NZ organisations risk being left behind in Artificial Intelligence plans

There is a stark divide in AI use amongst New Zealand organisations, posing a risk they are being left behind, a new report has revealed.

Data specialist firm Qrious released a new inaugural report titled State of AI in New Zealand, providing a full picture of the rate and extent of adoption of AI technologies in New Zealand.

Produced by Qrious in partnership with Spark NZ, the AI Forum, and the Ministry of Business, Innovation and Employment, it contains the findings from a nationwide survey conducted in May with decision-makers and analytics leaders across corporate, government and tertiary domains and establishes a framework for local 'AI maturity'.

Sam Daish, Head of AI and Data Science at Qrious, says that AI is projected to be the most significant technological advancement in a generation, offering unprecedented opportunities for productivity, innovation and the economy.

"The report is the first of its kind in Aotearoa - uncovering how AI is currently used; how to ignite AI adoption to create a local AI economy; and how to secure our place at the forefront of AI innovation internationally," he says.

The results issue a clear warning: A stark divide exists in AI maturity in New Zealand. Just one in five organisations reaching AI maturity; 7% engaging in core practices supporting widespread AI adoption; and 17% not considering AI at all. The majority are still in initial trial stages – with just over one third taking their first steps to building AI capability. Most have only run ad hoc pilots or applied AI to a single business process.

New Zealand is also lagging behind our North American counterparts – just 27% of our organisations trialling AI compared to their 52%; and with the majority of respondents saying our biggest risk is businesses not willing to leverage AI enough, then as a nation we risk being left behind.

Daish says there is a number of companies with no plan for AI.

"Fewer than one in six have an AI strategy; for many it's a 'work in progress'; and two thirds with a plan have just a two-year horizon," he says.

"That's a problem, because the report tells us that getting to AI trials is crucial. Put simply, it's a numbers game - an increase in trials leads to an increase in success and that flows to more trials."

Those dominating the higher-end of the 'AI Maturity' scale are much more likely to be smaller, newer organisations or 'AI natives' (half have 100 or fewer employees; a quarter 10 or fewer); while the lower-end are typically larger, more established organisations where AI innovation may not happen evenly or naturally.

AI mature organisations are primarily financed by government grants and/or venture capital and AI is innate - they are disrupters, outclassing well-established organisations with their deeper understanding of modern technology and a different approach to business.

However, organisations face significant barriers to greater AI use.

"Interestingly the report shows it's cost and capability – not technology. You can buy technology, but capability is more complicated," says Daish.

"It's not just skill set – it's organisational mindset, exec education, AI literacy, and supplementing internal capability with external partnerships."
 
Ethics, bias, transparency and accountability are concerns for close to half of respondents - 47% disagree that businesses are transparent enough about their AI use; 42% are concerned some will go too far; and 47% believe that they don't have a handle on the legal and ethical implications. 45% also see a role for the Government here with many seeking more funding support.

Minister for the Digital Economy and Communications, Dr David Clark, agrees that there is a clear role for Government in New Zealand's AI Economy moving forward.

"I have responsibility for the Digital Technologies Industry Transformation Plan (ITP). One of the core priorities of the ITP is the creation of an AI Strategy for Aotearoa and Qrious is to be commended for this very useful contribution to our knowledge of how firms and organisations in New Zealand are using AI at the moment," he says.

The minister is pleased with the finding that organisations are increasingly seeking government funding support.

"This is a demonstration of the impact of the Crown's investments through venture capital and grants and the ITP will look to further deepen the investment pool across the economy," he says.

Furthermore, he is conscious of the crucial role the Government can play in this space to bolster public confidence in AI.

"The development of the AI ecosystem supports the Government's vision of a more productive, sustainable, inclusive, and resilient economy. It is critical, in a world increasingly influenced by AI, to ensure public confidence in these new technologies so that we can deliver a bigger share of a growing industry. One that reflects our values and culture and which benefits all New Zealanders."

Stephen Ponsford, Acting Qrious CEO, says that working with external AI experts is key to building this AI ecosystem and increasing AI trials.

"Organisations do not need, and won't have, all the data, skills and technology required. A skilled partner can fill capability gaps, reduce costs, and provide the credibility to navigate ethics concerns. Combining a partner's expertise with your internal experience, delivers strong results," he says.

"We want Kiwi organisations to know that Qrious is here to help – we are New Zealand's leading organisation when it comes to the design, project management and roll-out of AI solutions. We believe in generating success collaboratively, leaving you stronger after every engagement, and building trusted partnerships so you achieve your AI vision and goals.

"With AI representing a paradigm shift in the power of technology to improve our lives and increase our wellbeing, the Qrious difference is its proven AI roadmap - taking you from where you are now, to where you want to be, walking beside you through each of the incremental steps in the AI Maturity scale," Ponsford says.

"New Zealand has all of the raw ingredients necessary to create a vibrant, inclusive, productive economy centred on AI technologies. The time to grasp that opportunity is now.