GenAI In Canada
For some time now, Canada has seen a decline in productivity, and the country is the second least productive country in the G7 countries. Two key reasons are weak competition within sectors and low investment in infrastructure. Canadian business investment per employee has also reduced in the last decade. These factors are leading to lower prosperity for Canadians compared to their counterparts.
GenAI can help Canadians overcome their low productivity and reach comparable productivity levels with the US and other OECD countries.
GenAI Adoption in Canada
Canada takes a distinct approach to technology adoption, often taking its time to fully embrace new innovations. This is also the case with GenAI, a technology Canada is carefully considering for its potential benefits.
The Canadian Chambers of Commerce recently published a comprehensive report on GenAI adoption by Canadian businesses. Here are some key statistics from this report:
Generic Trends—Around 1 in 7 businesses (14%) are early Gen AI adopters in Canada, and larger businesses, industries with educated workers, exporters, or emerging enterprises are also early adopters of GenAI. Large businesses are twice as likely to use GenAI as small businesses.
Sector Trends: 31% of Information and cultural industries are adopting Gen AI. Professional service businesses ranked second in adoption (28%), followed by finance and insurance (23%). All these industries employ a highly educated workforce. The lowest adoption( less than 10%) of GenAI is among construction, agriculture, transportation and warehousing, mining, oil and gas.
Exporter trends: 24% of goods and 48% of service exporters are early adopters of GenAI-based products and solutions.
Province trends: Ontario and BC have the highest adoption rates, followed by Alberta and other smaller provinces.
Adoption rate: For Canada, the tipping point (50%) adoption of GenAI can be reached in a fast scenario by 2027, or in a slow scenario, it would be reached by 2030.
Google trends and IPSOS Survey: According to Google Trends, the Indo-Pacific region shows the highest interest in AI. Currently, Canada is ranked 23rd out of 68 countries for AI search interest. A Global IPSOS survey has revealed that Canadians are less knowledgeable and more nervous about AI than citizens of most other countries.
Business value of GenAI: Accelerate creative content development, increase automation in tasks without reducing employment, improve customer experience, achieve cost efficiencies and Spur data-driven decision-making.
The rationale for GenAI adoption among different verticals: Natural resources, manufacturing, and finance are focused on using GenAI to enhance their data-driven decision capability.
Finance, administrative services, and real estate departments are interested in utilizing GenAI to enhance customer experience.
Automating tasks and achieving cost efficiencies using GenAI is important for Wholesale trade, information and culture, finance, and professional services industries.
GenAI Productivity: GenAI could help Canada grow its productivity by 1% and 6% over the next decade. The productivity gains would depend on how quickly Canada adopts GenAI based solutions.
Recommendation for Enterprises thinking to adopt GenAI in Canada
Understand the business requirements unique to your business, and then think about how GenAI can help you grow and move ahead.
Research your industry vertical and understand the unique business cases for GenAI that are helping enterprises immensely.
There are probably tons of companies that have different GenAI services in the market. Enterprises must do proper research to understand which GenAI solution would benefit them.
Recommendations for GenAI service providers
Understanding the demand and unique requirements for each industry vertical in Canada is essential, as this would help service providers customize their GenAI solution accordingly.
Go after the industries with the appetite and ability to consume GenAI-related services.
Recommendation for Federal and Regional Governments
AI adoption in Government: Be a front runner in adopting GenAI base solutions within different federal and regional government departments.
Upgrade AI strategy: Numerous governments globally are adopting strategies that are helping them advance in GenAI adoption in their countries. The Canadian government can find the best practices and adopt them here accordingly.
Setting Incentives: Setting incentives to help increase the adoption of GenAI. This can be done with a public-private partnership and would be especially helpful in increasing adoption within SMEs.
At Strategy Spark Advisory, we can help enterprises see the ROI in GenAI, help solution providers understand the demand, and help the government find ways to increase its adoption.
Source: Canadian Chamber of Commerce, Business Data lab, Strategy Spark advisors’ analysis
