Understanding Enterprise GenAI Adoption Barriers & Their Organizational Impact
Adopting generative artificial intelligence (GenAI) has tremendous benefits for organizations of all sizes, regardless of what they do or the sectors they serve. However, as with most new or emerging technologies, there are barriers that can slow adoption and the realization of those promised benefits. Some barriers are obvious, such as lack of in-house IT skills to handle adoption or not enough allocated budget. But some challenges are more nuanced, such as not realizing the expected return on investment of GenAI, or seeing tangible outcomes of adoption due to underlying issues and challenges in artificial intelligence. Even more critical are the significant risks around data security, intellectual property protection, regulatory compliance, and privacy concerns that can dramatically impact an organization’s willingness to fully embrace GenAI technologies without proper safeguards in place.
And that is not forgetting the concerns around the consequences of adoption of using GenAI—both sanctioned and unsanctioned, so-called BYOAI or bring your own AI—around privacy and security.
In identifying and overcoming these barriers to GenAI adoption, companies need to understand the risk of GenAI usage, and know what GenAI is being used, where it is being used, who is using it and for what reason, and what data is being used or shared; all of which could be barriers in themselves. Just consider that there are already more than 139 million organizations using GenAI and upwards of another 111 million in the process of getting started. What’s particularly alarming is that the vast majority of these organizations are proceeding with little to no understanding of how to monitor GenAI usage, the impact on existing security controls, or how to properly investigate following a security incident. This represents not just an unprecedented technology adoption wave, but potentially one of the largest collective security blind spots in recent enterprise history.
For businesses wishing to reap those benefits of GenAI, get out ahead of competitors and fuel growth strategies, understanding and overcoming the AI adoption barriers are critical. The question is how.
Putting GenAI adoption into context – the widely recognized benefits
By now, most business leaders understand the fundamental benefits of GenAI adoption. While these benefits will manifest differently across organizations, the core advantages are well-established and compelling. As you’re likely aware, these include improved efficiency and productivity through the automation of manual tasks, enhanced innovation, a more streamlined customer experience, and more informed decision making and access to insights thanks to better handling of large amounts of data. The question isn’t whether these benefits exist – it’s how to safely unlock them while managing the associated risks.
In essence, being a successful early adopter of GenAI can lead to increased competitive advantage and a positive impact on the company’s bottom line.
In the food and beverage industry, for example, GenAI is being used to increase personalization around advertising and marketing, and deepen connections with customers which is leading to increased revenue. The risk for companies who don’t use GenAI? Being left behind.
A 2024 study by McKinsey takes this further by saying early adopters are reaping the benefits when it comes to their bottom line; they can attribute more than 10% of their EBIT to the use of GenAI. Although these early adopters represent a small group within the overall sample, the figures are more than encouraging.
The state of GenAI adoption
The appetite for GenAI adoption is certainly increasing—according to the same McKinsey study with 65% of respondents stating they use it regularly in at least one area of their organization.
But, despite the number of businesses using GenAI, formal GenAI programs are still very much in the planning stages—with widespread adoption not very common. This is perhaps due to the adoption barriers faced around privacy and security concerns, or where GenAI adoption is not seen as a priority – a significant barrier identified in a recent webinar for government agencies. Further highlighting these challenges, Gartner predicts that at least 30% of generative AI (GenAI) projects will be abandoned after proof of concept by the end of 2025, due to poor data quality, inadequate risk controls, escalating costs or unclear business value.
The attendees also revealed that they had noticed both successful and unsuccessful breaches of GenAI—while serious breaches are a rarity, 16% experienced breaches that were quickly stopped, while more than 40% said they saw unsuccessful breach attempts.
Understanding concerns – GenAI challenges for business
As with the adoption of any new technology there will be questions, concerns and even objections from the business; not just decision makers, users too. For many organizations their default position is to block the use of GenAI, or they are letting risk get in the way of accelerating their efforts. Think back to the early days of cloud adoption, for example, where concerns centered on data security and in accepting the validity and security of cloud, there was a shift in organization behavior.
The same logic can be applied to the adoption of GenAI as a business tool; adding GenAI to a tech stack will likely come with its own challenges and won’t be as easy as first thought, but once objections are overcome and the risk is understood (and mitigated) specifically around areas such as privacy, security and ethical concerns, the benefits can be realized. This sentiment is backed by research conducted by Portal26 that revealed while 82% of organizations see competitive advantage as the main benefit of GenAI adoption, 85% saw concerns about privacy and security as significant GenAI adoption barriers.
In getting to the point where risks are mitigated and the benefits realized, there are questions that business leaders should be asking before GenAI adoption.
Information needed to overcome AI adoption challenges
The most important questions business leaders should be asking around GenAI adoption concern risk, i.e. can it be measured across the organization? Is the organization losing data, intellectual property or other valuable data via GenAI? Can the business uncover unsanctioned or malicious use of GenAI? How can the organization run an effective insider risk program around GenAI?
Other questions include:
- Is there an auditable record of the who, what, when and why of GenAI use?
- How are employees dealing with the use of GenAI? Is training needed?
- How effective is the organization’s GenAI acceptable usage policy? Do they even have one in place?
- What are employees using GenAI for? Is the business deriving value from it?
- If GenAI resources are limited, where should the organization allocate its spend?
Key GenAI adoption challenges
The main challenges around successful GenAI adoption can be grouped into four areas: guardrails, management, reporting and guidance.
As a first step to GenAI adoption, many organizations are putting policies in place to ensure its safe or compliant use. These include fair usage policies. However, there are still unknowns around how the organization will actually manage and monitor the use of GenAI, what types of other guardrails are needed to make sure they are getting the most from the technology, and how employees will react to these additional policies.
Following the implementation of guardrails, the policies and procedures need to be properly managed. This includes updating the policies as the landscape evolves, as well as ensuring all employees are made aware of the policies and the importance of following them. How will this all be managed?
When it comes to reporting, how will this take place? Manually or automatically? What types of data should be included in reports? How will the reports be shared with management and executive leadership? And how will the insights from the reports be used to update policies?
The final GenAI adoption barrier is around knowledge. With so many questions around the technology, its usage and overcoming GenAI adoption barriers, who is there to answer them and offer guidance? Does the organization have the skills in-house to make this happen? Especially when it comes to ensuring compliance, regulation and security.
Accelerating GenAI impact through strategic adoption
Working with a partner like Portal26 and implementing the AI TRiSM platform that has been designed specifically to overcome GenAI adoption barriers, can help organizations focus on reaping the benefits of the technology sooner in a secure, compliant and effective way. The platform includes features such as GenAI Governance and GenAI Visibility that enables organizations to monitor GenAI usage in real-time across the entire business which assists in risk mitigation, provides strategic insights and maximizes return on investment by boosting operational efficiency.
Addressing the specific barriers, the Portal26 platform provides reporting for both board and functional level, as well as audit and forensics to track and assess incidents. There is also a user education feature and GenAI policy management, all of which provide a wider framework to view, track and manage GenAI usage to ensure it is delivering the needed return on investment and delivering the promised value.
If you’d like to discuss your own GenAI adoption challenges, and how we can help, schedule a demo with us today.