Retail and Consumer Product Executives Shift Focus to AI Integration
A new global study by the IBM Institute for Business Value highlights a significant pivot among retail and consumer product executives toward artificial intelligence (AI). The report, titled ‘Embedding AI in Your Brand’s DNA‘, reveals that spending on AI outside traditional IT operations is expected to surge by 52% in the next year. By 2025, surveyed companies plan to allocate an average of 3.32% of their revenue to AI, equating to $33.2 million annually for a $1 billion company. This investment will span customer service, supply chain operations, talent acquisition, and marketing innovation, signaling AI’s growing role as a strategic imperative.
Key Findings: Rapid Adoption and Workforce Transformation
The study underscores the rapid adoption of AI across enterprises, with 81% of executives and 96% of their teams already using AI to a moderate or significant extent. By 2025, AI usage in integrated business planning is projected to grow by 82%. Additionally, workforce transformation is a critical focus, with 31% of employees needing new AI-related skills within the next year, increasing to 45% within three years. Notably, AI-driven customer service enhancements, such as personalized responses, are expected to grow by 236% in the next 12 months, with 55% of these improvements involving human-AI collaboration.
AI Ecosystem Platforms and Governance Challenges
Investment in AI ecosystem platforms, which enable data and model exchange, is set to rise dramatically—from 52% today to 89% within three years. These platforms are seen as essential for blending AI capabilities with business and technology partners to accelerate innovation. However, the study also highlights a governance gap: while 87% of executives claim to have AI governance frameworks, fewer than 25% have fully implemented tools to manage risks like bias, transparency, and security.
A Strategic Imperative for Supply Chain Leaders
For supply chain leaders, this report underscores the urgency of integrating AI into operations. From predictive analytics in inventory management to personalized customer interactions, AI offers transformative potential. However, the governance gap is a critical concern. Leaders must prioritize robust frameworks to ensure ethical and secure AI deployment, balancing innovation with accountability. As AI adoption accelerates, those who act decisively will gain a competitive edge in an increasingly AI-driven marketplace.
