Leadership division a key barrier to AI success

As organisations struggle to realise value, yet another study has found that just one-in-ten are actually using it at a “truly transformative level”. As the hunt continues for an explanation as to why the technology is still underwhelming, new Gate One and IDC research suggests leadership division may be to blame; with CEOs naming workforce capability as a top threat, while people leaders focus elsewhere.

According to the research, based on a survey of 750 senior decision-makers across the UK, Ireland, France and the United States, leaders are facing challenges from every direction – strategic, operational, technological, financial and regulatory. Leaders aren’t just dealing with a few headline issues, they’re being pulled in multiple directions by a wide mix of priorities, each vying for attention.

At the head of the list, is a concern among 30% of CEOs, who believe AI is evolving too fast to keep pace with. This is impacting companies’ ability to plan and resource projects effectively – with workforce readiness and strategy cited by a further 29% as their leading worry.

But tellingly, while workforce matters were high on the agenda – 28% of leaders saying they are concerned with talent and skills shortage – it is not the next item on the list. Instead, 29% say leadership and effective line management is more important. This is possibly because on some level, these leaders understand that for their plans to have their desired impact, the organisation needs to agree on clearly defined targets – and often these are currently misaligned.

That misalignment sits alongside competing demands on the business. Some 44% of organisations rank growth among their top three priorities for the year ahead, together with efficiency (43%) and cost savings (38%). Yet, 39% highlight conflicting stakeholder demands as a key challenge in prioritising initiatives, particularly with short-term financial performance and long-term transformation goals (63%), business expectations and current technology capabilities (50%), and risk or compliance requirements versus innovation ambitions (45%).

Into this environment, organisations are deploying AI at scale, but not always wisely. Some 63% are using AI to automate routine tasks and 60% to optimise process speed. Yet only 10% of organisations are already using generative AI and AI agents as a core part of how they operate and deliver value, and only one in three such initiatives currently meet or exceeds expectations.

If there is not agreement on which problems need to be addressed, AI investment potentially scales the problem, rather than solving it. The contrast with leading organisations is instructive. Those at a transformative stage of generative AI and AI agent deployment are using the technology not only to automate routine tasks but to support decision-making, enhancing operational decisions (57% versus 46% average) and optimising resource allocation and workforce planning (47% versus 40% average). Critically, 84% of leaders prioritise end-to-end process redesign before deploying AI, compared with fewer than 40% of non-leaders.

To that end, there is also a gap where firms invest in AI to begin with – and a strategic approach is a stronger marker of success. Leading organisations consistently prioritise strategic investment over tactical investment. Strategic investment isn’t just smarter; it’s a marker of transformation maturity.

James Cooper, partner at Gate One, commented, “Our assessment is clear: deploying AI onto processes never designed for the pace, flexibility or data quality modern transformation demands is not working. Automating a broken process doesn’t drive efficiency, it simply scales inefficiency. Technology can accelerate transformation, but it won’t fix misaligned leadership or weak foundations. The organisations pulling ahead are making clear choices on where to focus: accelerating performance by aligning leadership, prioritising what matters most and redesigning how work gets done to unlock sustainable value.”