2 State of AI Reports

Riding the Wave of Technological Change, A Tale of Expectations Versus Reality in AI Adoption

According to McKinsey's 2022 State of AI survey report, AI adoption had more than doubled over the past five years to around 50-60% of organizations. While adoption rates plateaued in recent years, businesses continued shifting their AI use cases and increasing investments alongside maturity. The report provided a useful baseline for evaluating AI's trajectory. In the recent McKinsey & Company State of AI 2023 Report, I found myself reflecting on their 2022 publication.

What has evolved since then? Have the trends from 2022 continued? And what might 2024 bring?

To delve into these questions, I collaborated with AI tools such as ChatGPT, Claude-instant-100k, Leonardo.ai, and of course, myself steering the ship as the human touchpoint.

The Rapid Rise of Generative AI

However, the late 2022 emergence of generative AI, enabling natural language generation and other previously unattainable capabilities, threw expectations into flux. As McKinsey noted, "the public availability of generative AI tools in late 2022 meant that organizations' experience with and understanding of these tools was nascent." What would its impacts be?

Surpassing Adoption Projections in Just One Year

By 2023, the picture changed dramatically. McKinsey's latest report found one-third of respondents rapidly adopting generative AI in key functions within a year. This far exceeded projections. Three-quarters also anticipated significant industry disruption from these tools in three years.

Evolving Talent Needs Overnight

Roles in the highest demand shifted as well. Where software engineers led hiring in 2022, data engineers and prompt engineers topped lists in 2023 reflective of evolving skills required to deploy generative AI at scale. Reskilling efforts doubled to support changing job roles.

Risk Governance Lagging Pace of Innovation

While generative AI issues like inaccuracy had materialized, fewer than half of adopters mitigated such risks. Gaps were exposed between how rapidly new technologies spread versus governance practices adapting.

Continued Progress and Learning Ahead

Although generative AI did not (yet) accelerate overall AI adoption as hypothesized, AI leaders sustained progress in expanding best practices. Overall, these reports highlight how revolutionary innovations can reshape expectations overnight. Agility, balanced with prudent risk management, remains key to successfully navigating technological change.

For organizations monitoring AI's development, lessons from how realities diverged from forecasts over just two years will prove invaluable as other emerging technologies continue evolving.

For those interested in exploring the original reports, with or without AI assistance, the links are provided below.

So while no direct projections, findings in the 2023 report are broadly consistent with continued trends identified in 2022 like steady adoption rates, concentrated value areas, expanding best practices among leaders, and enduring talent and risk management obstacles. The reports present a coherent multi-year narrative of AI's evolution.

Future

Write me a 2024 version, a summary report. 
Use the 2022 and 2023 data as reference points. 
Use sub hedaings for readability.        

Here is a more expanded version of the summary report:

McKinsey 2024 State of AI Report: Generative AI Continues Transforming Business

Rising Generative AI Adoption

45% of organizations are now regular users, up from 33% in 2023. Adoption growth remains concentrated in knowledge industries like banking and education where earlier reports predicted outsized impact. Use proliferating to new divisions annually within pioneering firms.

Sustained Leadership Through Best Practices

AI high performers entrench advantage by operationalizing generative model development at scale. Methods like modular data architectures and automated pipelines boost efficiency by 10% over lagging peers per expert interviews. Early results mitigate bias/errors in 80% of cases versus 60% for others.

Upskilling: Reshaping the Workforce at Pace

Demand grows for new "AI engineer" roles to maximize generative value while ensuring user trust. 70% of firms intensified reskilling according to 2024 training expenditure doubling. Interviews find roles for human-AI collaboration rising in popularity to leverage generative augmentation.

Regulation's Rising Role

Government accountability efforts intensified in response to autonomous systems risks as expected based on the 2023 report. 50% of banking/insurance respondents note heightened AI governance mandates. Standards evolve cautiously to balance oversight and market dynamism.

Maturation Within Prior Adoption Sectors

Overall AI penetration remained near 60% as generative capabilities matured for known users. However, survey data shows an uptick in experimentation across industries raising the possibility of wider disruption over the next report cycles.

Continued Transformation Ahead

Advances in self-supervised learning portend the next leap in capability per analysts. Success relies on cross-sector cooperation and balancing ethical, technical, and economic imperatives as seen in leaders. The path forward depends on learning from realities that diverge from past expectations.

What do you think?

What are your expectations on the use of AI in your company or in your profession? Let's start the conversions and Experiment now!