State of Enterprise AI: The AI Value Gap
AI is creating visible operational gains for many enterprises. However, it's not yet consistently producing business and financial value.
2026 AI Adoption & Performance
Most organizations say AI works well and employees are using it. User adoption, agent utilization, governance and model accuracy all rate about expectations.
Operational impact gets mixed reviews, with employee productivity gains coming in slightly below what was expected, and most business and financial outcomes have fallen far short.
Today, nearly a quarter of AI work is reviewed by humans and almost 14% involves humans only for exception handling. The role of the human employee is moving away from completing every task and toward managing the conditions in which AI performs the work.
Leading AI Use Cases
More than 40% of enterprises report that AI has generated the most value over the last 12 months through workflow-centered uses.
-
Task automation and workflow execution
-
Data analysis and insights generation
-
Process optimization and operational improvement
Requiring people to validate these functions can create bottlenecks when AI produces results faster than employees can review them. Enterprises can avoid that by applying AI to higher-value roles within workflows, such as monitoring information and gathering context to identify issues for humans to assess.
AI Value Realization is Not a Linear Journey From Adoption to Success
Organizations can use AI extensively and experience very different outcomes.

The differentiator is an organization’s ability to convert AI into value while managing the technology, workforce and economic challenges that come with it.
Let's Dive In...
To generate value from AI, enterprises need to modernize their data, simplify the technology stack, redesign the way employees work, clarify the economics of AI and set clear governance guardrails. These changes will help turn today’s AI activity into tomorrow’s measurable business and financial results.

Page Count: 34
Meet the Team
Loren Absher
Director, Americas Lead – AI Advisory
Loren Absher
Loren Absher leads ISG’s AI Advisory practice in the Americas. He helps clients unlock business value from AI by bringing together all the elements required for success: the foundational data enablement strategies that make AI possible, the selection of the right use cases aligned to business priorities, the sourcing strategies that connect enterprises with the right provider ecosystem, and the implementation and adoption frameworks that drive sustained results, ensuring client strategies are consistently translated into outcomes.
Alex Bakker
Distinguished Analyst
Alex Bakker
Alex leads the Primary Research Team where he focuses on study design, panel research, and interview based research for ISG. In addition to leading the Primary Research practice at ISG, Alex also serves as the lead analyst on provider pursuit effectiveness, and helps IT service providers understand how they can improve performance in the competitive process.
Dr. Dorotea Baljević
Director, EMEA Lead - AI Advisory
Dr. Dorotea Baljević
Dorotea Baljević is a Director within the AI Acceleration Unit, enabling clients in their business, AI and data transformations while delivering value across the entire ecosystem.
Dorotea provides support and counsel to customers in their current and future digital journeys. Particularly focusing on improving and enhancing data and AI capabilities for the decision-making ecosystem to ensure healthy organisational longevity and relevance. This includes a focus on value driven outcomes, responsible use of data and AI, and shaping authentic and right-size solutions that align to the clients current and strategic needs.
Her spectrum of experience includes innovation, green-field environments, existing transformations (including building high performing teams), governance, regulatory preparation and compliance, development of digital threads and decommissioning.
Michael Dornan
Principal Analyst
Michael Dornan
Michael Dornan is a Principal Analyst in Provider Services based in the UK. He is responsible for ISG’s Buyer Behavior research program, helping providers navigate changing market dynamics, identify unmet enterprise demand, and position services and solutions that align to client needs.
Steve Hall
Chief AI Officer
Steve Hall
Steve Hall is Chief AI Officer, leading the firm’s work to help clients create an AI strategy, select the right business partners and deliver meaningful value and outcomes. His industry-leading expertise in navigating the complexities of adopting technology at scale is helping both clients and ISG leverage AI to drive value into every aspect of their operations. Steve joined ISG in 2005 and has led ISG Digital Advisory Services, Emerging Technology Services, Global Product Engineering and Application Development & Maintenance. Trained as a software engineer, he serves on the Advisory Board of Consortium for Information & Software Quality (CISQ). He holds a bachelor’s degree in computer science from Regis University.
Stanton Jones
Distinguished Analyst
Stanton Jones
Stanton helps enterprise technology leaders, IT service providers and buy- and sell-side professionals make sense of the global IT services sector. Stanton's weekly briefing - the Index Insider - is read by thousands of industry stakeholders each week.
Angela Kreiter
Principal Analyst
Olga Kupriyanova
Principal Consultant, AI & Data Engineering
Olga Kupriyanova
In ISG, Olga supports our advisory capability in developing digital solutions with special focus on data and analytics. Olga’s extensive knowledge of analytics and data engineering framework combined with hands on experience in complex transformational projects results in unique insights invaluable for effectively assessing the data analytics solutions for ISG’s clients.
David Menninger
Executive Director, Software Research and Distinguished Analyst
David Menninger
David manages the software research and advisory for IT and leads the expertise in AI. He oversees the team and expertise areas for software used by IT and for what is used by business. David leads the software research efforts in AI for IT and AI-infused software building on over three decades of experience in data and analytics. For decades, he has brought to market leading-edge analytics and data products in marketing and product leadership positions at Pivotal (a division of EMC), Vertica Systems, Oracle, Applix, InforSense, and IRI Software. David earned his MS in Business from Bentley University and a BS in Economics from the University of Pennsylvania.
Colleen Sivill
Director
Colleen Sivill
Colleen leads systems integration and organizational transformation initiatives for Enterprise Change. In this role she partners with clients to make purpose driven decisions around change management, communications, and culture challenges that surface during large-scale change. This holistic and integrated approach delivers change for today while simultaneously strengthening an organization’s ability to continuously change – leaving it healthier, more agile, and always improving.
Eryn Peters
Director - AIM Product & Commercial Strategy