In partnership with

MARKET IMPACT REPORT

The two-year
GenAI countdown

How businesses are scaling GenAI adoption

and avoiding the productivity trap

© 2024 | HFS Research 1

Foreword

As companies step into generative AI’s uncharted waters, the journey holds huge promise, but it is not without its
perils.
The challenge for most enterprises is they remain anchored in what I call “POC land” — an island full of proofs of
concept that can be impressive, but rarely reach operational scale. Having access to insights that can chart a
course toward GenAI’s full benefits — beyond productivity alone — is invaluable.
That’s what this report delivers.
It condenses the experiences of 550 senior executives into six chapters. These findings will help you and your
business set your GenAI investments, adopt a human-centric approach with responsible AI frameworks, and
redefine the nature of work. And while there’s no denying that productivity is a crucial GenAI outcome, the journey
can’t end there. We’ll steer you toward new revenues, happier customers, and greater market share, too.
As you stand on the brink of this AI revolution, use this report to reach a future where AI is not just another tool,
but a trusted copilot in your quest for innovation and excellence.

Sreekanth Menon
Global Head, AI/ML Practice, Genpact

The generative era is the first real innovation to disrupt industry since the advent of the internet in the mid-1990s,
where ubiquitous data access radically changed our lives. In fact, it is really the technological evolution that takes
connected businesses, employees, customers, and supply chain partners to a whole new level of value, one where
new data and content can be created at rapid speed.
However, we must remember that it took the internet many years before genuine commercial models evolved, and
we learned to derive immense value from these experiences. GenAI is barely more than a year in, and
expectations are far outpacing adoption.
The reality is we are sitting on a smoldering platform with immense potential, which will eventually spark burning
fires as the early pioneers prove they can outcompete their markets, attract the best and the brightest, and
innovate products and services faster than they had ever previously envisaged.
I will go back to the main excitement behind GenAI… it is disruptive because it helps us create new data and new
content. But it needs to become an extension of our humanness to do that, not merely another technology tool
that can add some value in bits and pieces.
With the recent launch of GPT-4o, the multimodal capability brings speech, text, video, and content together into
one neural network, which allows us to communicate with machines in real-time and immersing the tech into our
day-to-day activities is the game changer we have been unwittingly waiting for. In effect, old GPT was like texting
a friend, and GPT-4o is like calling a friend… GenAI innovation is happening at a breathtaking pace and we are
only at the beginning of this journey.

Phil Fersht
CEO and Chief Analyst, HFS Research

© 2024 | HFS Research 2

Contents

00 Executive Summary 04

01 Doubling Down on GenAI 06

Most enterprises are still early in their GenAI journeys but are placing
big bets

Unleashing Value Beyond Productivity 10

02
Executives view GenAI as a catalyst for new value creation, expecting
gains within two years

03 Navigating Rollout Challenges 18

The GenAI journey is tough, hindered by poor planning, talent gaps, and data
quality issues

Bridging the GenAI Talent Gap 22

04
Embrace GenAI's transformative power, but don't lose sight of its impact on
humans in a rush for efficiency

The Ecosystem Effect 26

05
Enterprises need an ecosystem that will succeed with GenAI and are shifting to
performance- and purpose-driven commercial models

06 Recommendations to Realize the Promise of GenAI 29

Key actions to make the transition to GenAI smooth and effective

07 Appendix 32

08 About this Study 34

© 2024 | HFS Research 3

Executive Summary
There is no time to waste. Enterprises have just two years to capitalize on generative
AI’s (GenAI) benefits. Any delay will be costly as GenAI is rapidly reshaping the
competitive landscape. And even as you set off on your road to GenAI success, this
report finds that obsessing over productivity gains at the expense of broader goals will
prevent you from realizing the technology’s full value.

Enterprise leaders are at a pivotal juncture with rapidly evolving generative AI technology. First, they must
learn to harness its power. Then, they must implement it across their organizations at speed and scale. The
weight of executives’ decisions is palpable, as they hold the potential to shape the future of their
businesses. Yet, amid the excitement surrounding the technology's immediate impacts, there is danger in
overlooking its long-term implications.

To gain deeper insights into GenAI’s long-term value and the risks of overemphasizing immediate
outcomes such as productivity improvements, HFS Research, in partnership with Genpact, a global
professional services firm, surveyed 550 senior executives across the globe. These respondents
represent organizations with revenue exceeding $1 billion across 12 countries and eight industries. For
further insights, we conducted in-depth interviews with 10 enterprise leaders at the forefront of GenAI
adoption and innovation.

To dive deeper into the data, check out our interactive dashboard.

Key findings:

Most enterprises are early in their GenAI journeys but are placing big bets.
1
Despite only 5% of enterprises having mature GenAI initiatives, a significant majority are
gearing up for a technological transformation. Approximately 61% of executives are dedicating
up to 10% of their tech budgets to explore and expand GenAI capabilities.

Executives view GenAI as a catalyst for creating new value within two years but caution
2 against overemphasizing productivity.
74% of executives anticipate GenAI will be a springboard for value creation, driving not only
productivity gains, but also customer satisfaction, revenue growth, and a competitive edge —
all expected to materialize within two years. However, concerns loom as 52% caution against
overemphasizing productivity, citing potential negative impacts on the employee experience.

© 2024 | HFS Research 4

 Quality data is the linchpin for the successful deployment of GenAI initiatives.
3
Organizations are challenged with several hurdles, including data quality and strategy. Notably,
there's a hesitancy around data sharing, with only 16% of enterprises using their proprietary
data, underscoring the urgent need for a robust data strategy.

Embrace GenAI's transformative power, but don't lose sight of the human element.
4
Bridging the talent divide is crucial, as 36% of executives report a scarcity of skilled
professionals. Finding the balance between technical and business skills will be vital. However,
in the short term, technical skills gain importance.

Enterprises need an ecosystem for GenAI success, but current time-and-material-driven

5 engagement models will be rendered useless in the AI era.
Executives emphasize the need for a diverse ecosystem, highlighting the importance of
partnerships that support talent acquisition and skill development. Additionally, 80% recognize
the need to transition to performance- and purpose-driven commercial models with partners to
capitalize fully on GenAI's potential.

© 2024 | HFS Research 5

SECTION 01

Doubling Down
on GenAI

As the momentum behind GenAI

adoption grows across industries,
organizations recognize its
transformative potential. However, the
journey toward widespread adoption
is in its infancy, with relatively low
deployment rates. Despite this early
stage status, enterprises are placing
significant bets on GenAI.

© 2023, HFS©Research
2024 | HFS Research 6
6
Only 5% of organizations are in the mature
phases of GenAI adoption

Our research delineates enterprises into four or multiple areas of their businesses. This
GenAI maturity levels reflecting the commitment strategic investment suggests a desire to
of investments and the extent of GenAI catch up with pioneers quickly, using
deployment within business operations (see learnings to implement GenAI swiftly and
Exhibit 1): efficiently.
• Deniers (23%): These enterprises are GenAI • Pioneers (5%): The smallest but most
skeptics. Without plans or investments advanced segment has fully embraced GenAI,
dedicated to GenAI, they risk missing out on investing in and integrating it across various
potential efficiencies and innovations. Since business units. They're leading the way and
this group lacks GenAI initiatives, this study will influence industry trends and set GenAI
does not discuss them further. benchmarks.
• Wait and Watch (45%): This cautious
majority observes and plans, without
immediate investment. They have no
significant commitment to spend on GenAI.
They prefer to learn from the early adopters,
which puts them at risk of lagging behind
more aggressive competitors.
• Fast Followers (27%): These enterprises are
in an intermediate maturity phase. They have
begun investing a sizable part of their tech
budgets in GenAI and are deploying it in one

Exhibit 1: Only 5% of enterprises have reached full GenAI maturity

45%

27%
23%

5%

Deniers Wait and watch Fast Followers Pioneers

No GenAI plans No significant Already committing Already deployed GenAI
or spending ** commitment to spend on significant tech spend to solutions across multiple
GenAI and mainly in GenAI or deploying GenAI parts of the business and
planning stages solutions across multiple committing significant
Sample: 666 executives parts of their business technology spend to GenAI
Source: HFS Research in collaboration with Genpact, 2024
**Deniers include respondents excluded from the study due to having no GenAI initiatives or plans.
Q. What best describes the status of GenAI solutions deployment?
Q. What percentage of your organization’s technology budget is dedicated to GenAI initiatives?

© 2024 | HFS Research 7

Organizations are doubling down on GenAI
investments, even shifting funds from
other business and technology areas

While most enterprises are in the nascent stages When asked about the origins of investments,
of GenAI adoption, their notable commitment to most executives (51%) report shifting funds from
the technology is visible in their investments. other resources or investments, with IT
61% of executives have earmarked up to 10% of infrastructure and software development being
their technology budgets for GenAI. They also the primary areas benefiting from budget
anticipate expanding these investments. On reallocation (see Exhibit 2). Additionally, 50%
average, they expect a 30% jump in GenAI also report earmarking dedicated funds for
funding over the next year, with those in the wait- GenAI initiatives, and 42% of respondents intend
and-watch maturity group the most aggressive in to use anticipated savings from GenAI efficiency
their forecasts. This reflects a strategic pivot to gains. External funding and partnerships, while
catch up and position themselves prominently in still relevant, are less favored for sourcing
the evolving market landscape. investments.

Exhibit 2: Most respondents are shifting funds to GenAI from other sources, including IT
infrastructure, software development, and research and development

Source of GenAI investments Shifted budget source

Shifting funds from other

resources or investments IT infrastructure 51%

Software development 43%

Using additional dedicated
budget allocated for GenAI Research and development 38%

Marketing and advertising 35%

From the predicted savings Training and talent
29%
generated by GenAI in operations development
People costs 28%
Other technology
Seeking external funding or 28%
investments
partnerships
Not sure 4%

Sample: 550 executives

Source: HFS Research in collaboration with Genpact, 2024
Q. How are you funding your GenAI investments (select all that apply)
Q. Where are you shifting funds from to invest in GenAI (select all that apply)

© 2024 | HFS Research 8

Among the industries surveyed, healthcare, Overall, the data shows a reallocation and a
retail, and high-tech are most inclined to redirect reimagining of corporate budgets, signaling
existing funds toward GenAI investments. In GenAI's transition from a peripheral interest to a
contrast, the banking and capital markets and central business and technology strategy.
the insurance sectors prefer to allocate additional Executives increasingly acknowledge the need to
dedicated budgets for their GenAI initiatives, pivot away from legacy systems toward more
indicating a strong commitment to GenAI's agile, future-ready technologies that enable them
potential. Meanwhile, the life sciences sector to remain competitive.
adopts a dual strategy, counting on forecasted
GenAI-driven savings for funding while remaining We're witnessing a ‘rip the rearview mirror off’
open to external funding and partnerships. mentality, where the traditional focus on past
spending to maintain and marginally improve
legacy systems gives way to forward-looking
investments in GenAI.

“ A common trend is the shift from

traditional IT cost centers toward
technology investments that enhance
broader productivity and innovation.
By reallocating funds from areas such
as infrastructure and software
development, companies are freeing
resources to fuel innovation and
revenue generation.

—Sanjay Patel, CIO, CDO and

Transformation Executive

© 2024 | HFS Research 9

SECTION 02

Unleashing
Value Beyond
Productivity
GenAI’s influence is expanding
rapidly. Most executives recognize its
potential to transform industries and
generate new value within an
ambitious two-year timeline. However,
this fast-paced adoption risks
prioritizing short-term productivity that
could harm the employee experience.

© 2023, HFS©Research
2024 | HFS Research 10
10
Executives view GenAI as a
catalyst for new value creation

74% of executives acknowledge how GenAI

creates new and disruptive value (see Exhibit 3).
This recognition highlights a shift from perceiving “GenAI enables us to leverage our
GenAI simply as a technological advance to existing data in completely new
leveraging it as a strategic asset that reshapes ways and create new solutions and
industries. new value propositions to solve
problems that we could never
imagine otherwise.”

—Sandeep Sacheti,
EVP of customer insights & operational
excellence at Wolters Kluwer

Exhibit 3: 74% of executives believe GenAI is inspiring new and disruptive ways of
value creation

To what extent do you agree or disagree with the following statements: GenAI is inspiring our organization to
adopt new and disruptive ways of value creation

Most likely High-tech

to agree
7% Consumer products

19% Agree Insurance

Healthcare
Disagree
Banking and capital markets
Neutral Life sciences
74%
Retail
Least likely
to agree Manufacturing

Sample: 550 executives

Source: HFS Research in collaboration with Genpact, 2024

© 2024 | HFS Research 11

The case for GenAI: Doing
more with less

Executives pinpoint several benefits that such as increased market share and competitive
underscore GenAI’s impact, including improved advantage while the “Fast Followers” are focused
productivity and efficiency (35%), competitive on better customer experience. However, the
advantage (31%), enhanced customer “Wait and Watch” are focused primarily on
engagement and satisfaction, faster revenue operational efficiency and productivity. This
growth, and increased market share (30%) (see shows that as organizations advance in their
Exhibit 4). GenAI journeys they realize it will drive
operational improvements, but the real benefit is
However, across maturity levels, the perceived in aligning their AI strategy to growth and market-
top benefits of GenAI differ. “Pioneers,” the most oriented gains.
advanced group, seek direct growth outcomes

Exhibit 4: Top business benefits from GenAI overall and across maturity level

Top business benefits from GenAI

Improved productivity and efficiency 35%

Competitive advantage 31%

Improved customer engagement and satisfaction 30%

Faster revenue growth and increased market share 30%

Better decision-making and insights 29%

Enhanced creativity and innovation 28%

Accelerated product development and time to market 26%

Improved agility in aligning operations with market strategy 26%

New revenue streams and business models 25%

Enhanced security and risk mitigation 21%

Enhanced employee engagement and satisfaction 19%

Pioneers Fast Followers Wait and Watch

Faster revenue growth and Improved customer engagement Improved productivity and
36% 36% 38%
increased market share and satisfaction efficiency

Sample: 550 executives

Source: HFS Research in collaboration with Genpact, 2024
Q. Select the top 3 business benefits of using GenAI in your enterprise

© 2024 | HFS Research 12

Across these benefits, executives are capitalizing orchestrating highly personalized marketing
on GenAI's versatility for multiple use cases — campaigns to refining lead qualification (see
from streamlining data analysis, forecasting Exhibit 5).
trends, crafting bespoke content, and

Exhibit 5: Illustration of GenAI use cases across top benefits

Improved Customer Faster Revenue Growth

Productivity & Competitive
Engagement and and Increased
Efficiency Advantage
Satisfaction Market Share

Streamlining data entry Accelerating prototyping Providing personalized Leveraging trend analysis
tasks, freeing up time and testing new product shopping to identify untapped
for other activities. ideas, reducing time to recommendations. markets and align product
market and staying ahead offerings with emerging
of competitors. demands.

Automatically generating Utilizing market intelligence Customizing marketing Implementing hyper-

reports, presentations, and to anticipate competitor content for specific personalized
technical documentation, moves and strategically audiences. marketing to drive
saving time and ensuring position products. revenue growth.
consistency.

Boost manufacturing Optimizing supply chain Analyzing customer Streamlining the process
efficiency with GenAI- processes to improve feedback to improve of identifying and
powered virtual product availability and products and services for qualifying leads to
collaboration tools. delivery speed. higher satisfaction. accelerate sales cycles
and expand market reach.

Automating customer Developing unique value Offering tailored product Innovating product
queries with chatbots propositions based on suggestions to enhance development to bring new
to increase efficiency deep customer insights the shopping experience products to market faster.
in banking customer and market research. and drive customer
support. satisfaction.

Source: HFS Research in collaboration with Genpact, 2024

Q. Can you describe a GenAI use case your organization is investigating to drive the benefits selected?

© 2024 | HFS Research 13

Pursue productivity not as just an end
goal, but as a critical step in a broader,
more strategic GenAI journey

Pioneers recognize that mastering productivity through GenAI is foundational, setting the groundwork for
more ambitious applications. This initial focus on productivity builds trust and internally verifies the
technology's reliability before implementing it in broader, more impactful ways. This approach enables
companies to refine GenAI capabilities internally, ensuring robustness and effectiveness before scaling up
to include customer-facing operations and deliver strategic advantage.

“ We are initially focused on

leveraging GenAI for internal
improvements and productivity
because this will give us the
confidence to expose it to our
customers, knowing our internal
experts have thoroughly tested it.

—Sandeep Sacheti,
EVP of customer insights & operational
excellence at Wolters Kluwer

© 2024 | HFS Research 14

A singular focus on GenAI-driven
productivity is potentially dangerous

While productivity remains a key initial focus, it's GenAI on the employee experience. They cite
important to recognize the potential pitfalls if this that overemphasizing productivity can cause
focus persists for too long. More than half of employee dissatisfaction, burnout, and declining
respondents express concern that framing GenAI morale. This suggests that the human elements
solely as a productivity tool is shortsighted and of work are at risk of being sidelined in the sole
potentially hazardous (see Exhibit 6). pursuit of operational efficiency. Moreover, a
narrow focus on productivity may overlook the
A significant issue, highlighted by 44% of wider benefits of GenAI, potentially stifling
respondents, is the potential negative impact of innovation and fueling employee discontent.

Exhibit 6: 52% of respondents view an obsession with productivity when adopting

GenAI as problematic

Q: To what extent do you agree or disagree with the following statements: A singular focus
on productivity when adopting GenAI is potentially misleading

22%
Agree

Disagree
52%
Neutral
25%

Sample: 550 executives

Source: HFS Research in collaboration with Genpact, 2024

© 2024 | HFS Research 15

Speed is of the essence

Respondents expect to realize all GenAI benefits It is surprising to see GenAI's relatively low rating
on average within two years, with some taking for impacting the employee experience. Ignoring
longer than others (see Exhibit 7). Benefits this benefit might be a missed opportunity to
including enhanced productivity and efficiency, foster a supportive work environment conducive
customer satisfaction and faster decision-making to innovation and growth.
are top-rated quick wins. Increasing revenue
streams and expanding market share are valued
although they will take the longest to realize.

Exhibit 7: Anticipated timelines to realize the full benefits of GenAI across a two-
year period

Top-rated benefit

Fastest to realize Slowest to realize

(Less than one year) (2 years or more)

Lowest rated benefit

Sample: 550 executives

Source: HFS Research in collaboration with Genpact, 2024
Q. Select the top 3 business benefits of using GenAI in your enterprise
Q. For the chosen business benefits of GenAI, by when do you anticipate realizing the full benefits?
See Appendix A for GenAI use cases across each quadrant

© 2024 | HFS Research 16

 says Sreekanth Menon, global head, AI/ML
practice, Genpact. “This is how companies are
successfully operationalizing GenAI at scale.” He
offers the following advice:

• Identify use case viability: Focus on projects

that significantly impact core business
functions, aligning AI initiatives with overall
strategic objectives.

• Invest in reusability: Design reusable

technology assets that seamlessly integrate
across departments, accelerating deployment
and maximizing ROI.

• Devise responsible AI frameworks: Establish

clear data ownership, access, and security
The speed of technology innovation is protocols throughout the AI lifecycle to
breathtaking, and enterprises need to keep pace maintain compliance and ethical data usage.
with it.
• Implement a robust deployment process: It
should include model monitoring and version
“Last year’s learnings from the experiments with
control processes to ensure continuous
GenAI are now converted into frameworks and
improvement and operational efficiency.
in-house platforms that serve the AI pipelines,”

© 2024 | HFS Research 17

SECTION 03

Navigating
Rollout
Challenges
With a strong push to deliver GenAI
outcomes within two years, leaders
must not only know where to place
their bets but recognize that data
quality profoundly impacts GenAI’s
success. It's the linchpin determining
whether GenAI initiatives flourish or
flounder. As the saying goes,
"Garbage in, garbage out." This rings
especially true for GenAI, as its
effectiveness is directly tied to the data
quality it processes (see Exhibit 8).

© 2023, HFS©Research
2024 | HFS Research 18
18
Implementing GenAI is not a slam dunk
for organizations. They face several
potential rollout challenges

Interviewees often emphasized the criticality of While data is the biggest headache for IT leaders,
data foundations in their efforts. For IT leaders, business leaders are worried about a lack of a
the stakes are exceptionally high, as data not structured GenAI plan or roadmap. This
only fuels AI but also must be safeguarded underscores the need for a balanced approach
against inaccuracies and breaches, which are that addresses both strategic and operational
crucial for training effective AI models. imperatives to realize GenAI's full potential.
Organizations must ensure their data is
voluminous, clean, relevant, and governed by a
robust strategy that aligns with broader
“The real challenge is not merely
organizational goals.
adopting AI technologies but
integrating them in ways that
significantly enhance our processes
“There is always an element of risk
and outcomes.”
involved, particularly with AI. For
instance, using GPT to underwrite a —Global revenue operations leader at a major
policy could be risky due to the social media and technology platform
potential for data inaccuracies,
hallucination, and the omission of
crucial data.”

—Head of architecture and advanced

engineering at a large US insurance provider

Exhibit 8: Organizations face several challenges as they employ GenAI

Top 3 challenges hindering adoption of GenAI between IT and business

IT Business

42% 46%

Lack of data quality or strategy Lack of structured plan

37% 40%

Lack of structured plan Difficulty in finding, training, and retaining AI talent

33% 33%

Difficulty in finding, training, and retaining AI talent Lack of data quality or strategy

Sample: 550 executives (IT = 198n, Business =302n)

Source: HFS Research in collaboration with Genpact, 2024
Q. What are the top 3 barriers that hinder the adoption of GenAI in your organization?

© 2024 | HFS Research 19

Establishing responsible AI frameworks is
critical to becoming comfortable with
sharing proprietary enterprise data with AI

While executives recognize that establishing This cautious approach to enterprise-specific

robust data strategies is a cornerstone for data is understandable, given concerns about
unlocking GenAI’s full potential, they must also system modifications, risk of hallucinations,
become open to making their data accessible to governance issues, and data quality assurance.
GenAI. While publicly available data is the most In contrast, the shorter time required to integrate
accessible resource for 38% of organizations, partner or vendor data indicates established trust
only 16% are already tapping into enterprise- and protocols. Achieving readiness with
specific data such as financial records. The enterprise-specific data may pose challenges,
journey to incorporate various data sources into but it is vital to realizing strategic ambitions tied
GenAI systems is lengthy, averaging a year for to GenAI.
customer data and slightly longer for third-party
sources, reflecting underlying complexities in
data integration (see Exhibit 9).

Exhibit 9: Data sources already accessible to GenAI

Data sources already accessible to GenAl

Publicly available data from the internet 38%

Individual data from partners/vendors 30%

Individual data from employees 30%

Individual data from customers 28%

Data from third-party sources (e.g., Moody’s,

17%
Neilson’s sales data)

Enterprise specific data from systems of record (e.g.,

16%
financial data, operations data)

Sample: 550 executives

Source: HFS Research in collaboration with Genpact, 2024
Q. When will the following data sources be accessible to GenAI within your enterprise? (chart only showing ‘already accessible’)

© 2024 | HFS Research 20

This cautious stance toward integrating making it feasible to leverage sensitive and
enterprise-specific data underscores the need for strategic data assets effectively. Developing a
a robust Responsible AI framework. By Responsible AI strategy that prioritizes ethical
enhancing governance structures, improving considerations, transparency, and accountability
system resilience against errors, including is vital for enterprises aiming to leverage their
hallucinations, and ensuring high standards of own data in GenAI systems. Enterprises should
data quality assurance, companies can align also look to design or implement responsible AI
their internal data practices with Responsible AI benchmark tools to systematically evaluate and
principles. Establishing these rigorous protocols compare their responsible AI policies.
mitigates risks and fortifies trust in AI systems,

© 2024 | HFS Research 21

SECTION 04

Bridging
the GenAI
Talent Gap
When considering the transformative
potential of technology, organizations
often overlook the humans affected
by these changes. This is especially
true with GenAI. As GenAI continues
to evolve, there will be a fundamental
shift in how workers need to reskill to
adapt to these changes.

© 2023, HFS©Research
2024 | HFS Research 22
22
Combining business and technical
skills will be critical for success

Bridging the skills gap is essential, given that

talent shortages are a top concern for executives “The gap between the digital acumen
and GenAI can transform jobs. The interplay of the incoming workforce and that of
between business acumen and technical existing executives is widening. The
expertise is the top skill to drive successful GenAI future workforce will possess innate
initiatives (see Exhibit 10). Business skills enable digital skills, making it essential for
strategic integration of GenAI initiatives, ensuring current executives to elevate their
they serve core business goals and deliver value, digital understanding. Reskilling is vital
while technical expertise is necessary to develop, for adapting to new technologies and
deploy, and maintain sophisticated AI systems. ensuring relevance in a rapidly evolving
Combining these skill sets ensures that GenAI digital landscape.”
solutions are technically sound, commercially
viable, and responsive to market needs. —CFO at a multinational technology company

Exhibit 10: Business and Technical skills needed to drive successful GenAI initiatives

Business skills needed to drive the success of your Technical skills needed to drive successful
GenAI initiatives GenAI initiatives

The ability to combine business Data science and machine

44% 53%
skills with technical knowledge learning expertise
Data analysis, interpretation,
Understanding of ethical 41%
41% and visualization
AI practices The ability to combine technical
35%
Critical thinking and analytical knowledge with business skills
39% Software development and
problem-solving 29%
engineering skills
Effective project management Cloud computing and
39% 29%
and execution deployment experience
Data engineering and big data
Adaptability and agility 36% 25%
technologies
Data security and
Strategic planning and 23%
36% privacy awareness
business acumen
DevOps and model
21%
Industry-specific knowledge maintenance skills
30%
(e.g., healthcare, finance, etc.) Natural language processing
20%
(NLP) knowledge
Communication and
28%
collaboration skills Prompt engineering 16%

Sample: 550 executives

Source: HFS Research in collaboration with Genpact, 2024
Q: What are the top three business skills crucial for the success of your GenAI initiatives?
Q: What are the top three technical skills crucial for the success of your GenAI initiatives?

© 2024 | HFS Research 23

While the combination of skills remains
crucial, pioneers increasingly acknowledge
the significance of technical expertise

While respondents recognize the criticality of 11). The emphasis on technical skills, as
combining business and technical skills, reflected by interviewees, is believed to be a
surprisingly, after the introduction of GenAI, short-term focus essential for effectively
there’s a notable tilt toward the importance of integrating, managing, and innovating with these
technical expertise, with 41% of respondents advanced technologies within existing business
now emphasizing its significance (see Exhibit frameworks.

Exhibit 11: Technical skills gain importance with GenAI

Importance of skills before and after the introduction of GenAI

Before GenAI After GenAI

17% Business skills more 19%

important

Both technical and

53% business skills 39%
equally important

Technical skills
31% 41%
more important

Sample: 550 executives

Source: HFS Research in collaboration with Genpact, 2024
Q. Please rate your perception of the importance of technical skills vs. business skills before and after the introduction of GenAI.

© 2024 | HFS Research 24

GenAI isn't just a lever for faster
outputs; it heralds an opportunity to
redefine job roles

Of the respondents, 61% acknowledge GenAI's impact on automating routine and repetitive tasks such as
data entry, scheduling, and report generation. More notable, however, is that 49% of respondents foresee
significant job transformations, suggesting a pivot to more complex, strategic work that relies on human
creativity and decision-making skills.

“ As GenAI becomes more

prevalent, we'll see significant
job transformations. Humans
must adapt to new roles and
tasks as AI technology
integrates into various
industries.

—Claus Rose, senior executive and

EHS SMO leader at GE Vernova

© 2024 | HFS Research 25

SECTION 05

The
Ecosystem
Effect
As we navigate the complex terrain of
GenAI, it's increasingly evident that
no enterprise is an island. Success in
this disruptive tech landscape
requires more than just the most
advanced tools. It requires a
commitment to sustaining and
amplifying these innovations.

© 2023, HFS©Research
2024 | HFS Research 26
26
Enterprises need an ecosystem to
succeed with GenAI

Executives understand that GenAI success

hinges on collaborative ecosystems. The primary “Our approach to GenAI is to leverage
areas for investment are talent acquisition, the investments our vendors and
specialized GenAI technology providers, and IT partners are making in their solutions
consulting services, all of which are essential for rather than direct investments, given
building robust GenAI capabilities. Interestingly, the marketplace is still evolving. This
despite the importance of security, cybersecurity strategy allows us to benefit from
partnerships tend to be undervalued, indicating GenAI advancements through existing
they might become a focus only after the core partnerships and maintain market
capabilities are established (see Exhibit 12). parity.”

The data suggests a strategic organizational —Vijay Venkatesan, chief analytics officer,
approach that favors adopting vendor solutions Horizon Blue Cross Blue Shield of New Jersey
for GenAI over direct investments.

Exhibit 12: Partnership investments to support AI capabilities

Partners investing in to build and enhance GenAl capabilities

Partnerships with talent acquisition and skill development 45%

Technology providers specializing in GenAl solutions 41%

IT, business services, and consulting firms 40%

Startups and innovation hubs focused on Al and GenAl 37%

Data providers to enhance Al training datasets 33%

Regulatory and compliance experts to navigate Al ethics and

30%
regulations

Research institutions and universities for advanced Al research 29%

Strategic alliances with complementary businesses e.g., a retailer

27%
partnering with a consumer packaged goods company

Cybersecurity partners 25%

Sample: 550 executives

Source: HFS Research in collaboration with Genpact, 2024
Q. Which partners are you strategically prioritizing investments in to build and enhance your GenAI capabilities? (select all that apply)

© 2024 | HFS Research 27

80% of respondents want AI-led
commercial partnerships to be
performance-focused and purpose-driven

With enterprise executives recognizing the need effectiveness in dealing with the multifaceted
for partnerships, the approach to AI-focused challenges of AI initiatives. Hybrid models enable
collaborations is fundamentally shifting. Only organizations to adapt to the evolving
15% of those surveyed still see traditional effort- technological landscape, align payments with
based models working for the future of AI results (not just effort), and foster innovative
engagements, indicating a move away from solutions by combining the strengths of various
these once-dominant frameworks. Instead, 34% partnership approaches. This adaptability is
now champion a hybrid model that merges essential in a field where technological
aspects of effort, transaction, and outcome, advancements and market demands constantly
suggesting a growing demand for flexible, change.
nuanced commercial strategies that can adapt to
the complexities of AI initiatives (see Exhibit 13). This shift reflects a maturing market perspective
where success is measured by input and the
Enterprise leaders are moving toward these tangible value and outcomes delivered.
hybrid models that offer greater flexibility and

Exhibit 13: Prevalent commercial structures for GenAI engagements with third-party
services

Commercial structures for GenAl engagements with third-party services

Effort-based Transaction-based Outcome-based Hybrid

(number of people, (volumes processed) (gain sharing) (some combination of
time & material, etc.) effort, transaction or
outcome based)

Sample: 550 executives

Source: HFS Research in collaboration with Genpact, 2024
**1% of respondents indicated they “don’t know”
Q. What do you believe will be the most prevalent commercial structures for GenAI engagements with 3rd-party service partners
going forward?

© 2024 | HFS Research 28

SECTION 06

Recommendations
to realize the
promise of GenAI

Adopting a balanced and strategic

approach is crucial as enterprises
navigate the next two years of GenAI
integration.

© 2023, HFS©Research
2024 | HFS Research 29
29
Here are recommendations to help firms not just inaccuracies and ensure ethical usage,
survive but thrive: thereby enhancing trust in AI systems.

• Strategic deployment over quick fixes: Resist • Develop a skilled workforce ready for AI: The
the temptation of short-term productivity transformation brought about by GenAI will
gains. Instead, focus on the strategic shift job roles significantly, necessitating a
deployment of GenAI that aligns with long- workforce that is adept in both the technical
term business objectives and fosters and business aspects of AI. Investing in
sustainable growth. Focus on projects continuous learning and development to
impacting core business functions, aligning AI bridge the skills gap is essential.
initiatives with overall strategic objectives.
• Human-centric approach: Value the human
• Pivot to system-wide optimization: Move element to maintain a balanced perspective.
beyond piecemeal improvements; aim for Ensure that the rush to integrate GenAI
holistic enhancements across your systems to doesn’t overshadow the importance of
fully leverage GenAI and prepare for the employee engagement and morale.
future of autonomous agents. Design reusable
assets that seamlessly integrate across • Evolve partnership models: Move away from
departments, accelerating deployment and traditional, effort-based models and toward
maximizing ROI. performance- and purpose-driven
partnerships. This shift will better align with
• Prioritize quality data and robust AI the complex nature of AI projects and focus
frameworks: Quality data is the foundation of on delivering tangible outcomes.
successful GenAI initiatives. Enterprises must
prioritize data quality and strategy, By adopting these key recommendations,
recognizing that poor data can derail AI enterprise leaders can ensure they keep up with
efforts. Implementing robust data governance GenAI's rapid pace while using the technology to
and management practices is crucial. its full potential and redefining their industry and
Additionally, crafting responsible AI operational models.
frameworks will safeguard against data

© 2024 | HFS Research 30

 The Bottom Line: You have just
two years to succeed with GenAI,
so it's crucial not to lose focus by
overemphasizing productivity.
Instead, focus on strategic
outcomes that bring long-term
benefits to your organization.

We’re racing into the GenAI era, and it’s a pivotal moment for
executives to either get it right or get left behind. The key? Look
past the allure of quick fixes and short -term gains. It's about
thinking strategically, unravelling talent and data problems, and
not losing the human factor in the quest for efficiency. Precision
will determine the future.

In the GenAI era, hesitation leads to loss. But remember, don’t

rush down the productivity rabbit hole.

© 2024 | HFS Research 31

SECTION 07

Appendix

© 2023, HFS©Research
2024 | HFS Research 32
32
Additional use cases across four
quadrants of GenAI benefits (see Exhibit 6)

Quick wins Strategic pillars

These benefits can be realized fast and have a high

These represent long-term goals that are crucial for
impact. Quick wins improve aspects such as productivity,
sustained revenue growth and are highly valued, although
customer satisfaction, and decision-making efficiency.
they take longer to achieve.
• Enhanced productivity and efficiency: Automate
• Market analysis and opportunity identification:
routine tasks to free employees for more complex
Analyze market trends, consumer behavior, and
challenges and enable predictive maintenance to
competitive dynamics to identify opportunities,
prevent equipment failures.
optimize pricing strategies, and predict market gaps,
• Advanced analytics and decision-making: Employ enhancing market share and revenue.
predictive analytics for proactive business
• Sales and marketing optimization: Drive targeted
adjustments, dynamic risk assessments, and efficient
advertising, generate personalized marketing
resource management.
campaigns, and enable predictive inventory
• Improved customer engagement: Power responsive management to meet customer demand more
chatbots for instant, personalized customer effectively, thereby increasing sales and market
interactions and generate tailored product penetration.
recommendations to enhance satisfaction.
• Product design and customization: Create tailored
• Operational optimization: Enhance supply chain and products and prototypes rapidly, reducing
inventory management through demand forecasting development cycles and enabling customization at
and production scheduling, while minimizing scale to meet individual customer preferences.
downtime in manufacturing.
• Risk management and compliance: Enhance fraud
• Creative and content generation: Aid in developing detection and automate compliance in real time,
engaging marketing and creative content and facilitate safeguarding operations and maintaining market
innovative product design and advertising. leadership through trust and regulatory adherence.

Low-hanging fruit Future Foundations

This quadrant covers relatively easily achievable benefits These benefits are transformative and seen as
that can provide quick but moderate impacts. foundational for the future but are realized gradually.
• Product development acceleration: Reduce the time • Dynamic supply-chain adjustments: Adjust supply
from concept to prototype by quickly generating and chain operations based on real-time data, ensuring an
iterating design prototypes, automating design efficient response to market fluctuations.
prototyping, and streamlining risk assessments.
• Adaptive production planning: Implement dynamic
• Design optimization automation: Automate the pricing strategies and adjust production planning in
optimization of product designs according to specific real time to meet current market demands.
criteria including weight, cost, and performance
• Anti-counterfeiting measures: Detect and prevent
enables rapid iterations and enhances efficiency in the
counterfeit products in the consumer goods market,
development process.
protecting brand integrity and consumer trust.
• Employee engagement and satisfaction: Power
• Real-time anomaly detection: Employ GenAI for swift
platforms that support employee well-being and
identification of irregular patterns, enhancing security
provide personalized training and development.
by preventing potentially fraudulent activities.
• Learning and development: Customize training
programs to individual employee needs, fostering
professional growth and adapting learning materials to
enhance engagement.

© 2024 | HFS Research 33

SECTION 08

About this
Study

We surveyed 550 senior executives

worldwide and conducted detailed
interviews with 10 enterprise leaders
who are setting the pace in GenAI
adoption and innovation. Below are
the demographic details of the survey
participants.

© 2023, HFS©Research
2024 | HFS Research 34
34
Survey demographics

Role in organization Revenue

28% 44% 27%

9%

29% 22% 25% 15%

VP
VP SVP
SVP EVP orEVP or
Business C-level
/ C-level CEO
CEO $1 Billion - less $5 Billion - less
Business / $10+ Billion
regional head than $5 Billion than $10 Billion
regional head

Role in investments and initiatives around GenAI Industry

19% 11%
I have a good understanding of
23%
my organization’s GenAI initiatives Banking and capital markets Healthcare

I am responsible for executing my 13% 11%

24%
organization’s GenAI ambitions
Consumer products Manufacturing
I am influencing and advising my
20%
organization’s GenAI initiatives 13% 11%
I am the decision-maker for our
19% Life sciences Retail
GenAI initiatives

I own / partly own the budget for 11% 11%

15%
our GenAI initiatives
High-tech Insurance

Country

33%

13% 11%
8% 8% 7% 5% 5% 4% 2% 2% 2%

United States Germany Japan Canada France United Australia China Switzerland Denmark Netherlands Sweden
Kingdom

Primary function Department within IT

IT 21%
Infrastructure and networking 33%
Data & Analytics 18%
Industry-specific operations
13%
(please specify)
Application development and
Sales & Marketing 8% maintenance 27%
(software engineering)
Customer Services 8%

Finance & Accounting 8%

Project & IT management 25%
Financial Crime 6%

ESG or Regulatory Compliance 6%

Supply Chain and Procurement 6% Cybersecurity 14%

Human Resources 4%

© 2024 | HFS Research 35

HFS Research authors

Saurabh Gupta
Dana Daher
President, Research and
Associate Practice Leader
Advisory Services

At HFS, Dana leads research in generative AI, Saurabh sets the strategic research focus and
employee experience, emerging technologies, agenda for HFS Research, understanding and
and the energy and utilities sector. She predicting the industry's needs and ensuring that
spearheads research projects that explore the HFS maintains its position as the strongest
adoption and implications of AI technologies and impact thought leader for business operations
plays a key role in the HFS Hot Tech program. and services research. He oversees the firm’s
global research function, managing a team of
Before joining HFS, Dana worked at Info-tech analysts and operations across the US, Europe,
Research Group, where she developed IT and Asia.
strategies and technology roadmaps, led digital
transformations, established governance
programs, and guided the selection of CRM and
ERP applications.

© 2024 | HFS Research 36

Genpact contributing authors

Sreekanth
Meg Van Winkle
Menon
Chief of Staff to the CEO
Global Head, AI/ML Practice

Sreekanth Menon leads Genpact's global AI/ML Meg leads the office of the CEO at Genpact. She
practice, collaborating with Fortune 100 clients drives key strategic initiatives pivotal to the
worldwide steering strategy, business company's goals, working with major internal and
transformation, product development, and external stakeholders to foster strategic, growth-
delivering top-tier analytical solutions. He has focused engagement. Previously, as Genpact’s
spearheaded the company's data science growth excellence and commercial
practice, making Genpact a Top 50 Data transformation leader, Meg formulated the
Science firm for four consecutive years. company’s growth strategies. She joined
Sreekanth has incubated and launched over 100 Genpact from Accenture in 2018 as part of the
advanced analytics solutions across various corporate strategy team, focused on growth
industries. Recognized as one of India's most areas such as data, analytics, technology, and
influential AI and analytics leaders, he advocates experience.
for responsible AI systems.

© 2024 | HFS Research 37

 About Genpact

Genpact (NYSE: G) is a global professional services and

solutions firm delivering outcomes that shape the future. Our
125,000+ people across 30+ countries are driven by our innate
curiosity, entrepreneurial agility, and desire to create lasting
value for clients. Powered by our purpose – the relentless
pursuit of a world that works better for people – we serve and
transform leading enterprises, including the Fortune Global 500,
with our deep business and industry knowledge, digital
operations services, and expertise in data, technology, and AI.

Powered by our purpose – the relentless pursuit of a world that

works better for people – we serve and transform leading
enterprises, including the Fortune Global 500, with our deep
business and industry knowledge, digital operations services,
and expertise in data, technology, and AI.

Get to know us at genpact.com and on LinkedIn, X, YouTube,

and Facebook.

© 2024 | HFS Research 38

 About HFS

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© 2024 | HFS Research 39