In August 2024, we look back on an eventful six months in which artificial intelligence (AI) has developed rapidly. The latest data from the Deloitte study “State of Generative AI in the Enterprise” for the second quarter of 2024 shows how the forecasts published at the start of the year manifest themselves in reality.

A look back: AI development in the first half of 2024

The survey of 150 executives in Germany shows increased trust in AI technologies: 75% of respondents stated that trust in all forms of AI has increased since the introduction of Generative AI. This figure is above the global average of 72%.

Economic potential and implementation

The PwC study from January 2024 predicted that generative AI could increase German GDP by up to 220 billion euros in the coming years. The latest data from the Deloitte study shows that the German companies surveyed are progressing in implementing generative AI. However, it is important to note that this study mainly represents larger companies and early adopters of AI technologies:

• 44% of these companies state that they are already using generative AI in IT and cyber security.
• 48% use it in the areas of marketing, sales, and customer service.

These figures are not representative of the German economy as a whole, especially not for small and medium-sized enterprises (SMEs). Rather, they reflect trends among large companies and technology-savvy firms.

Interestingly, the average implementation rate of Generative AI across all functions among the companies surveyed in Germany is 11%, which exceeds the global average of 8%.

Expectations and reality

Expectations of Generative AI in the German companies surveyed are high, but have relativized somewhat over the year:

• 53% expect productivity increases (compared to 67% in Q1)
• 35% hope for cost reductions
• 34% expect more innovation and growth

Despite the slightly dampened expectations, there are positive effects: 64% of respondents state that the introduction of Generative AI will make software and system development faster and more efficient.

Challenges during implementation

The German companies surveyed face various challenges when implementing generative AI:

• 35% cite compliance with regulatory requirements
• 31% have difficulties in developing and implementing implementation strategies
• 29% see challenges in risk management
• 25% struggle with identifying suitable use cases

On a positive note, the shortage of skilled workers as a hurdle has fallen from 41% in Q1 to 36% in Q2.

Trust and risk management

Despite the increased trust in AI technologies, only 49% of the German companies surveyed report that they can reconcile the rapid integration of AI with effective risk management. This is well below the global average of 60% and shows that German companies still have some catching up to do in this area.

Talent development and training

The German companies included in the study have increased their efforts in talent development:

• 36% of companies are investing heavily in employee retraining (14% increase compared to Q1)
• 42% are focusing on recruiting technical talent (5% increase)
• 27% of respondents now feel “highly prepared” in terms of talent management, an increase of 11 percentage points

Outlook for the second half of 2024

For the remaining months of 2024, the experts in the study expect

1. further consolidation of the AI market with a focus on practical applications.
2. increased efforts to overcome regulatory challenges.
3. increasing integration of AI into existing business processes, particularly in the areas of IT, cyber security, marketing and customer service
4. continued investment in education and training to counteract the skills shortage.

Conclusion

The development of AI at leading German companies in 2024 shows that we are in a phase of real potential.

The increased trust in AI technologies and the progress in implementation are positive indicators for the future. At the same time, it is clear that companies are developing a more realistic view of the opportunities and challenges of Generative AI.

The focus on innovation and growth rather than pure efficiency gains and the increased efforts in the area of talent development are promising trends for further development.

However, it is important to emphasize that these findings mainly reflect the experiences of large companies and early adopters. For a more comprehensive picture of AI adoption across the German economy, including SMEs, further, broader studies would be needed.

Would you like to know how you can use the latest AI trends for your company, regardless of its size? Contact us for an individual consultation. Use our contact form to arrange an appointment.