Larger companies adopt AI faster than smaller firms

Companies with annual revenues over $500 million are adopting Artificial Intelligence (AI) more rapidly than smaller firms, according to a new report from McKinsey. These larger organizations are integrating Generative AI (GenAI) into various parts of their operations to create greater value. The report indicates that these companies are beginning to develop structures and processes that help them leverage GenAI effectively. They are redesigning workflows and enhancing governance to better manage risks associated with AI. Overall, the use of AI, including both GenAI and analytical AI, is gaining momentum. More than 75% of companies surveyed report using AI in at least one business function. GenAI is particularly being implemented in marketing and sales, product development, service operations, and software engineering. The findings also reveal how companies structure their AI deployment. For risk and compliance, as well as data governance, many organizations use a centralized model, often referred to as a center of excellence. However, for technology talent and AI solutions, a hybrid model is more common, with some resources managed centrally and others distributed among business units. Smaller companies, those with revenues below $500 million, tend to centralize risk and compliance aspects more often than larger firms. The report notes that many organizations are increasing efforts to manage risks associated with GenAI, including issues related to accuracy, cybersecurity, and intellectual property rights. Respondents report being more proactive about these risks than they were in early 2024.