BENGALURU: Indian companies across sectors acknowledge the potential of artificial intelligence (AI) to drive business in the coming days, but not even one-fifth of them are ready to leverage this technology, says a new report.
According to Cisco 2024 AI Readiness Index, only 18% of firms in India are fully ready to deploy and leverage AI-powered technologies. The irony becomes starker given the fact that a year ago, 26% of businesses were all set for adopting AI. The decline shows the challenges that organisations are facing in adopting and deploying AI.
One of the major reasons holding back the Indian firms is that the returns from investing in AI are not attractive enough. AI investments broadly go into three areas -- cybersecurity (47% of companies are at full/advanced deployment), data analysis (44%), and data management (42%). The expected outcomes of these investments are improved efficiency of systems, processes, operations, and profitability; the ability to innovate and remain competitive; and growing revenue and market share for the business.
Despite increasing AI investments, many companies pointed out that returns on these investments are not meeting their expectations.
“As companies accelerate their AI journeys, it’s critical they adopt a comprehensive approach to implementation and connect the dots to link AI ambition with readiness,” said Dave West, president, APJC, Cisco. “This year’s AI Readiness Index reveals that to fully leverage the potential of AI, companies need a modern digital infrastructure capable of meeting evolving power needs and network latency requirements from growing AI workloads,” he added.
Nearly 48% of the companies report that the CEO and the leadership team are driving AI deployment, followed by the board of directors at 39%. “With the clock ticking, businesses in India are accelerating efforts and increasing investments to overcome barriers and embrace AI-driven transformation. About 39% of organisations plan to allocate more than 40% of their IT budget to AI investments in the next four to five years, a steep climb from 7% of companies who said they are allocating a similar portion of their IT budget to AI currently,” the report notes.
The report says there is a strong need to address skills and talent gaps as there is a shortage of skilled talent across various aspects of AI. “This means, companies will need to invest in their existing talent pool to meet the growing demand. At the same time, it is crucial that all stakeholders – the private and public sectors, educational institutions, and governments – work together to develop local talent so that the entire ecosystem can benefit from the immense potential that AI offers,” said Anupam Trehan, VP, People and Communities APJC, at Cisco.