Unprecedented Generative AI Use Does Not Guarantee Quick Productivity Gains

Rhea-AI Summary

Oliver Wyman Forum released a report on generative AI adoption, finding that over 50% of employees globally use AI at work, with varying levels of productivity. The report forecasts that AI-trained employees will rise in management ranks, but senior leaders express concern about an AI productivity disconnect.

Insights

Economist

Generative AI's rapid adoption in the workplace has profound implications for the global economy. While the technology promises to revolutionize productivity, the AI productivity disconnect highlighted by the Oliver Wyman Forum suggests that the anticipated efficiency gains are not yet being realized. This could be due to a lag in the development of complementary skills among the workforce, or a misalignment between current AI capabilities and business processes.

The potential for generative AI to accelerate career progression for junior employees could disrupt traditional promotion timelines and necessitate a reevaluation of career development programs. Companies may need to invest in upskilling initiatives to harness the full potential of AI and maintain competitive advantage. In the long term, this technology could lead to a significant restructuring of the labor market, with implications for wage growth, job displacement and the nature of management roles.

Market Research Analyst

The findings from the Oliver Wyman Forum underscore the importance of generative AI as a competitive differentiator in the marketplace. Firms that effectively integrate AI into their operations could gain a significant edge over competitors. However, the lack of immediate productivity improvements indicates that businesses are still in the experimental phase of AI integration, attempting to find the best applications for the technology.

Market dynamics may shift as companies that successfully leverage AI for productivity gains could potentially lower costs and improve customer experiences, leading to increased market share. Conversely, companies that lag in AI adoption or struggle to train their workforce may find themselves at a disadvantage, potentially impacting their stock valuations and investor confidence.

Technology Adoption Expert

The comparison of generative AI's adoption rate with that of other transformative technologies such as the internet and smartphones is striking. It underscores the disruptive potential of AI, which could redefine entire industries. However, the report's indication of a disconnect between AI adoption and productivity suggests that the technology's integration is not yet optimized.

Organizations may need to rethink their technology strategies, focusing on the alignment between AI tools and business objectives. The role of change management in facilitating this integration cannot be overstated, as it is critical to ensure that employees not only have access to AI tools but also the training and support necessary to use them effectively.

Oliver Wyman Forum Finds Challenges Remain in Training Current and Future Workforces

DAVOS, Switzerland, Jan. 16, 2024 /PRNewswire/ -- Oliver Wyman, a business of Marsh McLennan (NYSE: MMC), announced today findings from a new report entitled "How Generative AI is Transforming Business and Society," released at the World Economic Forum Annual Meeting in Davos, Switzerland.

The report, from Oliver Wyman's think tank, the Oliver Wyman Forum, found that more than half of employees globally now use generative AI at work and that adoption is far higher in some countries. The Forum also found that adoption has not necessarily translated into higher levels of productivity – yet.

"The adoption rate of generative AI has been nothing short of remarkable," said John Romeo, CEO of the Oliver Wyman Forum. "ChatGPT achieved mass adoption in less than one year -- a stark contrast to the internet, which took 17 years, smartphones 21 years, and electricity which took three decades, but training is not keeping up and we are facing an AI productivity disconnect."

Forecasting business impact over the next decade, the report shows generative AI-trained junior employees will climb into management ranks faster than ever before. And senior-level leaders express the greatest levels of concern about losing their jobs to generative AI automation, according to the report.

Key workplace findings from the report are below:

1. Developing Countries Ahead: India leads 16 countries in employee adoption with 83% surveyed reporting daily or at least weekly use of generative AI. By contrast, weekly use by North American and European employees is below 50%.
   
   
2. Explosive Growth Among Pink & Blue Collars: Between June and November 2023, generative AI use exploded among white-collar knowledge workers as well as pink-collar workers. Doctors, nurses, and life-sciences employees increased weekly use by 264%. Weekly adoption among pink-collar education employees grew 144%, and blue-collar retail worker use increased by 71%.
   
   
3. Productivity Gains Are Years Away: As many as 20% of employees who report generative AI has not increased their productivity say they are bogged down by corporate guidelines and "unsatisfactory output" which adds review and editing time to projects. The full potential of generative AI's productivity gains is still six to 10 years away, according to the report.
   
   
4. Generative AI Training Gap: Lack of productivity may be linked to insufficient training. Employees at all levels seek more upskilling than employers currently provide. Among white-collar employees, 80% want more or better AI training, but only 64% currently say they receive it. This gap is wider among pink-collar employees.
   
   
5. Job Loss Concern: Across the 17 industries and job types studied, 60% of employees express increasing concern their jobs will be replaced by generative AI. Globally, 30% of all job seekers say generative AI is motivating their job search. Employees who worry about AI are 57% more likely to feel their productivity is declining and 78% more likely to believe they don't matter to their employer, according to recent data from the American Psychological Association.

Consumer findings include:

1. Bias concerns: In all 16 countries studied, most consumers are concerned generative AI is producing biased content. People are most concerned in India (92%) and least concerned in France (73%) while 83% of US respondents report being are concerned.
   
   
2. Trust is shaken: When asked if organizations using generative AI are untrustworthy, 29% said "yes," with 18% saying generative AI tools "are not trustworthy at all" or "not very trustworthy."
   
   
3. Privacy, cybersecurity and more: Privacy, cybersecurity and overreliance on generative AI are the top three concerns for over 30% of consumers, but many cited additional worries, including job loss (29%), environmental impact (15%) and mental health (14%).

Ana Kreacic, COO of the Oliver Wyman Forum and Chief Knowledge Officer of the Oliver Wyman Group commented: "Automation is no longer just a narrative of blue-collar workers. Many white-collar workers fear their roles will become displaced with generative AI, and this anxiety is having a direct impact on productivity. It's a misconception for businesses to wait a year or two and hope to hire a fully generative AI trained workforce. Companies need to reskill the employees they have now by focusing on areas with the most near-term applications."

About the report

Oliver Wyman Forum conducted the survey to enhance its understanding of generative AI, specifically in the context of the workplace, the consumer economy, and risk. The survey was conducted in June and November 2023 among a total of 25,000 respondents across 16 countries including: the United States, Canada, Mexico, Brazil, the United Kingdom, France, Italy, Germany, Spain, China (Hong Kong), India, Indonesia, Singapore, the United Arab Emirates, and Australia.

About Oliver Wyman
Oliver Wyman is a global leader in management consulting. With offices in more than 70 cities across 30 countries, Oliver Wyman combines deep industry knowledge with specialized expertise in strategy, operations, risk management, and organization transformation. The firm has more than 7,000 professionals around the world who work with clients to optimize their business, improve their operations and risk profile, and accelerate their organizational performance to seize the most attractive opportunities. Oliver Wyman is a business of Marsh McLennan [NYSE: MMC].

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SOURCE Oliver Wyman

FAQ

What is the title of the report released by Oliver Wyman Forum?

The report is entitled 'How Generative AI is Transforming Business and Society'.

Where was the report released?

The report was released at the World Economic Forum Annual Meeting in Davos, Switzerland.

What is the ticker symbol for Marsh McLennan?

The ticker symbol for Marsh McLennan is 'MMC'.

What percentage of employees globally use generative AI at work?

The report found that over 50% of employees globally use generative AI at work.

What is the concern expressed by senior-level leaders in the report?

Senior-level leaders express concern about an AI productivity disconnect in the report.