AI Governance Emerges as a Top Priority, IBM Reports

Indian businesses are accelerating AI adoption, with 87% reporting significant progress in their 2024 AI strategy and 76% achieving positive ROI. Open-source tools are poised to play a key role, with 71% of companies planning to leverage them.

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A new IBM report points out that Indian businesses are investing in artificial intelligence (AI) for the long term, with a keen eye on maximizing returns and innovation. The study, which was carried out in association with Morning Consult and Lopez Research, finds that companies are quickly embracing AI in their operations, emphasizing responsible AI governance, and resorting to open-source solutions for scalability and efficiency.

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Key Findings: AI Investments Yield Strong ROI, But Governance Remains a Challenge

  • 87% of Indian IT decision-makers report substantial progress in executing their 2024 AI strategy.
  • 76% of companies say their AI initiatives are delivering positive ROI.
  • 93% plan to increase AI investments in 2025, focusing on IT operations (83%), software coding (56%), and data quality management (55%).
  • 71% of enterprises are eyeing open-source AI tools in 2025 to enhance efficiency and cost-effectiveness.
  • Top AI challenges: Lack of governance (53%), AI expertise (51%), and technology integration (51%).

Open-Source Adoption of AI Becoming More Prominent

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The report indicates a sharp pivot towards open-source AI solutions, with 48% of Indian firms affirming that over half of their AI deployments are based on open-source technologies. With the companies scaling up AI adoption, the need for cost-effective, flexible, and transparent solutions is fueling this trend.

Responsible AI Governance: A Top Priority for Enterprises

With AI regulation coming up as the largest stumbling block, Indian businesses understand that an organized, end-to-end solution is required to ensure transparency, fairness, and privacy in AI adoption. The demand for accountable AI emphasizes increasing relevance of regulation and ethical application of AI.

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IBM's Take on India's AI Growth

"India is embracing AI very quickly to fuel business transformation, but ethical implementation of AI is key to growth that lasts," stated Sandip Patel, IBM India & South Asia Managing Director. "IBM is committed to enabling businesses to use AI with transparency, trust, and choice."

Future Outlook: AI Investments Set to Surge

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  • 97% of businesses will either increase or maintain AI spending in 2025.
  • 62% of companies balance innovation and ROI as primary AI investment drivers.
  • 63% of businesses move from AI pilot to full production within 12 months.

With AI adoption gaining momentum, enterprises in India are strategically aligning their AI roadmaps to unlock innovation, productivity, and financial benefits. Open-source AI tools and responsible AI governance will be instrumental in shaping the future of AI-driven business transformation in the country.

For the full report, visit: IBM ROI of AI Report – December 2024.

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