Friday, July 19, 2024

Accuracy worries delay Gen AI initiatives

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Less than 60 percent of manufacturers plan to increase AI spending in 2024 compared to 93 percent in 2023, according to a new survey.

The study from Lucidworks gathered input from over 2,500 leaders involved in AI technology decision-making worldwide and finds in 2023 more than 40 percent of manufacturing leaders had a positive view of AI, with 93 percent planning to increase investments.

In 2024, however, only 58 percent plan to increase their spending. 30 percent worry that they’re falling behind their competition, with only one in five successfully deployed initiatives. Despite slow deployment though manufacturers reported above-average cost benefits (48 percent).

Concerns around security, response accuracy, and costs have forced most businesses to slow down their planned initiatives and be more strategic about the balance between cost and benefit. Security worries have tripled, accuracy concerns have grown fivefold, and transparency issues have quadrupled since 2023. Manufacturers have some of the most concerns around response accuracy (44 percent) and some of the least concerns around job displacement (three percent) compared to other industries.

“While many manufacturers see the potential benefits of generative AI, challenges such as response accuracy and cost are causing them to take a more cautious approach. This is reflected in spending plans, with significantly fewer planning to increase AI investments compared to last year,” says Mike Sinoway, CEO of Lucidworks. “However, above-average reported cost benefits in 2024 could make them more bullish in the coming year. B2B companies and manufacturers have much to gain if they can balance cost and risk to improve efficiency, enhance the buyer experience, and reduce operational costs using generative AI.”

Among other findings global AI spending plans are down sharply, with only 63 percent planning increases compared to 93 percent last year. US-based organizations remain above average with 69 percent planning to increase their AI spend.

Interestingly almost eight out of 10 companies say they use commercial LLMs and 21 percent have opted for open source only.

The complete 2024 Generative AI Global Benchmark Study is available from the Lucidworks site.

Image credit: iQconcept / Shutterstock

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