AI-driven smart services are drawing greater attention globally, even perceived as a key – the ‘secret sauce’- to building a highly effective customer experience.
According to an array of industry pundits, combining machine learning, deep learning, natural language processing, and cognitive computing is beginning to deeply impact how we interact with machines and each other.
Smart services definition
This combination can be loosely referred to as a smart service used in the design and implementation of digital infrastructure. Admittedly, definitions of what constitutes ‘smart services’ vary slightly; for instance – one Science Direct paper – describes a smart service as a ‘digital service that reacts on collected and analysed data based on networked, intelligent technical systems and platforms. In contrast to the technology of Industry 4.0, which can exist in just one specific sector, smart services require cross-functional areas.’
Five years ago, analyst Ray Wang said that AI-driven smart services’ capabilities included sensing one’s surroundings, learning one’s preferences from past behaviour, and subtly guiding people and machines through their daily lives seamlessly.
He also opined, ‘ This quest to deliver AI-driven smart services across all industries and business processes will usher the most significant shift in computing and business this decade and beyond.’
What we can expect, for example, is that organisations will use AI-driven smart services to impact the future of workflows, IoT services, customer experience journeys, and synchronous ledgers (blockchain). The first step is to define what success means in terms of AI outcomes, followed by developing AI-driven smart services that will produce, automate, and deliver mass personalisation at scale.
Several examples from around the world show some simple enhanced or new customer service – here is a random listing of 15 retail experience smart services. The innovative use of data lies behind these simple services.
At the more complex end of the scale, we have more ambitious schemes to build smart services by digitising services and improving access and balance, such as the following.
With the cooperation of TM One, the enterprise digital solutions arm of Telekom Malaysia, the Sabah state government is using a roadmap of smart services to put together smart cities in the state. During the 2021 launch of the E-Jariah Sabah application, the Sabah’s Chief Minister, Datuk Seri Panglima Haji Hajiji bin Haji Noor said the aim was to raise the quality of life for the community. He noted that the E-Jariah Sabah application would help the public contribute during the pandemic using their smartphones.
Generating a new kind of value
With COVID-19, 2020 and 2021 saw technology as providing an essential lifeline to Malaysia. Additionally, the heightened focus on smart services as a practical component of a smoother digital journey has been exacerbated by other current global crises in today’s highly dynamic and fragile environment.
But the call to action was being sounded some years ago. Back in 2006, a Harvard Review of business models – Four Strategies for the Age of Smart Services warned that any industrial manufacturer that had to realise it must transition to a service business model ‘was in serious peril’. Furthermore, the study said that ‘smart services needed to have intelligence built into them – that included awareness and connectivity.’
It is further expected that the rewards of such a transition include organic growth rates in double digits for many of the companies that are following this path. ‘The leaders are establishing the new performance benchmarks for their industries, deriving more than 50% of their revenues and 60% of their margin contributions from services as opposed to product sales. For most management teams in product-centric companies, numbers like these sound like nirvana.’
The authors’ research at that time found that smart services innovated ‘an entirely new kind of value—the value of removing unpleasant surprises from their lives. Meanwhile, because the field intelligence makes product performance and customer behaviours visible as never before, manufacturers gain unprecedented research and development feedback and insight into customers’ needs and can provide even greater ongoing value.’
Companies embarking on high-gain transformation journeys know that networks with smart solutions form the foundation for AI-driven services. These ‘intelligent’ learning systems rely on gathering and analysing data drawn from machines, processes and, of course, people. Another attribute is adaptive configurability, which is used for predictions, capacity planning, remote maintenance and repair, and securing business continuity.
Smart services evolved from product providers offering innovative products, changing to solution providers offering solutions based on a core product, which then became value-added services focused on offering physical and smart services around a product, moving to product as a service, and then XaaS on platforms offering products and services.
These services have been creatively adapted to power larger pieces of smart communities and cities worldwide. During City LEAP Summit event hosted by TM One, Mohamad Rejab Bin Sulaiman, the Vice President Product and Innovations, noted such examples, which include:
- The use of 20,000+ active sensors to capture temperature, air quality, mobility data, etc. in Barcelona;
- 380 intelligent traffic lights, smart parking, smart E-bike, energy lab, and solutions lab helped build City Data Exchange in Copenhagen; and
- 42 day/night cameras were installed to help identify up to 300,000 cars an hour, which led to a 65% drop in crime in Cape Town, among many other use cases.
In the field
In Malaysia, smart services have already started to seed the components of smart ecosystems and smart communities and cities.
Najib Ibrahim, Managing Director, Cyberview Sdn Bhd, during the Actualising smart communities in Malaysia: CEO interview confirmed that the heart of building smart connected communities rested on smart services on “the supply and secure handling and analysis of data, flowing through an integrated yet complex array of projects that embrace key functionalities of community life”.
Another feature article, Pushing Malaysia’s Smart City development in 2022, has marked significant smart city developments, especially by local authorities, such as the Smart Selangor initiative, which aims to become ‘the most liveable state’ within the region by 2025; Smart City Iskandar Malaysia, as well as various digital programmes under DBKL (Kuala Lumpur City Hall) under the umbrella of the Kuala Lumpur Smart City Blueprint 2021-2025.
Malaysia’s more recent moves include two further strategic moves: the Smart City Handbook: Malaysia on 22 June 2021 by Malaysia’s former housing and local government (KPKT) minister YB Datuk Zuraida Kamaruddin and the UK’s high commissioner, H.E Charles Hay; and the soft launch on 29 June 2021 by technological partnership think tank MIGHT (Malaysia Industry-Government Group for High Technology) of its Smart City Outlook 2021/22 (MSCO) report.
The 5G accelerator
The next key catalyst is touted to be the adoption of the 5th generation connectivity technology, which is expected to strengthen Malaysia’s bid as a hub for innovative 5G and emerging technology, empowered by the country’s private and public collaborative platform.
Motivated by building up Digital Malaysia, the Telekom Malaysia group of companies was among the first to sign with Digital National Berhad (DNB), the government-owned entity mandated to be the single neutral party to coordinate the deployment of the country’s 5G infrastructure and network nationwide.
The model states that this supply-driven approach would promote a more inclusive nationwide rollout.
This move is expected to enhance artificial intelligence/machine learning (AI/ML), robotics and augmented reality and virtual reality (AR/VR) and encourage innovations to build greater efficiency and service enablement and make possible a new level of experiences among many verticals.
DNB further said key service offerings the public can expect from the 5G rollout include:
- Enhanced Mobile Broadband (eMBB) to deliver faster mobile data speeds and low latency;
- Massive Machine Type Communication (mMTC) to support the higher levels of reliability and extremely low latency demanded by industrial automation, intelligent transportation, and remote medical diagnosis and surgery;
- Ultra-Reliable Low-Latency Communication (uRLLC) to build connectivity for large numbers of sensors used within the internet of things (IoT) context; and
- Network Slicing allows the sharing of 5G infrastructure among multiple logical networks aligned to different defined objectives, such as generating new business opportunities for communication service providers with more robust security, faster service and improved flexibility.
In a recent commentary, Shazurawati Abd Karim, Executive Vice President, TM One, agreed that faster speeds and lower latency in 5G presented new commercial opportunities for enterprises in various sectors.
Network slicing is expected to boost the development of applications across multiple areas such as smart cities, autonomous vehicles and drone delivery to immersive entertainment, mobile robotics and remote health monitoring.
“Enterprises today can benefit from data-intensive applications to innovate seamless and immersive digital experiences for their customers. Of course, 5G is more than a new technology; it is a prime business enabler,” she said, adding that TM One is fully committed to fostering human-centred technologies and well-positioned to help enterprises transform their businesses.
She further noted in an interview with Disruptive.Asia that 5G’s heightened connectivity poses the potential to be the catalytic ‘glue’ to help smart services ‘connect the dots that are required to enliven a dynamic digital economy.’
Demonstrations of how 5G would help connect smart services and enhance the growth of smart communities reached a new level in early 2020 and were recounted in this year’s City LEAP Summit, a two-day event aimed at boosting smart city execution by the country’s local city and municipal councils.
An industry collaboration featured efforts by Telekom Malaysia (TM) to transform the Langkawi archipelago into a showcase of 5G-enabled smart services. The island’s bounded environment proved to be an ideal testbed to kickstart several new use cases, 11 of which were on show, spanning smart cities, smart tourism, smart agriculture, and other areas.
The 5G command centre 5GCC, APIs (application programming interfaces) and related projects were built and developed on an open, sharing model to allow for extended collaboration by other service providers and organisations in other Malaysian states in the coming months.
Embedding intelligence in automation
With the dynamic nature of the world today, organisations need to be smart to keep pace with the digital forces that are changing the way we work and interact with each other.
Leaders in the manufacturing sector across three regions participated in a July 2020 survey conducted by Deloitte and the Manufacturers Alliance for Productivity and Innovation (MAPI). Globally, manufacturers believe an ecosystem approach will help them unlock value and benefits. 85% of the respondents agree that ecosystems are growing in importance, while 87% believe broad ecosystems can help them stay competitive.
One example of using digitalisation and smart services to accentuate relevancy, competitiveness and profitability is Malaysia’s more than 200-year-old postal service, Pos Malaysia Group. To advance its transformation, the group is currently on a three-year modernisation and transformation plan, which includes revitalising its website and an enhanced mobile application, which has seen more than 1.3 million downloads with an average of 200,000 monthly users from January to July 2020. This ongoing adoption of digital technologies is helping transform customer experience and help Pos Malaysia expand into digital era opportunities such as providing financial services and supply chain solutions.
Another recent success story is with a local city council in the state of Perak. Inspired by a demonstration by TM One of Smart Traffics Analytics and Recognition System (STARS) solution during the March 2020 edition of City LEAP Summit, Majlis Bandaraya Ipoh (MBI) formed a collaboration with TM One to trial the AI-driven smart services system.
Following several joint survey sessions to assess the traffic scenario in Ipoh, Perak, a trial period started on 15 November 2021 for the STARS solution at four intersections along a major road in Ipoh, Jalan Sultan Idris Shah. This proof of concept (PoC) resulted in smoothing traffic flow by up to 51%, especially during peak hours, saving costs and time for road users and in addition, reducing carbon production by 7,500kg per month boded well for the council’s aim to make Ipoh a low-carbon city by 2030.
Moving forward, the city council, MBI, decided to advance to full implementation and signed a collaboration agreement last June 2022 with TM One covering a period of five years.
Shazurawati commented that other tangible benefits from using AI-driven smart services include greater innovation, enhanced customer experience, visibility, resilience, and profitability.
“The three steps to unlocking such benefits lies in using professional services that can help leaders create a smart services vision; providers with ready blueprints and pre-architected solutions; and managed services teams who can maintain smart services applications throughout their lifecycle.”
At the time of writing, the company has formulated smart services approaches covering Smart City, Smart Industry, Smart Agriculture, and Smart Healthcare.
According to industry experts, tomorrow’s innovative networks will be complex and managed remotely by automated smart services.
In building AI-driven smart services, analyst Ray Wang believes that fears of being taken over by robots are overblown. “Successful AI-driven smart services will augment human intelligence just as machines augmented physical capabilities. AI-driven smart services play a key role in defining business models for synchronous ledger technologies (blockchain), Internet of Things (IoT), customer experience, and the future of work by reducing errors, improving decision-making speed, identifying demand signals, predicting outcomes, and preventing ‘disasters.”
Furthermore, as AI-driven smart services equate to moving some decision-making responsibility to atomic-driven smart services, he says the foundation of any AI-driven smart service is trust.
The Malaysian government has reaffirmed the urgency of driving digitalisation across industries in the country. Under the National Fourth Industrial Revolution (4IR) Policy, various initiatives were recommended, including the Malaysian International Trade and Industry ministry’s (MITI’s) Industry4wrd policy, containing three core elements and eight-core thrusts to create a pathway for enhanced productivity, job creation, and growing a high-skilled talent pool in the manufacturing sector.
TM One holds that a human-centred approach to technologies is fundamental. “This is to develop a matrix of trust with AI-driven smart services and other technologies to augment human life. One of the central aims for smart services is the enhancement of customer experience and to transform the way we work, live and even the way we innovate,” said Shazurawati.
TM One’s professed aim is to build connected and intelligent ecosystems, transmitting data in near real-time, to form a crucible for generating new revenue streams, greater efficiencies, and empowering people.
Moving forward, Shazurawati at TM One’s recent LEAP Summit 2021 urged enterprises to manage changes in digital services by (a) adopting scaled agile practices, processes and mindset, (b) embracing digital coalition and co-creation, and (c) being responsive to change and to pivot to a cloud-first principle to be future ready.
Held annually, the LEAP Summit is TM One’s signature event. It is a significant platform that offers industry insights drawing together cross-sector leaders from the public and private sectors.
At the time, she also reaffirmed: “When strategically and innovatively applied and combined with devices, sensors and data, smart services will help manifest many benefits. Coupled with inclusivity, sustainability and the enhancement of quality of life, Malaysians will be able to forge new economic opportunities and boost our overall progress as a digital nation.”