Business leaders still struggling to put AI hype to practice

21 June 2024 Consultancy.uk 3 min. read

According to a new international study, more than eight-in-10 executives say they have deployed artificial intelligence in their firms to enhance revenue. However, the paper from Tata Consultancy Services also found that even among industry pacesetters, only a third of firms have actually completed an AI project.

As the global boom in AI hype closes on its second year, studies continue to show that businesses are keen to demonstrate how the technology is a priority. Half of UK businesses claim to be piloting AI use cases, while consulting firms in particular recently outlined AI tools as a leading form of investment.

In line with this, a new study by Tata Consultancy Services (TCS) has polled respondents across 24 countries and 12 industries to demonstrate the impact of AI on the future of business. And among the researchers’ leading findings, TCS has announced that 86% of senior business leaders have already deployed AI to enhance existing revenue streams or create new ones.

Business leaders still struggling to put AI hype to practice

Source: TATA Consultancy Services

Executives were generally positive about the impact of AI, with 57% reporting excitement or optimism about the potential impact of AI on businesses. Considering the slow state of economic growth, it might have been instinctive for them to use the technology more conservatively to find ways of cutting costs – but they largely believe they can aim higher than that. To that end, TCS also found that 69% were more focused on using AI to spur innovation and increase revenue, than on productivity improvement and cost optimisation.

Harrick Vin, chief technology officer, TCS, commented, “2023 was a year of exuberance, with every enterprise experimenting with AI/GenAI use cases. We are now entering an era of wide-and-deep enterprise AI adoption.”

Most firms deploying AI do not see it as a simple replacement for human labour, either. A 65% majority said that human strategic decision making, intuition, and creativity will remain at the core of their company’s competitive advantage. Instead, they expect the technology will enable staff to become more productive, and bolster their own capacity for creativity. Among respondents in the study, 45% therefore expect that half their employees will need to use generative AI capabilities to do their job in three years’ time – and another 41% think even more will do so.

Business leaders still struggling to put AI hype to practice

Source: TATA Consultancy Services

However, Vin added that – as was the case with much of the digital transformation work of the last decade – businesses are realising that the path to production for AI solutions is not easy. He noted that the study had confirmed that enterprises feel “underprepared to deploy AI solutions at scale as well as to manage the profound shifts in the roles of people and ways of working resulting from such deployments.”

That might explain why the majority of firms have not actually managed to implement the AI projects they were hoping for. At present, the completion rate for AI projects across all corporate functions and departments stands at an average of 26% – and only rises to a sparse 30% among the absolute leaders of the market.

This is not the first time that a study has found leaders are struggling to walk the talk on AI, either. The benefits of the technology for the financial services sector are supposedly massive, but a poll from Kin + Carta has also found that only 14% of leaders in the sector have integrated it into their corporate strategy.