New research has revealed that Irish businesses need to invest more in AI in order to fully leverage its benefits, while most organisations expect no net job losses as a result of its introduction. The joint research conducted by PwC and the Analytics Institute benchmarks the AI readiness of Irish businesses against their US peers. It identifies the opportunities and challenges that organisations face and highlights the six AI priorities businesses cannot afford to ignore.
Speaking at the survey launch, Darren O’Neill, Partner and AI and Data Analytics Leader, PwC Ireland, commented: “It is clear that AI is less well developed in Ireland when compared to the US. Irish businesses have more work to do to fully invest in and embed AI opportunities into their operations. While recognising the potential of AI, Irish business leaders need to have the infrastructure, key talent and, most importantly, the appropriate data to successfully implement AI. The gap between the AI vision and execution remains the largest stumbling block. Organisational leaders know AI is important, but they are reluctant or unable to take actions necessary to make the transformation happen.”
Pictured are l-r: Darren O'Neill, Partner and AI & Analytics Leader, PwC Ireland; Sheelagh Carroll, Client Director, Analytics Institute and Lorcan Malone, Chief Executive, Analytics Institute.
"While recognising the potential of AI, Irish business leaders need to have the infrastructure, key talent and, most importantly, the appropriate data to successfully implement AI."
Lorcan Malone, Chief Executive, Analytics Institute, said: “AI and analytics, if successfully deployed, can extract valuable insights for better business decision making and robust data is a key enabler. But in our experience, organisations have some way to go to provide the robust, reliable and complete data that is needed. Monitoring data standards, as well as developing systems and processes that make it easier for employees to create usable, labelled data sets for future use is also important.”
Over three-quarters (76%) of Irish survey respondents recognise that businesses that fail to apply AI could quickly lose competitive advantage. A similar proportion (77%) are of the view that AI will significantly change the way they will do business in the next five years.
But the survey suggests that Irish business leaders, while seeing the opportunities of AI, need to invest more in AI. Nearly half (46%) admit that they do not understand the impact that AI will have on their businesses in the next five years. Four out of ten (39%) confirmed that they have no plans to roll out AI initiatives in the year ahead while the vast majority of their US counterparts are much more advanced having either fully rolled out AI or are in the process of doing so.
The greatest expected benefits from AI investments, according to the survey, include automating routine tasks (37%), creating better customer experiences (25%), improved decision-making (23%), achieving cost savings (22%) and gathering forward-looking intelligence (16%).
With much talk about the impact on jobs as a result of AI and automation, over half (53%) of Irish respondents said that they do not expect to make changes to overall employee headcount in the immediate future as a result of AI, although some expect to change the composition of roles and skills (US:39%). At the same time, nearly one fifth (16%) expect AI initiatives to create more employee roles than they eliminate, increasing headcount (US: 38%). Nearly a third (31%) expect roles will be eliminated, reducing headcount or are unsure (US: 23%).
When looking to implement AI, the inability to meet demand for AI skills (52%) is by far the top AI concern, but just 31% of US counterparts share the concern – suggesting AI skills in the US are more developed. Nearly half (47%) of Irish respondents reported not yet having developed a plan to adapt to workforce and skills changes brought about by AI, while only one in ten (11%) US peers have no such plans.
The survey highlights that Irish businesses may be less equipped to get a return on investment from AI. Aside from skills challenges, making the business case (27%) and getting budget approval (14%) are the greatest challenges holding back AI implementation – much greater hurdles compared to US counterparts. In our view, creating an AI centre of excellence, overseeing AI ownership, strategy and implementation, is the best way to build a credible AI foundation to harness return on investment. But few (11%) Irish respondents plan to develop such an AI centre of excellence compared to nearly a quarter (24%) for US peers. Furthermore, 26% stated that they don’t know who in the organisation is responsible for AI including co-ordination, roll-out and governance (US:4%).
New cyber threats (42%) and privacy threats (34%) are key perceived risks brought about by AI, according to the survey. But very few Irish respondents scored managing related cyber-security and fraud risk (4%) as key priorities (US:19%). Less than one in five (16%) are of the view that customer distrust as a result of AI will lead to lost business, but US peers are much more concerned (UA: 30%).
"The majority of survey respondents feel that AI will have a significant impact on how they will do business in the future but they are not ready to leverage the opportunities."
Robust data is a key AI enabler for machine learning and the detection and prediction of accurate patterns. To create data sets, the correct labelling of data needs to a priority and actioned. The data needs to be correct and consistently labelled. Less than half (45%) of Irish respondents rank data labelling, standardisation and integration as one of their top priorities where AI-data related issues are concerned.
Globally, we are seeing growing concerns over the last few years about how AI is making decisions and its provability. But despite 88% of Irish respondents agreeing that AI-based decisions need to be explainable in order to be used, nearly half (44%) have no plans to address responsible AI issues (US:5%).
With rising concerns around trust and cyber threats, over three-quarters (76%) of survey respondents are calling on the Irish Government to have a public policy for AI. Furthermore, an overwhelming majority (87%) are of the view that it is important that Ireland puts itself at the forefront of the AI revolution, investing in the skills and technology needed to successfully adopt AI into commercial business opportunities.
Lorcan Malone added: “Responsible AI means explainable AI, so that the algorithms’ decisions are transparent. Boards may be asked about risk management and the reliability of their brand when machines are making the decisions. To make AI more trustworthy, and more acceptable, it needs to be easy to explain. We recommend developing your AI with trust and transparency in mind, and an expectation that it will be regulated in the future.”
“And while AI policy is still in its infancy, many policy makers are calling for comprehensive guidelines that address ethical algorithms. We see national AI strategies emerging with a large majority of Irish respondents calling on the Irish Government to create a public policy on AI.”
AI offers opportunities for greater product innovation and tailoring of products for individuals. But few Irish respondents score product innovation (3%) as an expected investment return from AI, while US counterparts see a much great opportunity (US: 14%).
The full benefits of AI only come to life when AI is integrated with other emerging technologies such as analytics and the Internet of Things. The survey highlights that Ireland has some way to go on such integration. For example, very few (5%) Irish respondents admitted that managing the convergence of AI with other technologies is a challenge when rolling out AI initiatives (US:12%).
Darren O’Neill concluded: “The majority of survey respondents feel that AI will have a significant impact on how they will do business in the future but they are not ready to leverage the opportunities. When implementing AI, it is important to look at the issues and then the technology and ensure that the AI experience is appropriately personalised.
“Aside from rich business insights, cost efficiencies and better understanding of customer habits, AI’s power can be harnessed even more if it communicates with other emerging technologies and is used to enhance products and services for individual preferences. Companies that do this will successfully seize the benefits from AI.”
The analysis identifies six key AI priorities that Irish organisations cannot ignore:
1. Clarity: Understand AI and how it fits your business
Ensure you and your people understand AI and its benefits. It can support your business strategy, reduce costs, improve products and services and drive efficiencies at every level.
2. Strategy: Get the AI strategy right; Organise return on investment
Bring together AI, IT and core operation leaders in a structured way to manage priorities, data, strategy and resources and organise the business to measure the return on investment.
3. Data: Locate and label to teach machines
Identify the data sets you need to train AI to solve specific business problems, then prioritise capturing and labelling that data in line with enterprise-wide standards.
4. Skills: Build an AI-ready workforce with an agile mindset
Recruiting and upskilling are just two pieces of the puzzle. You also need to systematically identify how AI is changing job roles and skills; evolve upskilling, performance and compensation frameworks and develop new collaborative processes.
5. Trust: Make AI responsible in all its dimensions
Trustworthy AI requires fairness, interpretability, robustness and security, governance and system ethics. Create roles and establish metrics so all teams are working to build responsible AI.
6. Convergence: Combine AI with analytics, the IoT and more
Many technologies can benefit from AI, but advanced analytics and the Internet of Things will bring sizeable benefits.