Connect with us

Business

AI Adoption and Management Implications in Modern Industry

Published

on


By Roberto García-Castro and Dr. J. Mark Munoz

AI technologies are spreading fast across industries, but adoption varies widely. This article helps managers understand where and how AI is gaining ground across the main U.S. industries in the 2020-2024 period, based on large-scale textual analysis of annual corporate 10-K reports.

Introduction

The increasing relevance of artificial intelligence (AI) and data-driven technologies across sectors has prompted growing interest in measuring their adoption across firms and industries (Cockburn, Henderson, and Stern, 2018). While anecdotal evidence points to the widespread integration of analytics, machine learning, and automation into business models, systematic evidence remains limited, particularly outside of the technology sector (Seamans and Raj, 2018).i

This article explores AI-related adoption patterns across US industries between 2020 and 2024, using a large-scale textual analysis of 10-K filings. By tracking the frequency of AI-related keywords in regulatory filings submitted to the Securities and Exchange Commission (SEC), the authors constructed a novel, replicable dataset that offers insight into how different industries disclose and potentially adopt AI technologies over time. The dataset consisted of annual 10-K filings from 7,883 unique US firms, downloaded using the Edgar package in R, which interfaces with the SEC’s EDGAR system. The filings span the years 2020 through 2024 and are parsed as plain text for computational efficiency. Each filing is tagged with its firm’s industry using standard SIC codes, which we mapped to broad industry categories for visualization purposes. In total, we analyzed 131,603,450 words in all US filings available in the EDGAR system. The average 10-K filing contained 23,037 words of text.

The methodology builds on prior work that uses natural language processing (NLP) techniques to study digital transformation (Chen and Srinivasan, 2020; Li, 2010). Specifically, the authors follow a keyword-based approach to proxy for firms’ engagement with AI, drawing on terms such as analytics, automation, big data, cloud, and machine learning. These keywords, drawn from both academic and consulting literature (Bughin et al., 2017), represent complementary dimensions of what is often broadly referred to as AI. The attached heat map visualizes the result of this exercise and reveals patterns in the diffusion of AI-related discourse across industries and years, highlighting both the heterogeneity in adoption and the concentration of AI-related language in certain sectors.

Increase in Ai Engagement and Diversity of Industry Usage

Following existing literature on digital adoption (Chen and Srinivasan, 2020), we define a dictionary of AI-related terms covering six core categories: AI, analytics, automation, big data, cloud, and digitization. The dictionary with the keywords used is shown in Table 1 below.

Table 1 - AI Industry Adoption and Its Management Implications

This set of keywords aimed to capture different dimensions of how firms discuss the integration of AI-related technologies into their operations. We also included a composite count (“total”) that aggregates the count from all categories.

Keyword mentions are counted in each firm’s 10-K text using regular expressions and aggregated by industry-year-category, resulting in a three-dimensional matrix. Figure 1 next page shows the intensity of keyword usage across time, industry, and AI dimension. Industries are arranged vertically, and AI categories are horizontally, with separate panels for each year from 2020 to 2024. Color intensity indicates the log-transformed frequency of keyword mentions, normalized by the number of firms in each industry-year cell. The higher the color intensity, the higher the adoption of the technology in that industry year.

Figure 1 - AI Industry Adoption and Its Management Implications

The results shown in Figure 1 reveal clear and increasing engagement with AI-related terminology over time, though unevenly distributed across sectors. Between 2020 and 2024, there was a general increase in mentions across all keyword categories, indicating growing awareness or adoption of digital technologies. The total keyword count shows a marked increase in intensity in the Business Services and Engineering and Management Services sectors, consistent with these sectors’ role in IT, consulting, and optimization. The machinery, computer equipment, and electronics sectors also show an increasing use of AI language, particularly in the context of automation, AI, and cloud technologies. Financial institutions show occasional spikes, particularly in analytics and big data, reflecting their investment in data-driven risk modeling and algorithmic trading. In contrast, traditional industries such as agriculture, mining, and lumber show minimal activity, possibly reflecting slower digitization trajectories or less public discussion of AI in filings.

The limited presence of AI-related activity in the air and railroad transportation sectors is a noteworthy finding. These industries operate under stringent regulatory oversight, where safety, reliability, and compliance are of paramount importance. The integration of artificial intelligence technologies in such contexts often encounters regulatory resistance and protracted certification processes, which can hinder adoption timelines and diminish the likelihood of prominent disclosure in official filings such as 10-K reports. Historically, firms within these sectors have been laggards in the adoption of digital technologies, including AI, which has contributed to persistent challenges in customer experience, operational efficiency, and profitability.

As firms adapt to e-books, online journalism, and on-demand printing, they increasingly adopt technologies such as cloud computing, automated workflows, and digital content management systems.

Our results also underscore the ongoing digital transformation of the printing and publishing industry, shifting from traditional print to digital platforms. As firms adapt to e-books, online journalism, and on-demand printing, they increasingly adopt technologies such as cloud computing, automated workflows, and digital content management systems—all of which are commonly linked with AI-related terminology in 10-K filings.

Another notable pattern is the consistent adoption of AI-related language within the telecommunications sector, particularly in analytics and cloud computing. This reflects the sector’s ongoing investment in digital infrastructure, customer behavior modeling, and network optimization—areas where AI tools have become essential to managing high data volumes and enabling services such as 5G rollout, predictive maintenance, and real-time service personalization.

Different keyword categories exhibit distinct temporal and sectoral patterns. Analytics is the most broadly adopted term, with usage growing steadily across most industries. Automation and AI terms appear less frequently but show sharp uptake in select years and sectors. Big data and cloud are often mentioned together, reflecting their complementary use in scalable data architectures. Digitization appears more often in sectors undergoing internal transformation, such as retail and communications.

Management Implications

It is noteworthy that while keyword counts proxy for awareness or strategic focus, they may not directly measure actual investment or implementation. Mentions in filings could reflect forward-looking plans, reactions to competitive pressure, or boilerplate language. However, prior research has shown that textual disclosures can be predictive of future firm behavior and market reactions (Li, 2008; Chen and Srinivasan, 2020), suggesting that these proxies offer meaningful insights into industry-level AI engagement.

This article presents a method for tracking AI adoption across industries using textual analysis of regulatory filings. By systematically counting AI-related terms in 10-K documents for nearly 8,000 US firms, we visualize trends in adoption over time and across industries. Our findings indicate that AI adoption is expanding rapidly across industries, led by a few dynamic service sectors that are at the forefront of this transformation. Analytics and cloud computing remain the most widely adopted category, while more technical terms like “machine learning” and “deep learning” are still relatively rare in non-tech sectors. The approach offers a framework for further empirical work on digital transformation and sectoral readiness.

Based on the findings, contemporary managers will benefit from the following strategic approaches:

  • Prepare for greater AI engagement. During the course of the study, AI engagement has increased. This trend will likely continue. Managers will be well served by planning their AI agenda in advance and pursuing strategic workforce training.
  • Plan for diverse utilization of technological tools. The findings suggest that companies have used a diversity of AI and other technological tools. Managers need to understand that technological progress does not necessarily follow just one path but rather multiple paths at different speeds. Set goals as well as resource allocation need to align with this reality.
  • Design the right digital transformation framework. It is evident from the research that digital technologies are reshaping the playing field of industries. The breadth and scope of transformation varies from industry to industry. Managers need to carefully assess their organization alongside the industry they are in and plan for the optimal and most impactful digital transformation.

The adoption of AI across US industries is presently underway. As such, organizational transformations are unfolding as new technologies gain popularity, prominence and usage. Contemporary managers need to strengthen their strategic planning skills to manage emerging threats as well as exciting opportunities ahead.

About the Authors

Roberto García-CastroRoberto García-Castro is a Professor of Managerial Decision Sciences at IESE Business School. His research covers various areas in decision-making in organizations and has been published in journals like Strategic Management Journal and Managerial and Decision Economics. Prior to academia, he worked for Arthur Andersen as an auditor and consultant.

Dr. J. Mark Munoz

Dr. J. Mark Munoz is a tenured Full Professor of Management at Millikin University and a former Visiting Fellow at the Kennedy School of Government at Harvard University. Aside from top-tier journal publications, he has authored/edited/co-edited more than 20 books, such as Global Business Intelligence and The AI Leader.

References
1. Bughin, J., Hazan, E., Ramaswamy, S. et al. (2017). Artificial Intelligence: The Next Digital Frontier? McKinsey Global Institute.
2. Chen, W. and Srinivasan, S. (2020). Going Digital: Implications for Firm Value and Performance. Harvard Business School Working Paper, p. 19-117.
3. Cockburn, I. M., Henderson, R. and Stern, S. (2018). The Impact of Artificial Intelligence on Innovation. NBER Working Paper No. 24449.
4. Li, F. (2008). Annual Report Readability, Current Earnings, and Earnings Persistence. Journal of Accounting and Economics, 45(2–3), p. 221–247.
5. Li, F. (2010). The Information Content of Forward-Looking Statements in Corporate Filings—A Naive Bayesian Machine Learning Approach. Journal of Accounting Research, 48(5), p. 1049–1102.
Throughout this article, we use the term “AI” in a general sense to refer to all the various technologies covered in our study: AI, analytics, automation, big data, cloud computing, digitization, and machine learning. Then, in our analysis, we separate “AI” from all other technologies. In this latter case, AI refers specifically to artificial intelligence technologies as defined by our dictionary of keywords.



Source link

Continue Reading
Click to comment

Leave a Reply

Your email address will not be published. Required fields are marked *

Business

Starmer cannot have armoured electric Range Rover ‘because of bomb risk’ | Jaguar Land Rover

Published

on


Would-be car buyers considering ditching petrol for electric tend to fret – not always correctly – about higher upfront costs, access to chargers and whether their battery will last on long journeys.

But Keir Starmer has an unusual obstacle to making the switch – Britain’s largest carmaker has claimed electric vehicles (EVs) do not offer adequate bomb protection.

The prime minister’s armoured Range Rover Sentinels will need to remain as petrol versions for the foreseeable future, according to their manufacturer, Jaguar Land Rover.

JLR addressed the issue in written responses to a government consultation on EV sales rules. The documents – obtained by Fast Charge, a newsletter covering electric cars, and shared with the Guardian – detailed how JLR and other carmakers lobbied the UK government to weaken targets requiring them to sell more EVs each year.

JLR said armoured cars should be excluded from the targets, known as the zero emission vehicle mandate, because it “does not see any workable engineering solution to the challenges surrounding an armoured BEV [battery EV], primarily because the required safety levels and blast protection cannot be achieved”.

Armoured vehicles are a small but very profitable business for carmakers. They usually have bulletproof glass, armour plating, and “bomb blankets” under the floor, adding hundreds of kilograms of weight to already heavy cars.

It is unclear what specific vulnerabilities the maker of Jaguar and Land Rover cars sees in armoured electric vehicles, although potential issues could include the reduction in range from the extra weight and the time needed to recharge.

However, its German rival BMW does not appear to share those worries: its electric i7 Protection saloon offers “special armouring” in the floor and ceiling to protect against explosives on the ground and those carried by drones.

JLR said the UK government was the main customer in Britain for its armoured vehicles. The vehicles are built at the company’s site at Solihull in the West Midlands and then converted by its special vehicle operations department.

Precise specifications of Starmer’s fleet of Range Rover Sentinels are not public to avoid aiding potential attackers, but they are understood to have 5-litre V8 engines, designed to allow the heavy cars to speed off if threatened.

The prime ministerial fleet also includes non-electric, German-made armoured Audi A8 saloon cars, which replaced the Jaguar XJ after that model was discontinued.

skip past newsletter promotion

Tom Riley, the author of the Fast Charge newsletter, said: “This is the first time I’ve come across ‘blast anxiety’ as an excuse not to switch. Clearly, it’s a valid concern, but it does mean the prime minister could be the last Brit to go electric.”

For motorists who do not need to worry about bomb attacks, overall lifetime costs for electric cars are significantly lower on average, while “range anxiety” should not be a problem for those who rarely make journeys longer than 200 miles and live in places where charging facilities are increasingly common, such as the UK, western Europe or parts of the US.

JLR declined to comment.



Source link

Continue Reading

Business

OpenxAI Launches on Base to Let Anyone Start an AI Business in Minutes, Without Middleman – HackerNoon

Published

on



OpenxAI Launches on Base to Let Anyone Start an AI Business in Minutes, Without Middleman  HackerNoon



Source link

Continue Reading

Business

Keir Starmer shakes up No 10 operation with mini-reshuffle | Keir Starmer

Published

on


Darren Jones, the chief secretary to the Treasury, has been moved to a new senior role in Downing Street as Keir Starmer attempts to get a grip on delivery before what is likely to be a tumultuous autumn for the government.

The senior MP, whose new title will be chief secretary to the prime minster, has been put in charge of day-to-day delivery of the prime minister’s priorities after No 10 spent the summer struggling to get on the front foot on issues including the economy and migration, and lags behind Reform UK in the polls.

He will be replaced as Rachel Reeves’s deputy by James Murray, who has been promoted from exchequer secretary, a more junior ministerial role at the Treasury. In turn, his role will be taken by Dan Tomlinson, the government’s “growth mission champion”, as Starmer seeks to reward the new 2024 intake.

However, there was not expected to be a wider reshuffle of the junior ministerial ranks at this point despite some reports, senior sources said, although Starmer would need to appoint a new homelessness minister after Rushanara Ali stood down this summer. The cabinet is to stay intact.

Speaking to the BBC on Monday, Starmer rejected the idea it was a reshuffle prompted by crisis, arguing it was more a case of a new phase of government. “This should be seen more as moving on to the second phase than a reshuffle, because some of the positions are actually new positions,” he told Radio 5 Live.

Downing Street is also expected to confirm that the former Bank of England deputy governor Minouche Shafik will become Starmer’s chief economic adviser, as the government seeks to strengthen its efforts to bolster UK growth and productivity.

The communications operation will also be shaken up with Tim Allan, an adviser to Tony Blair in No 10 who went on to fund the PR firm Portland, coming in as executive director of government communications. The political role is separate from that of David Dinsmore, who has been tasked with improving the civil service communications operation.

James Lyons, Downing Street’s director of communications for strategy, is stepping down. Steph Driver, his counterpart for day-to-day No 10 communications, who is close to Starmer, stays in post, answering to Allan.

The Downing Street policy unit is also undergoing changes, after some internal conflict over who was running the department. Liz Lloyd, who was Tony Blair’s deputy chief of staff at No 10, is leaving but is expected to move to a new role in government.

Stuart Ingham, another policy chief and Starmer’s most longstanding aide, will leave the unit to work in chief of staff Morgan McSweeney’s team, taking on a more political role, which sources said would ensure the prime minister’s priorities were taken into account in every decision.

A new political policy chief is expected to be appointed shortly, but in the meantime Vidhya Alakeson, one of McSweeney’s deputies, will oversee day-to-day policy work. Sources suggested that Louise Casey, a senior government fixer, would not be coming into No 10 despite reports.

The extent of the shake-up reflects the sense that Starmer’s No 10 has increasingly struggled to impose its own narrative, and is instead mainly being shaken by external crises, notably the focus over the summer on migration, and Reform UK’s planned response to it.

Things are not likely to improve in the short term, with the return of parliament presenting Starmer and his team with a series of tough challenges, including the likely need for tax rises in this autumn’s budget and ongoing legal battles over asylum hotels.

In his BBC interview, Starmer said while he understood people’s concerns about migration, Reform and Nigel Farage were exploiting the issue as “the politics of grievance”.

“They feed on grievance. They don’t want the problem solved because they’ve got no reason to exist if the problems are solved,” he said.

Asked about a recent spate of English flags being draped on lamp-posts or spray-painted on roundabouts, Starmer said he was proud of the flag, and had one in his Downing Street flat, but was wary of it being used for “divisive” reasons.

“In our flat, which is upstairs from here, as you know, we’ve got a St George’s flag,” he said. “I think they’re patriotic, and I think they’re a great symbol of our nation. I don’t think they should be devalued and belittled. And I think sometimes when they’re used purely for divisive purposes, it actually devalues the flag. I don’t want to see that.”

Downing Street sources characterised the changes as the next step in the government’s rewiring of Whitehall, with No 10 evolving into a “command and control” operation. They acknowledged that Jones’s appointment and the new structures were about increasing government grip and focus.

Jones’s appointment is likely to be seen as an acknowledgment by the prime minister that he needs to take a bolder approach to delivering on his promises, with the Bristol North West MP seen as a Blairite-style reformer who has privately urged the government to be more radical.



Source link

Continue Reading

Trending