SMEs yet to tap AI’s full power

ASK any small and medium enterprise (SME) whether its employees are using artificial intelligence (AI) at work, and chances are the answer will be yes.

In most cases, however, usage rarely goes beyond prompt-based individual tasks, such as using generative AI to draft emails, summarise information, or brainstorm ideas.

This barely scratches the surface of AI’s potential to transform business operations.

“The real power is in agentic AI,” says Edmund Teong, chief executive officer of GD XCHANGE, the technology arm of Malaysian express delivery service provider GDEX Bhd.

While generative AI typically relies on repeated user input and responses, AI agents can be embedded into workflows to autonomously carry out tasks, make decisions and take steps towards a goal.

“Harnessing agentic AI requires a deep understanding of your processes, systems and workflows, using a secure platform to reverse engineer them for enhanced efficiency,” he explains.

GD XCHANGE itself was born out of a necessity for greater operational efficiency. GDEX, which began in 1997 as a pure-play logistics company, had after two decades grown its presence across multiple countries and found itself competing against large, well-funded international players.

“We knew the only way to stay ahead was to have the most productive process flows and effective technology stacks.

“The question we asked ourselves was: How can we combine technology, people and processes to deliver outcomes at a lower cost to serve, while still ensuring our delivery standards are up to customers’ expectations?”

The answer was a new technology-focused business unit, which went on to kickstart the company’s digital transformation.

It began with integrating new tech platforms that made collaboration quicker and easier, cutting the need for tedious email chains.

From there, the team continued exploring ways to further optimise its workflows by incorporating AI, with one department achieving a tenfold productivity increase, according to Teong.

“Having undergone this transformation ourselves, we now aim to share our learned experience, use cases and technology stacks with other businesses, enabling them to reach higher levels of efficiency,” he says.

Today, GD XCHANGE helps SMEs tackle business challenges by advising, architecting and orchestrating systems through its team of forward-deployed engineers, who design tech-enabled workflows based on each business’s needs.

Additionally, it offers training sessions and workshops on practical AI use cases across business operations.

While applications are wide-ranging, Teong said agentic AI is particularly useful in inventory and supply chain management.

Compared with traditional inventory planning models, AI can generate more accurate forecasts by drawing on hundreds of data points and variables, improving stock planning and delivering cost savings.

“Additionally, from a revenue perspective, being able to respond to customers faster or send a quotation or invoice almost instantly using AI offers businesses a clear edge, especially when your competitors are taking two working days to do the same,” he adds.

For SMEs at the start of their digitalisation journey, figuring out where to begin is often a daunting step.

Teong says there’s no one-size-fits-all approach, recommending that businesses first look at their key bottleneck areas and define clear end goals.

Despite the potential gains, several hurdles remain, preventing SMEs from taking full advantage of AI technology.

These include a lack of trained talent to effectively deploy the technology, budget constraints and resistance to change.

“Mindset is crucial, as transformation happens first through people. There needs to be an acceptance that there’s a better way to do things.

“For GDEX, the mindset shift came out of a need to survive, which pushed us towards AI-led optimisation,” he explains.

Through GD XCHANGE, Teong aims to bridge these talent and culture gaps by providing the expertise, support and resources needed to securely integrate AI and improve business outcomes.

Meanwhile, to widen AI accessibility and address cost barriers, it is partnering with VSTECS KU Sdn Bhd and Amazon Web Services to provide free AI access to 10,000 Malaysian SMEs through a six-month programme.

The initiative aims to give SMEs exposure to AI’s capabilities while demonstrating the value it can deliver relative to cost, he says.

For Teong, the focus is on ensuring Malaysia is AI-ready through continuous education.

Beyond businesses, he believes there should be greater emphasis on preparing the next generation for a future in which AI will be deeply embedded.

He notes that while some universities have made significant strides, such as forming faculties that specialise in AI, more can be done in equipping the nation to thrive in an AI-driven economy.

“So much capital has been invested into AI infrastructure. Now the question for Malaysia is, how are our businesses and individuals tapping into these resources and becoming more AI native?

“Because if we don’t decide to change, the world is going to change without us.”