Artificial Intelligence (AI) industry is accelerating rapidly despite pandemic, driven by data partnerships and increasing budgets. In 2021, organisations are focused on understanding their data and using AI to support internal processes. AI decision-makers are moving away from the AI “silver bullet” and towards the use of AI to support internal processes, as they focus on better understanding their data and efficiency gains.
Since massive quantities of information require greater automation to find key insights, AI is the solution to this growing problem. According to The State of AI and Machine Learning released by Appen, AI is reaching broader market maturity, with budgets growing more than 50 per cent year-over-year, ranging from $500,000 to $5 million annually.
A significant finding is a shift in responsibility for AI projects from business decision-makers to technologists, motioning an increased focus on operationalising AI projects. For 39 per cent of organisations, C-level executives were responsible for AI initiatives in 2021, a sharp decrease from 71 per cent in 2020. A rising number of technologists implementing and maintaining projects is an indication that AI is maturing within organisations and being delegated into management layers in the business.
“Insights from this year’s State of AI report clearly indicate that companies are going all-in on AI,” said Appen CEO Mark Brayan. “When we first set out to understand the state of AI and machine learning seven years ago, organisations globally were eager to start AI projects but weren’t making meaningful progress. Today, in a time of transition during the pandemic, AI is considered core to survival, and we see this in the results of the survey – increased budgets, more technologists in charge, and increased reliance on external training data providers.”
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“This year’s State of AI report exemplifies how the maturing of AI projects, the desire for faster and greater ROI, and the increased reliance on third-party training data providers like Appen go hand in hand,” said Wilson Pang, CTO at Appen. “High-quality data is the foundation for success for every AI project, and no amount of tweaking of algorithms can negate the consequences of bad data. Companies that want to deliver better results faster understand that third-party training data is a must.”
The report also found that AI success requires a significant budget commitment. The data shows AI budgets of $1 million or more had a higher probability of AI project deployment than budgets under $1 million. Additionally, budget allocation correlated with achieving a return on investment (ROI) from AI deployments. Forty-eight per cent of organisations with budgets of $1 million to $3 million and 49 per cent of organisations with budgets of more than $3 million reported a deployment rate of 61 per cent to 90 per cent. The numbers were significantly lower for organisations with budgets under $1 million.
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Key takeaways from the 2021 State of AI Report
- Impact of COVID-19: Enterprises of all sizes confirmed they accelerated their AI strategy due to COVID-19 in 2020 and will continue to do so in 2021. However, organisations with an external data provider are twice as likely to significantly accelerate their AI initiatives than those that don’t.
- A shift in decision-making responsibility: In 2021, a significantly higher percentage of technologists are responsible for making decisions for AI projects and putting them into practice. C-level executives are responsible for AI initiatives for only 39 per cent of organisations, down from 71 per cent last year, with companies delegating responsibility to VPs and Directors.
- Budget increases: AI budgets of $500k to $5 million have increased by 55 per cent year-over-year, with only 26 per cent reporting budgets under $500K as companies have found that annual budgets of less than that prevent them from being perceived as a market Leader. Not surprisingly, annual AI budgets of $1 million or more leads to a higher probability of deployment than budgets under $1 million.
- Focus on the data: An overwhelming majority of organisations have partnered with external training data providers to deploy and update AI projects at scale – a reflection of the fact that data acquisition, preparation and management are the top challenges AI practitioners face. As a result, companies that use external data providers are 1.5 times more likely to say their company is ahead of others in AI deployment.
- Key disconnects remain: The report finds that business leaders and technologists don’t yet agree in areas like ethics and interpretability. Technologists have a greater concern for ethics (41 per cent versus business leaders’ 33 per cent), while business leaders are more concerned with interpretability (47 per cent versus technologists’ 38 per cent).
