Avanade advises mid-market firms to rethink AI strategies

Avanade is urging mid-market organisations to reconsider their approach to AI adoption by emphasising a people-centric strategy.

The call follows findings from Avanade's Trendlines: AI Value Report 2025, which surveyed 4,100 IT and senior business decision-makers worldwide. The report indicates that 84% of respondents believe their organisation's AI investments focus on cost savings and efficiencies gained from employee replacement. This perception raises concerns about job displacement and its impact on the workforce.

Florin Rotar, Avanade's Chief AI Officer, highlighted the implications of these findings. "AI presents incredible opportunities for organisations but it's more than a tech upgrade; it's a transformative shift in workplace dynamics and raises vital questions about the future of work and the role of the workforce," he said. "Our data shows that the mid-market must confront these questions directly or risk alienating the very employees who drive their success. AI should enhance, not replace, human potential—employees should be seen as collaborators with AI, not mere tool users. Integrating AI thoughtfully, with people at the center, will be crucial for sustainable business value and will set the standard for success in the AI era."

The report also unveils that 80% of mid-market leaders expect AI to impact human roles by the end of 2025. Many respondents expressed concerns over employee trust, recognition, and well-being, with nearly one-third saying they are comfortable with AI autonomously making high-risk decisions. Nonetheless, 85% expressed unease about whether employees are sufficiently informed about AI-driven decisions. The potential for AI to overshadow human contributions also worried 78% of respondents, with only a third feeling confident that leaders can distinguish AI-generated work from human labour.

The research points out that only 40% of respondents have confidence in their leaders' ability to manage AI's social and emotional impact in the workplace. This lack of confidence suggests that there might be significant challenges facing organisations as they integrate AI technologies into their operations.

Avanade advocates for mid-market companies to create balanced environments where AI and human contributions are equally valued. The company supports organisations with services such as responsible AI consulting and workforce retraining to help them navigate these challenges.

Avanade commissioned independent market research firms McGuire Research Services and Vanson Bourne to undertake research to understand the mid-market's experience in developing and implementing AI solutions and emerging technologies.

Across the two separate research projects, a total of 4100 IT decision makers and senior business decision makers outside of IT were interviewed in August and September 2024, across Australia, Brazil, France, Germany, Italy, Japan, Netherlands, Spain, UK, and US. Respondents worked for organisations with between $500M and $5bn global annual revenue in these industries: Banking, Consumer Goods and Services, Energy, Government, Healthcare, Life Sciences, Manufacturing, Non-profit, and Retail