European SMBs are leading the way in AI execution – here's why

European small and medium-sized businesses (SMBs) are bullish on generative AI, according to new research from SAS and IDC, and some are setting an example in how to nail adoption.

Analysis conducted by IDC on behalf of the data management firm shows SMBs across the region are executing AI deployments in a far more efficient manner to global counterparts.

In North America, for example, SMBs scored strongest in terms of planning and building, but many aren’t reaching full deployment.

This contrast suggests European organizations are making “stronger progress in operationalizing AI and embedding it into day-to-day operations”.

A key factor in European SMB successes lies in readiness, according to the report. IT leaders across the region are prioritizing areas such as governance before diving head long into adoption projects.

“Organizations treating governance as a foundation rather than an obstacle are often the ones best positioned to execute,” said John Carey, Senior Vice President of Global Channels at SAS.

“The findings suggest European SMBs are taking a more operational approach to AI adoption – focusing not just on experimentation, but on putting the right structures in place to scale AI effectively.”

Notably, Carey suggested that “stronger execution performance” among European SMBs may be due to regulatory considerations such as the EU AI Act.

Simply put, IT leaders at small businesses across the region are accelerating preparation to ensure compliance with the legislation.

It’s perhaps no surprise then that governance, risk, and compliance for AI has emerged as the top priority for SMB leaders, cited by 26%.

Progress on this front is easier said than done, however. The study noted that uncertainty is rife with regard to compliance, risk management, and security.

Nearly one-quarter (24%) identified this as their biggest execution barrier with AI adoption.

Still a long way to go

Despite positive signs for European SMBs, on a global scale the pace of AI adoption is still slow. SAS noted that many are “still struggling to move from experimentation to meaningful business impact”.

Nearly three-quarters (70%) of SMBs worldwide either remain in ‘experimental’ or ‘opportunistic’ stages of AI maturity, for example. Similarly, only 9% have fully embedded AI into daily operations or decision making.

Slow progress in AI maturity is, at least in part, due to traditional data-related problems such as silos and visibility. Nearly half (45%) of SMB leaders said their data remains “scattered across systems with no clear ownership”.

A similar number (46%) said AI tools are often still used in isolated environments across the business, preventing teams from aligning workflows.

Notably, 90% of those in experimental phases report having no formal AI strategy in place, which is impeding progress for IT leaders.

“To actually make something of their AI strategy, SMBs need to move from disconnected pilots to true alignments of their data, people, and resources,” said Daniel-Zoe Jimenez, VP of research at IDC.

“Experimenting with the technology is one thing. Deploying it strategically and sustainably is quite another.”

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