Why Singapore's AI Leaders Can't Scale Beyond Pilot Phase

A new study reveals that 64% of Singapore businesses now use AI consistently in daily workflows, yet only 18% have reached fully autonomous AI deployment, exposing a significant gap between adoption and real business impact.

Adoption Rate Masks a Deeper Performance Gap

The HubSpot and Lonergan Research survey of more than 700 Singapore business leaders, conducted in early 2026, finds that businesses have moved past the experimentation phase. However, the research describes a "plateau in their transformation journey" where scaling AI reliably has become the central challenge.

The top two barriers are trust and reliability concerns, cited by 43% of respondents, and data quality and integration challenges, cited by 37%. Critically, these barriers grow worse as organizations advance. Among companies already running fully autonomous AI agents, data integration challenges rise to 41%, legacy system limitations reach 42%, and skills gaps climb to 39%.

Megan Hughes, Managing Director and Vice President JAPAC at HubSpot, states: "The key challenge among Singapore businesses is no longer whether they are using AI. It is whether they have the knowledge of customers, market trends, and operations needed to scale the business reliably."

Governance Deficits Undermine Trust in AI Decisions

Separate research on 175 Singapore IT and business leaders finds that 60% of Singapore businesses lack centralized data governance, compared to 53% globally. Just 27% of Singapore business leaders fully trust AI-generated decisions, despite a 70% year-on-year increase in AI usage.

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This trust deficit directly conflicts with what leaders themselves say is required. Among the same group, 66% rate accuracy and reliability as the most critical factor for effective AI agent operations, followed by system integration at 56%, governance at 53%, and access to relevant business context and data at 48%.

PwC's global AI research adds further context. Singapore businesses report a higher risk appetite for AI investment at 67%, compared to 41% globally. Some 17% of Singapore firms already use AI in autonomous and self-optimizing applications, more than double the global rate of 8%. This acceleration is occurring without matching improvements in governance and data infrastructure.

SME-Enterprise Divide Complicates the Broader Picture

Aggregate adoption figures obscure a significant divide within Singapore's business ecosystem. Larger businesses report an AI adoption rate of 62.5%, while SME adoption stood at just 14.5% in 2024. Given that SMEs employ approximately 90% of Singapore's workforce, this gap carries broad economic implications.

Investment Intentions Remain Strong but Conditional

Despite current limitations, forward-looking sentiment is positive. Some 43% of Singapore business leaders expect AI agents to become highly important within 12 to 24 months, and 28% are already actively investing. However, 30% state that clearly demonstrated business results would be required before they increase their investment.

Hughes frames the path forward as a shift in competitive strategy: "The most successful businesses will be those with a context advantage, combining leading-edge AI models with deep context to deliver highly impactful outcomes."

The HubSpot-Lonergan Research findings are available via HubSpot's APAC resources. Additional coverage of the study's findings has been published across Marketech APAC and Tech Coffee House.