ArmAIReadinessIndex

Chartingprogressandopportunitiesinatransformingworld.

2

CONTENT

Foreword

6

Chapter1:TheGlobalStateofAIReadiness:AData-DrivenAnalysis

8

Chapter2:TheTechnicalFoundation:TechnologyRequirementsfor21

AISuccess

2.1OverviewofAITechnologyRequirements

21

2.2TheArchitecturalFoundationsofModernAI

24

2.3PowerandPerformanceSolutions

32

2.4InfrastructureScalingRequirements

37

2.5EmergingTrendsinAIInfrastructure

39

Conclusion

40

ArmSidebar:AIEverywhere:Arm,sVisionfortheFutureofCompute

42

AcceleratedAIEverywhere#onArmFromCloudtoEdge

43

TheEnergy-EfficientPervasiveComputePlatformtoPowerGenAI

44

TheDeveloper-TrustedPlatformforRunningAIWorkloads46

Everywhere

Chapter3:PolicyandGovernance:ShapingtheAIRegulatory47

Landscape

3.1UnderstandingthePolicyandRegulatoryPillarofAI

47

3.2CurrentRegulatoryFrameworks

49

3.3InternationalCooperation

53

3.4EthicalConsiderations

56

3.5FuturePolicyDirections

59

3.6Conclusion

62

3

ArmSidebar:AIPolicy,Regulation,andGlobalTrends

63

TheGlobalDivideonAIRisks

65

WhattoExpectFromShiftingAIRegulationintheU.S.

65

Sector-Specificvs.Cross-SectoralAIRegulation

66

TheRoleofStatesinAIRegulation

66

ChallengesofOperatingUndertheEUAIAct

67

AShiftinAIRegulatoryMindset

68

ImplicationsforU.S.andGlobalCompanies

68

HowDevelopersMayNavigateAIRegulatoryFrameworks

69

PreparingtheWorkforcefortheAIRevolution

70

AIRobotsWillChangeRegulatoryConsiderations

71

BalancingSector-BasedRegulationandGlobalAIPolicy

72

Chapter4:AISafetyandRisk:NavigatingthePathtoResponsible74

Innovation

4.1CurrentSafetyChallenges

75

4.2RiskAssessmentFrameworks

77

4.3AlignmentProblems

79

4.4EmergingSafetyStandardsandBestPractices

82

4.5CollaborationandtheRoleofStakeholders

85

4.6FutureDirectionsinAISafetyandRisk

87

Chapter5:TrustandSecurityintheAIEra

89

5.1UnderstandingAI’sUniqueSecurityandTrustChallenges

89

5.2AISecuritySolutionsandRisks

91

5.3DataProtectioninAIApplications

95

5.4ChallengesandSolutionsforTrustworthyAISystems

96

4

5.5EvaluationMetricsforSecurityandTrust

98

Conclusion

100

Chapter6:SustainabilityasaCoreMetricforAIReadiness

101

6.1AI'sRisingEnergyConsumptionanditsImplications

101

6.2EnhancingEnergyEfficiencyinEdgeAI

103

6.3FocusonInnovationsinEnergy-EfficientAIHardware

105

6.4AIasaCatalystforGlobalClimateSolutions

106

6.5CollaborationforSustainableAI

108

6.6BalancingInnovationandResponsibility

109

ArmSidebar:SustainableAI:BalancingInnovationwith110

EnvironmentalImpact

TheEnvironmentalImpactofAI

110

SustainableAIInitiativesandTechnologies

111

TheRoleofAIinClimateSolutions

113

CollaboratingforaSustainableAIFuture

113

LeadingAIResponsibly

114

Chapter7:BuildinganAI-ReadyCulture

115

7.1BuildinganAI-ReadyCulture:ARoadmap

117

7.2InvestinUpskillingandContinuousLearning

117

7.3LeadwithChangeManagementandClearCommunication

118

7.4FosteraHands-on,InclusiveAICulture

119

ArmSidebar:AddressingtheSkillsChallengesinanAI-Driven122

Workforce

CurrentSkillsChallengesintheAIWorkforce

122

Context-specificEducationforRegionalandGlobalVariationsin123

SkillsChallenges

5

TheEvolutionofEducationalRequirements

123

TheRoleofAcademicInstitutionsinWorkforcePreparation

124

TheRoleoftheSemiconductorEducationAlliance

124

ArmCollaborationswithAcademia

125

AComprehensiveApproachtoEquippingtheAIWorkforce

125

Chapter8:Casestudies

126

StreamliningADASIntegrationforSafer,SmarterVehicleswith126

LeddarTech

TheFirstAutonomousBeehive:HowBeewiseisRevolutionizing129

BeekeepingwithAI

AccessibleComputingPlatformForEveryone:TheEvolutionof132

RaspberryPi

SpaceTechSmartCityInfrastructurePoweredbyArm’sEdgeAI

135

Conclusion:FromAIReadinesstoAILeadership

138

Appendix

140

References

140

SurveyMethodology

149

AbouttheContributors

152

6

Foreword

WILLABBEY,

EXECUTIVEVICEPRESIDENTANDCHIEFCOMMERCIAL

OFFICER,ARM

Throughouthistory,certaintechnologicaladvancementshave

fundamentallyalteredourworld.Theprintingpressdemocratized

knowledge.Theindustrialrevolutiontransformedmanufacturing.The

internetconnectedhumanityinwayspreviouslyunimaginable.Today,westandatanothersuchpivotalmomentwithartificialintelligence.

Likethosehistoricinflectionpoints,artificialintelligence(AI)isnotmerelyanincrementalimprovementonwhatcamebefore;itrepresentsaparadigmshiftthatisredefininghowwework,communicate,create,andsolve

problems.Andlikethoseearliertransformations,thefullimpactofAIwillbedeterminednotjustbythetechnologyitself,butbyhowwechoosetodevelop,deploy,andgovernit.

Whatwasonceconsideredtherealmofsciencefictionhasbecomean

integralpartofourdailylivesandbusinessoperations.TheAIReadiness

Indexreportrepresentsacomprehensiveefforttounderstandwherewe

standtodayinarapidlytransformingworldandchartacourseforthefuture.

Aswenavigatethistransformativeera,onethinghasbecomeabundantly

clear:AIisnolongeratechnologyoftomorrow—itisthedrivingforceof

now.Ourresearchrevealsthat82%ofglobalbusinessleadersarealreadyusingAIapplications,withoverwhelmingmajoritiesexpectingtoincrease

theirinvestmentsinthecomingyears.Yetdespitethiswidespreadadoption,only39%reporthavingaclearlydefined,comprehensivestrategyinplace.

Thisgapbetweenadoptionandstrategicimplementationunderscores

thecomplexchallengesorganizationsface.Frombuildingrobusttechnical

foundationsandaddressingsecurityconcernstonavigatingevolving

regulatorylandscapesanddevelopingnecessarytalent,thepathtoAI

successrequirescarefulconsiderationofmultipleinterconnectedfactors.

Whatmakesthismomentparticularlysignificantistheshiftingnatureoftheconversationitself.WehavemovedbeyondaskingwhetherAIwilltransformourindustriestoaskinghowwecanresponsiblyharnessitspotentialto

driveinnovation,efficiency,andgrowth.Thefocushasrightfullyexpandedfrompurelytechnicalconsiderationstoencompassbroaderimplicationsforsecurity,sustainability,governance,andworkforcedevelopment.

TheAIReadinessIndexaimstoserveasbothamirrorandacompass—reflectingthecurrentstateofAIreadinessacrossindustriesandregionswhileprovidingdirectionfororganizationsatvariousstagesoftheirAI

journeys.Bycombiningextensivesurveydatafrom665businessleaderswithexpertanalysisandcasestudies,weofferanuancedviewofthe

challengesandopportunitiesthatlieahead.

Asyouexplorethefindingsinthisreport,Iencourageyoutoconsider

notjustwhereyourorganizationstandstoday,butwhereitneedstobe

tomorrow.Theorganizationsthatwillthriveinthisnewerawillbethose

thatapproachAIwithbothambitionandresponsibility—embracingits

transformativepotentialwhilethoughtfullyaddressingthetechnical,ethical,andhumandimensionsofimplementation.

ThefutureofAIisbeingwrittentoday,byleaderswillingtoaskdifficult

questions,takeboldrisksandmakestrategicinvestmentsinthe

foundationsoftomorrow’ssuccess.Myhopeisthatthisreportwillserveasavaluableresourceasyouwriteyourorganization’schapterinthatfuture.

7

FOREWORD

CHAPTER1

TheGlobalStateofAIReadiness:

AData-DrivenAnalysis

METHOD

COMMUNICATIONS

Inboardroomsandstrategysessionsacrosstheglobe,artificialintelligencehasmovedfromadistantaspirationtoanimmediatepriority.Our

extensivesurveyofbusinessleadersrevealsanotablereality:AIadoptionisacceleratingrapidly,with82%ofglobalbusinessesalreadydeployingAIapplicationsintheirday-to-dayoperations..Thisbroadadoptionofartificialintelligencespansindustriesandregions,demonstratingthatAIisno

longertheexclusivedomainoftechgiantsbuthasbecomeanessentialtechnologyforenterprisesofalltypes.

Customerservicestandsattheforefrontofthisadoptionwave,with63%oforganizationsdeployingAItoenhancecustomerinteractions.Documentprocessing(54%),IToperations(51%),andsecurityapplications(51%)

followcloselybehind,showinghowAIhasrapidlyinfiltratedcorebusinessfunctions.Thisisntmerelyexperimentationitstransformationatscale.

TheenthusiasmforAIrunsdeepwithinorganizationalhierarchies.An

overwhelming90%ofleadersreporttheirorganizationsarereceptivetoAI-drivenchanges,with83%consideringAIadoption“urgent.”

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8

83%ofGlobalLeadersBelieveitisurgentfortheirorganizationstoEmbraceA;

with30%sayingit'sHighlyurgent

Mosttellingly,82%ofbusinesseshavesecuredexecutivesponsorship

atthehighestlevels,withCEOsandseniormanagementpersonally

championingAIinitiatives.Thistop-downcommitmentsignalsthatAIhastranscendedtechnicalcuriositytobecomeastrategicimperative.

Financialcommitmentsreinforcethisstrategicshift.Eightinten

organizationshaveestablisheddedicatedAIbudgets,withregional

variationshighlightingdifferentapproachestoinvestment.TheAsia-

Pacificregionleadsinbudgetallocation,with86%ofAPACbusinesses

dedicatingresourcestoAIinitiatives,comparedto76%inEuropeand75%intheUnitedStates.However,Americanorganizationsareinvestingmoreaggressively,with57%committingmorethan10%oftheirITbudgetstoAI,surpassingEuropean(46%)andAPAC(45%)counterparts.

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“AIwilleliminate

repetitivework,

allowingemployeestoengageinmore

strategicand

creativetasks.”-

Businessleadersurveyrespondent

HasDedicatedABudgetpercentagespendsover10percentonAPercentage

Asia-pacficEur。peunitedstates

Thisfinancialcommitmentshowsnosignsofwavering,as87%ofbusinessleadersanticipateincreasingtheirAIbudgetsoverthenextthreeyears.

What’sdrivingthisrushtowardAI?Inaword,efficiency.Acompelling

63%ofgloballeadersidentifyoperationalefficiencyastheprimary

benefittheyexpectfromAI,with80%makingitthecentralfocusoftheir2025AIstrategy.Asonebusinessleaderarticulated,“AIwilleliminate

repetitivework,allowingemployeestoengageinmorestrategicand

creativetasks.”Anotherexplainedhow“AIadvancementswillimpactourorganizationbyenhancingefficiencyindecision-makingandinnovationacrossoperationswhilerequiringcontinuousadaptationtonew

technologiesandregulatorychanges.”

Yetbeneaththismomentumliesaconcerningparadox.

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10

Adoption-strategyparadox

organizationscurrentlyusingAl

organizationswithapartialAIStrategy

organizationswithnoAIStrategy

organizationswithaCearyDefinedAlstrategyorganizationsW。rking。nDevelopingastrategy

Despitewidespreadadoptionandexecutivesupport,only39%of

organizationshavedevelopedaclearlydefined,comprehensiveAIstrategy.Evenfewerjust37%haveimplementedarobustchangemanagementplantoguideAIimplementationacrosstheirbusinesses.Thisgap

underscoresthatwhileAIisdeployed,manyorganizationsmaynotfullyunderstandhowtointegrateiteffectivelyorreadytheirworkforceforthechangesahead.

OneVicePresidentinthefinancialindustrysITdepartment

acknowledged:“Wehaveourworkcutoutforusinformalizingthese

toolsets.Theirusehasgrownorganicallywithinthebusinessunits,sowehaveduplication.Ithinkweregettingthere,andthatscertainlypartofmyroletofigurethatout.”

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Thislackofacohesivestrategyraisescriticalquestionsaboutthe

sustainabilityofcurrentAIinitiativesandtheirlong-termimpactonbusinessperformance.

PROCEEDWITHCAUTION

TheenthusiasmforAImustbetemperedwithasoberingreality:manyorganizationsremainill-equippedtoscaletheirAIinitiativeseffectively.

Ourresearchrevealssignificantshortcomingsinthreecriticalareas—infrastructurereadiness,talentavailability,anddataquality—eachrepresentingapotentialbarriertorealizingAI’sfullpotential.

Infrastructurechallenges

Infrastructurelimitationsareparticularlyconcerning.Only29%of

organizationshavesystemsorstorageresourcestomeetgrowingAI

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demands.Evenfewer—amere23%—havededicatedpowerinfrastructuretohandletheincreasedenergyrequirementsofAIworkloads.Thismeans77%ofbusinesseshaveonlybegunupgradingtheirfacilities—if

theyhaveanypowermanagementstrategy.Additionally,65%ofleaders

acknowledgethattheirorganizationslackcomprehensiveenergyefficiencyoptimizationmeasuresforAIsystems,raisingquestionsaboutoperationalcostsandenvironmentalimpactastheseworkloadsgrow.

AIEfficiencyoptimizationLevel

Thetalentgapposesanequallysignificantchallenge.Athirdofbusinessleaders(34%)reporttheirorganizationsare“significantlyunder-resourced”or“under-resourced”whenitcomestoAIexpertise,whilenearlyhalf

(49%)identifyalackofskilledtalentasaprimarybarriertosuccessfulAIimplementation.AsoneC-levelexecutiveinmanufacturinglamented,“It’saboutmanpowertalent.It’ssohardtofindpeoplewhoknowAIandcantalkaboutAI.”

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Despiterecognizingthetalentgap,organizationsaretakinginconsistent

approachestoaddressingit.Whiletwo-thirds(66%)ofleadersexpress

intentionstoupskillexistingemployeestoadapttoincreasedAIintegration,39%stilldonthavededicatedprogramstodevelopAIskillsamongtheir

workforce.Thisdisconnectbetweenrecognizedneedanddecisiveactionthreatenstowidenthetalentgapratherthancloseit.

Perhapsmostfundamentally,organizationsstrugglewithdatareadiness

“Wehaveourwork

theessentialfoundationforeffectiveAIapplications.Nearlyhalfof

cutoutforusin

businessesleveragecustomerdata(49%)andoperationaldata(48%)forAI

formalizingthese

initiatives.However,datamanagementpracticesremainlargelyrudimentary.

toolsets.Theiruse

Onlyabouthalf(53%)oforganizationshavebasicdataautomation

haslargelygrown

processesforAI/MLmodels,while18%relyonmanualoradhocdata

organicallywithin

cleaningprocedures.Notsurprisingly,46%ofleaderscitedataqualityand

thebusinessunits,andthat’swhywe

accessibilityissuesasamajorbarriertosuccessfulAIimplementation.

haveduplication.”

Industryleadersrecognizethesechallenges.OneVicePresidentin

-VicePresident

thefinancialindustrysITdepartmentexplained:“Ourdataqualityand

withintheInformation

catalogingissocriticalwhenitcomestoAI...Thatisworkinfrontofus.”

Technology

AnotherC-levelITexecutiveinmanufacturingemphasizedtheneedfor

department,working

integrateddataplatforms:“Weneedtogetthedataintooneplatformso

foranorganizationinthefinancialindustry

wecantrytoleveragetheotherfunctionstouseAI.”

Theseinfrastructure,talent,anddatachallengescannotbeoverlooked.

Withoutaddressingthesefundamentalcapabilities,organizationsrisktheirAIinvestmentsdeliveringdiminishingreturnsastheyattempttoscale

beyondinitialproof-of-conceptdeployments.

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SECURITYSENSITIVITY

AsorganizationsincreasinglyintegrateAIintotheiroperations,anew

dimensionofriskhasemergedthatdemandsurgentattention:datasecurityandprivacy.Securityconcernsaregrowingproportionally,withpersonally

identifiableinformation(PII)rapidlybecomingcentraltoAIinitiatives.

securityconcerns(ThosewhoRankedcategoryamongToP3)

DataprvacyBreachesthr。ughM。delExtractionC。mpliancewithsecurityRegulations

AdversarialAtacksonAM。dels

IntegrationwithExistingsecuritynfrastructure

M。delTheftorntellectualpr。pertyLosssupplychainsecurtyf。rAlC。mp。nentsunauth。rizedAccesst。TrainingData

pr。mptInjectionAtacks

Nearlyhalf(49%)ofbusinessesalreadyusecustomerdatatopowertheirAIinitiatives,andthetrendisaccelerating.Lookingahead,56%ofleadersindicatetheirorganizationsplantoutilizepersonallyidentifiableinformationforfutureAIapplications.Thisgrowingrelianceonsensitivedataintroducessignificantsecurityconsiderations.

Asonedirectorinthelifesciencesandbiotechnologyindustryexplained:“Ithinkwhenyougetintosomeofthesecompanies,oursinparticular,wehavetobealittlebitmoresafeguardedbecauseofthedatasetswehave.

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“AIadvancements

willimpactour

organizationby

enhancingefficiencyindecision-making

andinnovationacrossoperationswhile

requiringcontinuousadaptationtonew

technologiesand

regulatorychanges.”

-Businessleadersurveyrespondent

Notallofitcanbesharedinpublicknowledge,butAImakeslookingatthatdata,interpretingthatdata,analyzingthatdata1000timeseasier.”

TheexpandeduseofsensitivedatainAIsystemsintroducessecurity

considerationsandethicalconcernsaboutbiasandfairness.AIsystemsareonlyasobjectiveasthedatathey’retrainedon,raisingimportant

questionsabouthoworganizationsensuretheirAIapplicationsmakefairandunbiaseddecisions.

Ourresearchrevealsasignificantgapinthisarea.Nearlyhalf(47%)of

businessleadersacknowledgetheirorganizationshavelimitedbias

detectionandcorrectionprocessesintheirAIsystems.Evenmore

concerning,17%reportedhavingnoformalbiascorrectionprocessandrelyinginsteadonadhocbiaschecks.Thisinconsistentapproachtobiasmitigationposessignificantrisks,especiallyasAIbecomesmoredeeplyintegratedintoconsequentialbusinessdecisions.

Forward-thinkingleadersrecognizethesechallenges.AsoneVice

Presidentinthefinancialindustryobserved:“Wehavetomakesurethat

dataisbias-free,andtodothat,wehavetocomeupwithpoliciesand

standardscontrolsthatneedtobeimplementedwithintheorganizationbysupportofdatascientistsanddatastewards.”Thisrecognitiondrives44%ofleaderstoidentifyAIethicsanddataengineeringasthemostcritical

skillstheirorganizationswillneedinthenextfiveyears.

Onamorepositivenote,organizationsarebeginningtoimplement

securitymeasuresfortheirAIsystems.Only5%ofbusinessesreportno

specificAIsecuritymeasures.Thevastmajorityaretakingatleastsome

precautions,with56%conductingregularsecurityauditsofAImodelsandinfrastructure,56%performingsecuritytestingofAI-poweredapplications,and51%conductingvulnerabilityassessmentsforAIsystems.

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16

Despitethesemeasures,significantconcernspersist.Nearlyhalf(48%)ofbusinessleadersidentifydataprivacybreachesthroughmodelextractionasatopAIsecurityconcern.OneVicePresidentofMarketingandSalesinretailobserved:“IthinktheresabigopenquestiononITsecuritythatlargecompaniesaregoingtoworryabout.”

AsAIsystemsbecomemoredeeplyintegratedwithsensitivebusinessandcustomerdata,organizationsmustevolvefrombasicsecuritypracticestocomprehensivesecuritystrategiesthataddresstheuniquevulnerabilities

associatedwithAItechnologies.

PREPARINGFORANAI-POWEREDFUTURE

Onepredictionseemscertainaswelooktowardthehorizon:AIadoptionwillcontinuetoaccelerateacrossallindustries.Organizationsthatprepareeffectivelytodaywillpositionthemselvestocapitalizeonthistechnologicalrevolution,whilethosethatfailtoaddressfundamentalreadinessgapsriskfallingbehind.

ThebusinesscaseforAIcontinuestostrengthenamongorganizations

usingAI;65%reportthattheirAIapplicationsaremeetingorexceedingexpectationsforreturnoninvestment.Thispositiveexperiencedrives

furtheradoption,with92%ofbusinessleadersindicatingplanstoexpandtheirAIusageinsomecapacity.

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%1%

6%

5%

22%

50%

15%

AlexpectationsVs.reality

signficantpositiveRO(ExceedsExpectations)

positiveRO1(MEetsExpectations)

TooEartyt。Measure

Neutral

unsureH。wt。Measurempact

NegativeRO1(D。esN。tMeetExpectations)

signficantNegativeRO(FallsBelowExpectations)

However,successfullyscalingAIinitiativesrequiresaddressingseveral

criticalpreparationgaps.Athird(34%)ofbusinessleadersidentify

integrationwithexistingsecurityinfrastructureasatopAIsecurityconcern.Meanwhile,43%acknowledgetheiremployeesdemonstrateonlyabasicunderstandingofAIatbest,withadditionaltrainingurgentlyneeded.Thesechallengeshaveledtwo-thirds(67%)ofbusinessleaderstoidentifyAI

securityamongthemostcriticalAI-relatedskillstheirorganizationswillneedtodevelopoverthenextfiveyears.

OrganizationsmustbalanceenthusiasmwithstrategicplanningastheyprepareforanAI-poweredfuture.Bysystematicallyaddressing

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infrastructurelimitations,closingtalentgaps,enhancingdataquality,andstrengtheningsecuritymeasures,businessescanmovebeyondinitial

experimentationtorealizeAI’stransformativepotentialatscale.

Thepathforwardisclear,ifchallenging.OrganizationsmusttranslatetheirAIenthusiasmintocomprehensivestrategiesthataddressfoundational

readinessgaps.Thosewhosuccessfullynavigatethistransitionwillbe

positionedtoreaptheefficiencygainsandcompetitiveadvantagesthatAIpromises.Fortherest,thegapbetweenAIambitionandAIreadinessmayproveincreasinglydifficulttobridge.

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CHAPTER2

TheTechnicalFoundation:

TechnologyRequirementsforAISuccess

DRJOHNSOLDATOS,

HONORARYRESEARCH

FELLOWATTHEUNIVERSITYOFGLASGOW

2.1OVERVIEWOFAITECHNOLOGYREQUIREMENTS

2.1.1TheNeedforaRobustTechnologyInfrastruc