Australia ranks fourth in global AI optimism league, says IFS research

New research from global enterprise cloud provider IFS has placed Australia in a prominent position in terms of optimism towards an AI-driven future. The study, detailed in the IFS Global Optimism League Table, ranks Australia fourth globally, surpassing countries like Germany, the United Kingdom, and the United States.

The research suggests a strong correlation between investment in skills and overall optimism towards AI. Conversely, nations that have not heavily invested in skills are generally more cautious about technological advancement. The comprehensive study, titled "Industrial AI: The New Frontier for Productivity, Innovation and Competition," surveyed 1,700 senior decision-makers across various industries, including Manufacturing, Telecommunications, Aerospace and defence, Services, Construction and engineering, and Energy and resources.

The findings also suggest that large enterprises exhibit less optimism towards AI, attributing this to disparities in strategy, data readiness, and available skills. Among the prominent observations is a significant polarisation within enterprises, influencing their AI strategies and their confidence in realising AI benefits. Notably, businesses with annual revenues between USD $200-$500 million were the most optimistic, whereas the UK and the USA were among the least optimistic despite their substantial resources.

Christian Pedersen, Chief Product Officer at IFS, noted, "At the surface level, the lack of optimism across some respondents may suggest we are at the edge of a trough of disillusionment, particularly following the all-encompassing hype that AI enjoyed for much of the last 18 months. What we are actually witnessing is enterprises differentiating themselves with AI. Organisations that have established a strong data foundation, invested in skills, and embedded sustainability into their strategy are optimistic because they can see the benefits coming into view quickly. It is vital that leaders see AI as a strategy, not a tool."

Furthermore, the research indicated that companies showing architectural readiness are more likely to be optimistic about AI. This readiness often translates into a stronger cloud-based foundation, which propels businesses further along their AI journey and brings expected benefits closer to hand.

Pedersen stated, "We see direct evidence from our research that the market is splitting into those who have embraced AI and those who have not. There is an element of following the herd fueling the board's desire for AI programs. Without a clear direction and strategy, AI programs stall, making the end result seem further away than it needs to be."

On a global scale, Norway, Sweden, and France secured the top three spots on the Optimism League Table, with Australia ranking fourth and Japan fifth. Contrarily, the USA and the UK were positioned near the bottom of the table, highlighting a significant variation in global sentiment regarding AI's potential.

Additional insights from the survey spotlight that the most anticipated areas for AI impact are innovative products and services (31%), data accessibility (30%), and cost reductions (29%). However, only respondents from the USA (32%) and Germany (31%) predominantly believe that AI will consistently drive business growth.

The research also underscores a positive correlation between investment in skills and AI optimism. Nations that have invested significantly in skills, such as France, the UAE, Norway, Australia, Sweden, and Japan, tend to be more optimistic about AI. This optimism is closely linked with robust sustainability strategies, as countries with inadequately defined sustainability frameworks are generally less optimistic about AI.

Pedersen concluded by emphasising the importance of a strategic approach to AI, particularly within the context of Industrial AI. "The lofty expectations for AI belies a fundamental misunderstanding of how it is supposed to drive value. The real power lies in Industrial AI, where data flows through every part of your business, combining structured, interlinked datasets to uncover insights, optimise every process, and marry the digital with the physical world. That's where the true value lies. If a business doesn't have a strategy to reach that point, then they need a partner who can guide them on that journey," he said.