Increased AI Use is Fast-Becoming a Private Company Priority

A Deloitte private survey of C-suite executives finds that increasing AI use across the organisation (43%) and investments in technology (37%) are the top two business priorities for private companies over the next twelve months.

In its report, Private Company Outlook: Governance, the firm's survey respondents suggest that emerging technologies such as AI are the most important to strengthen a company’s digital posture.

These findings come in the wake of 2023 research from Deloitte suggesting that nearly half (48%) of respondents agree that the value of their organisation has declined. With this in mind, businesses will be eager to find new ways to remain agile in a growing competitive landscape. 

The importance of AI training

Organisations around the world are swiftly moving to scale disruptive technologies like generative AI (Gen AI) across their operations. In response, business leaders are making big workforce and technology investments to harness its potential.

Earlier research from Deloitte on this found the Gen AI hype is paving the way for business strategies to scale the technology so it can drive real business value. It suggested that organisations feel the need to overcome barriers and instead capitalise on the immense potential of AI.

Now, businesses desire to reposition their strategies to prioritise digital transformation.

“Private company boards, like the organisations they oversee, have a growing list of priorities and demands on their time,” says Wolfe Tone, Vice Chair and US Deloitte Private leader.

He adds: “Private companies told us that increasing the use of AI and making strategic technology investments are the top two priorities for their businesses over the next twelve months. Even more telling are the two priorities that appeared lowest on their list: acquiring capital investment and managing liquidity. This suggests that private companies are feeling more confident in their balance sheets and ability to finance their growth through digital transformation."

Now, the firm finds that training and educating board members about AI is just as important as reskilling the workforce. Private company C-suite respondents in the survey say determining AI use within their organisation (50%), training and upskilling the workforce on the use of AI (49%) and training and education for board members (49%) on AI were high or very high priorities. 

"This infers that, while businesses recognise the importance of quickly enhancing their employees’ knowledge and use of AI, this emerging area must be broadly understood for purposes of fulfilling long term strategic objectives and enhancing overall stakeholder value," Wolfe comments. "In both cases, private companies are more focused on training from within versus going outside the organization for advanced AI expertise."

Cyber risks are also a primary concern for businesses, with reputational risk (54%) and cyber threats (51%) high on the priority list. Additionally, 62% said the board should spend more time on strategic risk.

Talent upskilling essential in a modern workplace

Gen AI holds great potential to transform businesses as it can boost productivity and improve workplace efficiency. However, whilst companies are keen to invest, they currently do not have the necessary skills to handle AI. A consequence of this is that the technology is not currently being harnessed to its full potential, which also leads to intensified costs for businesses.

Deloitte finds that talent issues (51%) most often appear on the quarterly board meeting agenda, close behind digital transformation (46%) and emerging tech and AI (44%). However, 61% of survey respondents believe their board should spend more time on hiring and retaining talent.

This contrasts to one-third of respondents who cited recruiting board members with advanced AI or emerging technology experience as a high, or very high, priority.

Additionally, less than one-third (31%) cited recruiting board members with advanced AI or emerging tech experience as a high or very high priority. It suggests that workforces believe their board needs to spend additional time on key business issues to drive operational success.

“Traditional pressures like strategic, reputational and competitive risks persist, while organisations seek more attention on areas like talent,” Wolfe says. “Expanding the experience and knowledge of board members is one step, but dialogue about board capacity and priorities can improve governance on external and enterprise risks today while preparing organisations for transformational changes in the future.”

******

Make sure you check out the latest edition of Technology Magazine and also sign up to our global conference series - Tech & AI LIVE 2024

******

Technology Magazine is a BizClik brand