Cisco has released its second annual AI Readiness Index, highlighting an escalating urgency for organizations to implement artificial intelligence while exposing significant gaps in their ability to do so effectively. The report, which surveyed nearly 8,000 senior business leaders across 30 markets, reveals that only 13% of companies are fully prepared to harness AI’s potential, down from 14% last year.
Jeetu Patel, Chief Product Officer at Cisco, underscored the stakes: “Eventually there will be only two kinds of companies: those that are AI companies, and those that are irrelevant. AI is making us rethink power requirements, compute needs, high-performance connectivity inside and between data centers, data requirements, security and more.”
The Index paints a stark picture of organizations struggling to keep pace with the demands of AI while recognizing its transformative potential. Key findings include:
- Urgency: Nearly all respondents (98%) report increased pressure to deploy AI. However, 85% believe they have less than 18 months to demonstrate its impact, with 59% giving themselves only 12 months.
- Infrastructure Gaps: Just 21% of companies have the necessary GPUs to handle current and future AI workloads, while only 30% have comprehensive data security measures such as end-to-end encryption and continuous threat monitoring.
- Declining Cultural Readiness: Board-level receptiveness to AI has dropped significantly, with only 66% of boards being moderately or highly receptive, compared to 82% last year. Employee resistance to adopting AI has also increased, with 30% reporting hesitancy or outright resistance.
Although current AI implementations have fallen short of expectations for nearly half of respondents, companies remain optimistic about its long-term potential. In the next five years, businesses expect AI-related spending to comprise 30% of IT budgets, nearly double today’s levels.
However, readiness challenges persist. Only 31% of organizations report high levels of talent preparedness for AI, and 24% indicate they lack the in-house expertise required for effective deployment. Additionally, 51% cite a shortage of professionals with expertise in AI governance, ethics, and law.
Governance remains a critical hurdle, with only 31% of organizations having highly comprehensive AI policies and protocols in place. Data management also lags behind, with 80% of respondents reporting issues with pre-processing and cleaning data for AI projects, a figure virtually unchanged from last year.
Furthermore, tracking data origins remains a challenge for 64% of organizations, adding to the complexity of ensuring AI systems are accurate and reliable.
The Index evaluates companies across six key pillars—strategy, infrastructure, data, talent, governance, and culture—using 49 metrics. Respondents are categorized into four readiness levels: Pacesetters (fully prepared), Chasers (moderately prepared), Followers (limited preparedness), and Laggards (unprepared).
This year’s results reveal a noticeable decline in infrastructure readiness, compounded by a reduction in cultural willingness to embrace AI-driven transformations.
Patel emphasized the need for immediate action: “Organizations need to be preparing existing data centers and cloud strategies for changing requirements, and have a plan for how to adopt AI, with agility and resilience, as strategies evolve.”
