UK organizations are failing to move past basic AI use-cases

AI adoption continues to gather pace across the UK, but many organizations are struggling to scale the technology – and it’s potentially leaving billions in economic gains on the table.

That’s according to new research from Amazon Web Services (AWS), which found the estimated productivity gains of broader AI adoption could unlock £35 billion in economic growth by 2030.

The appetite for AI tools across the country has grown over the last year, AWS found, with nearly two-thirds (64%) of organizations now using the technology – an increase compared to 52% last year

AWS noted that the benefits of AI are becoming clearer for enterprises, with 68% reporting marked productivity gains. Nearly three-quarters (72%) said they expect AI to increase business growth in the year ahead, while 79% said the technology is accelerating innovation.

While these are all positive takeaways from the report, Phil Le-Brun, executive in residence at AWS, warned that they mask a recurring problem with enterprise AI integration – it’s largely for basic tasks.

Most organizations are using the technology to speed up simple activities, such as summarizing documents or answering queries using chatbots. More advanced AI uses, however, haven’t yet materialized.

Indeed, just 24% of adopters have reached an advanced stage, which, by AWS’ definition, means AI forms a “part of core processes and decision-making”.

Those stats mark just a one percent increase compared to the year prior, highlighting a painfully slow rate of improvement.

Speaking to ITPro at AWS Summit London, Le-Brun noted that a key factor here is a “lack of imagination in organizations” – these simple improvements appear to be boosting productivity, but it doesn’t paint the full picture.

“We have organizations today designed to be efficient for the last 150 years,” he told ITPro. “So how do we increase efficiency, which naturally turns into productivity (or not)?”

While a lack of imagination is stifling innovation, Le-Brun noted that it’s extremely difficult to “fundamentally rethink how your business operates in the first place”.

The findings by AWS align with a recent study from Accenture, which highlighted a trend of “localized” AI adoption, with broader business-wide benefits not being realized.

The consultancy noted that while workers are using the technology to automate basic tasks, enterprises are failing to redesign “systems and workflows” to accommodate the technology.

Only one-quarter of employees said that a major process in their team had been “restructured around AI”, for example.

AWS’ study specifically highlighted the importance of redesigning workflows around AI, noting that this helps accelerate decision-making and supports the development of new products and services.

Those that make the shift from basic to advanced uses, AWS noted, report average efficiency gains of 68% compared to 40% of those still stagnating in basic use-cases.

Skills a key barrier to AI growth

Progress on this front is being stunted in part by a lack of relevant internal expertise, according to AWS. Indeed, nearly half (49%) of respondents cited AI and digital skills-related shortages as their main challenge.

Concerningly, this marks an increase compared to the 46% who cited this as a key issue last year. The company noted that as AI adoption rates accelerate, the situation is becoming worse.

Just 17% of organizations said they have a “strong” AI skillset at present, and 84% expect AI-related skills to grow in importance over the next five years.

The situation has reached such an extent that organisations are now willing to pay an average 41% salary premium for top AI talent, AWS found.

High stakes for the UK economy

This inability to scale AI or shift toward more advanced uses has wide-reaching implications, AWS found. Businesses themselves risk falling behind more agile competitors, but the broader economic impact on the UK is huge.

The £35 billion figure touted by the hyperscaler represents roughly the economic output of the city of Manchester. Given the current rates of improvement, Le-Brun said, “By the end of the century, we’ll be in a good position”.

Progress compared to other nations paints the UK’s current situation in a more positive light, however. With 64% of UK organizations now using AI, and with a yearly growth rate of 23%, it stands 10% above the European average.

That’s the equivalent of a business adopting AI every 40 seconds compared to an average adoption rate of one every 60 seconds on the continent.

Similarly, positive moves by the public sector with AI adoption should also be a point of pride for the UK, Le-Brun told ITPro.

Simply put, progress may be slow, but some movement is better than none at all.

“There is a massive opportunity, [and] the UK in particular is an ideal place to capitalize on this,” he said. “We’re showing a faster rate of adoption and a more advanced use of AI than most European countries.”

“That’s something [to be] very proud of,” Le-Brun added. “We just need to go faster.”

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