McKinsey Global Institute sheds light on AI investments and adoption over the last five years

McKinsey Global Institute sheds light on AI investments and adoption over the last five years

New research from McKinsey Global Institute (MGI) provides insights into the changes in Artificial Intelligence (AI) deployment and investment over the past five years. One key finding: adoption, as measured by the percentage of businesses using AI, has plateaued in recent years.

The survey revealed the adoption of AI technology has more than doubled since 2017. However, the percentage of businesses utilizing it has remained between 50 and 60 percent in recent years. The firms reaping the most extensive financial rewards from AI have begun to separate themselves from their competitors through more significant investments, advanced practices for faster development and better recruitment of talented personnel. The survey revealed a need to grow diversity in AI teams. Research has demonstrated that diverse groups tend to perform best.

Organizations’ use of Artificial Intelligence (AI) capabilities has increased significantly over the years, with the average number doubling from 1.9 in 2018 to 3.8 in 2022.

“Among these capabilities, robotic process automation and computer vision have remained the most commonly deployed each year, while natural-language text understanding has advanced from the middle of the pack in 2018 to the front of the list just behind computer vision,” stated the company in the McKinsey Global Survey on AI. The online survey, conducted by MGI partners Michael Chui, Bryce Hall, Helen Mayhew and Alex Singla garnered responses from 1,492 participants representing a range of regions, industries, company sizes and tenures.

Over the past five years, the increased adoption of AI has been accompanied by increased investment. Previously, 40% of organizations utilizing AI reported investing over 5% of their digital budget. In contrast, now more than half have done so. Looking ahead, 63% anticipate that their organization’s AI investment will increase further within the next three years.

In 2021, the most reported areas of revenue effects from AI use were in marketing/ sales, product/service development and strategy/corporate finance. Similarly, the survey found the most significant cost benefits in supply chain management. Overall, around a quarter of respondents stated that their organization’s EBIT was at least 5% attributable to AI this year, which has remained consistent over the past few years. This shows that AI continues to provide significant value for businesses. In contrast, the specific areas in which companies see value from AI have changed over time.

“In 2018, manufacturing and risk were the two functions in which the largest shares of respondents reported seeing value from AI use,” stated the company in the McKinsey Global Survey on AI.

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