AWS: Malaysian companies already en route to digitalisation, even before Covid

  • 2019 Malaysian Institute of Accountants study finds 25% firms set aside 10% budget for IT
  • Customers share five ingredients necessary for success when moving to cloud

According to Santanu Dutt, head of technology for Southeast Asia with Amazon Web Services,  the company believes some tech terms, like machine learning, IoT, analytics, will potentially go away in the next three to five years.

Although Covid-19 has been touted as the "new CTO" that will usher in a new age of digitalisation, Santanu Dutt, Head of Technology for Southeast Asia with Amazon Web Services believes that it is more the speeding up of a change that is already happening. "The digital transformation journey in Malaysia, and throughout Southeast Asia, continues to follow the pattern that we've been seeing in the last 18 months," he said.

Based on a report by the Malaysian Institute of Accountants “MIA-ACCA Business Outlook Report 2020", 25% of organisations in Malaysia say they are setting aside at least 10% of their budget on technology, including investing in big data analytics (64%), cloud computing (57%), machine learning and artificial intelligence (33%), and robotic process automation (27%).

[Ed: An earlier version mistakenly cited AWS as conducting the report.]

This conclusion is borne out of research conducted last year, and published in early February, before the impact of Covid-19 was even hinted at. "We've already seen this increased urgency from a lot of SMEs and enterprises for the last 18 months or so, specifically as a part of digital transformation," says Dutt.

To AWS the "new normal" being spoken of today, is in fact, the norm. For instance, in the late 1990s and early 2000s, there was a term called “e-business”. "(But) what is e-business today?” Dutt poses? It is simply business, he explains, “because almost every business is maintained in the digital world."

Infact, he points out that AWS believes some tech terms, like machine learning, IoT, analytics, will potentially go away in the next three to five years. "If you're doing an online business, it will be assumed that you're using analytics and machine learning. So, those terms might even cease to exist."

 

Machine learning is already a “new normal”

Naturally, AWS has been trying to place itself in the forefront of this shift by offering customers technologies and services to enable digitalisation.

An obvious example is machine learning, which Dutt said is now a relatively mature industry 4.0 technology. "It's no longer a case where it's in the initial stages of adoption. There are industries across in Malaysia and Asia that are adopting it in a tangible manner," he said. "It's actually become the new normal."

AWS has also been working to shorten the distance between the data sources and its own cloud. "We have 24 global regions across the planet, including the nearest one to Malaysia being in Singapore, and one in Indonesia which is going to be announced towards next year," explains Dutt.

Amazon Cloudfront, which is a global distribution of proxy servers that cache content closer to where it's needed, including access points (termed 'edges'), is in KL, Singapore and Manila.

"In addition to that, we just announced something called AWS Outposts, which is computing by AWS on a rack where they actually ship a compute instance, and storage instance in a rack to customers," says Dutt, adding that this solution is now available in Malaysia, Singapore and Indonesia.

[Ed: Para updated for accuracy.]

From the shelves of Amazon.com to the Philippines

As examples of what AWS can do, Dutt talked about a supermarket in the Phillipines who wanted to ensure their shelves were always adequately stocked without needing employees to always manually check them.

"We basically took a very simple off the shelf camera, attached it to a Raspberry Pi IoT device and then used machine learning to learn what an empty shelf looks like, and began to overlay heat maps highlighting empty or low stock on the images of the shelves.

This relatively simple solution has far-reaching consequences for the supermaket chain as a whole.

"You can actually start to take pictures, automatically, in every mart, and create a time series format of this data. Then you can have a manager in the central office looking at all of this, and start seeing trends and patterns, for instance which shelves were empty faster."

It's no accident that the AWS team understood the potential of this from the start. "Amazon.com has been using something similar in their fulfilment centres and warehouses, to plan for real estate," Dutt explained. "We would ask, ‘Are we placing our shelves in the most optimal way, from a cost optimisation perspective’?"

Clearly, if it's good enough for Amazon, it's good enough for their clients.

 

Five ingredients for digitalisation

However, Dutt also pointed out that technology is only the tip of what is need for digitalisation. "Technologies as it turns out is potentially relatively simple."

"Just creating an app or a mobile website is not digital transformation," stressed Dutt. "It's a mind-set change. It's an entire journey, and the customers who have been successful using our platform have told us that five ingredients are necessary for success."

The first is what Dutt labels, "bold visions", citing Amazon's own ambitions for the future that go beyond a simple improvement in productivity. "We always make bold visions like running a hundred percent of our data centres on sustainable energy, for example."

In order to shepherd companies towards these bold visions, Dutt stressed the need for the second ingredient, "executive champions". As an example, he gives a project AWS did with Globe Telecom in the Philippines who had decided to go "all-in" to the cloud. "That was a big step to take two years ago, but the owners have been a big proponent of looking over this project, and championing its cause to ensure that they actually migrate of all traditional systems into the cloud," he said.

To actually make solutions work, Dutt then pointed to "workforce engineering", skilled and talented employees who would transform the vision to workable products. "If you really want to be a sustainable digital company, not just a bricks and mortar company, you might want to have at least a small workforce internally versus outsourcing everything, because then you retain a lot of control," he said, adding "Obviously, you can (also) try out experiments."

The fourth and fifth points, which Dutt says are related, is the need for a "mind-set change" with a shift to "agile practices". Dutt stressed the need to "unlearn the traditional practice of working for years on a single product" and instead use an agile way of working: "Run experiments, test the waters with customers, and if it works, start iterating on that," he said. "If it doesn't work, then obviously back off and try a new experiment."

On a scale of 1 to 10 in terms of their cloud journey, he hazards a guess that companies are somewhere between one and five in Malaysia and in Southeast Asia. "We will continue to engage with them to help them through this journey."

 

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