Deltek survey: AI adoption outpaces governance at project-based firms, new studies find.
The new Deltek Clarity Industry Studies report from Deltek on government contracting and architecture and engineering (A&E) firms show that while many are growing on paper, they face underlying strains from talent shortages, margin pressures, and challenges in translating technology investments into measurable results.
Why it matters: Based on surveys of nearly 1,800 businesses, the findings suggest a shared paradox. Firms are rapidly adopting AI and other technologies, but they are struggling to implement proper governance and demonstrate a clear return on investment, creating new operational risks.
Zoom in: Government Contracting
The 17th annual study on government contractors found that revenue growth is often offset by shrinking profit margins and other declining financial indicators.
- AI implementation gap: A widespread push to adopt AI is outpacing the readiness of many companies, leading to increased risk and uncertain outcomes.
- Compliance is key: Meeting cybersecurity and compliance requirements is becoming increasingly crucial for winning contracts and passing audits.
- What they're saying: "The defining challenge contractors are facing is closing the gap between adoption and execution," said Kevin Plexico, SVP of Information Solutions at Deltek.
The 47th annual A&E report shows that while demand for services remains steady, firms are struggling to keep up due to workforce and productivity issues.
- Capacity constraints: Limited workforce growth and high employee turnover are making it difficult for firms to scale operations.
- Inconsistent AI impact: While AI adoption is accelerating, firms are having trouble moving from broad experimentation to targeted use cases with measurable objectives.
- Digital risk: The urgency to digitally transform is rising, but so are the practical barriers and associated cyber risks.
The big picture: The reports indicate a broader industry shift from a focus on "growth at all costs to more disciplined, performance-driven operations," said Megan Miller, Senior Director, A&E Industry Insights Lead at Deltek. For many project-based businesses, the immediate challenge is no longer just about adopting new technology, but about integrating it effectively to improve data visibility, manage projects, and control costs.
See the full Deltek Clarity Industry Studies report here:
SOURCE: Deltek
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