A new study by Tata Consultancy Services highlights how artificial intelligence (AI) is revolutionising industries by enhancing efficiency, driving innovation and enabling data-driven decision-making. Despite these advancements, the study also reveals a notable reluctance among senior executives to fully embrace generative AI (GenAI).
A TCS report, titled TCS AI for Business Study, reveals that over eight out of ten (86%) senior business leaders have already deployed AI to enhance existing revenue streams or create new ones. This widespread adoption is driven by the need to improve operational efficiency, customer experiences and make data-driven decisions. The study indicates that around 69% of businesses are more focused on using AI to spur innovation and increase revenue than on productivity improvement and cost optimisation.
The country’s biggest IT company surveyed 1,272 CEOs and other senior executives across 12 industries and 24 countries.
Executives are generally positive about the impact of AI, with 57% reporting excitement or optimism about its potential. Among respondents, 45% expect up to half their employees will need to use generative AI capabilities in three years and another 41% think even more will do so. Most executives (65%) believe AI will augment and enhance human capabilities, enabling people to focus on higher-value activities requiring creativity and strategic thinking.
Further, the report highlights several key areas where AI is making a significant impact. In customer service, AI-powered chatbots and virtual assistants are improving response times and customer satisfaction. In supply chain management, AI algorithms are optimising logistics, reducing costs and improving delivery times. Data analytics is being transformed by AI’s ability to process vast amounts of data quickly and accurately, providing actionable insights for strategic decision-making.
One notable example from the report is a retail company that implemented AI for inventory management. The AI system predicted demand with high accuracy, reducing overstock and stockouts by 30%, significantly improving the company’s bottom line.
Challenges in AI Adoption
Despite many benefits, the TCS report outlines several challenges that businesses face in adopting AI, with only 19% saying they have “good enough” metrics for their current stage of AI deployment. One of the primary issues is the lack of skilled talent. The demand for professionals with expertise in AI and machine learning far exceeds the supply, creating a significant barrier for many companies.
Data privacy and security are also major concerns. Businesses must ensure that their AI systems comply with regulations and protect sensitive information. Additionally, integrating AI into existing systems and workflows can be complex and costly, requiring significant investment in both technology and change management.
Reluctance towards generative AI
Interestingly, the report reveals a notable reluctance among senior executives to fully embrace GenAI. While AI adoption is widespread, only 17% of senior executives expressed strong interest in integrating GenAI into their business strategies. This hesitancy is driven by several factors, including a lack of understanding of GenAI’s potential, concerns about its maturity and reliability, and the perceived risks associated with its implementation.
“GenAI is still in its early stages, and many executives are cautious about its practical applications and ROI,” explains Gopinathan. “There is a need for more education and demonstrable success stories to build confidence in GenAI.”
