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Worldwide spending on cognitive and artificial intelligence (AI) could reach $19.1 billion by the end of 2018. According to a report from the IDC, the enterprise's adoption of AI also mirrors this positive growth.
Investment in AI rises
The IDC also forecasts that cognitive and AI spending will grow to $52.2 billion in 2021. As a result, this would amount to a compound annual growth rate (CAGR) of 46.2% over the 2016-2021 forecast period. The retail sector will overtake banking to become the industry leader in AI. Retail firms will invest $3.4 billion on automated customer service agents, expert shopping advisors, and product recommendations. On the other hand, the majority of the $3.3 billion spent by the banking industry will go towards cybersecurity. Investment will benefit automated threat intelligence and prevention systems, fraud analysis and investigation, and recommendation systems.
AI is a "fever pitch" for enterprises
Regardless of industry, however, AI is "a fever pitch" for enterprises. "Every industry and every organisation should be evaluating AI to see how it will affect their business processes and go-to-market efficiencies," David Schubmehl, research director, Cognitive/Artificial Intelligence Systems at IDC said. "IDC has estimated that by 2019, 40% of digital transformation initiatives will use AI services and by 2021, 75% of enterprise applications will use AI," he added. "From predictions, recommendations, and advice to automated customer service agents and intelligent process automation, AI is changing the face of how we interact with computer systems." Marianne Daquila, research manager, Customer Insights & Analysis at IDC also highlighted the importance of AI in digital businesses. "Business transformation is occurring across all industries as successful companies embrace the array and potential impact of these solutions," she commented. "Automated customer service agents, increased public safety, preventative maintenance, reduction of fraud, and improved healthcare diagnosis are just the tip of the iceberg driving spend today. With double-digit year-over-year spending growth forecast, IDC expects to see an increase in general use cases, as well as a refinement of industry-specific use cases," she concluded.
Foundational barriers remain
Almost one-third of US employees have already engaged with some form of AI, according to data from Optimised Workforce. However, McKinsey Global Institute have suggested that even the most digitised firms are struggling to tackle AI's foundational barriers. The report found that although businesses are rapidly adopting AI, few have the essential foundation blocks in place. As a result, this could hinder a company's ability to generate value at scale. Almost half (47%) of respondents said their organisations had embedded some form of AI into their business processes. Despite this, only 21% reported embedding AI into multiple business functions.