More than seven out of 10 of businesses and organizations around the world are using artificial intelligence, a new study by the global management consulting firm McKinsey has found, a significant increase from the approximately 50% adoption rate observed a year ago.
In a survey of more than 1,363 respondents, 72% said their organizations had adopted some form of AI in at least one business function, and 65% said their organizations were regularly using generative AI—twice the 33% rate reported in 2023.
The impact of AI and generative AI extends across borders and industries. Last year, AI adoption was no higher than 66% in any part of the world, but this year, more than two-thirds of respondents in nearly every region report their organizations are using AI—with the largest increases in the Asia-Pacific region and China.
The study garnered responses from 1,363 participants through an online survey in early 2024, with the results released last week. McKinsey says the data set could represent a full range of regions, industries, company sizes, functional specialties, and tenures. To adjust for differences in response rates, McKinsey weighted the data by the contribution of each respondent’s nation to global gross domestic product (GDP).
Last year, McKinsey published a report stating that “Generative AI could add the equivalent of $2.6 trillion to $4.4 trillion annually” to the world economy. This is equivalent to 15 to 40 percent of the entire economic impact of artificial intelligence as a whole.
While AI, or artificial intelligence, is a broad term that encompasses various technologies designed to emulate human intelligence, generative AI is a specific subset of AI that focuses on creating new content. Traditional AI systems often analyze and interpret data, make decisions, and solve problems based on pre-existing information. But Generative AI uses deep learning techniques to generate new data that resembles the training dataset. This can include creating text, images, music, and even limited 3D worlds.
Broken down by industry, the biggest increase in AI use was found in professional services, including human resources, legal services, and management consulting, where organizations are leveraging its power for areas that require human interaction for repetitive tasks.
“The average organization using gen AI is doing so in two functions, most often in marketing and sales and in product and service development,” the study says. In sales alone, the use of generative AI has more than doubled since last year.
The use of AI has matured, McKinsey reports, with organizations now more involved in mitigating its risks—particularly in terms of hallucinations and intellectual property infringement. The top concern among respondents was tackling inaccuracy, rising from 56% to 63%. Workforce and labor displacement fell as a concern, from 34% to 27%.
Of the risk categories surveyed, respondents were least worried about environmental impact, political stability, and physical safety.
Perhaps not surprisingly, McKinsey said AI adoption is boosting company bottom lines.
“Respondents most commonly report meaningful revenue increases of more than 5% in supply chain and inventory management,” the study says.
The study also found that many organizations are not just using off-the-shelf AI solutions but are customizing them or developing their own proprietary models. This trend towards tailoring AI technologies to meet specific business needs and achieve competitive advantage is particularly prevalent in industries with high public engagement, McKinsey notes.
“Respondents in energy and materials, technology, and media and telecommunications are more likely to report significant customization or tuning of publicly available models or developing their own proprietary models to address specific business needs,” the report said.
The study also found a significant increase in the use of generative AI both at work and in personal lives compared to last year. With the explosion of popularity of tools like ChatGPT, MidJourney and Stable Diffusion, people are using generative AI for more than business, exploring entertainment, education, and even simulating social interactions.
For McKinsey, AI is more than just hype or a business trend. Generative AI is proving to be a business-changing technology.
“If 2023 was the year the world discovered generative AI, 2024 is the year organizations truly began using—and deriving business value from—this new technology,” the report concludes.
Edited by Ryan Ozawa.
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Source: https://decrypt.co/233623/global-ai-adoption-hits-72-generative-ai-use-doubles-in-2024-report
