Businesses are ‘no longer interested in AI for AI’s sake’

New research has found that organisations are all in on AI, despite many still waiting for their investment to produce a return.

The productivity crisis is driving change within organisations, top to tail.

According to the 2026 Directions Survey, produced by national law firm Mallesons, AI has beaten out more traditional business concerns, including profitability, workforce issues, and boardroom challenges, as the leading short- and medium-term priority, signalling a renewed focus on productivity and competitiveness.

In what aligns with ongoing coverage into the theory and practice of AI in the workplace, however, the gap between productivity intention and actuality is growing: while more than 70 per cent of surveyed respondents perceive AI as an opportunity for productivity and growth, only 46.5 per cent have reported tangible improvements compared to the year before.

Further, another 42.2 per cent are still in the early stages of adoption or integration – and have therefore not recorded gains.

Rhys Casey, M&A partner at Mallesons, said: “Australian businesses are betting heavily on AI as a means of addressing the productivity challenge, but the honeymoon period is ending.”

“After a significant investment, many organisations are effectively saying: show me the money.”

The research found that many organisations are broadly staying the course, but shifting implementation strategy in the hope it will elicit a more measurable return. While a strong 70.8 per cent of respondents view it as a tool for growth, less than 5 per cent view the technology primarily as a cost minimiser.

The research also found that 69 per cent of organisations are finding alternative investment means, and 19.6 per cent are exercising more caution over what they fund, more than double that of last year.

Meredith Paynter, corporate M&A partner at Mallesons, said the findings show a more hard-headed approach to AI.

She said: “Organisations are still investing, but they’re also demanding greater accountability. The winners won’t necessarily be those spending the most on AI, but those that are best able to translate the technology into sustainable productivity gains and competitive advantage.”

In this vein, Mallesons corporate M&A partner Lizzie Knight said that “the organisations most likely to realise value from AI won’t necessarily be those with the largest funding envelopes”.

“They’ll be the organisations that successfully combine technology, governance and workforce capability. That’s where the productivity dividend will ultimately be won,” Knight said.

It was also noted that some business leaders are continuing to refine AI management skills and make smaller adjustments that will allow for improved productivity and performance without compromising the workforce. According to the research, more than 60 per cent of surveyed leaders are not looking to counter AI implementation with a workforce reduction, a significant jump from 14.6 per cent in 2025.

Further, the proportion of leaders actively pursuing AI-driven reductions has fallen by 8.4 per cent in the last year.

Governance and regulation is also on the rise, with 39 per cent of surveyed organisations now seeking AI expertise when recruiting for leadership and Board roles. Similarly, 21.6 per cent are operating under an AI governance framework, and more than 50 per cent evolving and updating their governance model on an ongoing basis.

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