IBM Study: Indian CEOs Say There Is No Effective AI Without Effective Governance, But Most Don’t Have the Policies in Place Yet

7 out of 10 Indian CEOs surveyed say trusted AI is impossible without effective AI governance in organizations
In contrast, only 4 in 10 Indian CEO respondents say they have good generative AI governance in place today

Bengaluru (Karnataka) [India], June 20: A new study by the IBM (NYSE: IBM) Institute for Business Value found that surveyed Indian CEOs are facing workforce, culture and governance challenges as they act quickly to implement and scale generative AI across their organizations. The annual global study* of 3,000 CEOs from over 30 countries and 26 industries reveals a high importance placed by Indian CEOs on AI governance, with 71% of those surveyed saying trusted AI is impossible without effective AI governance in organizations. Substantiating it further, 75% Indian CEO respondents say governance for generative AI must be established as solutions are designed, rather than after they are deployed.

At the same time, the study also noted a contrastin actual adoption of AI governance policies with only 42% Indian CEO respondents saying they have good generative AI governance in place today. This maybe because people in the organization aren’t sure of exactly what they’re being asked to do. In the survey,75% of Indian CEO respondents say that inspiring their team with a common vision produces better outcomes than providing precise standards and targets. Yet 31% acknowledge that their employees don’t fully understand how strategic decisions impact them.

Sandip Patel, Managing Director, IBM India & South Asia said, “As Indian CEOs navigate AI-led transformations within their organizations, they recognize the need for AI guardrails so that they derive real business value responsibly for growth and competitive success. However, our study reveals a gap between their intention and actual implementation. This scenario highlights the complexity of implementing AI governance, hence making a strong case for partnering with trusted experts to develop and execute effective practices and policies.”

Other key study findings include:

People and skills are at the heart of successful generative AI adoption

71% of Indian CEOs surveyed say that succeeding with AI will depend more on people’s adoption than the technology itself
49% of Indian CEO respondents says they are hiring for Gen AI roles that didn’t exist last year
CEOs surveyed from India say 34% of their workforce will require retraining and reskilling over the next three years – up from just 6% globally in 2021

Indian CEOs recognize it takes a cultural shift to successfully scale AI, but face organizational collaboration and adoption challenges.

70% of Indian CEOs surveyed say their organization’s success is directly tied to the quality of collaboration between finance and technology, yet nearly half (48%) say competition among their C-Suite executives sometimes impedes collaboration.
Nearly half (48%) of those surveyed from India acknowledge that cultural change is more important to becoming a data-driven organization than overcoming technical challenges.
58% of Indian CEO respondents say they are pushing their organization to adopt generative AI more quickly than some people are comfortable with.

Customer experience and product & service innovation are top priorities, regulatory constraints might be hindering long-term progress

Indian CEOs surveyed ranked customer experience and product & service innovation as their highest priorities for the next three years
59% of respondents say they are willing to sacrifice operational efficiency for greater innovation.
However, nearly half (48%) of Indian CEOs surveyed point to regulatory constraints as their top barrier to innovation.
Today, only 32% of the Indian CEO respondents are primarily funding their generative AI investments with net new IT spend, with the remaining 68% reducing other technology spend.

To view the full global study, including actionable strategies to help organizations navigate the complexity of generative AI adoption, visit: https://www.ibm.com/thought-leadership/institute-business-value/en-us/c-suite-study/ceo

Study Methodology

The IBM Institute for Business Value, in cooperation with Oxford Economics, conducted interviews with 3,000 CEOs from over 30 countries and 26 industries from December 2023 through April 2024 as part of the 29th edition of the IBM C-Suite Study series. These conversations focused on business priorities, leadership, technology, talent, partnering, regulation, industry disruption and enterprise transformation.

The IBM Institute for Business Value, IBM’s thought leadership think tank, combines global research and performance data with expertise from industry thinkers and leading academics to deliver insights that make business leaders smarter. For more world-class thought leadership, visit: www.ibm.com/ibv.

About IBM Consulting

IBM Consulting helps accelerate business transformation for our clients through hybrid cloud and AI technologies, leveraging our open ecosystem of partners. With deep industry and business expertise spanning strategy, experience design, technology, and operations, we have become a trusted partner to the world’s most innovative and valuable companies, helping them modernize and secure their most complex systems. Our 160,000 consultants embrace an open way of working and apply our proven co-creation method, IBM Garage, to scale ideas into outcomes. As the only major global systems integrator inside a technology company, we don’t just advise – we invent and build what’s next together with our clients. Find out more at IBM.com/consulting.

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