Hong Kong’s small and medium-size enterprises (SMEs) are tapping into new technologies like AI to help run their businesses, as the growing availability of such tools – some of which are cheap or even free – helps them save time and money, according to an HSBC survey.
Nearly three-quarters of the city’s businesses feel ready to incorporate such new technologies within the next year, rising to 90 per cent by the next decade, according to the survey, released on Wednesday.
Blockchain, machine learning and robotic hardware are the top three new technologies SMEs said they are considering investing in, each cited by around 60 per cent of respondents.
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“Small businesses want technology that will make them more efficient, that requires the lowest resources but delivers maximum impact,” said Ronson Chau, the head of growth at digital payments start-up Wonder, who cited productivity-focused tasks, like automating processes and drawing insights from data, as common objectives.
SMEs in Hong Kong number 340,000, accounting for 98 per cent of the city’s businesses and employing 45 per cent of its private-sector workforce, according to the government, which defines an SME as a non-manufacturing firm with fewer than 50 employees or a manufacturing firm with fewer than 100 employees.
HSBC’s survey of nearly 3,000 business leaders from around the world, including 534 from Hong Kong, found that 26 per cent believe leveraging technology can help cut costs.
Around a quarter also cited improved cybersecurity protections, greater competitive advantage and enhancing customer experience as potential benefits.
“Emerging technologies are levelling the playing field for SMEs by democratising access to tools and capabilities previously exclusive to larger businesses,” said Christina Ong, the head of business banking for HSBC Hong Kong.
Despite eagerness among SMEs to harness technological advancements, many also flagged barriers to accessing them, with 31 per cent identifying the cost of investing in such systems and boosting employees’ skills as the biggest challenges they face.
“The key to unlocking these benefits is recognising and understanding what technology can do, and how it can be integrated effectively into SMEs’ strategies and operations,” Ong said.
The survey also found that SMEs’ understanding of new tech lags in some areas, with 88 per cent of businesses surveyed saying they believe generative AI will create opportunities, but only 35 per cent saying they are familiar with it.
Depending on their needs, SMEs can find ways to access some new technologies on a budget, said Arthur Chan Chi-yuen, the founder of local tech company SagaDigits.
“The cost of accessing some tools and models is getting lower,” he said, adding that SagaDigits has used open-source, or freely available, AI tools and models sourced from mainland China or East Asia for some of its work.
The company uses location tracking and movement data to deliver services for clients in the private and public sectors.
“If your needs are simple, things like building a PowerPoint or generating document templates, you can do this for free,” said Chan. “But building hardware that needs a lot of computing power can be very expensive.”
Similarly, Wonder’s Chau said that his company uses off-the-shelf tools like WhatsApp chatbots, which can be acquired cheaply, to help manage replies to clients.
“With so many of these available, all competing on price, the costs aren’t a major concern unless something needs to be customised or is very specific,” he said.
In Wonder’s case, the company spent a seven-figure sum to develop a bespoke platform to automate its know-your-client process, one of the most time-consuming aspects of its work.
“It’s a huge investment not just because of the cost, but also the time taken to develop it and be sure it works,” said Chau. But the platform has more than proved its worth, he said, by saving the business not only time but also labour costs in the long run.
Since 2016, Hong Kong’s Innovation and Technology Commission has run a voucher scheme to help businesses access technological products and solutions.
In last month’s budget, the government announced HK$3 billion would be allocated to the Cyberport technology park for a three-year AI subsidy scheme, aimed at helping local businesses and universities tap into computing power at the park, which is developing an AI supercomputing centre.
A large majority of respondents to HSBC’s survey are examining the readiness of their teams: 88 per cent said they are emphasising hiring candidates with data analytics skills, while 89 per cent said their finance teams will need to hire or train employees for a wider range of skill sets in the future.
Both Chan and Chau said measures to help small firms be more competitive in attracting talent would also be useful. “The cost of hiring top talent in the AI field in Hong Kong is very, very expensive,” Chan said.
Source: https://www.scmp.com/business/article/3256168/hong-kong-smes-eager-adopt-ai-robotics-and-other-technologies-despite-costs-and-skills-gap-hsbc