KPMG LLP AI & Digital Innovation Quarter Pulse Survey: the path to sustainable returns

NEW YORK, JULY 10, 2024 – GenAI strategies have hit a new inflection point. As we reach the midpoint of 2024, C-suite and business leaders are no longer just investing in the technology, they are aggressively scaling GenAI to unlock new revenue streams, maximize ROI and cement their competitive advantage. 

The second KPMG AI & Digital Innovation Quarterly Pulse Survey reveals the majority of leaders (80%) across the U.S. recognize GenAI as important to gaining competitive advantage and market share.

“Leaders are beginning to view GenAI investment and adoption as table stakes. Now, they’re focused on how to translate those investments into a competitive advantage,” said Steve Chase, KPMG's Vice Chair of AI & Digital Innovation. "Organizations are making a massive push for AI talent and adjusting their business strategies to capitalize on GenAI’s transformative potential.” 

As organizations seek to demonstrate tangible financial outcomes, revenue generation has emerged as the primary measure of success according to 52% of leaders, followed by improved decision making (44%) and productivity (40%). Conversely, in the first quarter of the year, over half of leaders (51%) reported productivity as their top ROI metric over the next twelve months.

Talent acquisition and C-suite leadership are driving strategies 

In the midst of rapid scaling, the emphasis on hiring tech professionals has more than doubled from 26% to 60% quarter-over-quarter. Organizations are also heavily investing in upskilling their existing workforce, with training and capability building initiatives jumping from 35% to 59%.

"Organizations recognize that people are the linchpin of their GenAI success. But it’s not just about the frontlines,” continued Chase. “Leaders are diving into GenAI themselves. This hands-on approach is seen from executive GenAI training to a rising demand for AI skills on corporate boards.”

Nearly half of CEOs (49%) are now spearheading GenAI initiatives at their organizations, up from 34% last quarter, underscoring the strategic importance of executive leadership to enable implementation objectives. What’s more, 93% of leaders have reported their participation in mandatory GenAI trainings, a spike from just 19% last quarter. In contrast, 34% of employees have so far been provided mandatory training by their organizations, although leaders have expressed a commitment to training all employees within the next year. 

As leaders play an increasingly central role in GenAI implementation across the enterprise, boards are increasingly seeking GenAI experience with 73% of leaders planning to recruit new board members to guide GenAI strategy and oversight.

Enabling trust across the enterprise

While leaders race to capture value from GenAI, maintaining trust is paramount and will ultimately influence the value an organization generates. Establishing ethical frameworks for GenAI is considered the most effective business practice to ensure ethical use, up from 44% to 70% quarter-over-quarter, followed by regular audits and monitoring (58%).

The KPMG quarterly pulse survey captures perspectives from 100 U.S.-based C-suite and business leaders representing organizations with an annual revenue of $1 billion or more. Read additional findings from this quarter’s survey below:

• GenAI’s greatest upside: 48% of leaders see the greatest value creation potential in improving product quality followed by supply chain optimization and cost reduction (47%) and productivity gains (47%). 
• GenAI provider selection: When choosing GenAI providers, leaders prioritize technology and expertise (67%), scalability and performance (65%) and use case compatibility (54%).
• Leading sectors: Leaders overwhelmingly picked technology, media & telecommunications (TMT) as the sector leading in GenAI adoption (91%), followed by financial services (47%), and healthcare (25%). 
• Usage by level: 65% of executives and 43% of middle managers are using GenAI tools regularly, compared to just 11% of C-suite leaders and 1% of entry level employees.
• GenAI’s role in the transition to sustainable energy: 81% of leaders agree the rapid adoption of GenAI will accelerate the transition to more sustainable energy.  Another 11% agree the rapid adoption of GenAI will harm the transition to more sustainable energy.
• Long-term concerns around GenAI adoption: 53% of leaders are concerned about cybersecurity, followed by data privacy (52%) and data quality (39%).

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