- Bosses seem confused because massive AI in favor of human workers is not always a success
- AI operational costs are often higher than expected
- However, some companies are happy to adapt and reorient themselves when necessary.
Bosses are confused by the high cost of moving to AI-centric models, and many seem baffled that replacing human workers with agents won’t instantly save them huge amounts of money, new research claims.
A new report from KPMG found that nearly a third of business leaders reported some difficulties addressing the operational costs of AI in their organizations.
The news comes as several major AI vendors, including Anthropic and OpenAI, have moved some services toward usage-based billing, rather than flat-rate subscriptions, in recent months.
Make AI effective
In the report, KPMG surveyed 2,145 senior leaders across 20 countries and found that 29% were struggling to understand rising operational costs as they sought to scale AI in their businesses, and a similar proportion also highlighted a limited understanding of the costs and economics of AI as a major challenge to deploying AI agents.
“As usage-based pricing models become more common, many organizations are still developing the capabilities necessary to effectively forecast, monitor and manage AI spend,” KPMG stated.
When things go wrong, the report highlighted how leaders were often unclear about who should take responsibility, particularly in the case of hallucinations or errors by AI models.
He noted that it is important to hold human leadership accountable: “Ultimately, governance succeeds or fails through day-to-day operational practices.”
“Organizations need clear rules about when employees can intervene, who is responsible for AI-related costs, how AI results are reviewed, and what happens when systems fail. While most organizations report having at least some governance mechanisms in place, relatively few describe these practices as fully integrated,” the report says.
When costs exceeded the expected value, the report found a surprising amount of regret from its participants, with nearly half of organizations saying they had rescheduled AI deployments in that case.
“These actions do not indicate reduced trust in AI,” the report warns. “Rather, they suggest a growing willingness to evaluate where AI creates significant value and where it does not. Organizations appear increasingly focused on concentrating investment where expected returns are strongest.”
“We are seeing a clear divide between organizations with leadership responsibility at the top and those without,” added Steve Chase, KPMG Global Head of AI and Digital Innovation, KPMG International.
“These companies are seeing substantially better results across the board, such as increased trust, greater value realization, and established return on investment.”
Follow TechRadar on Google News and add us as a preferred source to receive news, reviews and opinions from our experts in your feeds.
