- The Surge of AI Adoption
- Companies’ Recognition of Value Created By AI
- Investments in AI
- The Most Recognized Risk of AI Use
- Despite Criticism, Numbers Are Telling a Different Story
If generative AI (gen AI) was first introduced to the world in 2023, then 2024 is the year businesses really started utilizing and benefiting from this new technology. 65% of participants in the most recent McKinsey Global AI Survey shared their companies use generative artificial intelligence (gen AI) on a regular basis, which is almost twice as many as in the survey conducted just ten months prior. As in the previous year, the majority of respondents (75%) expect generative artificial intelligence (gen AI) to have a significant or disruptive impact on their industries in the coming years.
The Surge of AI Adoption
A wider range of AI capabilities has also come to light due to interest in generative AI. The adoption of AI by the organizations of the respondents has remained steady at roughly 50% over the last six years. According to the survey, adoption has increased to 72% this year. Also, the interest is genuinely worldwide in scope. Although the adoption of AI did not reach 66% in any region, according to the survey conducted in 2023, this year over two-thirds of respondents in almost every region say their organizations are using AI. When considering the various industries, professional services got the biggest increase in adoption.
Additionally, results indicate that businesses are now utilizing AI in more areas of their daily operations. Compared to less than a third of respondents in 2023, half of respondents say their organizations have implemented AI in two or more business functions.
Companies’ Recognition of Value Created By AI
The majority of respondents now state that they personally use gen AI, as do their organizations. Up from one-third last year, 65% of respondents say their companies regularly use gen AI in at least 1 business function. The majority of organizations utilizing gen AI do so in two areas: IT, marketing, sales, product and service development, which are the two areas where prior research indicated gen AI adoption could yield the greatest value. Sales and marketing have seen the largest increases since 2023 and according to reports, adoption has more than doubled in these areas. However, only two use cases, one each in sales and marketing are mentioned by 15% or more of respondents across all functions.
Additionally, respondents' personal lives are being affected by Gen AI. Respondents are far more likely to use generative AI at work and even more likely to use it in both their personal and professional lives when compared to respondents in 2023. All regions are seeing increases in the use of gen AI, according to the survey, with Greater China and Asia-Pacific seeing the biggest increases. When compared to their peers in midlevel management, respondents with the highest seniority levels exhibit greater jumps in the use of Gen Al tools both inside and outside of the workplace. When examining particular industries, those in the professional services and energy and materials sectors report the biggest increases in the use of Gen AI.
Investments in AI
The poll below also reveals how various industries are allocating funds for artificial intelligence. According to the responses, companies are almost as likely to allocate more than 5% of their digital budgets to generative AI in many industries as they are to nongenerative, analytical AI solutions. However, a higher percentage of respondents in the majority of industries state that their companies spend more than 20% of their budget on analytical AI as opposed to general AI. Even 67% percent of the respondents anticipate that their companies will increase their AI spending in the upcoming three years.
What is the return on those investments? Human resources is the function where the majority of respondents claim to have seen cost reductions. The supply chain and inventory management departments are where respondents most frequently report significant revenue increases (of more than 5%). Similar to the findings from the previous year, respondents to analytical AI most frequently mention cost savings in service operations as well as appreciable revenue gains from AI use in marketing and sales.
The Most Recognized Risk of AI Use
Businesses are becoming aware of the various risks connected with artificial intelligence (AI) as they start to realize its advantages. These can include model management risks, which typically center on false output or lack of explainability, or data management risks, such as data privacy, bias, or intellectual property (IP) violations. Not suitable use and security form a third major risk category.
The use of Gen AI has already had some unfavorable effects on some organizations; according to 44% of respondents, at least one consequence has occurred. The most frequent risks mentioned by respondents as having an impact on their organizations are explainability and cybersecurity, then inaccuracy.
Despite Criticism, Numbers Are Telling a Different Story
Between February 22 and March 5, 2024, 1,363 people took part in the online survey, which collected responses from a wide range of regions, industries, company sizes, functional specializations, and tenures. Of those surveyed, 878 stated their companies regularly used gen AI in at least one function, and 981 stated their organizations had adopted AI in at least one business function. The data are weighted according to each respondent's nation's share of the global GDP in order to account for variations in response rates.
