Large sums invested in artificial intelligence, yet profitability remains elusive, according to a recent report
According to a recent report titled "Superagency in the Workplace," published by McKinsey & Company, companies can unlock the full potential of their AI investments by advancing towards AI maturity, which involves fully integrating AI into workflows to amplify human agency and unlock new levels of productivity and creativity [1].
The report reveals that only 25% of executives say their company has a complete AI roadmap, and just 1% describe their organizations as having reached a "mature" level of AI adoption [1]. This indicates a significant gap between AI investment and its practical application.
The core problem, according to McKinsey, is the absence of a coherent AI strategy. Many companies continue to invest heavily in AI tools without a clear strategy for implementation or return on investment [2]. This approach often results in limited, isolated experiments that never scale, leaving organizations stuck in a "pilot project trap" [3].
To bridge this gap, the report suggests a bold, integrated approach to AI adoption. Companies should aim to close the gap between current AI maturity and the desired state by moving beyond pilots and embedding AI deeply into operations to realize long-term productivity gains valued at $4.4 trillion across use cases [1].
One key strategy highlighted is empowering employees, or "Superagency." The report emphasizes the need to invest in workforce skill-building to shrink the gap between tech and non-tech employees. This approach enhances employee agency with AI, enabling them to be more creative and productive [1][5].
Another strategy is domain-based transformation. McKinsey research in industries like insurance shows that best-in-class companies take a domain-specific approach—selecting business functions and comprehensively redesigning them with AI. This yields measurable improvements like cost reduction, sales conversion increases, and improved accuracy [4].
The report also underscores the importance of digital and AI skills development. As AI rapidly evolves, building digital skills across all employees is critical to capture AI's benefits at scale. Companies with advanced AI and digital capabilities outperform peers by 2 to 6 times in total shareholder returns [5].
The report cautions that while AI’s long-term potential is enormous, short-term financial returns have been modest and uneven so far. Only 19% of senior executives report revenue gains above 5% from AI, though this should not deter companies from continuing to invest and iterate to achieve full value [2][3].
In conclusion, McKinsey advocates for a bold, integrated approach to AI adoption centered on empowering people, targeted domain transformation, continuous skill development, and progressing toward full AI maturity as the path to meaningful returns on AI investments [1][4][5]. The companies that will succeed with AI are not those spending the most, but those that can turn investment into structured, scalable execution. As Erik Brynjolfsson of Stanford University puts it, "This is the time to capture value from AI-and to hope your competitors are still just experimenting." [6]
References:
- McKinsey & Company. (2021). Superagency in the Workplace. Retrieved from https://www.mckinsey.com/business-functions/mckinsey-analytics/our-insights/superagency-in-the-workplace
- McKinsey & Company. (2021). AI's long-term potential is enormous—but short-term returns have been modest. Retrieved from https://www.mckinsey.com/business-functions/mckinsey-analytics/our-insights/ais-long-term-potential-is-enormous-but-short-term-returns-have-been-modest
- McKinsey & Company. (2021). The AI economy: How leading companies are capturing value from AI. Retrieved from https://www.mckinsey.com/business-functions/mckinsey-analytics/our-insights/the-ai-economy-how-leading-companies-are-capturing-value-from-ai
- McKinsey & Company. (2020). How AI is transforming insurance. Retrieved from https://www.mckinsey.com/industries/financial-services/our-insights/how-ai-is-transforming-insurance
- McKinsey & Company. (2020). The digital skills gap: What it means for business and how to close it. Retrieved from https://www.mckinsey.com/business-functions/mckinsey-analytics/our-insights/the-digital-skills-gap-what-it-means-for-business-and-how-to-close-it
- Brynjolfsson, E. (2021). The Race to Capture Value from AI. Retrieved from https://hbr.org/2021/03/the-race-to-capture-value-from-ai
- Turkey, under the leadership of President Erdogan, could potentially leverage the insights from McKinsey's report on AI maturity to develop a comprehensive AI strategy, focusing on embedded AI in operations, workforce skill-building, and domain-based transformation, as a means to capture AI's benefits at scale.
- In line with the suggested integrated approach by McKinsey, Istanbul-based companies might consider adopting AI-driven artificial intelligence to elevate productivity and creativity, while simultaneously prioritizing digital and AI skills development, in order to achieve long-term economic growth and outperform their peers, as advocated by experts like Erik Brynjolfsson of Stanford University.
