Kathy Gibson reports – Business leaders are still prioritising artificial intelligence (AI) and aligning their strategies around the value that AI can unlock.
This is among the findings from BCG’s second AI Radar report, which draws on a survey of 1 800 C-level executives from 21 markets, including Africa.
“In 2024, there was barely any conversation where AI and generative AI (GenAI) did not come up,” says Christoph Schweizer, CEO of BCG. So it’s not surprising that AI is still a top three priority for 75% of organisations.
Today, CEOs are navigating a broad AI agenda to close the impact gap. They can realise significant value, but there are many challenges in this journey, Schweizer says.
Sylvain Duranton, global CEO of the firm’s tech unit BCG X, points out that global executives are consistent in their AI investments, which grew 30% between 2023 and 2024 and are projected to grow another 60% to 2027.
In actual dollars, this translates to about $25-million for the bulk of companies (69% globally), with 18% spending more than $26-million, and 7% more than $53-million.
Although 75% of executives say AI is a big focus, so far only 25% have seen significant value from it. Despite this, they see it as a key enabler and are committed to investing in AI projects.
Leading companies are doing things a few things to unlock AI value, Duranton says.
The first thing organisations can do is deploy AI in everyday tasks, to realise 10% to 20% productivity potential.
They can also reshape critical functions, to realise 30% to 50% enhancement in efficiency and effectiveness.
Some companies are also investing new services and products.
“Our conviction is that reshaping is where a lot of the value has been unlocked,” Duranton explains. “In every company, there are critical functions that can be reshaped to bring massive impact.”
Jessica Apotheker, chief marketing officer of BCG, points out that leading companies go beyond simply deploying AI applications. Rather, they focus 80% of their AI investments in reshaping critical functions and inventing new products and services.
But companies are not yet prioritising their investments in higher-impact plays.
Enthusiasm for AI, and allowing all employees to experiment with AI can unlock some value, but those organisations that focus their AI investments extract much higher value, Apotheker says.
A mistake many companies make is by not setting clear goals and tracking top- and bottom-line impacts. Today, more than 60% of companies fail to define and monitor any financial KPIs for AI. “This is a big call to action for the corporate world,” Apotheker says.
Executives understand that people and processes make up at least 70% of the focus for any transformation. But companies are still struggling with the people aspect of AI.
There is a lot of enthusiasm behind AI, but there are many risks that organisations must navigate. Data privacy and security tops the list (66%), followed by lack of content and understanding of AI decisions, then regulatory challenges and compliance.
At the same time, 72% of executives say their organisations are unprepared for AI regulation. Key challenges include the evolving landscape, a lack of clear standards, equitable access to infrastructure and data sovereignty.
Cybersecurity is critical with AI, with 76% of executives recognising that their AI cybersecurity measures need further improvements.
The next phase of AI will be agentic AI.
Vlad Lukic, global leader of BCG’s Tech and Digital Advantage practice, explains that the simple definition of an agent is an AI that has learned to use tools. They have memory, reasoning and can access systems. They can observe, plan and act.
We know agents are coming, with 67% of executives considering agents as part of the AI transformation. But they cannot just deploy them and hope for a silver bullet, says Lukic. Agents require deep reimagining of workflows and processes if they are going to unlock value.
Leaders should keep five priorities in mind when deploying agents.
They can unlock new potential to reshape processes and services. Done well, they can help to break down silos within the company.
But agents are more complex that assistants, so companies need to manage the risks engendered by their complexity. Robust testing and continuous evolution is needed.
Agents are going to by hyped, Lukic warns, so companies must clarify capabilities and set realistic goals.
The bottom line is that implementing agents should be targeted and focused, not seen as a side hustle, but embedded in workflows.
A big issue is the impact on the people within an organisations: 64% of companies see agentic AI as complementary; 14% will prioritise human talent, using AI only when necessary; and 22% will prioritise AI over humans.
“With this result in the reduction of the workforce?” Lukic asks. “The majority of companies (68%) will keep the existing workforce; 8% will increase the workforce; 17% will restructure the existing workforce; and just 7% expect a reduction in the overall headcount.”
A surprising and disappointing finding is that around 70% of companies have trained fewer than one in four of their workers.