Recent advancements in generative AI, including sophisticated language models and image creation technologies, are drawing significant attention across various sectors. These breakthroughs are lauded for their role in simplifying routine tasks, augmenting the creative capabilities of workers, and notably enhancing individual efficiency. Yet, they also raise concerns regarding issues such as incorrect results, potential misuse of proprietary content, accountability dilemmas, and substantial costs and energy requirements.
Woozle’s TMT equity research analysts engagements with dozens of prominent corporate leaders and IT experts revealed a keen interest in exploring generative AI, but also a general lack of readiness for its integration. As firms initiate test phases, they are keenly exploring ways to capitalize on the advantages of generative AI while managing its potential downsides.
Highlights of the study include:
- A notable 82% of the participants are applying generative AI to improve internal process efficiency.
- Concerns about the privacy of customer data are widespread, with 75% of the respondents voicing apprehensions.
- An optimistic 90% anticipate that generative AI will lead to cost savings in the next half-decade.
Woozle Research, a global leader in primary investment research, carried out a survey in December 2023 with 100 high-ranking IT and business leaders from North America and Europe. These individuals play a significant role in selecting generative AI technologies and services. The survey aimed to capture their perspectives on the capabilities and challenges of generative AI.
Key outcomes from the study:
- Most respondents are in the early adoption phases of generative AI, primarily engaging in pilot projects and exploratory phases.
- The leaders are mainly focused on employing generative AI to enhance customer experiences and operational effectiveness.
- A major concern for these leaders is safeguarding intellectual property and customer information.
The survey also detailed the demographics of the participants:
- Regarding annual revenue, the distribution was diverse, with 45% of the companies boasting revenues exceeding $1 billion, and the rest spread across various lower revenue categories.
- The respondents spanned multiple industries, with Financial Services (20%) and Healthcare (17%) being predominant, followed by sectors like Professional & Business Services, and Industrials.
- In terms of job functions, more than 65% of experts that attended video-interviews with our equity analysts held positions as senior-IT decision makers or executive/management roles at their organization.
Woozle Research’s channel checks indicate an eagerness among organizations to adopt generative AI, coupled with a notable deficit in readiness for its implementation. A significant 85% of middle management across various organizations are either interested in or considering adopting generative AI. They recognize its potential in revolutionizing operations, with 75% expecting a surge in worker productivity and 72% anticipating changes in user interactions with information systems. Despite this enthusiasm, a mere 30% believe their organizations are primed for generative AI deployment.
The survey shows that the majority of organizations are still experimenting with generative AI, with only 3% having fully integrated it into their daily operations. While 48% have started pilot programs, a noteworthy 20% have not yet taken steps towards adopting this technology. The absence of formal AI leadership in companies may be a factor in this slow uptake, as only 18% have a designated AI leader.
In application, generative AI is primarily used to improve internal processes and customer service, with 77% and 74% of respondents respectively either already employing it or planning to do so within two years. Its use in sales, marketing, and product development is not as widespread, suggesting uncertainty about the broader benefits of generative AI in these areas.
The survey also uncovers a gap in understanding the full scope of generative AI. While many recognize its value in supporting skilled labor and reducing monotonous tasks, fewer acknowledge its potential for customization, ideation, and new product creation. This implies that the wider applications of generative AI remain underutilized.
In terms of risk management, data privacy and legal concerns related to intellectual property are prominent. However, there’s less focus on making generative AI accessible to lay users or differentiating its use from competitors.
Despite these obstacles, there’s a general agreement on the critical role of generative AI in future growth. Most participants believe it will be essential for revenue enhancement and cost reduction in the coming five years, leading to increased investment in generative AI technologies. While current investment levels are modest, a substantial shift is anticipated, with over half of the respondents planning to invest upwards of $5 million in the near future. This reflects a strong confidence in the transformative potential of generative AI despite existing challenges and uncertainties.