Global Enterprise AI Budgets in 2023: Soaring to over $1 million

Artificial intelligence has quickly become a significant investment for most businesses. In a new report, Omdia found that there is a significant budget for AI in 2023 and that AI budgets will increase in 2024.

"42% of the businesses we surveyed have 2023 AI budgets of $1 million or more, 23% of budgets of $2 million or more, and 9% of budgets of $5 million or more," said Mark Beccue, principal analyst at Omdia," said Mark Beccue, principal analyst at Omdia. There is a logical difference – businesses with smaller revenues spend less than businesses with higher revenues, while verticals with more mature AI use cases spend more than others. ”

As interest in generative AI surges, Omdia surveyed 369 businesses in February 2023. The budget for 2023 is likely to have been set before the generative AI movement.

Growing AI spending is significant:

AI cannibalizes other priorities. AI budgets can eat into budgets that were previously dedicated to other IT and operational initiatives.

The accelerated learning curve of the AI lifecycle will test the patience of leadership. Organizations will be under increasing pressure to quickly become competent and demonstrate results.

Then there's the pressure on organizational culture. Increasing AI budgets often means that leadership expects to achieve substantial results within a defined timeframe. AI initiatives come to fruition in organizations with good innovation processes that tend to go beyond organizational silos to address better advocacy topics. Organizations with a narrow culture will struggle to achieve results.

The urgency of KPI measurement will increase. With a formal AI budget in place, organizations must develop and report on specific AI KPIs.

AI-ready organizations will accelerate. A large AI budget will reflect the importance of aligning the entire organization. Investments will be made in a more formal organizational structure to manage the people and processes that support operational AI.

It is clear that AI will reshape the number of organizational operations, and the allocation of funds for AI adoption will be one of the decisive factors in the success of the organization.