Editor's Note:Arun Kumar serves as the Global Practice Lead for Data and AI atHero Digital, a technology consulting firm focused on customer experience, headquartered in Chicago, Illinois. The views expressed in this article are solely those of the author.

Companies that have not yet embraced artificial intelligence are already falling behind.

But it's not too late. As we move into 2024, the opportunities to integrate AI into business operations and practices are more abundant than ever.

The business value is already clear—according to aIBM study, companies that effectively use AI can generate13% higher return on investment, more than double the average return of those that implement AI without preparation or strategy.

AI is not just another Silicon Valley fad; it is a transformative technology that is here to stay.

Since ChatGPT was released to the public over a year ago, the pace of AI adoption by businesses has accelerated significantly. While many applications remain in the "wow—didn't know it could do that" stage of amazement, a wealth of practical uses and use cases have emerged.

Additionally, governmentsare beginning to regulate AI, which further underscores its importance, even though the technology is still in the early stages of adoption.

Risks and Challenges in Adoption

A recentSalesforce surveyfound that more than half of employees using AI do so without employer approval, putting companies at risk. This unauthorized use—though often not malicious—can lead to data breaches and reputational damage, as seen in the case ofSamsung employees uploading sensitive code to the ChatGPT platform.

Privacy and other risks associated with AI implementation will come into focus in 2024 and beyond. U.S. President Joe Biden has signed an executive order on AI, and many scientific and government organizations have begun issuing their own specific guidelines. Meanwhile, the European Union has alreadyintroduced AI regulations, the impact of which will be felt globally. Given these developments, companies need to prioritize privacy, data protection, and ethical AI practices to avoid regulatory fines and reputational loss.

AI adoption also brings cultural challenges to organizations. Embracing AI is both a technological and a cultural transformation. Familiarity and acceptance of the technology may vary among people within the organization. Employees must be properly equipped and informed to fully leverage this new tool.

Furthermore, first-time AI adopters often are uncertain about how to proceed in ways that generate real business value. A 2019 study by MIT Sloan Management Review and Boston Consulting Group found thatseven out of ten companies derive little or no impact from their AI use。

How to Get Started

Here are some practical recommendations for first-time AI adopters to navigate these thorny challenges:

Start small.Companies should begin their AI journey with manageable, small-scale projects rather than attempting a massive transformation. Focus on initiatives that deliver value and efficiency gains, and do not hold unrealistic expectations for immediate, dramatic growth.

Measure real outcomes.Although AI may seem magical, linking its applications to tangible business results is crucial. Companies should not overhype, but demonstrating value is key to securing support and resources for future AI projects. The focus should be on creating genuine business value rather than merely highlighting the novelty of the technology.

Stay authentic and transparent.Do not make the mistake of labeling non-AI solutions as AI, as Google encountered controversy with itsGemini demo video. Consumers can tell the difference, and deceptive practices damage a company's reputation. Instead, focus on executing foundational use cases that genuinely benefit customers. For example, Amazon released anAI-powered featureto summarize user reviews, demonstrating how practical and transparent AI applications can enhance customer experience.

Establish internal policies and processes.It is crucial to develop clear AI usage policies, processes, and guidelines within the organization. Ensure employees are aware of these policies and have access to guidance on how to use AI responsibly, ethically, and in compliance with legal standards.

Train and educate employees.Provide employees with the knowledge and skills needed to use AI effectively and responsibly. Training will empower the workforce to safely harness AI's capabilities.

Foster open internal communication.Make AI a non-taboo topic by creating an environment where employees can openly discuss questions and concerns. This communication helps prevent employees from experimenting with AI tools without approval, thereby avoiding potential data leakage risks.