KPMG GenAI Survey 2024

According to a new survey conducted by KPMG, executives say that generative AI (GenAI) is already having a significant impact on how they are charting the course for their organisations and the vast majority say that investments will increase with positive ROI expected in the next three years. The survey of 225 senior business leaders at companies with $1 billion or more in revenue found that the majority are already seeing the impact of GenAI on their business: 71% are leveraging data in decision making, 52% say it is shaping competitive positioning, and 47% say it is opening new revenue opportunities. 

The majority of respondents also expect investments in GenAI to increase over the next three years, with 83% predicting growth. Executive management primarily aims for revenue growth with these investments, while other respondents focus on productivity. Additionally, 78% are confident in the return on investment (ROI) from these investments in the next 1-3 years, with ROI being measured by revenue growth, profitability, cost savings, efficiency, and employee engagement, among other factors. In terms of future plans, 24% intend to deeply integrate GenAI into their business processes and strategies, 61% plan to expand the use of GenAI within current initiatives, 55% aim to introduce it to new business functions, and another 55% are focused on upskilling employees to prepare for these changes.

In terms of functional integration, the survey found that IT/technology has the highest integration of GenAI, with 66% of organisations having fully integrated or in the process of executing a holistic GenAI program, followed by operations at 53% and marketing and sales at 48%. The top purposes for GenAI utilisation include IT query support and assistance (45%), demand forecasting (39%), and personalised marketing messages (41%).

When it comes to the workforce, the survey found just 16% are highly equipped and capable across all areas necessary for GenAI utilisation, while 78% are moderately equipped. Over two-thirds (69%) are currently training their current workforce in GenAI, and 61% are actively hiring new talent to support their GenAI initiatives.

A human-first approach to AI transformation requires personalised upskilling and reskilling for jobs and roles across the enterprise. Empowering workers with AI collaboration in their everyday tasks unlocks the potential for the new workforce and org models that deliver the long-term benefits to the enterprise. It has become increasingly evident that GenAI is freeing employees from common tasks and activities that allow workers to focus on uniquely human skills such as critical thinking, problem solving and decision making, which is redefining the jobs and career pathways of the future.

Leaders also report that their employees are making productive use of the time saved by using GenAI, with strategic planning and decision making (43%), creative and innovative projects (40%), and learning and skill development (40%) as the top-cited applications of their new-found time.

When it comes to executive leadership of their organisation’s GenAI strategies, 8% say they have already assigned a dedicated chief AI officer position to lead their efforts, while 37% plan to do so.

The survey also examined whether organisations prefer to build or buy GenAI solutions and found that 50% of organisations are buying or leasing GenAI from vendors, while 29% are using a mix of building, buying, and partnering. Only 12% of organisations are developing GenAI solutions in-house.

The main reasons for opting to develop GenAI solutions internally include cost savings and a strong return on investment (63%), the ability to customise solutions to meet specific needs (52%), securing intellectual property rights (41%), and the ability to quickly prototype and iterate (41%).

Additionally, respondents have raised concerns about working with external partners for GenAI solutions with the primary worries of data privacy and security risks (76%), reliance on a partner's expertise and resources (58%), and the potential for non-compliance with regulations (52%).

As the use of GenAI scales, leaders also remain focused on risk management and mitigation, with more than half (56%) citing risk as a highly significant focus. Survey participants indicate that cybersecurity (79%) and data quality (66%) are the key areas of focus for current GenAI risk mitigation efforts. They also say that “deploying ethical AI frameworks” and “implementing stringent data privacy measures” are essential in managing GenAI risks.

Organisations continue to monitor the evolving AI regulatory environment, with 63% anticipating more stringent data privacy requirements in the future. As a result, 60% are actively reviewing and updating their data handling practices. More than half (54%) expect AI regulation to increase costs for their organisation.

With the growing adoption of GenAI, prioritising risk management and governance, with a focus on cybersecurity and data privacy, is crucial for innovation and retaining stakeholder trust. Also ensuring the safe deployment of GenAI and weaving it into governance structures will allow organisations to guarantee their GenAI initiatives are efficient and effective which adheres to ethical and regulatory guidelines.