For the overwhelming majority of companies in the region and around the world, success is measured using the straightforward metrics of profits and revenues. Not so for American tech giant Microsoft.
As Samer Abu-Ltaif, the company’s president for the Middle East and Africa tells it, Microsoft measures its success in a bigger way: its impact to national economies, the millions of jobs it can potentially create and the way it enables a tech-savvy and ambitious population.
Speaking to Arabian Business at Microsoft’s high-tech office in Dubai’s Media City, Abu-Ltaif says that, in his view, the company has three main “pillars” to its strategy moving forward in the Middle East and Africa.
“One ‘pillar’ is a need for our support in enabling a knowledge-based economy, and that means reshaping education. That’s very, very critical, to empower the youth in the region,” he says. “When you look at the Middle East and Africa, where something like 60 percent of the population is under the age of 25, it’s staggering. Upscaling the workforce towards digitisation is crucial.”
In such a young region, there is a strong appetite for technology. But then there are realities to it
A second – but no less important – pillar, Abu-Ltaif notes, is contributing to the acceleration of “digital transformation”, which in turn will increase the competitiveness of countries in the region, and the Middle East as a whole. Last but not the least, he says that Microsoft has a keen eye on philanthropy and corporate social responsibility, but in a unique form that uses “technology as a force for good.”
While optimistic, Abu-Ltaif readily admits that these lofty goals are not without immense challenges. When it comes to digitisation, for example, he oversees a vast region in which countries are often at vastly different levels of technological advancement and sophistication.
“When we talk about diversity, it’s also the levels of sophistication, the affordability levels in different markets and their maturity in terms of their ability to embrace new technologies,” he says. “But, across the board, I would say the passion for embracing and adopting technology is remarkable… in such a young region, there is a strong appetite for technology. But then there are realities to it.”
Among these realities, Abu-Ltaif says, is that across the Middle East and Africa, only about six percent of people have access to broadband. “When you think about it, that’s really quite an obstacle,” he remarks. “And then you come across an array of experiences. There are markets that are very sophisticated.
I would go as far as saying that some of them here are ahead of the mature markets in their adoption of cloud computing, artificial intelligence, IoT (Internet of Things), machine learning, and even quantum computing.
“Then there are places where we need to engage in leveraging technologies and innovation, like wideband [communication links that require an ultra-large bandwidth] in order for us to provide access. Between these two extremes, you can imagine a partner ecosystem across governments and enterprises of all kinds to support the challenge of that diversity, which is just amazing.”
Abu-Ltaif’s eyes light up when he discusses the benefits to the region from technologies such as AI and blockchain, the implications of which he says are enormous and only now beginning to be properly understood.
I want to encourage our people to lead with a growth mindset with the level where we would approach opportunities in the region differently
As an example, he points to a recent PwC study which found that the Middle East is set to accrue two percent of the total global benefit of AI in 2030 – the equivalent of $320bn. In Saudi Arabia alone, AI is expected to contribute $135.2bn – or 12.4 percent – of GDP in 2030, compared to $96bn in the UAE and $42.7bn in Egypt.
“What does this mean? We need to make sure we integrate AI in every aspect of digitisation that we engage in. That means infusing AI in the technologies that we provide and in the innovation that we bring to market,” he notes. “That’s our approach as Microsoft. We want to innovate and we want to enable these technologies to evolve. We’re integrating them from the first moment in everything we provide.”
While clearly excited about the prospects of AI, Abu-Ltaif cautions that it is his view, and that of Microsoft, that AI technologies should only be built upon an ethical foundation that embodies four distinct principles: fairness, accountability, transparency and ethics.
“It’s important that there be certain principles to which we adhere when it comes to AI. These must have been debated and will continue to be debated in the industry, primarily about inclusion but also ensuring that AI is fair and can drive accountability,” he notes. “These are very critical topics for Microsoft. Yes, there’s innovation, but at the same time we are adhering to these principles in the design and the development of artificial intelligence.”
Microsoft’s most tangible benefit to the region, Abu-Ltaif says, will be through direct and indirect job creation. Clearly excited, he notes that research conducted by Microsoft and the International Data Corporation (IDC) concluded that Microsoft’s investment into large-scale data centres and the cloud – it’s “ecosystem” – has the potential to generate more than 520,000 jobs across key markets in the Middle East and Africa between 2017 and 2022.
“If you take the conversion that has been adopted by the World Bank that for every high-tech job, you can have 4.3 jobs in other occupations and other sectors, you’re talking about potentially Microsoft’s ecosystem leading to one million incremental jobs in MENA, and two million in the Middle East and all of Africa,” he says.
This, he notes, is in addition to the benefits that organisations will reap from the efficiencies that technology brings. Taking Microsoft’s data centres as an example, Abu-Ltaif notes that their use can save organisations – or government entities – as much as 50 percent of what they spend in terms of operating hardware, as well as 80 percent of their environmental impact.
“That’s huge. I think the investments that we’re making in the region are meant to enable governments and enterprises to shift the hardware operating costs and repurpose that capital to innovate, to develop human capital, and build applications that can reflect solutions for pain areas that exist today,” he says.
“This allows them to work on various aspects of what they want to achieve for their country, for the public sector. Of course, that is a viable thing across all enterprises.”
Of the various Microsoft “pillars” that Abu-Ltaif identified, he is most excited about the philanthropy – and not without reason. The numbers are staggering: over the last five years, the company has made cash donations of over $162m, provided technology help to over 5,100 non-profit organisations, helped over 730 entrepreneurs and, by its own estimation, managed to reach 13 million underserved young people across the Middle East and Africa.
“We have a tendency not to mention these things because the core of what we’re trying to do is just to integrate and just to tap into what matters,” he says.
“The work continues to evolve. We’re trying to ensure that philanthropy and social responsibility are at the centre of what we’re trying to do here. How will we be able to move the needle in terms of employability? What are we doing to serve the youth? What can we do in terms of reshaping education in the region? Because these fundamentals, if addressed well, are going to lead to progress in our region.”
When asked about future plans for the region, Abu-Ltaif explains that his general strategy is to bring the resources that Microsoft can bring to bear as the third largest company on the planet to provide its employees – and its customers – a platform for innovation and with which to make an impact.
Just as importantly, however, Abu-Ltaif says that he wants to shift attitudes about Microsoft and its brand.
“I want to encourage our people to lead with a growth mindset with the level where we would approach opportunities in the region differently, thinking out of the box. This is a very different approach than what people have been used to in our region” he notes.
“It is also about building our capabilities, both internally at Microsoft but also among our partners and even our customers. Last but not the least, I wanted us to take a view of how we can think from the outside in.”
According to new research from IDC, Microsoft’s tech ecosystem and the expanding presence of cloud services will lead to the creation of more than 63,400 jobs in Saudi Arabia by the end of 2022. Largely due to ongoing nationwide initiatives such as Saudi Vision 2030, IDC forecasts that spending on public cloud services in the kingdom will almost quadruple over the next five years from $114.02m in 2017 to $418.64m in 2022. The IDC research also found that Microsoft’s ecosystem – which includes the companies that sell, service, deploy or work with Microsoft products – supported over 69,000 workers in 2017.
“Digital transformation has the power to engage customers and citizens, empower employees, optimise operations and reinvent products and services,” said Dr Mamdouh Najjar, technology officer at Microsoft Arabia.
Among the local entities that have turned to Microsoft to help with their digitisation efforts is Abu Dhabi Global Markets (ADGM) Courts, which has begun embarking on a shift away from a traditionally heavily paper-dependent system, which is costly and inefficient.
In a bid to introduce more digital judicial services, court officials teamed up with Microsoft to create a digital platform. “We realised that the traditional court does not reflect workings, operations and dealings of the international business community,” said Linda Fitz-Alan, registrar and chief executive at ADM Courts. “The court is now accessible 24/7 from anywhere in the world, so we know no geographical or time boundaries. You can register, submit documents, file and pay online, and utilise Skype-enabled trial hearings from remote locations.”
In late September, Microsoft and Dubai-based Beco Capital announced a strategic partnership designed to boost the regional entrepreneurial ecosystem. As part of the partnership, Microsoft and Beco will give early stage tech companies in the MENA region exposure to a curated audience of potential investors throughout the 2019 fiscal year.
“Microsoft’s credentials as a start-up mentor are well established,” said Sayed Hashish, regional general manager, Microsoft Gulf. “In the MENA region, where we have a strong track record of contributing to GDP growth, we back innovators who have something new to offer in areas such as AI and the IoT. These are technologies that better enable digital transformation, engage customers, empower employees and reinvent products and services.”
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