British companies risk being left in the middle of the pack when it comes to artificial intelligence. A new PwC study shows that there is a significant gap in both spending and revenue between UK companies and the world’s leading AI adopters.
The consultancy’s global survey found that leading companies worldwide invest an average of five percent of their revenue in AI and receive a return of 15 percent, while their UK counterparts invest just two percent and receive a return of ten percent. It’s a gap that should worry boardrooms across the country, particularly among small and medium-sized companies that are already struggling with tight margins and limited technology transformation budgets.
Perhaps even more worrying is the innovation deficit that the numbers suggest. British companies generated just 27 percent of their sales from products that didn’t exist three years ago, compared to 43 percent for global leaders. For SMEs that have historically relied on agility and new thinking to compete with larger rivals, this disparity should raise some uncomfortable questions about whether enough is being done to transform AI capabilities into truly new commercial offerings.
Research points to well-known obstacles. Outdated IT systems and rigid internal processes continue to slow down companies. Only 27 percent of UK companies have redesigned their workflows to properly integrate AI, rather than simply grafting it onto what already exists. The same proportion had modernized outdated technology to better accommodate the tools.
It is also a question of ambition. Almost half of UK companies surveyed said efficiency and productivity were their main motivation for experimenting with AI, while just 26 percent cited revenue generation. According to Leigh Bates, global risk AI leader at PwC UK, this mindset limits the country’s potential.
Bates described the findings as a wake-up call, arguing that too many companies remain trapped between piloting AI projects and scaling them effectively. The companies that generate the highest returns in the world, he said, are not just doing more of the same, but are fundamentally reinventing the way they work.
Overall, the UK ranked 11th out of 19 countries in PwC’s assessment, behind China at the top of the table, as well as France, Germany and Saudi Arabia. The United States in particular did little better, coming in 13th place. PwC defined global leaders as companies in the top 20 percent of AI-driven performance.
For the UK SME community the message is clear enough. The window of opportunity to move from cautious experimentation to meaningful adoption is narrowing, and those who continue to view AI only as a cost-cutting measure risk finding that their competitors at home and abroad have already moved on.
