IBM Highlights AI Governance Challenges As India Inc Embraces Open-Source AI To Drive ROI, Innovation

As the use of open-source artificial intelligence tools such as ChatGPT and DeepSeek grows for improving productivity, Indian companies are embracing AI with a focus on driving innovation and ROI. New research commissioned by IBM found that organisations are investing in AI for the long term, with an interest in using open-source tools to drive ROI and innovation.

The study revealed that 87% of Indian IT decision-makers report making progress in executing their 2024 AI strategy, with 76% already seeing positive ROI from AI investments. Companies are experimenting with AI to find new uses cases, with 89% leaders saying their companies have started more than 10 pilots in 2024. 

Of the surveyed Indian organisations, 97% are planning to either increase or maintain their investment in AI in 2025. Areas of focusing investments include IT operations (83%), software coding (56%), and data quality management (55%). 

Surveyed ITDMs identified utilising open source (71%), managed cloud services (70%), and hiring specialised talent (66%) among the most common ways they plan to optimise their AI investments. 

However, companies face a broad range of challenges as they implement AI. The top one among these is the need for robust governance and this highlights the need for responsible AI. The top five such concerns were the lack of AI governance (53%), lack of AI expertise (51%), technology integration (51%), data management (41%), and failure to deliver business value (39%). 

Around 48% of companies said that more than half of their AI solutions are based on open-source. As company size increases, so does the likelihood that the majority of AI solutions are based on open source. 

Of the surveyed Indian ITDMs, 87% reported making progress in executing their AI strategy, while only 1% reported no progress. Companies typically move from AI pilot to full production within 12 months in 63% of cases. On what is driving AI investments, 62% of companies said both innovation and ROI, mostly innovation (15%), and mostly ROI (13%). 

Faster software development (34%), rapid innovation (32%), and productivity time savings (17%) ranked as the three most important metrics Indian ITDMs use to calculate ROI from AI investments. 

More than three-fourth (76%) of surveyed companies are achieving positive ROI from their AI projects, while 19% are breaking even and just 4% said they are recording negative ROI.  

Additionally, the companies not yet achieving positive ROI, 33% expect to begin seeing dollar savings within the next 12 months; 100% believe they will turn a positive ROI within 3 years.