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1 in 3 Indian Enterprises Held Back by Legacy and Talent Gaps in AI

Artificial Intelligence has become an indispensable marker of digital maturity globally, and Indian enterprises are no exception. Yet the India Inc. Digital Playbook 2025 survey by Tech Disruptor Media reveals an important paradox: AI awareness and experimentation are widespread, but enterprise-wide transformation remains elusive.

The findings do more than highlight adoption gaps—they signal structural fault lines in how India Inc. views digital priorities and how firms must recalibrate strategy to remain competitive.

AI’s Half-Open Door: Why Scale Remains Out of Reach

Survey results show that 64% of enterprises are either planning or running pilots, while only 10% have reached full integration.
On the surface, this looks like progress. But from an analyst’s lens, it reflects a maturity bottleneck: organizations recognize AI’s potential but lack the execution frameworks to deploy it across the business.

This “pilot trap” risks eroding competitiveness. Regions and firms that successfully operationalize AI enjoy compounding advantages—lower costs, faster innovation cycles, and richer customer experiences. By contrast, Indian enterprises risk being locked into proof-of-concept mode at a time when operational AI is fast becoming hygiene, not differentiation.

When asked about AI in cybersecurity, 44% of firms said AI contributes less than 10% to their workload, with only 9% applying it to more than half of operations. The gap is striking.

For a market increasingly exposed to AI-enhanced fraud, ransomware, and compliance risks, underutilization of AI for defense implies reactivity rather than resilience. Cybersecurity is not just a technology function but a trust enabler. Without embedding AI deeply here, future breaches could directly undermine enterprise credibility and regulatory compliance.

In other words: AI in India Inc. remains focused on customer-facing pilots (chatbots, analytics dashboards) but has not yet become a core layer of enterprise defense and resilience.

The Barrier Triad: Legacy, Skills, and Culture

The barriers reported offer insight into where transformation actually stalls:

  • 38% point to legacy integration – Indian firms are held back by tightly bound core systems that resist AI overlays.
  • 31% cite talent shortages – while global competitors invest in deep AI skill pools, India risks a widening “applied AI workforce” gap.
  • 19% mention cultural resistance – this illustrates that digitization is as much a human transformation as a technology one.

Viewed together, these are not discrete hurdles but a triad of interlinked challenges: outdated infrastructure limits AI feasibility, shortage of skilled talent slows experimentation, and employee resistance prevents acceptance. Unless addressed simultaneously, pilots will not scale.

Sectoral Readiness: Uneven Terrain

Patterns emerge sector by sector:

  • BFSI demonstrates maturity in fraud monitoring but remains entangled in compliance-heavy systems—showing sectoral leadership with structural rigidity.
  • Manufacturing embraces predictive maintenance but struggles with monolithic legacy architecture—innovation running ahead of infrastructure.
  • IT/ITES & Media present higher skills readiness, but channel AI into chatbots and CX rather than mission-critical functions, a comfort zone bias that delays deeper transformation.

This sectoral unevenness underscores that India’s AI evolution is fragmented. Unlike markets where AI ecosystems build shared-scale flywheels, Indian sectors appear siloed in their trajectories.

Strategic Analysis: What This Means for India Inc.

The survey findings converge on one clear analytical observation:
India is not short of AI ambition—it is short of enterprise readiness.

  • Execution gaps prevail: Without structured frameworks to move pilots into production, India risks perpetual AI prototyping.
  • Competitiveness is at stake: Firms unable to operationalize AI will lag on productivity, agility, and compliance—three of the pillars Indian executive leaders themselves flagged as strategic.
  • The talent equation is decisive: Upskilling and re-skilling will differentiate firms that stagnate from those that scale.

The Strategic Road Ahead

Breaking the pilot trap and achieving integrated, scaled AI will require:

  1. Cross-functional leadership alignment – moving accountability beyond CIO/CTO silos into business line ownership.
  2. Data-first modernization – legacy modernization must be prioritized to build interoperable AI-ready ecosystems.
  3. Talent investment at pace – from AI engineers to domain-specific translators who can connect models to business outcomes.
  4. Governance framework – embedding ethics, compliance, and explainability into enterprise AI scaling.

From an tech perspective, the trajectory is clear: enterprises that operationalize AI will establish structural competitive advantage in India’s digital economy. Those that remain confined to pilots risk being overtaken not just by global competitors, but by domestic leaders ready to move faster.

Conclusion

Indian enterprises are enthusiastic adopters of AI pilots, but real competitive transformation requires shifting from proof-of-concept to proof-of-scale. Legacy systems, cultural inertia, and weak talent pipelines are today’s bottlenecks—but also tomorrow’s opportunity zones. Firms that resolve these first will not just catch up—they will reset India’s benchmarks for digital competitiveness.

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