A new study by IFS, a provider of cloud business software, shows that German executives want to follow the hype about artificial intelligence – but companies are not yet able to meet expectations in practice.
1,700 top decision-makers from 12 countries took part in IFS’s global study Industrial AI: the new frontier for productivity, innovation and competitiveness, including 207 from Germany. The results show that the implementation and exploitation of the huge potential of artificial intelligence continues to be hampered by a lack of technology, processes and skills. Although respondents in Germany face structural and technological challenges in implementing their AI projects, they remain optimistic. The following analysis refers to the answers of German managers.
Expectations do not correspond to reality
An overwhelming majority of respondents (91%) expect massive benefits for their company from artificial intelligence. The three most important areas in which AI solutions are expected to offer decisive added value are: product and service innovations, continuous business growth and increased employee productivity. At the same time, 88% of decision-makers in Germany say that the hype surrounding AI is now so great that they are under considerable pressure to introduce AI tools more quickly. One of the biggest fears is that AI projects can get stuck in the pilot phase if they are not properly planned, implemented and communicated.
Many companies have not prioritized the adoption of AI and do not have the infrastructure or skills to reap the expected benefits. According to IFS, a robust industrial AI strategy requires a strong combination of cloud, data, processes and expertise. For example, 86% believe that a lack of a strategic approach is a sign that the company does not have sufficient skills to successfully implement AI solutions. This sentiment is also evident elsewhere in the study: 43% of respondents believe that employees’ expertise and skills in AI are acceptable but need improvement.
German companies remain optimistic
The ongoing skills shortage means that many German companies are lagging behind in preparing for the introduction of AI solutions. The IFS study shows that over half of respondents (54%) have only requested quotes and started structured pilot projects, rather than having a clear strategy and tangible results (28%). 14% are in the research phase, where uncontrolled tests are carried out, and a further 4% do not yet have a coordinated approach. Despite these challenges, optimism prevails: 51% believe that AI could make a significant difference to their company in one to two years. Around a quarter (24%) expect that a significant development can be observed within a year.
Respondents see the greatest impact of generative AI in intelligent production and service provision in terms of effectiveness and business and operational management (23%). Around a fifth of respondents also see significant impacts on growth and decision-making (21%). In addition, the qualification and retention of employees and the innovation of new products and services are also seen as having a significant impact (20% each).
Focus on data availability
To take advantage of these benefits, companies must properly leverage their most strategic asset: their data. The right amount and quality of data are critical to the success of AI applications. More than four in five respondents (87%) recognize the importance of real-time data for successful AI projects. Despite this realization, however, only a quarter of respondents have created a database that supports both data-based business decisions and real-time reactions. In addition, only 34% of respondents have mostly structured data.
“AI is well on its way to becoming the most relevant business tool of all time,” says Christian Pedersen, Chief Product Officer at IFS, commenting on the results. “However, our study also shows that there are still fundamental misunderstandings about how to use the potential of AI in an industrial environment. It is telling that AI is expected to significantly reduce costs and increase margins – but the lack of a corresponding strategy for implementation shows that most companies are not sufficiently qualified and prepared to achieve these goals. The value of artificial intelligence lies not in a single function, but in its holistic deployment across all products and business processes. This supports customers’ decision cycles and provides the data and AI services.”
Source: www.com-magazin.de
