News & Insights

AI adoption: Business leaders weigh in

Over the past year, the initial hype after ChatGPT burst onto the scenes has given way to a clearer reality for business leaders. At the same time, regulations are coming into force to better guide firms on their professional and ethical responsibilities.

It's therefore perhaps unsurprising that sentiment toward AI appears to have cooled slightly over the course of 2024.

Globally, 68% of business leaders still see AI as an opportunity, but this number is down from 82% a year ago. Meanwhile, the percentage of business leaders viewing AI as a potential risk has doubled to 11%, up from just 5% a year ago.

The path to AI adoption is undoubtedly challenging, with a significant skills shortage emerging as the top obstacle to overcome, along with ethical considerations.

Interestingly, "technical infrastructure challenges" were cited as a top barrier among respondents in our first survey. One year later, that barrier was replaced by "increased compliance issues."

Still, 2024 was another growth year for GenAI adoption, according to our global Attitudes to AI Adoption and Risk Survey.

Progress in the pace of adoption has been notable — with almost two-thirds reporting their business has at least started testing AI, up from just over half at the start of the year.

Respondents have likewise increased their expectations of the impact of AI on their business, their industry and their role.

The resulting shift in attitude toward AI may point to a more holistic awareness of the practicalities of implementation. Business leaders may feel they better understand both the upsides, potential downsides and risks associated with AI adoption.

According to Mark Bloom, global chief information officer at Gallagher, successful implementation requires diverse skillsets and perspectives, and an approach that keeps the humans in the loop.

"The need to carefully manage potential risks means that a successful framework for AI integration requires more than investment in technology," comments Bloom. "It necessitates a comprehensive, cross-functional approach to decisions, bringing IT, data privacy, legal, compliance, risk management and business leadership, among others, to the table to ensure AI systems are safe, ethical and compliant. For a period of time, it is also recommended that a human validate the results and outputs to avoid unintended consequences."

When it comes to investment in AI, the trend mirrors adoption rates. Globally, businesses are leaning towards AI investments, with 60% having already invested in AI over the past 12 months, with another 16% actively securing funding and 15% planning to invest in the next 2-3 years.

Assessing AI adoption journeys

From the perspective of firms' AI adoption journey to date, it's a case of "so far, so good." Of those who anticipate a significant impact on their business, the majority think it will be more positive than negative, consistent with sentiment a year earlier.

On average, over two-thirds of the senior business leaders polled rated their AI transformation journeys a success.

Respondents from industry sectors that are further along in their AI journeys — namely IT/computing, technology and financial services — are more likely to rate their efforts a success.

Meanwhile, larger organizations — those with greater resources to bring to bear in the transformation — have also reported higher AI adoption success, at 82%, up from 69% a year ago.

Businesses perceive AI as a valuable tool for increasing efficiency by automating tasks, enhancing decision-making and driving innovation. Forty-four percent of business leaders cite improved problem-solving as a top benefit, while 42% say the technology is boosting employee efficiency and productivity.

Within the organization, a disproportionate result is emerging in terms of the impact on workers, with different departments at various stages of adoption. Perhaps unsurprisingly, IT continues to lead the charge in how it's embedding the technology (58%), followed by customer services (37%) and finance (34%). Departments deemed to be lagging in their AI adoption include procurement, risk and compliance, and health and safety.

Ben Warren, managing director, head of Digital and AI Transformation, Communication Consulting at Gallagher, observes that: "Business leaders are focused on unlocking the value of new AI technology, highlighted by an increase in investment over the past 12 months. However, despite a proliferation of tools, we have found that AI adoption is largely limited to IT and sales and marketing functions, leading to gaps in AI literacy and adoption across organizations, limiting the overall ROI and increasing business risk."

Most firms are still just scratching the surface in terms of use cases. Global business leaders surveyed noted that AI is primarily being used for handling customer inquiries (36%), summarizing documents (35%) and writing emails (32%).

How AI adoption is reshaping risk management

Despite the benefits, business leaders are increasingly mindful of the risks associated with AI.

Perceived understanding of risk remains stable year over year, with 77% of respondents saying their business understands the risks connected with AI, compared 78% the prior year.

Counterintuitively perhaps, communication of the risks to the workforce has dipped to 78%, down from 84% a year ago.

"Last year, a lot of organizations carried out a few communications campaigns across their teams and organizations and then stepped away," says Warren. "But it's not a one-and-done exercise."

As AI-related risks become more apparent, business leaders tell us where their concerns lie.

AI errors, or "hallucinations" — where the system generates inaccurate results — top the list of risks, according to just over a third of respondents. Other key concerns include data protection and privacy violations (33%) and legal liabilities (31%) related to AI misuse.

"AI has immense potential to boost efficiency, automate complex operations and enhance predictive data analysis," says John Farley, managing director, Cyber Liability practice at Gallagher. "However, emerging technology almost always brings new and unforeseen risks to those who adopt it. That's why it's imperative that organizations deploy a strategy for striking the delicate balance between making sound, risk-based decisions while staying technologically competitive to enhance productivity."

To address these risks, many businesses are updating their risk management frameworks to address AI-specific challenges.

Nearly half have revamped strategies to include AI considerations, such as revising cybersecurity protocols, bolstering data privacy policies and ensuring regulatory compliance.

Unencumbered by rules and compliance, cybercriminals remain two steps ahead in their ability to leverage AI to carry out ever-more sophisticated cyber attacks. In response, 42% of respondents said they've strengthened their cybersecurity practices, and 41% are reassessing privacy and data security measures to mitigate the unique risks posed by AI.

Farley warns that businesses will be more exposed to social engineering-type attacks in 2025: "Hackers can launch really sophisticated phishing campaigns with emails that have no spelling mistakes and excellent grammar, which are very targeted to you as the victim because they pulled all your information from social media. We must get better at responding to those and then preventing those.

"Then there's deepfake technology," he continues. "That's another area where you're going to see video or voicemail impersonations. Employees need to be trained on the new ways hackers are using AI."

Prioritizing people in AI implementation

Beyond technical and professional risks, people-related risks are top of mind for businesses. More than a quarter of leaders surveyed worry about AI's impact on employee engagement and morale, and 20% cite reduced leadership trust as a risk of using AI in their business.

It's hardly unexpected, then, that when it comes to strategies used to implement AI within the business, outside the number one being identifying appropriate use cases, the remaining of the top five strategies are all focused on people and skills development.

A significant majority (85%) of respondents have introduced job protection strategies as part of their AI adoption framework.

The reasons why businesses have introduced strategies to protect employees' jobs within the business vary, but the main driver is to retain and promote creativity (38%).

The need to protect creativity was a particular driver for larger companies. For smaller firms, meanwhile, the main reason for protecting jobs is customer service and the need to maintain the human touch when interacting with clients (36%).

Thinking about the specific policies implemented, 45% have offered training to upskill employees on AI tools and a third have offered to reskill employees whose jobs have been taken by AI.

This feeds into their belief that the AI transformation is more likely to augment rather than replace roles in the business, with the need to upskill staff so they can get the most from the technology.

"There's fear amongst some employees, who are asking, 'Is AI going to take my job?' and 'Are we all going to be automated away?' The noise is making some people quite despondent about change and embracing the opportunities with AI," says Warren.

"So, how do you bring employees on that journey? You need to set clear AI governance and guardrails, drive AI literacy and ensure there's an ongoing change management program to support the transformation."

Equipped with the right tools and training, 76% of business leaders expect to see an increase in employee efficiency and productivity.

However, while still a positive trend overall, sentiment does appear to have dampened since last year, with a 10%-point decline among businesses who believe efficiency will be improved.

Many firms are also creating new jobs to bring in AI skills and expertise. A third of respondents in our Attitudes to AI Adoption and Risk Survey said their business was creating new roles — such as AI product managers, chief AI officers, data scientists and AI specialists — to target specific digital skills.

Business leaders from larger businesses are most likely to be creating new roles that feature AI, acknowledging that a strategic, skilled workforce is essential for AI adoption and long-term success. However, of those who indicated they have hired a chief AI officer as part of their AI adoption, small businesses (10-249 employees) responded at a rate equal to large businesses (1000+ employees).

Rewards, risks and the strategic road ahead for AI adoption

There's no doubt that GenAI will continue to have wide-sweeping impact on business, regardless of business size, industry or geographic reach.

The 2025 Attitudes to AI Adoption and Risk Survey identified a shift in attitude toward AI from business leaders globally — one that reflects a more experience-based view of this technology and its potential impact over prior year's optimism.

The most common use cases respondents identified — handling customer inquiries, summarizing documents and writing emails — scratch the surface of this technology's potential. But each also creates its own potential for risk, requiring a cross-functional approach to key AI adoption decisions and maintaining a human touch to validate outputs.

And while business leaders clearly identified their focus is on their people through reskilling and job protection strategies, the unforeseen risks and impact of their AI adoption journeys are yet to be fully revealed. This risk necessitates a deeper reliance among business leaders on experts who can help them navigate AI adoption within a rapid pace of change, ensuring a strategic and adaptable approach to their risk management and people strategies.

Published March 2025