Dive Brief:
- Enterprises are continuing to fuel AI investments in pursuit of productivity gains despite a lack of clear ROI as the technology evolves, according to an Infosys report released this week. The IT and business consulting services firm surveyed more than 1,000 senior business executives across various industries.
- Most enterprises said that AI is a critical driver of new revenue opportunities, but 72% of respondents said they’ve scaled less than a quarter of their AI pilots successfully. Two-thirds said their organization struggles to measure the ROI generated by AI to prove the positive benefits executives tout.
- “Team alignment and determining how success is defined in business terms such as speed, cost, quality and risk have a greater bearing on outcomes and are imperative to outlining a successful roadmap,” Anant Adya, EVP, head of cloud, infrastructure and security services at Infosys, said in the report.
Dive Insight:
Although demand for AI remains high, enthusiasm alone can’t sustain the funding that enterprises are devoting to the technology.
Global end-user spending on AI models and platforms will jump 63% from last year, reaching $64 billion in 2026, according to Gartner data from July. And many enterprises are running an excess of pilots — almost half of respondents of a recent Deloitte survey said they have more than 30 AI pilots in the works, knowing that several will not proceed.
Still, organizations feel pressure to deploy AI without understanding its ultimate goals. Nearly three-quarters of respondents said the rush to prove short-term ROI is inhibiting their ability to experiment with more transformative, long-term AI initiatives, according to Infosys.
This approach can lead organizations to pursue returns quickly while working with partial, inconsistent or misaligned signals, the report found. Only about half of respondents said they have a balanced KPI framework for evaluating AI’s value in their organization.
“Exponential impact is realized when AI capabilities are productized on enterprise platforms, allowing them to scale and be democratized across the organization,” Rafee Tarafdar, CTO at Infosys, said in the report. “This is key to turn hype and noise into tangible signals that can drive step change and not incremental opportunities.”
Although companies are waiting for their AI use-cases to translate into financial results, they continue to invest in AI because it’s now involved in decision-making, product development and competitive strategy in their workflows, the report said.
Organizations continue to invest in AI because they see signals that show potential in the technology, said Bali D.R., EVP and global head of AI and automation at Infosys, in the report.
But companies need clearer business cases, success metrics and consistent leadership strategies to reap the eventual financial rewards, he said.
“Companies understand that by leaning in now, they are accumulating a compounding advantage that will be very hard to replicate in two or three years,” D.R. said. “Essentially, they are building a moat to hedge against future challenges.”
