Is Generative AI the Answer?
How are your generative artificial intelligence (AI) proofs of concepts faring? If you’re like other organizations, you’ll abandon more than 30 percent of them after 2025, according to Gartner, the Stamford, Connecticut-based research consultancy.
Why? Due to such issues as “poor data quality, inadequate risk controls, escalating costs or unclear business value,” a Gartner analyst said during the Gartner Data & Analytics Summit held last month in Sydney, Australia.
“After last year's hype, executives are impatient to see returns on generative AI investments, yet organizations are struggling to prove and realize value,” Rita Sallam, distinguished vice president analyst at Gartner, said in a press release. Investment costs add up and can become a burden due to the many proofs of concept companies deploy, she said.
A myriad of statistics, research findings and more is being generated about AI and generative AI. Here is a look at others:
• Other Gartner research found that generative AI for procurement has reached the peak of inflated expectations — the second phase of a five-phase technology hype cycle (the first is the innovation trigger) — and that its use will arrive at the last stage within two years.
The second phase means there have been early success stories — often along with many failures. At this stage, not all companies take action, Gartner researchers note.
The next stage is the trough of disillusionment, followed by the slope of enlightenment. The plateau of productivity is the fifth stage.
“Generative AI can already enhance many different workflows in procurement and 73 percent of procurement leaders at the start of the year expected to adopt the technology by the end 2024,” said Kaitlynn Sommers, senior director analyst with Gartner’s supply chain practice.
“This level of adoption, along with promising use cases, such as contract management, means gen AI will rapidly move through the hype cycle and reach the plateau of productivity at a faster rate than is typical for most emerging technologies in procurement.”
• In a recent “McKinsey Talks Talent” podcast by McKinsey & Company, partner Bryan Hancock stated that the use of generative AI in middle manager roles is still nascent.
“Right now, with generative AI, there’s a lot of belief in the promise; some use cases are beginning to make an impact,” he said. Many middle managers are in wait-and-see mode.
The technology, he noted, “can be incredibly powerful if you can give managers insight across all areas of the organization. What we need to do is have more managers thinking holistically and thinking about integration.”
• A recent McKinsey survey found that 65 percent of organizations are using generative AI. One of the benefits is its ability to serve as a creative assistant “that can spark ideas for writing projects, art concepts, technical issues, and more,” the report states. Still, human interaction is required for decision-making and turning those ideas into fruition.
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