8.000 managers in 30 countries took part in the “AI Readiness” study and commented on the use of AI in the company. Germany is ill-prepared. IT infrastructure and cybersecurity are cited as the highest priority areas for the use of AI.
14 percent of companies worldwide are fully prepared to use AI - in Germany only 7 percent. This is shown by Cisco's first AI Readiness Index, for which over 8.000 companies were surveyed, more than 300 in Germany alone. Compared to seven other EU countries and Great Britain, Germany is at least in the top 3 of this group - but with a clear gap Sweden and Great Britain and tied on points with Poland. 36 percent of German companies belong to the top group of “pacers” or the second best category of “followers”, while in Great Britain and Sweden the figure is already 44 percent.
Companies are pushing for the use of AI
The launch of ChatGPT in November 2022 sparked an unprecedented AI boom. Since then, an international race has begun between companies to see who can be the first to profitably exploit the possibilities of AI. There are now enormous differences in “AI readiness”. To do this, Cisco evaluated companies in 30 countries based on the AI requirements “under the hood” - i.e. examined their strategy, infrastructure, data storage, governance, specialist staff and corporate culture with regard to AI.
Across all countries, almost all respondents (97%) say that the urgency for using AI technologies in their company has increased in the last six months. Here, IT infrastructure and cybersecurity are listed as the highest priority areas. Too little speed would have a direct negative impact: 61% believe they only have a maximum of one year to implement an AI strategy, otherwise their business will be significantly impacted. Globally, 84% believe AI will have a significant impact on their business operations. But 81% see major challenges in using AI with their data distributed in silos.
“All companies around the world want to use AI in their business, but there is a huge gap in their ability to do so. There are some clusters of excellence in Germany, but across the board the entry threshold is too high to use AI,” says Christian Korff, member of the Cisco Germany management board and head of the Federal Commission “Artificial Intelligence and Value Creation 4.0” from the CDU Economic Council.
Germany: Top 3 in Europe – good values in strategy and talent
Globally, Germany ranks in the middle in terms of “AI readiness” – however, a specific comparison only makes sense with its European neighbors, as similar standards of self-assessments can be expected here.
In Germany, only 7% of companies belong to the group of pacemakers that are considered fully prepared for AI. Worldwide it is 14%, across Europe and the UK it is 8%. In Sweden, on the other hand, 22% of companies are considered pacesetters in AI readiness. If you combine the first two categories (“pacemaker” and “chaser”), Great Britain and Sweden share first place overall in Europe with 44% each. Germany and Poland share third place with 3%. This is followed by Italy (36%), France and Spain (34% each), then Switzerland (31%) and the Netherlands (24%).
German companies are not leaders in any category – neither globally nor in Europe. German companies achieved the best results in the area of strategy. Here, 69% of them belong to the two advanced categories of pacesetters and pursuers; globally the figure is 73%. In Europe, Germany is also in the middle: while in Sweden 86% of companies belong to these two categories, in Italy it is 73%, Great Britain and Switzerland 71%, Spain 66%, Poland 64%, the Netherlands 48% and France 30%. .
Companies want to increase their productivity with AI
German companies are aware that they need a clear strategy to use AI effectively. 95% of companies in this country already have these or are working on them. However, the existence of a strategy says nothing about its quality. When introducing AI, companies in this country primarily focus on increasing productivity and efficiency (58%), followed by an improved customer experience (53%). The development of new sources of income, on the other hand, ranks last (28%). The use of AI for the workforce is currently similarly prioritized (29%), although applications such as video conferences in particular benefit significantly from artificial intelligence.
German companies do comparatively well in an international comparison when it comes to the AI expertise of their employees (talent category: 47%). In Europe, only Sweden is ahead of Germany with 63%. This is followed by the UK (45%), Italy (44%), Switzerland (43%), Poland (40%), France (39%), the Netherlands and France (both 35%). On a global average, however, 53% of companies belong to the two advanced categories.
Germany: Poor infrastructure and data
German companies in the areas of infrastructure and data are less well positioned for their “AI readiness”. When it comes to infrastructure, only 34% of German companies belong to the two advanced categories; globally the average is 47%. The situation is similar in the data area: only 31% of companies in this country are in these categories, compared to 43% worldwide. In both areas, Great Britain and Sweden are clearly ahead of Germany, Italy and Poland at a similar level, with the Netherlands, France, Spain and Switzerland well behind.
“The infrastructure used determines a company's AI capabilities to a large extent, but in Germany it is often not yet ready for a highly scaled use of artificial intelligence,” adds Christian Korff. “Two thirds of German companies say that their infrastructure is only scalable to a limited extent. They are also not fully prepared for the significantly increasing power consumption due to AI (60%) and increasing cybersecurity threats (35%).” After all, almost a third (29%) perceive threats to their cybersecurity in connection with AI and machine learning gives them a high priority.
In the remaining categories “Governance” and “Culture” the picture for German companies is mixed. There are hardly any differences in corporate culture between European countries. Companies from Germany (42%), Sweden, Great Britain, Italy, Switzerland and Poland (41-45%) are close together. In the governance category, Germany ranks third with 35%, behind Great Britain (40%) and Sweden (37%) - and well behind the global average of 44%.
Other global results:
Strategy: 85% have or are working on metrics to measure the impact of using AI solutions. Two thirds (75%) of companies have already partially or fully implemented AI-powered solutions for customer interaction (e.g. chatbots or video conferencing solutions).
Infrastructure: Networks are not currently ready for AI workloads. 95% of organizations believe AI will increase the workload on their infrastructure, but only 17% have the flexible networks in place to handle it. 23% cannot handle new AI processes with their current IT infrastructure due to limited or no scalability. To meet increased performance and computing demands, more than three-quarters (76%) of companies require additional graphics processing units (GPUs) in the data center.
Data: Although data forms the basis for all AI activities, this area has the most laggards worldwide (17%). In 82% of companies, data is fragmented or stored in silos.
Talents: 98% of companies are of the opinion that there is an urgent need to invest in the further training of existing employees. In almost half of the companies (47%), their level of knowledge about AI is at a moderate level at most.
Governance: AI policy adoption is slowly gaining momentum. 76% of companies do not yet have comprehensive AI governance.
Corporate culture: This area has the lowest number of pacemakers (9%). Only 26% of companies have change management plans to fully adopt AI.
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