Generative AI's growing role in ANZ business by 2025

As 2025 approaches, the role of generative AI in shaping business operations is set to grow significantly according to Cloudera's recent analysis.

The focus for many organisations in the coming year will be on deriving measurable results from AI investments. Keir Garrett, Regional Vice President of Cloudera Australia and New Zealand, notes, "For organisations, effective data management is no longer optional – it is essential for compliance and for showcasing the tangible benefits of AI investments." According to McKinsey's report, 65% of organisations already use AI to achieve cost savings in HR and revenue enhancements in supply chain management, but the focus on scalability and outcomes is becoming more pressing.

Many businesses are still navigating the transition from pilot projects to fully integrated AI solutions, with 70% of IT leaders in Australia and New Zealand admitting to being at varying stages of AI deployment. Despite this, there are challenges related to foundational data management and achieving a "single source of truth" as organisations struggle with data fragmentation and inefficient insights.

Another significant prediction is the inadequacy of merely having a hybrid cloud infrastructure. In 2025, scaling GenAI deployments will heavily depend on a comprehensive cloud adoption strategy that prioritises flexibility, security, and innovation. Gartner forecasts that IT spending in Australia, influenced by cloud investments, is expected to reach AUD $147 billion, highlighting the importance of robust multi-cloud capabilities in managing diverse data environments.

As businesses strive for AI innovation, there is a growing preference for private over public large language models (LLMs). Keir Garrett states, "Enterprise AI innovation is driving a shift towards enterprise-grade private LLMs for tailored insights." The emphasis on security and customisation is particularly pronounced in heavily regulated industries, aligning with the government's promotion of operational resilience. Growth in retrieval-augmented generation is anticipated to enhance accuracy in field support, human resources, and supply chain management.

The rise of FinOps as a discipline is also foreseen as vital in optimising the costs associated with AI. Gartner highlights this, projecting that 94% of ANZ CIOs will prioritise operational margins from technology investments in 2025. FinOps will play a crucial role in balancing AI-driven innovation with cost efficiency, leveraging AI-powered analytics to monitor cloud costs and optimise resource allocation.

The regulatory landscape is expected to evolve significantly, focusing on reducing risks and improving trust in AI. Australian legislative reforms concerning compliance, cybersecurity, and data privacy will necessitate robust data governance frameworks. Gartner predicts that organisations with comprehensive AI governance platforms might experience 40% fewer AI-related ethical incidents by 2028.

Keir Garrett emphasises the importance of these predictions for businesses, stating, "Business leaders must champion data governance frameworks that uphold data quality and integrity while investing in advanced data management solutions to enhance security and navigate the regulatory landscape effectively." As businesses prepare for 2025, these insights provide crucial guidance on leveraging generative AI for sustainable growth and innovation.