GenAI outranks cloud as business IT strategic priority

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Enterprise Strategy Group (ESG), an IT analyst firm owned by Computer Weekly publisher TechTarget, has published research about generative AI (GenAI) enterprise use cases that shows the concept ranking higher than sustainability and cloud migration as a strategic priority for enterprise IT globally.

According to the research, 9% of those surveyed identified the use of GenAI as a top strategic initiative, marginally ahead of cloud (8%) and sustainability (7%). Arguably, the technology will also have an impact on the top five initiatives the report puts forward. These are cyber security resiliency (19%), digital transformation (19%), cutting costs (16%), automation (11%), and application modernisation (11%).

The research report Beyond the GenAI hype: real-world investments, use cases and concerns was conducted among 670 IT and business decision-makers in May, June and July 2023. Some 18% of the respondents were from the EMEA region, 65% from North America, 16% from the Asia-Pacific region, and 2% from Latin America.

The survey found substantial activity in train, with 42% of organisations using GenAI for business and IT use cases and 43% currently in the planning or consideration phase.

According to a press statement accompanying the research, the study shows that GenAI strategies among business and public sector organisations are moving apace. They are scrambling to assemble teams, budgets and technologies to support applications of the technology.

Mike Leone, principal analyst at Enterprise Strategy Group said: “Generative AI has moved passed the hype stage and organisations are rapidly adopting this game-changing tech. They’re seeing tangible business benefits from improving operational efficiency and automating processes to increasing employee productivity and enhancing the customer experience.

“But challenges loom large as organisations grapple with skills gaps, data issues, infrastructure complexities and security and privacy concerns. And that’s before considering the cost implications. Virtually every organisation needs help somewhere along this new journey, whether establishing use cases with measurable success metrics, identifying technology providers and partners, scaling usage throughout an organisation, or reducing risk and ensuring trust through a responsible AI framework.”

The organisations surveyed believe GenAI will most benefit customer service (48% of respondents), marketing (45%), software development (43%), IT operations (38%), and product development (37%).

Digital transformation programmes also look set to benefit from GenAI. More than half of the organisations surveyed expect GenAI to improve process and workflow automation, data analytics and business intelligence initiatives, and employee productivity.

Only 4% of respondents said they were actively using GenAI across their enterprises, but 14% are in early production stages, and only 15% have no plans for adoption at all.

One executive at an SME in telecommunications in EMEA said in the report: “We are at the beginning of the learning curve. We want to improve our cyber security posture using AI. We would like to improve the competitiveness of our company and products using AI technologies.”

Another executive from the EMEA region, in computer services, said: “We use it to generate content for client social media marketing, articles and blogs. We generate content for websites and images for marketing and website use.”

However, the report also points to problems with skills gaps, ethical and legal considerations, and data quality as GenAI technology adoption moves at speed.

According to the report, 51% of organisations plan to work with a third-party provider that offers proprietary or open source large language models (LLMs) to support their GenAI initiatives. More than half of organisations reported that they are more likely to consider technology vendors that incorporate GenAI capabilities into their product or service versus a competitive vendor that does not offer comparable GenAI capabilities.

Nevertheless, the organisations surveyed are not willing to pay substantial premiums for GenAI products. Only 10% of the organisations surveyed indicated they are willing to pay over a 10% premium for a product or service that includes GenAI.

One respondent, a consulting manager from a small business in North America said: “I know it can help us, but one current issue is cost and cost concerns. We need specific cost benefit analysis for each case/production case in our products.”


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