The majority of surveyed CEOs are reporting seeing impact from implementing generative artificial intelligence (GenAI) across their operations.
However, profitability improvements is somewhat below expectations expressed a year ago.
This is according to PwC’s 28th Annual Global CEO Survey, which points out that almost 60% of surveyed CEOs around the world expect global economic growth to increase over the next 12 months,as they plan headcount increases and continued AI rollouts.
The report, which surveyed 4 701 CEOs across 109 countries and territories, including SA, also finds that 42% expect to increase their organisation’s headcount by 5% or more in the next 12 months – more than double the proportion who expect headcount decreases (17%), and up from 39% last year.
More than half (56%) report seeing gains in their employees’ time over the last 12 months,as a result of deploying GenA initiatives.
However, performance is slightly below expectations expressed last year. In 2024, 46% said they expected to see profitability improvements. A year later, when we asked if they had seen those gains, only 34% said they had.
According to the survey, trust in AI remains a hurdle to more widespread adoption. Only a third of CEOs said they have a high degree of trust in embedding the technology into key processes in their company.
Despite this, optimism about GenAI’s impacts on profitability is slightly up on last year – with 49% expecting an increase in the next 12 months.
Roughly half (47%) expect to integrate AI (including GenAI) into their technology platforms over the next three years, 41% plan to integrate it into core business processes and 30% have plans for new products and service development.
Matt Wood, PwC Global and US commercial technology and innovation officer, says: “This year’s survey shows a more mature view of GenAI in the enterprise. CEOs are convinced it has the power to unlock new opportunities – in fact they are more optimistic than last year.
“At the same time, they are more aware of the challenges they need to navigate to realise that value. They see the importance of building trust into the way their AI systems are designed, and for now are prioritising integration into core business processes. It is important that they also see the potential GenAI has to generate growth through new products and services and create value in new ways.”
According to key findings of a previously conduced study, PwC’s Voice of the Consumer Survey 2024, although GenAI and AI adoption is rising among South Africans, concerns remain about its future developments.
Eighty percent of surveyed local consumers expressed concerns about GenAI’s future developments, relating to data security and the ethical use of AI, while 89% demanded assurances their personal information won’t be shared, it said.
Reinventing business models
Consistent with the last two years, four in ten (42%) CEOs believe their company will not be viable beyond the next decade if it continues on its current path. Among those that do not expect their company to last without significant change, 42% cite shifts in the regulatory environment as having the biggest influence on their economic viability.
But CEOs are taking action – across all sectors, almost two-thirds (63%) have taken at least one significant action to change how their company creates, delivers, and captures value in the last five years, with CEOs that have taken more reinvention actions in the last five years reporting higher profit margins in the last 12 months.
As companies look to reinvent their business models, almost four in ten (38%) say they have begun competing in at least one new sector in the last five years – with about one-third (34%) noting this has represented over 20% of company revenue over this period.
However, the pace of reinvention is slow and a large majority of companies lack agility. When it comes to moving budget and people between projects and business units, around half of CEOs told us that they reallocate 10% or less of financial and human resources from year to year. More than two-thirds reallocate less than 20%. On average, only 7% of revenue over the last five years has come from distinct new businesses.
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