Accuracy concerns delay Gen AI initiatives
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Accuracy concerns delay Gen AI initiatives

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Fewer than 60 percent of manufacturers plan to increase spending on AI in 2024, down from 93 percent in 2023, according to a new study.

Lucidworks’ study gathered feedback from more than 2,500 leaders involved in AI decision-making around the world. The results show that more than 40% of manufacturing leaders have a positive view of AI in 2023, and 93% plan to increase investment.

But only 58 percent plan to increase their spending in 2024. 30 percent fear they are falling behind the competition, and only one in five initiatives has been successfully implemented. Despite slow adoption, manufacturers reported above-average cost benefits (48 percent).

Concerns about security, accuracy, and cost have forced most companies to slow down planned initiatives and take a more strategic approach to balancing costs and benefits. Security concerns have tripled, accuracy concerns have increased fivefold, and transparency concerns have quadrupled since 2023. Manufacturers have some of the greatest concerns about accuracy (44 percent) and some of the least concerns about job replacement (three percent) compared to other industries.

“While many manufacturers see the potential benefits of generative AI, challenges such as response accuracy and cost are causing them to take a more cautious approach. This is reflected in spending plans, with significantly fewer planning to increase their AI investments compared to last year,” says Mike Sinoway, CEO of Lucidworks. “However, the above-average cost benefits reported in 2024 may make them more optimistic about the year ahead. B2B companies and manufacturers have much to gain if they can balance costs and risks to increase efficiency, improve the shopper experience, and reduce operating costs using generative AI.”

Among other findings, global AI spending plans have fallen sharply, with only 63 percent planning to increase compared to 93 percent last year. U.S.-based organizations remain above average, with 69 percent planning to increase their AI spending.

Interestingly, nearly eight in ten companies say they use commercial LLM programs, while 21 percent have opted for open-source software only.

The full 2024 Generative AI Global Benchmark Study is available on the Lucidworks website.

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