New Deloitte survey on Gen AI adoption

Bonifacio Global City, Taguig, 20 February 2024 – For its first in a series of quarterly surveys on Generative AI (Gen AI) adoption, Deloitte finds that leaders in business, technology, and the public sector are under tremendous pressure to understand what is happening with the rapidly changing technology and to quickly figure out how to harness its capabilities most effectively.

For its report, Now decides next: Insights from the leading edge of generative AI adoption, professional services network Deloitte surveyed more than 2,800 director and C-suite level respondents across six industries and 16 countries about the state of Gen AI in the enterprise to help the public and private sectors track the rapid pace of Gen AI change and adoption. Results released locally by Deloitte Philippines show that nearly two-thirds (62%) of the business and tech leaders surveyed reported ‘excitement’ as a top sentiment with regard to Gen AI, while 30 percent expressed feelings of uncertainty.

More than three-quarters (79%) of respondents expect Gen AI to drive substantial organizational transformation in less than three years, suggesting that many AI-fuelled organizations are on the verge of scaling up their efforts to move from experimentation and proofs-of-concept to larger-scale deployments of Gen AI. More than four in 10 (44%) respondents believe they have “high” or “very high” expertise in Gen AI. Among this group, the 9 percent who report “very high” expertise levels (referred to as early Gen AI experts) reveal how leaders are thinking about and treating Gen AI differently: 73 percent of these early Gen AI experts say they are already integrating Gen AI into their product development and R&D, suggesting that they are beginning to use Gen AI for innovation and growth-related purposes.

These early Gen AI experts feel more trust and less uncertainty about the technology and appear to be the most prepared for the changes Gen AI will bring – but they also see greater potential for disruption. For example, compared to respondents with “some level of expertise,” early Gen AI experts are twice as likely to feel that their business or operating model is threatened by the widespread adoption of Gen AI.

Managing talent, governance, and risk are top challenges related to Gen AI adoption

Respondents report feeling generally prepared when it comes to strategy and technology infrastructure, but they have lower confidence when it comes to talent, governance, and risk, which are seen as significant barriers to AI adoption.

In fact, respondents cite ‘lack of technical talent and skills’ as the single biggest barrier to Gen AI adoption. Only 22 percent of respondents believe their organizations are “highly” or “very highly” prepared to address talent-related issues concerning Gen AI adoption. And many are not yet focused on education and reskilling – only 47 percent of organizations agree that they are sufficiently educating their employees on the capabilities, benefits, and value of Gen AI. The early Gen AI experts, however, are much more likely to focus on educating and reskilling their workforce, and to focus on recruiting and hiring technical talent to drive Gen AI initiatives. For example, 74 percent of respondents with “very high” Gen AI expertise say they are educating their workforce versus 27 percent of respondents with “some” expertise.

Similarly, governance and risk are barriers to Gen AI adoption. Only a quarter (25%) of leaders believe their organizations are “highly” or “very highly” prepared to address governance and risk issues related to Gen AI adoption. Respondents’ biggest concerns related to governance are lack of confidence in results (36%); intellectual property concerns (35%); misuse of client or customer data (34%); ability to comply with regulations (33%); and lack of explainability/transparency (31%).

Leaders worry that Gen AI will drive greater economic inequality

Although the leaders surveyed are generally excited and enthusiastic about Gen AI’s potential business benefits, they are less optimistic about its broader societal impacts. More than half of respondents expect widespread use of Gen AI to centralize power in the global economy (52%) and increase economic inequality (51%). Additionally, 49 percent of respondents believe the rise of Gen AI tools/applications will erode the overall level of trust in national and global institutions.

To help address these concerns, majority of respondents agree there is a need for more global regulation (78%) and collaboration (72%) to manage the responsible, widespread adoption of Gen AI.

In the Philippines, the government has taken an AI-specific legislation approach to mitigating new technological risks and to pushing best practices related to this fast-developing technology. Early in 2023, a bill was filed in Congress proposing the creation of a comprehensive framework for the development and regulation of AI, including the establishment of the Artificial Intelligence Development Authority (AIDA) to oversee a national AI strategy.

Besides legislation, jurisdictions in Asia Pacific have also taken to setting AI principles, guidance, and tools in an effort to regulate AI and manage its risks. In Mainland China, for example, the National New Generation AI Governance Expert Committee issued in 2021 the “Ethical Norms for New Generation AI,” which offers high-level guidance for ethical norms relating to AI governance, including that humans bear ultimate responsibility for the systems.

“While local regulators work on establishing the Philippines’ framework for AI use and development, there are already robust templates and guidelines out there that organizations can use to inform their AI governance strategies,” said Anna Pabellon, Deloitte Philippines’ Risk Advisory Leader. “What is important is that organizations maintain a beginner’s mindset when they deploy Gen AI solutions so that they are always looking to learn as this technology develops and expands its capabilities. We must also be mindful that unlike other technologies, Gen AI has the strong potential to assist with its future development. Managing the exponential improvement at exponential speed that that capability will generate cannot be handled by any one person or team. Business leaders must improve Gen AI literacy throughout their respective organizations so that everyone is primed to use AI in a safe, optimal, and ethical way."