful insights and foresights for our client,” KPMG partner Gilbert Tirchera says in an interview.
Bonoan concludes his talk with some advice for organizations that want to adapt AI: dream big and start small, exploit while exploring, stay curious, make mistakes and move on, and secure top management buy-in.
According to David Hardoon, Aboitiz Data Innovation CEO and Unionbank senior advisor for data and AI, AI is not a form of technology but a field of knowledge that should be wielded responsibly. A similar study from the Boston Consulting Group says 10 percent of businesses that are scaling AI are getting better business impact; 50 percent are experimenting while 40 percent have not yet started.
One of the ways to apply this is through sustainability — something of which every business should be mindful. In terms of production and demand, AI can be used in emission, energy, material and product service efficiency, and demand reduction.
AI can also aid in energy transition with three steps: monitoring through satellite-based risk scoring, impact calculations and signal identification; intervention through innovation, reliability, efficiency and optimization; and scaling through practice and updating people, processes and technology.
In the financial service sector, it can fuel financial growth with data-driven AI solutions and enhance risk, efficiency and revenue management. In the power and industrial sector, it can unlock sustainable, efficient and future-ready solutions. AI can also enhance the community’s efficiency and drive engagement with tailor-made AI and data-driven insights in the public sector.
Overall, AI can help amplify the skills of employees and make a positive impact if used responsibly. It can generate solutions that are based on real data if organizations are aware of the risk and responsibility it has. To make AI work responsibly, it is imperative to follow ethical innovation.
Additionally, MAD Travel, Circle Hostel co-founder and Lighthouse Legacy Foundation Director Rafael Dionisio stresses the role of AI in the intersection of sustainability, particularly in the integration of environmental, social and governance or ESG.
Fostering digital trust
Unionbank Chief Information Officer (CIO) Dennis Omila, Bangko Sentral ng Pilipinas (BSP) Managing Director and CIO Eugene Teves, University of the Philippines – Diliman Professor Erik Capistrano and Rizal Commercial Banking Corp. Chief Information Security Officer Carlos Tengkiat discuss the prospects of building confidence in the digital age.
The panelists emphasize the importance of forming digital trust, especially in the mobile banking sector. There is still a gap when it comes to honing responsibility between the consumer and the provider. Both must work together to ensure that digital banking remain secure.
The panelists also address how younger generations tend to create disposable online personas. Once hacked, it is easy for them to create new accounts; however, as they get older, these digital footprints pile up and may result in greater consequences due to lack of digital security.
An example is using the same email for most accounts. If a linked social media account were hacked, then it will be easy for the hacker to gain control of the accounts if it is in a shared network.
To solve this, the panelists emphasize collaboration between the academe and the government to educate people on digital awareness and etiquette. For example, education on the importance of digital hygiene or the right way to use digital services is a start.
Currently, some universities are offering electives on digital literacy; however, there is also pressure on private and public universities to offer short electives and summer programs for digital literacy, apart from integrating it in the curricula. A proactive curriculum will leave to more active partnerships with private sectors in terms of honing these soft skills, the panelists say.
The panelists stress the need for funding toward smart laboratories as well to give practical experience to the learners. Industry experts may also be invited to share their knowledge.
People also tend to take technology for granted.
“It’s also high time that we realize that [we] — who are supposed to be teaching the younger generation about technology — should appreciate that when we talk about digital trust, we need to also consider what stakeholders and the legal aspect of trust has to do with any academic instruction, classroom discussion or research.” the panelists say.
The government also has a crucial role in these challenges. According to Teves, BSP highly considers the role of technology. The government agency places a supervisory authority over these technologies. BSP also takes complaints and concerns seriously, regarding digital banking.
“Right now, we are working with other departments in the government to lessen the impact of cybercrime,” Teves says.
For an instance, BSP has consumer protection standards that keep safe client information and ensures their fair treatment. BSP is also actively in charge of investigating cybercrime involving digital banking in accordance with Republic Act 10175 or the Cybercrime Prevention Act of 2012.
Still, the panelists highlight the difference between preventing cybercrime and chasing after it. The best way of eliminating cybercrime is through a robust cyber defense both for the provider and the consumer. The faster one can secure their accounts, the lesser the impact it will have.
On the provider’s side, there must be seamless technology and secure third parties. The provider may also opt for alternatives that are easy to adopt.
“There are steps and programs that try to adopt how to strengthen our cyberdefense. This is not just limited in the banking center. We’re actually looking at extending it in the payment system. The payment operators are also part of the bigger financial ecosystem,” the panelists say.
Lastly, collaboration between the government and private sector is crucial in building digital trust. Being proactive would trigger collaborations and create meaningful outputs, which will generate a good initiative in advancing the cause.
The Filipino people should also be actively involved as digitalization will be their future.
In a separate panel discussion, Prosperna CEO Dennis Velasco, Data Science and AI Center of Excellence of Security Bank Corp. head and Senior Vice President Esel Madrid, National Innovation Council Executive Cabinet Member Mark Gersava, Dragonpay CEO Dick Chiang and GCash Chief Financial Officer Tek Olano discuss the effect of digital evolution in businesses.
According to the panel members, digital transformation is more than just automation; it is a holistic rethinking of business models. In order to fully unlock this potential and embrace this change, there needs to be a firm leadership system within the company.
By setting clear and measurable goals, organizations can track the impact of digital initiatives. Studying the market is also crucial. Demonstrating GCash’s success, Olano cites the company’s problem-solving initiatives in the market, which allowed Filipino users greater access to financial services.
KPMG also showcased startups in the Philippines with Rezbin clinching the grand prize at the Global Tech Innovator (GTI) Philippines 2024 segment of the summit. Rezbin addresses the problem of waste management in the Philippines with a dynamic profit-generating solution.
Rezbin CEO Mari Martirez will travel to Lisbon in November to represent the Philippines at the KPMG GTI finals.
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