Excerpt from Techradar Article, Published on May 16, 2024

New research reveals that companies are navigating “AI roulette” with their tech investments, as only 53% of projects yield measurable benefits. According to a report by Ardoq, the approach of many businesses resembles trial and error, with 61% of CIOs driven by a fear of missing out.

A significant 79% of CIOs consider investing in emerging technologies crucial, fearing they might lag if they don’t embrace new innovations. Among the 700 CIOs and IT leaders surveyed from large enterprises with over 2,000 employees, 82% agreed that it’s easy to enhance a product’s appeal by adding AI capabilities—termed “AI washing”—without necessarily delivering tangible business benefits.

Despite the enthusiasm for AI, two-thirds (65%) of these leaders view AI investments as high-risk, reflecting uncertainty about the return on investment (ROI). The average enterprise spends $43.4 million annually on emerging technologies, yet the absence of a robust ROI prediction system leads to significant financial wastage.

Erik Bakstad, CEO of Ardoq, emphasized the dual nature of AI investment: “In today’s fast-paced digital era, those that can adopt new technologies quickly and integrate them into their business can unlock huge rewards.” However, he cautioned that organizations must carefully navigate the risks to avoid disappointing outcomes. The study also highlighted the prevalence of failed investments, with 64% of CIOs reporting past experiences where tech investments did not meet expectations. Bakstad stressed the importance of data-driven decision-making: “By harnessing data to inform decision-making at every turn, organizations can navigate the complexities of emerging technology adoption with confidence.”

In conclusion, while the potential rewards of AI and other emerging technologies are significant, the path to successful integration is fraught with risks. Companies must balance the excitement of new capabilities with strategic planning to ensure their tech investments are truly beneficial.

 

To delve deeper into this topic, please read the full article on Techradar.