This sounds like two vendors 'talking their book' to encourage greater spending on services they provide. But if even somewhat true, it indicates how the winner-take-all rule in technology has quickly transferred to AI and that returns to laggards may simply be the ante to stay in the game, not a competitive advantage. JL
Google and Deloitte report:
82% of respondents told us they’ve already gained a financial return from their AI investments. But that return is not equal across industries. Technology, media, and telecom companies, along with professional services firms, have made the biggest investments and realized the highest returns. In contrast, the public sector and financial services, with lower investments, lag behind. Half of respondents say their businesses are using statistical machine learning (63%), robotic process automation (59%), or natural language processing and generation (53%).
From consumer products to financial services, AI is transforming the global business landscape. In 2017, we began our relationship with Google Cloud to help our joint customers deploy and scale AI applications for their businesses. These customers frequently tell us they’re seeing steady returns on their investments in AI, and as a result, they’re interested in more ways to increase those investments.
We regularly conduct research on the broader market trends for AI, and in November of 2018, we released our second annual “State of AI in the Enterprise” study. It showed that industry trends at large reflect what we hear from our customers: the business community remains bullish on AI’s impact.
In this blog post, we’ll examine some of the key takeaways from our survey of 1,100 IT and line-of-business executives and discuss how these findings are relevant to our customers.
Enterprises are doubling down on AI—and seeing financial benefits
More than 95 percent of respondents believe that AI will transform both their businesses and their industries. A majority of survey respondents have already made large-scale investments in AI, with 37 percent saying they have committed $5 million or more to AI-specific initiatives. Nearly two-thirds of respondents (63 percent) feel AI has completely upended the marketplace and they need to make large-scale investments to catch up with rivals—or even to open a narrow lead.
A surprising 82 percent of our respondents told us they’ve already gained a financial return from their AI investments. But that return is not equal across industries. Technology, media, and telecom companies, along with professional services firms, have made the biggest investments and realized the highest returns. In contrast, the public sector and financial services, with lower investments, lag behind. With 88 percent of surveyed companies planning to increase AI spending in the coming year, there’s a significant opportunity to increase both revenue and cost savings across all industries. However, like past transformative technologies, selecting the right AI use cases will be key to recognizing near and long-term benefits.
Enterprises are using a broad range of AI technologies, increasingly in the cloud
Our findings show that enterprises are employing a wide variety of AI technologies. More than half of respondents say their businesses are using statistical machine learning (63 percent), robotic process automation (59 percent), or natural language processing and generation (53 percent). Just under half (49 percent) are still using expert or rule-based systems, and 34 percent are using deep learning.
When asked how they were accessing these AI capabilities, 59 percent said they relied on enterprise software with AI capabilities (much of which is available in the cloud) and 49 percent said, “AI as a service” (again, presumably in the cloud). Forty-six percent, a surprisingly high number, said they were relying upon automated machine learning—a set of capabilities that are only available in the cloud. It’s clear, then, that the cloud is already having a major effect on AI use in these large enterprises.
These trends suggest that public cloud providers can become the primary way businesses access AI services. As a result, we believe this could lower the cost of cloud services and enhance its capabilities at the same time. In fact, our research shows that AI technology companies are investing more R&D dollars into enhancing cloud native versions of AI systems. If this trend continues, it seems likely that enterprises seeking best-of-breed AI solutions will increasingly need to access them from cloud providers.
There are still challenges to overcome
Given the enthusiasm surrounding AI technologies, it is not surprising that organizations also need to supplement their investments in talent. Although 31 percent of respondents listed “lack of AI skills” as a top-three concern—below such issues as implementation, integration, and data—HR teams need to look beyond technology skills to understand their organization’s pain points and end goals. Companies should try to secure teams that bring a mix of business and technology experience to help fully realize their AI project potential.
Our respondents also had concerns about AI-related risks. A little more than half are worried about cybersecurity issues around AI (51 percent), and are concerned about “making the wrong strategic decisions based on AI recommendations” (43 percent). Companies have also begun to recognize ethical risks from AI, the most common being “using AI to manipulate information and create falsehoods” (43 percent).
In conclusion
Despite some challenges, our study suggests that enterprises are enthusiastic about AI, have already seen value from their investments, and are committed to expanding those investments. Looking forward, we expect to see substantial growth in AI and its cloud-based implementations, and that businesses will increasingly turn to public cloud providers as their primary method of accessing them.
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