Home / Blog / 2025 Outlook: AI is starting to impact the bottom line – I

2025 Outlook: AI is starting to impact the bottom line – I

Ai is starting to have an impact on the bottom line of several enterprises. In the graphic the result of interviews of companies indicating that a significant % of them are seeing increawed revenues from the use of AI. Image credit: The state of AI in 2020, McKinsey

On November 5th I will be presenting the outcome of discussions with several CEO/CTO/CIO that took place over the last 4 months as part of the FDC Industry Advisory Board -IAB- activity. In this blog series I will point out the main points soliciting your comments.

The broad, and increasing, availability of data coupled with advances in algorithms and processing capability is making AI, Artificial Intelligence, a ubiquitous commodity on the one hand and on the other hand an indispensable tool to dayanage the data deluge at company level.

Companies today generate huge sets of data, internally as result of digital processes and externally as result of the digitalisation of the supply and delivery chain. A few companies, they are still the exception -not the rule- are also gathering data from the end usage keeping a connection with their product or monitoring the use of their services. Most of these data, according to the discussions I had, are not used although most companies recognise their potential.
The reasons for this non/under utilisation are several, including (according to IAB discussion outcome):

  • non homogeneous data (activities in Gaia-X are aiming at addressing this issue)
  • property rights / privacy issues (missing a regulatory framework or -worse- regulatory hurdles in using data)
  • the “so what” question: what should I do with data
  • lack of a data strategy
  • automation rather than Digital Transformation: the company is generating data as fall-out of automation processes (use of computers in its internal/external processes) but has not shifted to the cyberspace culturally and in terms of biz models

The 2020/2021 pandemic has accelerated the “automation” and dematerialisation of several processes (by the way, further increasing the availability of data) but has not changed the company culture (let’s hope we can go back to normal as soon as possible!).

In spite of all these issues, the shift towards an increased interest in exploiting data by companies to increase margins (by increasing revenues and decreasing cost) has been ongoing for the last 2 years. The McKinsey Global Survey on the state of AI in 2020 clearly points out companies around the world area starting to see an impact on their bottom line from the adoption of AI.

As shown in the graphic, AI is being used in most areas of companies, from marketing and sales to Human Resources and companies are reporting increased revenues by its adoption. Notice that the graphic represents the “feeling” of industry, it is not a quantitative assessment. It matches the outcome of discussions I had within the IAB. However, feelings are important since they are impacting the strategic directions of companies. The paler color in the graphic indicates a perception of a greater than 10% increase in revenues as result of applying AI in that specific area, pale bluish colour an increase between 6-10% and darker blue an increase below 5% (but an increase nevertheless).

These figures are significant, considering than most companies are struggling for an increase of a few decimal point. Even more important the perception that AI can be an important factor to impact the bottom line: this perception means that over the coming years we will be seeing more an more focus on its introduction. The uptake / interest generated by the Gaia-X initiative (watch the clip for the latest on Gaia-X reported by its CEO) is a clear indication of the interest of companies to leverage on data.

We can expect that by 2025 the overall framework for the application of AI in industries will be solid and AI will be a fundamental component of the way of doing and generating business. More and more products will come with embedded AI, not just a pre-cabled one but a continuously learning AI, learning from the user interactions (the way the product is actually used). On a longer time frame, by decade end, we can expect the embedded AI to leverage and share intelligence with the ambient and with the cyberspace through Digital Twin.

All of this will createa  strong demand on new  skills hence on education and continuous education.

About Roberto Saracco

Roberto Saracco fell in love with technology and its implications long time ago. His background is in math and computer science. Until April 2017 he led the EIT Digital Italian Node and then was head of the Industrial Doctoral School of EIT Digital up to September 2018. Previously, up to December 2011 he was the Director of the Telecom Italia Future Centre in Venice, looking at the interplay of technology evolution, economics and society. At the turn of the century he led a World Bank-Infodev project to stimulate entrepreneurship in Latin America. He is a senior member of IEEE where he leads the New Initiative Committee and co-chairs the Digital Reality Initiative. He is a member of the IEEE in 2050 Ad Hoc Committee. He teaches a Master course on Technology Forecasting and Market impact at the University of Trento. He has published over 100 papers in journals and magazines and 14 books.