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CEOs Struggle to Leverage Generative AI, but Many Companies Embrace its Benefits

BUSINESSCEOs Struggle to Leverage Generative AI, but Many Companies Embrace its Benefits

The latest installment of the EY CEO Outlook Pulse Survey indicates that company CEOs are struggling to determine the most effective uses of artificial intelligence (AI). However, the necessity of innovation is prompting them to take specific steps. Seven out of ten respondents admit that their organization is working in the GenAI area to maintain a competitive edge. At the same time, nearly the same percentage of CEOs (68%) believe that uncertainty about generative AI (GenAI) hampers the rapid development and implementation of its use strategy. Companies in Poland also see the benefits of AI implementation. The results of the EY study – How Polish Companies Implement AI – indicate that the transformation of native organizations towards artificial intelligence is gaining momentum. This process has already been completed by 20% of organizations, and 63% of companies in Poland plan to increase their spending on AI-based tools in the next 18 months.

The pace of modern technology development is exceptionally fast currently. The past few months have focused on AI, whose refined machine learning algorithms can better support companies in innovative projects and increase the productivity of employees burdened with routine tasks. However, implementing this technology is a significant operational revolution that many companies are not yet prepared for. The latest EY CEO Outlook Pulse Survey confirms this. Over two-thirds (70%) of company CEOs believe that generative AI presents challenges regarding changing their business model to maintain a competitive edge.

To effectively leverage GenAI, CEOs must define their main goals related to it. However, this is not an easy task, as 68% of company CEOs struggle to quickly develop and implement a strategy for its use. Among key initiatives should be tracking national and regional regulations related to AI, managing risk, hiring new employees, or entering partnerships with other organizations. EY’s study shows that the companies most in need of benefits from AI, such as those predicting a decline in revenue growth in 2024, are the ones most delayed in its implementation and least willing to increase their budget for this purpose.

Generative artificial intelligence simplifies many daily tasks and shortens their execution time, starting from creating graphics and videos to computer codes and chatbots. Organizations that want to use its benefits more frequently and consciously should educate their employees and set challenging tasks for them. Only in this way will they be able to discover the full potential of GenAI, as well as the risks associated with this technology.

AI and business development

One of the most quickly noticeable benefits of implementing AI is improving the efficiency and productivity of organizations. These first successes often make CEOs complacent and lead them to be overly optimistic about how quickly it will transform the rest of their business. Over half of the companies (64%) that have already experienced the first positive effects of generative AI expect that it will redefine their entire business and operational model within a maximum of two years.

The longer and probably more realistic time frame suggests that AI and GenAI remain territories to explore for many CEOs, even if they already have a lot of experience using these solutions. In this case, cool judgment and a realistic approach to AI’s capabilities and their adept implementation will work in the CEO’s favor, helping to avoid unwanted disruptions in operational activities.

Too optimistic assumptions, which end up as unfulfilled promises and disappointed expectations, can undermine the trust of employees and shareholders in CEOs. As a result, this can hinder technological transformation in the longer term, as subsequent ideas will raise skepticism. To avoid this, the CEO should work closely with technology executives (CTO), ensuring that strategic plans for artificial intelligence are feasible.

Investors’ challenges

AI development also affects the mergers and acquisitions market. Two-thirds of surveyed CEOs (66%) admit that there has been a sharp increase in the number of companies claiming to have specialist knowledge in the field of AI, which makes it difficult to identify reliable suppliers, partners, or investment targets.

Every fifth company in Poland has already implemented AI, and the budgets for this purpose will continue to grow

Domestic enterprises approach the introduction of AI-based tools with great openness, as evidenced by the recent study conducted in Poland by EY – How Polish Companies Implement AI. This process has already been completed by 20% of organizations, and another 42% are in the process. Companies focus primarily on customer service solutions (50%), sales (40%) and IT (37%). Models are based on customer (54%), transactional (53%) and textual data (46%). As much as 63% of companies in Poland plan to increase their spending on AI-based tools over the next 18 months.

About the survey

The CEO Outlook Pulse Survey was conducted on behalf of EY in September and October 2023 by FT Longitude, a specialized research and content marketing department of the Financial Times Group. The respondents included 1200 CEOs of large companies from 21 countries who participated in an anonymous online survey. They represented the following countries: Brazil, Mexico, Canada, the United States, Belgium, Luxembourg, the Netherlands, France, Germany, Italy, Denmark, Finland, Norway, Sweden, the United Kingdom, Australia, China, India, Japan, Singapore and South Korea.

One fifth of surveyed organizations reported annual global revenues below USD 500 million. A further 20% showed revenues in the range of USD 500 million to USD 999.9 million (20%). Meanwhile, 30% of the companies had revenues of USD 1 billion to USD 4.9 billion, and the last group (30%) – above USD 5 billion.

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