Modernisation clears the path for AI to lift productivity.
Australian and New Zealand businesses are well positioned for Artificial Intelligence (AI) success according to Cognizant’s report “New work, New World”, produced in partnership with Oxford Economics.
The report surveyed more than 2000 companies worldwide, including 200 across Australia and New Zealand. Business leaders in this region recognise the importance of embedding AI into their operations and product and service offerings to drive productivity and growth.
At the same time, the research reveals uncertainty among ANZ businesses about the readiness of their overall technological infrastructure with only 16% saying they are confident in their ability to access their data.
At the recent Building the Foundations of AI Success roundtable co-hosted by Cognizant and the New Zealand Herald, most participants agreed on the importance of AI and the need to ensure it’s seamlessly integrated into their businesses.
Markets Lead for Cognizant New Zealand Kat Carter said AI works best when it’s embedded in everyday tools - but legacy systems and tech debt can stifle innovation.
Many organisations are held back by the complexity of their existing systems and processes. Overcoming these hurdles by reviewing and simplifying technology environments, will be crucial for New Zealand businesses aiming to stay ahead in a rapidly changing world.
“Instead of driving agility, [legacy systems slow us down and add cost. Imagine trying to race a high-performance car on the wrong track. No matter how powerful it is, it just won’t run the way it should,” Carter said.
Cognizant’s work with enterprise clients demonstrates that pervasive AI is far more than a passing technology trend. It is a strategic necessity. Realising its full potential depends on comprehensive modernisation across engineering, legacy systems, data and security, all underpinned by robust business cases, strong governance and a culture of experimentation and adaptability.
Peter Kennedy, Chief Data and Technology Officer at NZ Post, suggested that instead of focusing on the more complex uses for AI, businesses could start by using AI in a more simple way to boost productivity.
Carter agreed legacy transformation isn’t about ripping everything out, it’s about making targeted changes that unlock agility.
NZ Post implemented a bolt-on AI solution to create proactive customer interventions. Using machine learning, the system predicts when a parcel is likely to be delayed and automatically generates content to inform customers, guide them on next steps, and encourages them to take appropriate action.
While the AI model did not significantly improve its ability to predict parcel delays, it delivered value by using existing data to fine-tune customer responses and better understand parcel types. [TE1]
“It was contextualising how our response was going to land with the customer considering a number of interactions we’d previously had. All of a sudden the business case for AI makes sense but we have to take into account there will be many, often small, steps before we get there,” Kennedy said.
Ana Ivanovic-Tongue from the executive council of the AI Forum of New Zealand, said organisations are currently figuring out how to build AI into their existing systems, but long-term, it will require a fundamental business change.
“The challenge is having leadership teams who understand it's not just a technological change but an opportunity to rethink your business, your business model and what is possible,” Ivanovic-Tongue said.
Fellow roundtable participant, Emerald Cagney, ANZ Bank’s Innovation Enablement lead said the bank has a huge AI journey ahead and is currently investing a lot in their legacy systems.
“We’re having to straddle the old and the new but we’re discovering pockets of opportunities where we’re seeing how AI enables our business strategies,” Cagney said.
“It’s about better engaging our customers and providing a better experience for them and it will ultimately assist in providing more sophisticated personal financial management whether that be better self-service, more tools or guidance.”
Cognizant’s Carter agrees: “Cognizant’s approach is to modernise what matters. Start by prioritising the AI use cases that deliver the greatest potential value, modernise the thin vertical slice of your technology stack to support that use case.”
Chris Bradley who heads up Enterprise Architecture and Portfolio management at telco 2degrees, agreed the adoption of AI must ultimately lead to better customer outcomes.
“It’s not just about productivity gains for us but putting AI tools in the hands of the customer to enrich their experience. If we can do that in a trusted way then customers will share their data with us knowing it isn’t going elsewhere,” Bradley said.
