Dive Brief:

• The number of U.S. companies investing $10 million or more in artificial intelligence is expected to almost double next year, according to a survey by Big Four accounting firm Ernst & Young. 
• Thirty percent of respondents said their business is planning to invest at least $10 million in AI next year, up from a current level of 16%, according to a report on the findings, released Monday. But many of these organizations are failing to also invest in necessary infrastructure for AI, jeopardizing the technology’s potential impact, the report said.
• “AI is clearly moving out of the hype phase and firmly toward being a viable means of productivity for organizations,” Traci Gusher, EY Americas AI, data and automation leader, said in a press release. “As we move into the next phase of full-scale AI integration, leaders will need to develop a holistic strategy that completely reimagines the entire enterprise system to create an AI-centric business that best harnesses the transformative power of the technology.”

Dive Insight:

The EY report is the latest in a series of recent studies showing that business leaders are launching larger scale AI projects, while also focusing on return-on-investment metrics for the technology.

A survey unveiled last week by Big Four accounting firm KPMG found that ROI metrics for generative AI are rapidly evolving with revenue overtaking productivity as a chief priority.

“GenAI strategies have hit a new inflection point,” KPMG said in an accompanying press release. “As we reach the midpoint of 2024, C-suite and business leaders are no longer just investing in the technology, they are aggressively scaling GenAI to unlock new revenue streams, maximize ROI and cement their competitive advantage.” 

Organizations that are devoting 5% or more of their total budgets to AI are seeing higher rates of positive return on average, the EY research found.

However, the study cautioned that efforts to maximize AI’s full potential will fail unless organizations take steps such as building a scalable data infrastructure and fostering a workforce fluent in emerging technologies.

“While its ability to revolutionize the workplace is without question, AI is only as good as the underlying infrastructure, the governance framework it operates within and the talent development needed to properly use the technology,” the report said. “Without a strong foundation from which to harness the power of AI, leaders risk their investments cracking and crumbling beneath them.”

EY surveyed 500 senior business leaders across various industries in the U.S. from April 29 through May 6.