Almost three years after the release of ChatGPT, less than a fifth of organisations in SA are fully prepared for AI, tech giant Cisco has concluded in a new report.
AI investment has grown exponentially in recent years, driven by the rapid adoption and popularity of OpenAI’s ChatGPT since it was launched in November 2022.
Companies around the world have felt the pressure to capitalise on the trend by employing AI-backed services or software platforms to either improve their own operations or create products.
Cisco’s third annual AI readiness index lays out the reality that the majority of organisations are still scrambling to figure out the new technology or at least be prepared for it.
According to the report, a small but consistent group of companies, the “pacesetters”, have outperformed their peers across every measure of AI value over three years.
These pacesetters account for about 18% of organisations in SA and 13% globally.
This comes from Cisco’s global study of over 8,000 AI leaders across 30 markets and 26 industries.
The sustained advantage of Pacesetters indicates a new form of resilience, the company said.
“A disciplined, system-level approach that balances strategic drivers with the data and infrastructure needed to keep pace with AI’s accelerating evolution. They’re already architecting for the future, with 98% globally designing their networks for the growth, scale and complexity of AI compared to 57% in SA.”
Cisco argues that the combination of foresight and foundation exhibited by such organisations will give them a leg up on their competitors as two major trends are reshaping the tech landscape.
The first are AI agents, which it says “raise the bar for scale, security and governance”. Then there is AI infrastructure debt, which refers to the accumulation of compromises in technology investment, such as deferred upgrades and underfunded architecture that “erodes the value of AI over time”.
“AI is accelerating change, no matter the industry or how advanced the market is,” said Smangele Nkosi, GM of Cisco SA.
“Organisations everywhere want to embrace AI to boost efficiency, spark innovation and create new ways of doing business. The alignment of AI with strategy, data and infrastructure helps companies extract real value from its deployment, enabling a sustained competitive edge. AI value doesn’t come from experimentation alone; it comes from execution.”
Valued at about $280bn, Cisco is 40 years old and one of the world’s largest technology companies that manufactures and sells networking hardware, telecommunications equipment and other products.
While AI is undoubtedly a major trend in technology, many are beginning to question its efficacy and transformative value to the world of commerce. This is against the backdrop of billions that have been poured into the sector in recent years.
As Adam Slater, lead economist at Oxford Economics, explains: “The tech sector is surging thanks to excitement about the growth-enhancing potential of AI. But if the tech sector fails to live up to expectations, our modelling shows the consequences for the world economy would be a significant hit to growth.
“The tech sector has been the key driver of recent US growth, with surging stock prices and heavy investment in equipment and software. But this leaves the US vulnerable if tech suffers a downturn — without tech investment, US GDP would have barely grown in H1 2025, and business investment would have actually declined.”
“We think the risk of a downturn in the tech sector is lower than at the height of the 2000 dotcom bubble, but it’s far from negligible. A particular concern is that the predictions of very large and sustained productivity gains from AI may not materialise.”
