Fueled by the pandemic, the adoption of artificial intelligence (AI) technology is on the rise, with more than 72% of global enterprises having embarked on their AI journey, according to Everest Group. Global spending on AI services is expected to accelerate 32%, from US$25 billion in 2019 to US$95 billion by 2024.

While the transition from AI Proof of Concepts (POCs) to production was already under way, the pandemic further accelerated this shift. Prior to the pandemic, enterprise application of AI was focused on improving the efficiency and effectiveness of enterprise operations; however, during the pandemic, there has been a visible shift towards leveraging AI to improve stakeholder experience. A new set of use cases, such as touchless AI operations, social distancing solutions, and behavior drift analysis have further increased enterprise spend on AI.

However, as enterprises aim to scale the technology, they are presented with numerous challenges. A burgeoning skills gap, the lack of proven return on investment, concerns around privacy and regulations, and the black-box nature of the technology act as journey impediments. Among all, talent continues to remain the key challenge for firms.

To overcome the expanding talent gap, Everest Group recommends that enterprises invest in democratizing AI, ensuring that the technology is accessible to all within the organization. Investments in data and AI literacy, self-service no-code and low-code tools, and automation-enabled machine learning will be key to success. This democratization effort also will require contextualization, change management and governance to ensure responsible and successful use of AI as access expands within the enterprise.

These findings and more are shared in Everest Group’s recently published report, “Artificial Intelligence (AI) Services – State of the Market Report 2021: Scale the AI Summit Through Democratization.” This report assesses AI adoption levels among enterprises, outlining their spend by geography, industry and organization function. The report also highlights the various challenges enterprises face in their AI adoption journeys.

***Download a complimentary abstract of the report.***

Key findings:

  • Banking, Financial Services and Insurance (BFSI); retail and consumer packaged goods (CPG); and healthcare and life sciences lead AI adoption, followed by manufacturing.
  • North American enterprises contribute nearly 51% of the revenue for AI services, followed by European firms. Asia Pacific (APAC) enterprise spend on AI has been increasing in recent years, led largely by Chinese and Japanese firms, owing to significant government push for adoption.
  • Enterprise AI spend is highest amongst customer service as well as sales and marketing front-office functions, followed by human resources and finance and accounting in the back office.

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