AI is delivering business value today

AI is already delivering tangible business value and strong return on investment, but strategic adoption gaps risk leaving millions on the table.

AI is no longer on the roadmap, today it already supports 25% of tasks in global businesses. This is set to rise to 41% in two years, according to The SAP Value of AI Report, conducted by Oxford Economics.

Rapid adoption is having a significant business impact, with more than three quarters of those surveyed expecting their Al investments to achieve positive ROl in less than three years.

The global report surveyed 1,600 business leaders across eight countries, including 200 Australian executives from enterprise and mid-market companies.

In Australia, businesses are already achieving a 15% return on their AI investments, with an average ROI of $4.5 million* on a typical spend of $26.7* million this year. By 2028, ROI in Australia is expected to almost double to 29%.

Despite these positive signs, the report reveals Australian business AI spend – an average $26.7 million* – is being significantly outpaced by global peers. Chinese organisations lead the way with an average $58.7 million* spend, with $51.7 million as the average spend.

"This isn’t just about technology, it’s about competitive survival," says Angela Colantuono, President and Managing Director, SAP Australia and New Zealand.

"In addition to boosting revenue, AI is about building smarter operations and empowering people to focus on the work that matters."

Across the world, AI is transforming businesses. For example, it is helping Australian retailer Freedom Furniture reshape how customers discover and purchase products across its omnichannel network, turning casual browsers into loyal customers while operating at a scale that would be impossible to manage manually.

Freedom’s online catalogue has expanded from approximately 12,000 products four years ago to more than 70,000 today. With tens of thousands of SKUs ranging from $30 homewares to $8000 sofas, manual merchandising and curation are no longer sustainable.

The retailer implemented AI-powered search and product recommendation capabilities embedded within its commerce platform. These tools analyse browsing behaviour, past purchases, clickstream data and detailed product attributes to tailor results to each individual customer in real time.

Rather than offering generic “customers also bought” suggestions, the system adjusts recommendations based on context. A customer viewing a specific sofa style, for example, is shown complementary pieces aligned to that exact design and fabric, not simply a broad category suggestion.

The impact has been measurable. Following implementation, Freedom recorded months where conversion rates and transactions were up to 50% higher among customers engaging with search. More relevant recommendations have also lifted average order value while reducing time spent searching.

By embedding AI across search and customer engagement, Freedom has reduced friction, scaled personalisation beyond human capability and freed teams to focus on higher-value initiatives, demonstrating that AI is delivering tangible business value in Australia today.

It is a similar story across the globe, with the majority of Australian survey respondents anticipating that AI will become integral to business processes, decision-making and customer offerings by 2028 – one year earlier than the global average. Only 3% of businesses said they do not see AI ever becoming a core operational component.

Despite this, only 10% of Australian businesses are investing in AI in a strategic and holistic manner, with the majority taking a piecemeal approach (46%) or leaving it to individual departments (32%).

The SAP Value of AI Report highlights the significant business value offered by agentic AI – intelligent, autonomous systems that can iteratively plan, act, reflect, and collaborate to achieve an objective or task.

Agentic AI is expected to deliver a 10% ROI, or around $4.2 million*, for Australian businesses in the next two years. Even so, only 6% of Australian businesses are fully prepared for AI agents, but 75% recognise their transformative potential.

Global power tools giant Bosch is embracing agentic AI to assist its service teams in handling millions of tickets per year.

Until now, Bosch Power Tools has relied on a "complex, slow and frustrating" collection of static rules to route service tickets. Now, an AI agent will analyse each incoming ticket and automatically direct it to the right service team.

"The global rollout of the case classification agent in SAP Service Cloud will eliminate hundreds of workflow rules, while significantly improving first touch accuracy," says Florian Haustein, Head of Digital Customer Experience at Bosch Power Tools.

"This transformation will not only save thousands of work hours annually, but also optimise costs – a true leap forward in intelligent service management."