A burgeoning trend in the world of business technology is set to make a significant impact in 2025, as enterprise spending on generative AI (GenAI) is anticipated to surge by a remarkable 50%. This seismic shift, as prophesized by a recent research undertaking from Information Services Group (ISG), sheds light on the evolving priorities of companies. Notably, the focus is transitioning from mere operational efficiency to the cultivation of human expertise, capitalizing on the potential of GenAI to elevate performance and outcomes.
Insights From the ISG State of Applied Generative AI Market report
Delving into the revelations of the ISG State of Applied Generative AI Market report, slated for presentation today at the 2024 ISG Sourcing Industry Conference, crucial revelations are brought to the fore. The study outlines the prevailing trends, assorted use cases, proposed solutions, and hurdles encountered along the path of GenAI integration. Armed with data-oriented insights, the report also provides a roadmap for effectively embracing GenAI on a wide scale.
While GenAI applications span across diverse business domains, the lion’s share of funding is channeled towards enhancing customer-facing operations. Efficiency emerges as the linchpin motivating enterprises to adopt GenAI, with time-saving mechanisms and expedited task resolutions topping the agenda. Following closely are drivers of business growth, cost optimization, improved customer service, and avenues for innovation.
Current and Future Applications of GenAI
Survey results depict a landscape where 28% of organizations are leveraging GenAI for customer service chatbots, with other prominent areas of utilization including business process workflows (21%), customer service support (19%), and contact center management (15%). Steve Hall, the Chief AI Officer at ISG, underscores the evolving narrative, signaling a shift towards harnessing GenAI to amplify human intelligence. The technology’s prowess in data mining stands poised to empower functions such as compliance, market analysis, supply chain logistics, and software development in the foreseeable future.
Anticipated ROI Growth and Adoption Challenges
The study foresees a dramatic surge of 50% in enterprise investments directed towards GenAI initiatives in 2025, with a significant uptick in forecasted returns on investment. Notable predictions reveal a quantum leap in anticipated ROI across various spheres, encompassing efficiency gains, customer service enhancements, innovation drives, and cost savings. Amidst this fervor, a substantial portion of enterprises (43%) find themselves in pilot phases, underlining the experimental nature of ongoing GenAI explorations.
Despite promising outcomes from pilot programs, the scalability and consequential ROI generation of GenAI remain constrained by the prevalent ‘human in the loop’ approach. Hall elucidates that transitioning towards an autonomous GenAI operation model could unlock exponential returns and spur investments in growth-centric applications. However, risk aversion currently dominates enterprise decision-making, impeding a swifter transition to fully harness the potential of GenAI.
By diversifying GenAI applications within human-involved contexts and embracing AI-driven services for process enhancements, enterprises are laying the groundwork for a more expansive GenAI landscape. In the long term, technical advancements coupled with a nuanced understanding of associated risks will pave the way for bolder forays into high-yield GenAI use cases.
For further details on the ISG State of Applied Generative AI Market report, interested parties can access additional information on the ISG website.
About ISG
ISG (Information Services Group) III resonates as a premier global technology research and advisory entity, fostering partnerships with over 900 clients, including a substantial portion of the top 100 companies globally. With a steadfast commitment to enabling operational excellence and expedited growth trajectories, ISG specializes in an array of digital transformation services spanning AI, cloud computing, data analytics, and more. Founded in 2006 and headquartered in Stamford, Connecticut, ISG boasts a cadre of 1,600 adept professionals operating across 20 countries, renowned for their groundbreaking insights, industry influence, and unparalleled research acumen anchored in the most comprehensive marketplace data in the industry.
