COLLEGE
PARK, Md., July 16, 2024 /PRNewswire/ -- As robust as
artificial intelligence (AI) capabilities have become, it is still
very much in its infancy. With governments formulating strategies
for AI regulations, the onus is on U.S. businesses to successfully
adapt to AI policies as they emerge, says Research
Professor Kislaya Prasad at the University of Maryland's Robert H. Smith School of
Business.
As academic director of the school's Center for Global
Business, Prasad surveyed 885 U.S. business executives and
middle managers from for-profit companies. Published as "AI Use and
Regulation: A Survey of U.S. Business Executives," the findings
shed light on executive sentiments, revealing both the concerns and
support surrounding AI adoption and governance.
The report begins with five key takeaways:
- Considerable concern exists about job displacement and is
foremost in financial services and insurance and
telecommunications.
- Strong support is evident for AI regulation, including mandates
for transparency about AI use, explaining autonomous decisions and
undergoing third-party auditing for bias in algorithms.
- Strong support exists for restrictions on export of key AI
technologies.
- "Powering chatbots" and "coding" are identified as the most
important uses for Generative AI, which was already widely used
across sectors by November 2023.
- While "improving customer experience" and "improving
operations" are key drivers of AI adoption, major reasons for
non-adoption are an "absence of a clear use case or perceived need"
and "limited technical expertise of resources."
Survey respondents were chosen primarily based on the ability to
provide diverse responses and viewpoints on AI implementation
across industries. Respondents spanned eight sectors comprising
roughly half of the U.S. private sector workforce: financial
services and insurance, healthcare and biotechnology, hospitality
and leisure, information technology, manufacturing, retail trade,
telecommunications and transportation. A ninth category,
"Other," was included to represent individuals outside the eight
main sectors.
Collectively, almost 58% of respondents reported that their
firms had incorporated AI into their business practices in some
capacity, 35% reported in the negative, while the remaining 7%
stated they were unsure about the level of AI integration at their
company.
The report further addresses job displacement, support level for
AI regulation and export restrictions, sentiments on the
patentability of AI-assisted creations and intellectual property
infringement, AI use by sector, and the drivers and hurdles
associated with AI adoption.
More on the key takeaways
Job displacement concerns weigh heavily on
executives. Regarding the potential adverse impact of AI
on career prospects over the next five years, roughly 20% of
respondents expressed that they were either very or extremely
concerned. These worries resonated with 47% of participants from
the financial services and insurance sector, and with
32% in telecommunications. Additionally, 27.5% of respondents
with less than 15 years of work experience and 26% of
respondents who identified themselves as AI decision-makers at
their respective companies share this concern. Although there is
discernable concern among people directly involved with AI in their
work, "it's not clear if this stems from more intimate knowledge of
AI's possibilities or from being in more vulnerable roles," writes
Prasad.
A strong backing for AI regulations exists. The
Biden Administration's 2023 Executive Order on AI aimed to
establish new standards for AI safety and security, create privacy
safeguards and promote innovation and competition in business. Over
the past five years, 17 states have enacted 29 bills on AI
regulation promoting similar principles. As for the extent of
support among executives for regulation of AI-based systems,
respondents were asked about three types of mandates—transparency
about AI use and data collection, explainability of autonomous
decisions by AI algorithms and third-party auditing for the
presence of algorithmic bias in AI algorithms. Approximately 75% of
responses declared to strongly or somewhat supporting regulation
mandating transparency, with algorithmic bias regulation held in a
similar regard. About 72% of respondents strongly or somewhat
supported explainability regulations.
Resounding support for restrictions on exporting key AI
technologies. In addition to the 2023 Executive Order on
AI, the U.S. Department of Commerce strengthened export controls on
AI technology, targeting the sales of advanced chips and chip
making equipment to China.
According to Secretary Gina
Raimondo, the goal was to limit China's "access to advanced semiconductors
that could fuel breakthroughs in artificial intelligence." Support
for those policies was apparent among survey respondents, with
almost 60% strongly or somewhat supporting restrictions. Firms with
10% or greater international sales supported AI technology export
restrictions more significantly. Manufacturing led all sectors by a
sizable margin, with 70% of its respondents strongly or somewhat
supporting restrictions on exports of cutting-edge AI technology.
Older respondents, people concerned about AI-related job
displacement and those with high trust in the government are more
likely to support export restrictions, too.
Generative AI has the early lead in AI adoption within
business. When asked about the AI technologies implemented
by their companies, 39% shared that generative AI, followed by
computer vision (30%) and machine learning (27%), were in use.
Firms with a significant global presence proved to be the most
intensive users of AI for generative tasks. Among respondents from
these firms, 33% said they used generative AI for chatbots, while
32% used it for marketing purposes and 30% for text generation.
Regarding the decision-making tasks that currently use an
autonomous decision system, respondents regularly cited inventory
management, logistics, personalization and recruiting.
Customer experience and operations efficiency improvements
are at the core of AI adoption. Drivers and hurdles,
overall, were similar across sectors. However, at companies where
AI is in use, those two drivers appeared among 66% and 72% of
responses, respectively. Hurdles selected by more than 35% of firms
with adopted AI technologies included high initial costs,
difficulty recruiting skilled professionals and the challenge of
integrating AI with existing IT infrastructure. As for companies
where AI technology was not adopted, the two most cited reasons
were the absence of a clear use case or perceived need for the
technology and limited technical expertise or resources to
implement and manage the technology.
"There is great similarity in patterns of use of AI across
sectors, although levels vary widely. Information technology,
telecommunications, financial services and insurance, and
manufacturing have much higher levels of AI use than, say, retail
and e-commerce," Prasad says.
However, AI is being used in similar ways everywhere, he adds.
"Moreover, sentiments towards AI and its regulation are similar
across sectors."
Funding from the U.S. Department of Education through a Title VI
grant under the CIBE program contributed to this
research.
Read More: AI Use and Regulation: A Survey of U.S. Business
Executives
About the University of
Maryland's Robert H. Smith School of Business
The Robert H. Smith School of Business is an internationally
recognized leader in management education and research. One of 12
colleges and schools at the University of
Maryland, College Park, the Smith School offers
undergraduate, full-time and flex MBA, executive MBA, online MBA,
business master's, PhD and executive education programs, as well as
outreach services to the corporate community. The school offers its
degree, custom and certification programs in learning locations in
North America and Asia.
Contact Greg Muraski,
gmuraski@umd.edu
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SOURCE University of Maryland's
Robert H. Smith School of Business