Success is a peculiar word in business, with a million ways to measure it and a thousand buzzwords to skew it. So, when IBM’s new survey showed only 25% of recent AI initiatives delivering the expected ROI, the enthusiasm for agents and AI from business leaders is surprising.
Of course, early projects always run a greater risk of missing targets, and today’s AI is making big strides on a regular basis, compared to early generations of ChatGPT. And IBM’s new report highlights many benefits and reasons for optimism among hard-bitten leaders.
IBM on the AI uptake
The new global study by IBM’s Institute for Business Value found that surveyed CEOs are committed to advancing AI solutions across their organisation despite the challenges from accelerating technology adoption.
The survey of 2,000 CEOs globally, revealed that respondents expect the growth rate of AI investments to more than double in the next two years, and 61% confirm they are actively adopting AI agents today and preparing to implement them at scale.
Other insights from IBM include the fact that only 16% have scaled their AI projects enterprise-wide. To accelerate progress, 65% of CEO respondents say their organisation is leaning into AI use cases based on ROI, with 68% reporting that their organisation has clear metrics to measure innovation ROI effectively.
Just over half of CEO respondents say their organisation is realising value from generative AI investments beyond cost reduction. And 64% of CEOs surveyed acknowledge that the risk of falling behind drives investment in some technologies before they see the value they bring to the organisation, but only 37% say it’s better to be “fast and wrong” than “right and slow” when it comes to technology adoption.
Some 59% of surveyed CEOs admit their organisation struggles to balance funding for existing operations and investment in innovation when unexpected change occurs, as 67% say more budget flexibility is needed to capitalise on digital opportunities that drive long-term growth and innovation.
By 2027, 85% of surveyed CEOs expect their investments in scaled AI efficiency and cost savings to have returned a positive ROI, while 77% expect to see a positive return from their investments in scaled AI growth and expansion. CEOs see strategic leadership and specialized talent as essential to unlocking AI value, amid expertise and skills gaps
Talking the AI talk
According to the findings, 68% of surveyed CEOs identify integrated enterprise-wide data architecture as critical for cross-functional collaboration, and 72% view their organization’s proprietary data as key to unlocking the value of generative AI. However, the research indicates organisations may be struggling to cultivate an effective data environment: half (50%) of respondents acknowledge that the pace of recent investments has left their organisation with disconnected, piecemeal technology.
“As AI adoption accelerates, creating greater efficiency and productivity gains, the ultimate pay-off will only come to CEOs with the courage to embrace risk as opportunity. Meaning, focus on what you can control, especially when there is so much you can’t. When the business environment is uncertain, using AI and your enterprise data to identify where you have leverage is a competitive advantage. At this point, leaders who aren’t leveraging AI and their own data to move forward are making a conscious business decision not to compete.” Notes IBM Vice Chairman Gary Cohn.
“CEOs are balancing the pressures of short-term ROI and investing in long-term innovation when it comes to adopting AI,” said Mohamad Ali, Senior Vice President and Head of IBM Consulting. “But we know that organisations that keep innovating, especially during periods of uncertainty, will emerge stronger and be better positioned to capitalize on new opportunities.” He continued.
AI remains an inevitability for all businesses, but the focus must move to customer value and process improvement, as with any software service or feature. The customer experience can be boosted in many ways, including personalisation, streamlined support, and helping firms scale faster.