How AI can power Europe’s next industrial revolution

This is important because AI is arguably the most productivity-transforming technology in history. According to one estimate, generative AI alone could add more than $4 trillion to global GDP by 2030. Even a small slice of this pie could be a game-changer for Europe’s prosperity.

European organizations do not need to take the lead in developing an AI model to benefit from the technology or revive their competitiveness. Instead, there is a generational opportunity to become the first to deeply embed AI at scale, leveraging the benefits of its unique enterprise data.

When combined with Europe’s industrial strength, high regulatory standards, and world-class talent, the rapid adoption of AI could become a powerful source of competitive differentiation and economic renewal for the continent as a whole.

Why is AI adoption important?

As elsewhere, enterprise AI adoption in Europe is gaining momentum. In a recent IBM survey — The Race for ROI — 66% of senior European executives said their organizations had seen measurable productivity gains from AI, with 41% expecting a return on investment (ROI) within a year. In other words, real use cases are starting to get real results.

Examples are shown in various industries. Take, for example, a logistics company that has integrated AI agents throughout its supply chain. These intelligent systems forecast demand, reroute shipments, and optimize deliveries in real-time, improving customer experience and profit margins.

Or take, for example, a pharmaceutical company that uses AI to accelerate drug discovery by automating scientific literature reviews and screening of new molecules. What previously took months now happens in days or hours, resulting in treatments getting to market faster.

These scenarios illustrate how AI, when deployed strategically, can enhance operational performance and accelerate innovation – two pillars of long-term success.

For this to turn into a competitive advantage, European companies need to embrace AI more quickly and deeply than their competitors abroad. So where can leaders start to drive progress and unlock measurable value?

• Benefit from trusted enterprise data

Data is the raw material for competitive advantage in AI. Models trained on high-quality, domain-specific data outperform generic models built on data extracted from the Internet. This advantage is multiplied when models are combined with enterprise data, which is unique to a single company or industry.

Only about 1% of the world’s enterprise data has been integrated into AI models so far, so there is an opportunity to be an early mover – especially in the data-rich industries that Europe leads, such as advanced manufacturing, life sciences, and consumer goods.

For example, L’Oréal has collected 16 terabytes of private beauty data to train AI models that accelerate the discovery of new, more sustainable cosmetics formulations.

It could be German medical device makers, Italian carmakers, or Danish beer makers – their huge data sets, sometimes built over generations, are their crown jewel. The EU’s high standards for data integrity and AI transparency add further competitive differentiation for “Made in Europe” AI solutions, by helping to reduce adoption risks and increase consumer, government and investor confidence.

• Centrality And coordination of artificial intelligence operations

Research shows that centralized AI operations can deliver up to 34% higher ROI than decentralized systems. Harmonizing data, talent, and technology across business units means that models and AI agents can be reused and adapted for multiple purposes. For example, a fraud detection model designed for finance can be quickly adapted for supply chain security.

A recent example of this is France’s Elior Group, a leading global catering company, which is building a “data and AI factory” to unify its digital innovation efforts and support faster deployment of AI tools across its operations.

• Invest in improving AI and literacy skills at all levels

The biggest productivity gains from AI come not when it replaces work, but when it is integrated into how work gets done. This requires a workforce – and leadership – that understands how to work alongside intelligent systems.

At IBM, our consultants now use more than 3,000 AI assistants and 60 industry-specific applications to augment their work, improving productivity by up to 50% for some tasks. To replicate this success, European companies must make AI literacy a company-wide priority, from the factory floor to the boardroom.

Making employees experts in how to maximize the benefits of AI not only enhances performance, but also enhances trust and engagement in times of change.

Europe opportunity

The challenges facing European companies are enormous, but they are outweighed by Europe’s strengths – its industrial expertise, high-quality data, regulatory standards, and commitment to responsible innovation.

The combination of faster AI adoption and Europe’s unique industrial and intellectual assets provides the opportunity to revamp how the region competes on the global stage.

Those who act boldly today in strategically harnessing technology across the enterprise, by investing in data, technology and people, are capable of shaping the future of European innovation for decades to come.

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