BOSTON, October 24, 2024 – A thorough and in-depth assessment of enterprise AI utilization by Boston Consulting Group (BCG) has uncovered an alarming trend: almost three-quarters of the companies surveyed, are unable to extract the required value from their AI investments. The survey, which was responded to by 1000 senior executives from 59 countries, indicates that only 26% managed to scale up their operations on Artificial Intelligence initiatives.
Nicolas de Bellefonds, BCG senior partner and managing director, highlights the shifting focus in AI implementation:
“AI leaders are raising the bar with more ambitious goals. They target meaningful outcomes on cost and topline and prioritize core function transformation over diffuse productivity gains.”
The research highlights a distinct performance gap, with organizations employing advanced AI technologies achieving revenue growth that is 1.5 times higher, and shareholder returns that are 1.6 times higher, over the last three years. Michael Grebe, a BCG senior partner and managing director, makes the case for ease of integration with the core business:
“Contrary to popular belief, the true potential of AI goes well beyond support functions. In fact, 62% of AI’s value lies in core business functions.”
The highest level of AI utilization was recorded in Fintech at 49%, software at 46%, and banking at 35%, respectively. Amanda Luther, partner, and managing director at BCG, notes increasing inequality.
“Three-quarters of companies have yet to unlock value from AI. Without decisive action, they risk falling significantly behind.”
The study notes the importance of the 70-20-10 rule during the deployment of AI: success is 70% people and processes, 20% technology, and 10% algorithms. This finding challenges the common practice of prioritizing technical aspects over human factors in AI transformation efforts.
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