AI adoption grows despite challenges in Australian businesses

Recent research from Pegasystems has shed light on the rapidly evolving landscape of artificial intelligence (AI) adoption among Australian businesses. According to the study, AI's increasing prevalence has influenced 96% of Australian business decision-makers to integrate it into their operations. However, the survey raises critical questions about whether companies are genuinely prepared to harness AI's potential.

The findings highlight a considerable gap between perceived and actual readiness for AI. While a vast majority of decision-makers believe they have a robust understanding of AI, only a diminutive 4% think AI has been in use for over a decade in businesses, despite its mainstream adoption since the 1980s. This discrepancy is further highlighted by the fact that 67% would trust AI to run an entire department, yet 68% have experienced failed AI implementations.

The study, conducted by research firm Savanta and unveiled at PegaWorld iNspire in Las Vegas, found that the advent of generative AI has catalysed the broader acceptance of other AI tools aimed at boosting productivity and driving transformation. Generative AI, which is utilised for creative and productivity-enhancing tasks such as content creation and conversational chatbots, was reported as the predominant AI form in enterprises. About 50% of Australian respondents rely heavily on it, while less than a third use rational, analytical AI decisioning solutions.

The financial commitment to AI is substantial, with 94% of respondents likely to escalate their AI usage within the next five years. Moreover, 82% express confidence in AI's potential to deliver transformational business value in the next five to ten years. A significant 80% of businesses allocate up to half of their annual IT budgets to AI solutions, though 75% admit to budgetary waste due to a lack of strategic planning.

This growing investment underscores the urgent need for better strategic frameworks. Despite their confidence, 78% of decision-makers believe AI has been in business use for under five years, showcasing a stark contrast to its actual historical utilization. Additionally, over two-thirds of survey participants failed to accurately define generative AI, which corresponds with the high rate of failed AI projects reported.

Trust and apprehensions regarding AI also present a complex picture. Nearly half of the respondents are wary of relying on AI for brand success, while 48% are concerned about AI transparency and bias. Furthermore, 40% fear AI could replace their jobs, and 44% harbour concerns about AI-driven robotic control. Despite these fears, a notable 67% would entrust AI to manage a department, believing it would enhance overall results. In customer relations, 41% prefer human interactions supplemented by AI, whereas only 9% trust human engagement without AI assistance.

The demand for AI proficiency is on the rise, with 12% of respondents identifying weak AI skills within their organisations as a barrier. One in four consider this a significant hindrance to further AI adoption. Conversely, 99% value AI experience highly when evaluating new hires, with hands-on expertise in areas like prompt engineering and AI theory being particularly sought-after.

Don Schuerman, Chief Technology Officer at Pegasystems, commented on the findings: "Generative AI is leading a new wave of enthusiasm, encouraging businesses to explore and implement various AI forms boosting creativity and innovation. The next few years will witness accelerated AI growth and adoption, provided organisations foster the necessary skills and understanding to ensure the success of their AI projects. We anticipate a future where businesses not only utilise AI productivity tools but also collaborate with AI to drive significant innovations benefiting both the company and its customers."

The survey involved 500 business decision-makers globally, including 112 from Australia, reflecting a broad perspective on AI's implementation challenges and opportunities. The participants primarily hailed from the United States, the United Kingdom, France, Australia, and Germany.