The state of AI in 2023: Generative AI’s breakout year

The state of AI in 2023: Generative AI’s breakout year

Generative AI has come a long way in recent years. What was once a topic only discussed among tech employees has now become a focus for company leaders. According to a survey, nearly one-quarter of C-suite executives are personally using generative AI tools for work. Additionally, one-quarter of respondents from companies using AI say that generative AI is already on their boards' agendas.

However, it is still early days for managing the risks associated with generative AI. Less than half of the respondents in the survey stated that their organizations are mitigating the risk of inaccuracy, which is considered the most relevant risk. This shows that there is still work to be done in ensuring the accuracy and reliability of generative AI tools.

Despite these risks, experimentation with generative AI tools is already relatively common. Respondents in the survey expect that the new capabilities of generative AI will transform their industries. In fact, seventy-nine percent of all respondents say that they have had at least some exposure to generative AI, either for work or outside of work. Furthermore, 22 percent of respondents state that they are regularly using generative AI in their own work.

The most commonly reported business functions using generative AI are marketing and sales, product and service development, and service operations such as customer care and back-office support. These are the same functions in which AI use is most common overall. This shows that generative AI is being utilized in areas where it can have the most impact on business operations and customer experience.

Expectations for the impact of generative AI are high among respondents. Three-quarters of all respondents expect generative AI to cause significant or disruptive change in the nature of their industry's competition in the next three years. Industries that rely heavily on knowledge work are likely to see more disruption and potentially reap more value from generative AI. This is due to generative AI's strengths in language-based activities, as opposed to those requiring physical labor.

However, despite the high expectations for generative AI, few companies seem fully prepared for its widespread use or the business risks these tools may bring. Respondents in the survey cite inaccuracy more frequently than both cybersecurity and regulatory compliance as a concern. This shows that organizations need to prioritize addressing the risks associated with generative AI to ensure its successful implementation.

Respondents from AI high performers are more likely to have objectives focused on creating entirely new businesses or sources of revenue through generative AI. They also cite the increase in the value of existing offerings through new AI-based features. This highlights the potential for generative AI to drive innovation and create new opportunities for businesses.

Looking ahead to the next three years, respondents predict that the adoption of AI will reshape many roles in the workforce. However, they expect more employees to be reskilled than to be separated from their jobs. Nearly four in ten respondents expect more than 20 percent of their companies' workforces to be reskilled. In contrast, only 8 percent of respondents anticipate a decrease in the size of their workforces by more than 20 percent. This shows that organizations recognize the need to adapt and reskill their workforce to leverage the benefits of generative AI.

In the specific context of HR, generative AI has the potential to accelerate the shift from credentials like college degrees to the skills that candidates can actually contribute to the workplace. By using generative AI for talent acquisition, organizations can look for keywords and capabilities rather than relying solely on credentials. This opens up opportunities for individuals with amazing experience gained through on-the-job learning but who may not have traditional degrees.

Generative AI can also be used to analyze social media conversations and identify the words and phrases associated with specific skills. This can help organizations find candidates who possess the desired skills, even if they don't have the credentials typically associated with those skills. It can level the playing field and provide opportunities for individuals who have acquired valuable skills through non-traditional paths.

However, in order to fully leverage the power of generative AI in HR, there is a need for access to comprehensive data sets. Currently, there are limitations in accessing proprietary data sets and profiles. The challenge lies in piecing together different data sources to form a comprehensive understanding of skills and capabilities. This requires the development of an ontological cloud that can describe the various skills and tasks associated with different jobs.

In conclusion, generative AI is poised to have a breakout year in 2023. Organizations are recognizing its potential and are already incorporating it into their business operations. However, there is still work to be done in managing the risks associated with generative AI and ensuring its accuracy. To fully harness the power of generative AI, organizations should focus on reskilling their workforce and leveraging its capabilities in HR processes. By shifting the focus from credentials to skills, generative AI can open up new opportunities for individuals and drive innovation in the workplace.

Actionable advice:

1. Prioritize addressing the risks associated with generative AI, especially inaccuracy. Develop robust processes and systems to ensure the accuracy and reliability of generative AI tools.
2. Invest in reskilling programs to prepare your workforce for the adoption of AI. Identify the skills that will be in demand and provide training and development opportunities for employees to acquire those skills.
3. Embrace the potential of generative AI in HR processes. Look beyond traditional credentials and focus on the skills and capabilities that candidates can bring to the workplace. Utilize generative AI to analyze social media conversations and identify keywords associated with specific skills.