After DeepSeek’s language model sent shockwaves through the tech world and the US government announced a $500 billion investment in AI partnership, while the EU Commission is panicing about how to catch up with the US and China’s technological lead, it is appropriate to stop and reflect on whether it is really the technology at all, which is the limiting factor for AI’s potential to transform the way companies operate. If we dig a little deeper, we will see that it is not primarily technological problems that companies in the Nordic region are struggling with, but a wide range of other factors that limit the use of AI. Therefore, it is time to rethink how we harvest generative AI’s enormous potential
Technology is just one of many factors that limit AI adoption
I have just completed a survey of how 1,250 Nordic organisations use AI. One of the questions was what is holding them back from using AI to a greater extent. The responses showed four main types of barriers. The least common were the purely technological challenges – i.e. limitations in the technology itself, such as the models’ abilities and available data. Only 38 percent of the organizations in the survey saw technology as a significant obstacle to using AI.
The biggest barrier to AI use turned out to be limitations of the solutions themselves – especially unpredictability and lack of transparency, which 53 percent of the organizations pointed to. Almost half (46 per cent) mentioned human factors as a challenge, while 44 per cent highlighted external factors, such as how citizens and customers perceive the technology. This suggests that better language models from ChatGPT, Microsoft or Google are unlikely to significantly change how AI is used in Nordic organisations.
While DeepSeek is a cheaper alternative, which is good for the Nordic organizations’ IT budget, it will only make a small difference to the use of AI, as the price of AI only holds back adoption to a lesser extent. The cost of AI was only seen as a limitation for about 20 per cent of the organisations in the study.
A holistic approach is needed to realize Ai’s potential
It is therefore necessary to shift the focus elsewhere than the pipeline of the American and Chinese suppliers, because no matter how well or how cheaply they will be able to deliver AI in the future, it will not solve the limiting factors that Nordic companies face in the real world.
Instead, one should focus on developing a holistic approach that addresses all aspects of AI to ensure that the potential can be harvested in the best possible way. To ensure this, a number of factors must be addressed.
To fully exploit AI’s potential, it is important to establish a clear framework that covers both the technical and ethical aspects. It will clarify which principles will govern the use of AI and who is responsible for decisions about development and implementation.
To avoid it becoming a purely technical exercise, it is crucial to involve different stakeholders. For example, the sales department can contribute with insight into customers’ perceptions and quickly spot if a solution seems inappropriate. HR can ensure that employees are properly informed and trained, while the compliance department can identify potential legal challenges.
AI governance that involves a wide range of stakeholders is therefore key to ensuring responsible and efficient use of the technology.
A new approach to AI is needed
Technology is important for progress, but it does not bring progress by itself. AI has the potential for significant progress. The situation in Nordic companies today is not that they are limited by AI’s technological capabilities, it is actually the least important limiting factor. Therefore, a new approach to AI is needed, which does not focus blindly on the stage of American and Chinese technologies, but instead tries to place AI in a broader context that takes into account the solution’s special characteristics, human factors and external conditions that affect use and perception. There is a need for a new way of managing AI development, which is not driven from a technological focus, but instead from a focus on creating value for people and organizations in balance with the world they exist in. We can get started on this without throwing billions at more advanced algorithms and supercomputers today.
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