Only six percent of companies in Germany are optimally prepared for Artificial Intelligence (AI), according to a study by the US telecommunications company Cisco. Last year, the figure was seven percent. Additionally, 29 percent of German companies are still well-prepared for AI. In international comparison, Germany is falling behind.
In terms of the proportion of fully AI-prepared companies, Germany ranks sixth in Europe. The leader is the United Kingdom with ten percent, followed by Italy, Spain, and Switzerland, each with nine percent. When considering both optimally and well-prepared companies, Germany’s economy ranks third behind the UK and Spain.
Germany leads in AI strategies, with 84 percent of German executives fearing negative impacts on their companies if they cannot implement their AI strategies within the next 18 months. Nearly half expect noticeable consequences within a year. In strategy development, German firms are ahead, with 95 percent having a plan for dealing with AI or currently developing one. However, only 35 percent have measurement methods for the effects of AI-based solutions. This indicates Germany’s challenges lie in implementation.
The biggest need for improvement is in the introduction of AI guidelines. Currently, three-quarters of companies have no regulations for AI use, placing Germany fifth. Similarly, less than a third of German companies are adequately prepared for the data requirements associated with AI. In many firms, data is fragmented or stored in silos.
Germany lags in skilled workforce and infrastructure. Currently, only 40 percent of German companies have enough skilled personnel to meet demands, down from 47 percent last year. Although Germany ranks second in Europe for infrastructure, companies still lack the necessary equipment for AI. Only 14 percent have access to the required graphics processors. Adequate security measures for data within AI models are available in only one-fifth of German firms. These gaps are recognized by executives and are considered in investment decisions.
Spending on AI is almost evenly distributed across cybersecurity, infrastructure, and data analysis. Nearly a fifth of companies plan to allocate more than 40 percent of their budget to AI in the next five years. Companies expect improvements in efficiency, competitiveness, and customer satisfaction from these expenditures. However, previous investments in process optimization and automation have not met expectations.
The study surveyed 7,985 executives worldwide from companies with at least 500 employees across 30 different industries. The full AI Readiness Index report is available on Cisco’s website.