Companies Taking a ‘Wait and See’ Approach to AI Will be left Behind Says Report

Seventy-five percent of executives surveyed said that AI has already met or exceeded their expectations.

Companies Taking a ‘Wait and See’ Approach to AI Will be left Behind Says Report

Seventy-five percent of executives surveyed said that AI has already met or exceeded their expectations.

According to a survey of more than 570 executives by Bain & Company, seventy-five percent said that AI has already met or exceeded their expectations. The data coming from Bain’s fourth annual Global Technology Report says that the current generation of AI tools and models could help companies speed up 20% of worker tasks without a loss in quality.

While the ease of access to large language model (LLM) application programming interfaces (APIs) has made it relatively easy to demonstrate new AI-powered products, Bain’s survey found that 89% of software companies are already using AI to differentiate their products—15 percentage points higher than other sectors.

Early adopters of AI are already seeing results and productivity gains as companies explore new ways to use AI for their businesses, Bain found.


 

Highlights:

  • 89% of software companies are already using AI to differentiate products
  • AI and ML solutions led venture and growth funding in first half of 2023
  • As customers introduce AI into their own processes, job roles are expected to change

“Innovation is happening quickly, and we are still in early days,” said David Crawford, global head of Bain’s Technology practice.

“Three out of four software companies we surveyed believe that early movers will have a sustained advantage that will not level off. Software leaders expect the technology to generate significant opportunities to increase topline growth and customer retention. Our research shows that, in this fast-moving environment, companies that take a wait-and-see approach in terms of AI are at risk of being left behind.”

The report added that software companies also need to address how the adoption of generative AI by their customers and competitors can impact their core business. This due to customer concerns around data protection and access, personally identifiable information, audit trails, prompt grounding with proprietary data, and integration with other machine learning (ML) and automation technologies are served in platform layers, beyond the LLM.


 

The report highlighted that this is the area where software companies can differentiate themselves, leveraging established positions in customer architectures.

Generative AI talent implications

The report also notes that when customers introduce AI into their own processes, job roles are expected to change. Engineering, sales and marketing are among the functions most likely to benefit from AI over the next 18 months. Companies will need more engineering talent for AI and ML, particularly with experience building or integrating LLMs.

Generative AI will change the way companies market and sell their products and services as it enables significant automation across every step of the customer life cycle, Bain added. In particular, demand and lead generation, digital self-service sales, customer success, and other support activities all have the potential to benefit from the types of automation that generative AI enables.

When it comes to investor appetite, the report showed that most investors agree that AI will have a significant effect on the tech sector.

In fact, investors’ enthusiasm for AI is high, with AI and ML investments leading venture growth in the first half of 2023. However, most investors think that the evolution of the competitive landscape remains to be seen.

To avoid disruption risks, investors must consider both disruption potential and structural barriers in the market. They must also consider whether companies own proprietary data could enrich generative AI applications.

“Top funds are not waiting to see how generative AI changes this space. They are biasing toward action to capitalize on the potential of their incumbent software assets,” said Crawford.


You can see more from the report here.

 

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