The majority of global enterprises that use generative AI have reported payoffs within the first year of its implementation, despite earlier indications that return on investment (ROI) on Gen AI initiatives won't be immediate.
Google Cloud's new poll among 2,500 senior leaders of global enterprises revealed that GenAI is a "key driver of business transformation."
According to the report, 74% of enterprises using GenAI report ROI within the first year, with an additional 30 to 35% expecting ROI on Gen AI investments within the next 12 months.
Source: Google Cloud's The ROI of Gen AI
But Google Cloud's report found that 86% of respondents using Gen AI in production with revenue growth are estimating an increased overall revenue of more than six per cent.
"It's no surprise that organisations are seeing these revenue gains," said Christoph Rabenseifner, Managing Director, Technology, Data and Innovation, Deutsche Bank, in the report.
"In the long term, I expect even greater returns as the industry explores use cases that really change business models."
Another 45% of organisations that reported productivity gains have also cited Gen AI as the reason for their employee productivity at least doubling.
Source: Google Cloud's The ROI of Gen AI
In addition, 85% of organisations that saw improved user experience said the higher user engagement was because of Gen AI.
More than half of the respondents (56%) also reported an improvement to their security posture as a result of the emerging technology.
The findings come despite a previous report from Gartner that executives are getting impatient to see a ROI on Gen AI investments, as organisations struggle to justify their substantial investment in the emerging technology.
As a result, at least 30% of generative AI projects are expected to be abandoned by the end of 2025 due to the financial burden in developing and deploying them.
Aaron McEwan, Vice President of Research & Advisory at Gartner, previously urged organisations to avoid pulling back on Gen AI investments.
"There's no doubt that over the long term, this technology is going to potentially deliver on these exciting promises. The difference is that it's just going to take a little longer than maybe people first thought," he previously told HRD.
"So, my advice to HR leaders would not be to pull back on your investments, but to rather think very carefully about the best ways that this technology can be applied."
