Southeast Asia's Innovation Potential: Insights from SAP's APAC President Verena Siow

Washington DC, United States Jul 30, 2026 ALN: Southeast Asia is rapidly adopting AI-native systems, outpacing more mature economies due to the absence of legacy infrastructure. "Southeast Asia holds a lot of market potential because it’s very hungry for innovation," says Verena Siow, SAP’s new APAC chief, in an interview at the firm’s Singapore office. She notes that economies with a later start are eager to leapfrog into the latest technologies. This eagerness is indicative of a broader trend in the region, where countries are looking to harness modern technological advancements to bolster their economic growth and improve their global competitiveness.

The region, characterized by young, digitally-savvy populations and a burgeoning middle class, presents fertile ground for leapfrogging—a phenomenon where countries bypass traditional stages of development and directly embrace newer technologies and business models. This demographic advantage is significant; with a substantial portion of the population under the age of 30, Southeast Asia is poised to become a hub for innovation and digital transformation. The rapid growth of internet penetration and mobile device usage further enhances the region's attractiveness for technology companies and startups alike.

This trend has translated into a growing interest in SAP's business AI propositions. Siow explains, "Companies in this region tend to have fewer resources and smaller IT departments, so they’re looking to move straight to the cloud, rather than explore on-premise software, which requires more maintenance." Notable early adopters include transport conglomerate ComfortDelGro and airlines like Thai Airlines and Singapore Airlines. These organizations exemplify the proactive approach many Southeast Asian companies are taking towards digital transformation, recognizing the necessity of integrating advanced technologies to stay competitive in a rapidly changing market landscape.

Disputing the SaaS-pocalypse

Despite Siow’s optimism, she acknowledges that AI adoption among APAC firms remains gradual. A study commissioned by SAP and Oxford Economics found that Singapore firms, despite spending an average of $14.5 million annually on AI, report an average ROI of just 16%. "There is still a lot of potential to realize," Siow states, adding that many organizations are transitioning from pilot projects to execution, though AI integration remains fragmented. This gap between investment and return highlights the challenges organizations face in fully leveraging AI technologies, including the need for skilled personnel, effective change management, and alignment between technology initiatives and business objectives.

Artificial intelligence's rapid advancement has compelled legacy firms like SAP to rethink their business models. Analysts have raised concerns about the so-called SaaS-pocalypse—the belief that agentic AI will render traditional SaaS platforms obsolete. However, Siow counters this notion, asserting, "You still very much need applications and processes in place to get the best outcomes from AI." She emphasizes that while vibe-coded apps may serve small groups, large enterprises require robust platforms like SAP to ensure security and governance. This perspective underscores the importance of integrating AI within established frameworks, rather than viewing it as a standalone solution. The interplay between AI capabilities and existing enterprise systems will be critical for organizations seeking to maximize their investments in technology.

SAP’s financial performance reflects its resilience. In 2025, the company reported annual revenue of €36.8 billion (approximately $41.8 billion), an 8% increase from the previous year. Its cloud business grew significantly, generating €21 billion ($23.9 billion) in revenue, up 23% from 2024, although SAP's software revenue has declined by 34% year-on-year. This mixed financial performance illustrates the challenges facing traditional software companies as they navigate a rapidly evolving market, while also highlighting the growing demand for cloud-based solutions and services that align with contemporary business needs.

SAP’s First Female Asian APAC Lead

Siow, who took on the role of SAP’s APAC lead on July 2, has had a diverse career within the company, holding six different positions over 14 years. She joined SAP in 2011, initially leading sales for the firm’s education software in Asia-Pacific Japan. In 2018, she became managing director of Indochina and in 2020, the president and managing director for Southeast Asia. Her ascent through the ranks of SAP reflects not only her capabilities but also the company's commitment to fostering talent from within, particularly in a region that is increasingly recognizing the importance of diverse leadership.

Reflecting on her initial appointment during the COVID pandemic, Siow recalls feeling a sense of imposter syndrome due to the isolation of remote work. However, she has since embraced the unique business needs of the APAC region, noting that while over 90% of the top 500 companies use SAP, 80% of its customer base consists of small and medium-sized enterprises eager to leverage business AI solutions. This focus on SMEs is crucial, as these businesses often represent the backbone of the economy in many Southeast Asian countries, and their digital transformation is key to driving broader economic growth.

As the first Asian woman to lead SAP’s APAC operations, Siow feels the weight of her role and aims to pave the way for other women in corporate leadership. "Many female colleagues told me that my appointment proves that gender truly doesn’t matter," she shares. "It’s important not to let yourself be held back, or think that just because you’re Asian and female, that you can’t achieve your dreams." Her leadership exemplifies the changing dynamics in corporate governance, where diversity and inclusion are increasingly recognized as essential components of organizational success. Siow's journey serves as an inspiration for aspiring leaders, particularly women in technology and business, who may face barriers in their professional paths.

The implications of Siow's leadership extend beyond her personal achievements; they resonate throughout the industry as organizations strive to create more inclusive environments. By promoting diverse leadership, companies can harness a wider range of perspectives and experiences, leading to more innovative solutions and better decision-making processes. As Southeast Asia continues to evolve as a technology hub, the role of leaders like Siow will be pivotal in shaping the future of business in the region.

In conclusion, Southeast Asia's rapid adoption of AI and cloud technologies, coupled with the unique leadership of figures like Verena Siow, positions the region as a potential leader in the global digital economy. As companies navigate the complexities of AI integration and digital transformation, the lessons learned from this dynamic landscape will be valuable for organizations worldwide. The ongoing evolution of business models, driven by technological advancements and innovative leadership, will undoubtedly play a critical role in shaping the future of industries across the globe.