Planning for success with Gen AI? Start with getting the basics right

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Bennett Wong an experienced leader brings strong business acument and insights, having successfully led allliance initiaties with global vendor partners, as well as having driven channel sales leadership and engagement. With more than two decades of experience in the IT distribution industry across Asia Pacific, Bennett possesses deep knowledge of the IT ecosystem, including the market landscape, develop- ments and trends.

Generative Artificial Intelligence (Gen AI), once a concept primarily explored in science fiction and academia, has now become the predominant topic of discussion in households and boardrooms around the world. In a little over a year since the launch of OpenAI’s ChatGPT, the technology has seen exceeding levels of democratization that have brought its application to business operations into the mainstream.

As macroeconomic uncertainties continue to impact global economies, chief executives are turning to these Gen AI advances to achieve optimization and efficiency gains. This is driving a CAGR of 24.5% in AI spending in the Asia Pacific region with figures projected to hit $49.2 billion by 2026.

Against this backdrop of skyrocketing demand for Gen AI and other high-growth technologies such as cloud, cybersecurity, and networking, the channel partner ecosystem is rising to be an anchor of stability for technology vendors, reseller partners, small and medium businesses, as well as mid-sized enterprises.

Shifts in the channel

Channel partners have always been key players in the global IT ecosystem, serving not only as a resource to implement new technologies but also to drive the adoption of these business solutions. As the demand for enterprise AI grows, partners are now guiding businesses through fundamental changes in their technology stacks while shifting their own strategies to adapt to an evolving market.

Per Tech Data’s Direction of Technology 2023 report, partners in the Asia Pacific & Japan (AP&J) region recognize the transformative potential of high-growth technologies and are strategically expanding their portfolios to evolve with the changing and escalating demands. 40% of partners plan to offer AI/ML solutions in the next two years, nearly double the figure when compared to 19% in 2022. More importantly, partners are also realizing the value of foundational offerings such as accurate data, useful analytics and secure storage that are necessary to fully utilize new technologies like AI.

The building blocks in focus

Appetites for Gen AI adoption are at an all-time high but CTOs and CIOs are being cautious to avoid biting off more than they can chew. Many are currently considering whether to buy or build Gen AI capabilities, and then work closely with the channel to modernize existing technologies which they already possess, or to acquire new ones. Against this backdrop, several offerings have found their way to the top of the priority list.

As per our 2023 Direction of Technology report, secure storage accounted for a significant 60% sales for channel partners over the past year, especially in the wake of surging data volumes for businesses. Considering AI algorithms require reams of accurate data to deliver accurate results, data and AI infrastructures are closely linked. Next in line was hybrid cloud, which made up for 46% sales for channel partners as scalable cloud platforms provide flexibility and resources to deploy and manage AI applications. As data volumes and dependence on the cloud increase, cybersecurity emerged as the highest-selling technology, accounting for 63% of the pie in 2023.

"Hybrid cloud, which made up for 46% sales for channel partners as scalable cloud platforms provide flexibility and resources to deploy and manage AI applications"

Taking the right approach

AI is transforming enterprises in extraordinary ways, creating new and more efficient ways of doing business. It is also introducing crucial new business requirements that will be foundational to AI success, from the building block technologies to stronger governance and skills. As the pace picks up and businesses work on strengthening capabilities, a holistic approach that encompasses and delivers every aspect, particularly those necessary to adopt AI effectively, is key.

With the rise in deployment of high-growth technologies, the average organization often employs multiple vendors in its IT stack, often in silos. This prevents standardization and optimization, and can negatively impact business performance and outcomes. Additionally, as high-growth technologies cement themselves in these stacks, businesses must integrate strengths across the board to ensure that they are scaling at speed. In this context, leveraging the expertise of a Technical Centre of Excellence (Tech COE) is recommended.

A Tech COE simplifies complexity by carrying an end-to-end solution stack of hyper-converged infrastructure, next-gen solutions, hybrid cloud, and DevOps while certifying and enabling the seamless integration of AI solutions. It is also pivotal to change management and can help teams implement new technologies and methodologies quickly via its proof-of-concept and use cases, to close the skills gap that organizations face in these new areas of technology.

Looking to the future

The IT and channel ecosystem will continue to evolve with growing Gen AI demands. As Gen AI workloads increase, so will the demand for the building blocks from the channel, especially hybrid clouds and secure storage in the data center.

All in all, there is much to benefit for businesses as they race to embrace Gen AI, but the technologies they focus on and how they integrate them into the organization will be the key to successful deployment.