BCG’s Europe chief has a message for European companies: to succeed in AI, invest in training your people, not just in buying or developing AI.
In a recent survey of 1,400 executives, the consulting firm found that European companies lead the world in AI ambition: more than 86% of companies see investment in AI as a top 3 priority for 2024, the study found. “They really want to do it,” Matthias Tauber, BCG’s chair for Europe, told me.
But as eager as European companies are to invest in AI, they are poorly training their workers to master the technology. Just one in 20 European companies has trained more than 25% of workers on AI, the percentage required to achieve critical mass, BCG found. That share is the lowest of anywhere in the world.
“People really want to do it,” Tauber reiterated, “but if you look at where we are, we have a way to go. Europe is 60% in terms of AI readiness of the U.S., and half of the Middle East. Where European companies fall short is in getting scale in their employee base in [the] adoption of the tool.”
Still, European companies should adopt AI even if they won’t ever catch up to their Big Tech rivals in developing the technology.
“When you look at automotive, chemical, package goods, luxury…[your ability] to drive value for customers, stakeholders, or even your market cap will disproportionally depend on whether you’re able to drive AI and generative AI in your business model,” Tauber said.
So how can European companies still triumph in this “must-win battle”? Tauber suggested three things:
First, you need to adopt AI with scale. “If you do it with just one use case, forget about it,” Tauber said.
Second, it’s not a matter of choosing between generative AI or traditional AI; it’s the interplay between the two that’s key. “It’s not enough to train your people on gen AI,” Tauber said. “You also need to address certain aspects of traditional AI.”
And third, “you need to double down on the nontechnical aspect of AI” to promote adoption of the technology, the BCG partner said. Processes must change. “Otherwise, your organization doesn’t work differently.”
It only takes a glance around the news cycle to see how AI is creeping into all kinds of consumer experiences—for better or worse. Even companies that got a late start have a chance to influence how the evolution progresses.
“The numbers are snapshots of today. You can change things,” Tauber told me. “It’s a call for action, to really take this seriously, and move on.”
On a related note: Fortune and the UK Government Department for Business & Trade will be holding a dinner discussion on “AI: From Hype to Implementation” for CEOs and executives attending the Mobile World Congress in Barcelona, on Feb. 28. If you’d like more info, send me a note: peter.vanham@fortune.com.
More news below.
Peter Vanham
peter.vanham@fortune.com
@petervanham
TOP NEWS
Apple opens up
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Finnish fertility
Finland was hailed at the turn of the century as one of the few developed countries that knew how to sustain high fertility rates, thanks to a generous social safety net. No more. The country’s birth rates is now below the U.K.'s and around the same level as Italy's. That’s worrying Anna Rotkrich, a Finnish demographer who advised former Prime Minister Sanna Marin. “It’s not primarily driven by economics or family policies. It’s something cultural, psychological, biological, cognitive,” she says. Financial Times
France’s farmer protests
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AROUND THE WATERCOOLER
Bernard Arnault’s LVMH is stepping into 2024 with confidence after its highest-end products defy luxury slump by Prarthana Prakash
‘The grass always seems greener on the other side’: Top exec at $50 billion food giant Mars advises prospective job-hoppers how to water the side you’re on by Orianna Rosa Royle
Ryanair’s CEO once called Boeing’s leadership ‘headless chickens.’ Now he wants to buy the Max jets that U.S. airlines don’t by Sasha Rogelberg
Amazon walking away from its $1.7 billion iRobot deal leaves the Roomba maker without its founding CEO and staring down a 31% staff cut by Marco Quiroz-Gutierrez
This edition of CEO Weekly Europe was curated by Nicholas Gordon.
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