Global leaders anticipate AI to enhance efficiency rather than revenue
According to a recent survey by consulting firm EY, over three-quarters of CEOs from large companies across 21 countries believe that artificial intelligence (AI) will notably improve efficiency. However, they foresee only a marginal impact on revenue growth.
In a study that examined the tech transformation spurred by the Covid-19 pandemic, which forced a wave of innovation and financial protection in businesses, executives now recognize AI as the next transformative step. Nevertheless, the optimism is shaded with caution as a majority see its primary benefit in productivity rather than financial expansion.
Globally, 41% of company leaders are prioritizing AI in the next year to stimulate efficiency and enhance business performance. The report highlights a more conservative stance among Polish CEOs, with only 27% considering AI a top priority. These leaders are focusing more on reinventing supply chains and investing in new products and services, pointing to local geopolitical factors that influence their strategic decisions.
Arkadiusz Gęsicki, a partner in EY-Parthenon in Poland and the Baltics, suggests Polish entrepreneurs’ strategies are heavily influenced by the need to secure and stabilize existing business and meet consumer demands for innovative products and solutions.
Currently, most organizations use AI mainly for optimizing operations, automating processes, and developing self-service tools, such as chatbots. However, the potential is believed to be much greater than its current application. EY underscores that challenges still remain, especially concerning data protection and intellectual property rights, assertion that will soon be addressed by the recently adopted AI Act in the European Union. Regulatory frameworks are necessary to help company executives minimize operational risks and invest more boldly in AI technologies.
The CEO Outlook Pulse survey, conducted by FT Longitude, a research and content marketing arm of the Financial Times Group, collected insights from 1200 CEOs of large firms from 21 countries through an anonymous online questionnaire during December 2023 – January 2024. Representatives from a diverse range of countries including Brazil, Mexico, Canada, the United States, multiple European nations, as well as Australia, China, India, Japan, Singapore, and South Korea, provided their perspective on the matter.
Important Questions and Answers:
Q: What are the main obstacles preventing CEOs from seeing AI as a major revenue driver?
A: CEOs may be concerned about the cost of AI implementation, the lack of skilled talent to manage and optimize AI systems, potential regulatory and ethical issues, as well as the uncertainty about the return on investment. There could also be doubts about customer acceptance and the ability of AI to drive new revenue streams as opposed to just cutting costs.
Q: How does the recent AI Act in the European Union address these challenges?
A: The EU’s AI Act provides a legal framework intended to address risks associated with AI systems and reinforce trust in the technology. This includes regulations on high-risk AI applications, data governance, transparency measures, and standards for ethical AI use. By offering clarity on regulatory expectations, it aims to help companies mitigate operational risks and foster greater investment in AI innovations.
Q: Are there any significant benefits of AI beyond efficiency gains and potential revenue growth?
A: Yes, AI can improve decision-making with data-driven insights, enhance customer experiences through personalization, and promote innovation by accelerating R&D processes. AI can also contribute to societal benefits, like advancing healthcare diagnostics, improving energy efficiency, and facilitating educational tools.
Key Challenges or Controversies:
– Ensuring AI is developed and deployed ethically and without bias.
– Protecting user privacy and data security when AI systems handle sensitive information.
– Bridging the skills gap as AI demands new expertise and roles in the workforce.
– Addressing fears of job displacement due to AI automation.
– Navigating international regulatory environments that differ in their approach to AI governance.
Advantages:
– Increased operational efficiency and cost savings.
– Ability to scale operations and offer 24/7 services.
– Enhanced data analysis for better business decision-making.
– Innovation in products and services enabled by AI capabilities.
Disadvantages:
– High initial investment costs for AI integration.
– Potential for increased unemployment due to automation.
– Ethical and privacy concerns regarding AI decision-making and data usage.
– Dependence on AI could lead to vulnerabilities, including system failures or manipulation.
To explore further insights and trends about AI in the business sector, you may visit the websites of reputable consulting firms, technology think tanks, and research institutions. Here are some suggestions, assuming the URLs are valid:
– EY (Ernst & Young)
– McKinsey & Company
– PwC (PricewaterhouseCoopers)
– BCG (Boston Consulting Group)
– Gartner
These links lead to the main domains of professional services networks and research organizations which frequently publish reports and insights into AI impacts on businesses and economies.
The source of the article is from the blog maestropasta.cz