A new study from ServiceNow highlights a growing gap between AI ambition and execution in Asia Pacific. While organisations across the region are accelerating the use of artificial intelligence, many are doing so without a clear strategy or governance framework, reducing the overall impact of their investments.
AI interest grows despite budget cuts
According to ServiceNow’s Enterprise AI Maturity Index, enterprise leaders in Asia Pacific remain optimistic about the potential of AI. However, this enthusiasm is not reflected in their budgets. The study found that AI spending as a share of total technology budgets has declined in several key markets, including Singapore (-4%), Japan (-3.3%), Australia (-3%), and India (-2.1%).
This decline comes even as more C-suite executives express confidence in AI’s ability to transform business operations. The mismatch suggests that while interest in AI is growing, the lack of a unified strategy is causing organisations to scale back investments, potentially due to poor returns or operational difficulties.
Lack of alignment and weak governance hinder progress
One of the most significant issues identified in the report is the absence of a clear, shared AI vision within organisations. On average, only 39% of companies in the four key Asia Pacific markets surveyed say they operate with a common AI strategy. India leads at 52%, but the figures are lower in Singapore (34%), Australia (33%), and Hong Kong (30%).
Visibility across departments is also limited. Only 40% of organisations in the region report having a strong view of how AI is being implemented across functions. India again leads at 51%, with Singapore (36%) and Hong Kong (31%) lagging behind.
CK Tan, APJ Innovation Officer, Singapore at ServiceNow, said: “You can’t steer what you can’t see. Enterprises are pushing forward with AI, but without a unified vision or clear line of sight across the business, they’re essentially flying blind.”
The study also found that 68% of organisations deploy AI through multiple task forces. While this approach encourages experimentation, it increases the risk of fragmented efforts and inconsistent implementation when there are no central governance frameworks in place.
Governance remains a weak point across the region. A majority of enterprises in Australia (57%), Singapore (56%), and India (51%) have not made significant progress in establishing formal processes to oversee AI use. The absence of unified controls can result in duplicated work, inconsistent customer experiences, and exposure to data security and compliance risks.
Workflow transformation brings stronger returns
Beyond budget and governance issues, the study points to the importance of rethinking workflows to unlock real AI value. Companies that redesigned workflows to better integrate AI and human input saw much stronger business outcomes than those that simply added AI tools on top of existing systems.
In Singapore, businesses that reimagined workflows were about three times more likely to report improvements in efficiency and employee experience. In India, productivity gains were twice as likely among firms that adopted new workflows. In Hong Kong, companies saw roughly double the benefits in areas such as risk management and overall experience when adopting redesigned workflows.
Despite these findings, many organisations continue to build on outdated systems. In Australia and Hong Kong, 61% of companies are layering AI solutions on top of existing platforms rather than replacing them with integrated tools. In Singapore, this approach is seen in 50% of organisations. The result is an increasingly complex ecosystem of disconnected tools, referred to as “solution sprawl”.
Employee concerns are also rising. The study found that a majority of enterprises in Australia (60%) and India (57%) report increased anxiety among staff about job security due to generative AI. In Singapore, the figure is 54%. There is also growing unease about AI-related risks, including data misuse and model errors, underlining the need for stronger transparency and oversight.
“Many enterprises are building isolated AI capabilities without the connective tissue needed to scale responsibly. As deployments grow more complex, governance will become the difference between competitive advantage and operational risk. Leading with transparency and putting people at the centre of AI is essential to building trust and unlocking long-term value,” added Tan.
