Saros Consulting, an independent IT consultancy with headquarters in Dublin, has announced the results of new research which reveals that Irish organisations have spent almost three-quarters of a billion Euro – €720M* – on failed AI projects to-date. The research shows that the AI race is well and truly on in Ireland, with 62% now reporting that it is important to their business, and the average organisation here burning through €770K on AI projects that delivered nothing.
The research was carried out by Censuswide on behalf of Saros Consulting and surveyed 200 IT decision-makers in large organisations in Ireland on their attitudes and experiences with AI. It sheds a light on the level of risk that large organisations in Ireland are willing to take on in their bid to get ahead, with 99% reporting that they have experienced AI project failure.
In fact, the majority of organisations (57%) admitted that they have spent more on failed AI projects than successful ones. Despite this, just 58% of organisations reported that they have an AI strategy. The primary barriers to AI implementation, according to IT leaders, are regulatory concerns (24%), budget constraints (24%) and lack of AI governance (23%).
The research also suggests that organisations in Ireland may be facing regulatory compliance issues with AI. Over half (53%) of IT decision-makers admit that their organisation has implemented AI that made decisions they couldn’t explain to customers. Furthermore, 54% were left unable to explain their AI’s decision-making to regulators and over half (53%) have discovered AI making biased or discriminatory decisions in the past 12 months.
These issues are coming as IT departments face increased organisational pressures regarding the implementation of AI, and what it can achieve. Just over one-in-seven (15%) IT decision-makers believe their organisation’s leadership team has unrealistic expectations of what AI can achieve. The pressure appears to stem from the top, as only 58% say leadership has realistic expectations of the AI models the organisation can actually implement and 63%* say IT leaders are hiding their lack of preparedness for AI due to pressure from leadership.
Ray Armstrong, co-founder and co-CEO of Saros Consulting, said: “Our research shows that AI ambitions are coming at an unnecessary cost to enterprises in Ireland. We are seeing a pattern of businesses investing significant resources in AI, without fully understanding why, and in the hope of success that often doesn’t come to fruition. While the many promises of AI are undoubtedly exciting, these will remain out of reach to organisations who do not define a strategy first.”
Justin van der Spuy, co-founder and co-CEO of Saros Consulting, said: “AI is ever-changing, thus demanding a steady flow of investment. While some enterprises can afford continuous expenditure on AI projects, they risk losing time and other benefits if those projects prove to be of no use. Businesses in Ireland must reassess how they decide which AI projects to invest in and ensure proper safeguards are in place. Failure to do so will result in wasted spend with no tangible return, or even worse, a negative one.”