the state of digitaland ai readiness a research-based report benchmarkingprogress and unlocking value in the ageof continuous digital and ai transformation may 2025 executive summary3 foreword4 insight one7execute a fully aligned and integrated business-technology strategy insight two9focus on continuous improvement insight three11be a technology leader in order to unlock greater returns bonus insight14take one step forward: a realistic self-perception conclusionmethodology 17 executive summary how would you categorize your organization based on their digital and ai readiness? are youtrailblazing and setting new industry standards? beginning to lay some foundations? or somewherein between? this state of digital and ai readiness report assesses the responses of 1,000 senior decision-makersfrom a range of public and private sectors (see methodology on page 17 for more details). it measurestheir organizations’ adoption levels across five pillars: digital products, platforms and services;enterprise modernization; managing/modernizing technology; data modernization; and scaling ai (frompilot to production). based on their adoption levels, each organization is classified into one of fourgroups on the digital and ai readiness index: leaders (setting the benchmark for industry excellence),strong performers, emerging players and late adopters (early in their journey). rapid technological change is raising the bar for digital and ai readiness, making it harder to gaina competitive edge. however, the findings from the index highlights how, through widespread andintegrated adoption across all five pillars, leaders (17%) are excelling, propelling them to the front ofthe pack. it demonstrates that strategy alone is just the starting point – it’s the alignment, integrationand execution of that strategy, combined with continuous improvement and technology investment,that delivers the greatest roi. however, for the 29% of emerging players and late adopters who are further behind the curve,it’s not too late: opportunities are attainable. as we share in this report, focusing on three keyareas – strategy, continuous improvement and investment – offers a unique advantage for makingconsiderable gains. and it starts with a realistic self-assessment. so, where does your organization truly stand – and more importantly, what steps are neededto propel your organization forward? let’s dive in. foreword: a roadmap todigital and ai digital success i first read about ai as a teen, when isaac asimov’s “i, robot” captured my imagination.this highlights a simple truth: ai is not a new idea. and yet the explosion of interest inai, sparked by the emergence of tools like chatgpt, which suddenly made ai accessibleto everyone, caught many enterprises by surprise. since that tipping point, many of us have experimented with generative ai tools, looking to gaina competitive edge. some with more success than others. and this got us thinking: what is it thatseparates those companies who haven’t just experimented with ai but put it into production andrealized value, from those still stuck in the sandbox? this report dives into that question and reveals some fundamental truths. because really, this isn’t justa question of ai readiness, it’s about digital, data and ai readiness. you can’t expect to get ahead in aiif your digital strategy remains in its infancy. we’ve identified three key pillars that separate the leaders from the rest: •a robust technology strategy that is tightly integratedwith business goals across the entire tech stack.•a relentless focus on continuous modernization.•and strategic investment which yields sustained returns. for those wanting more than just interesting data points, this report gives you a roadmapto supercharge your digital readiness. but there’s a caveat. we saw that nearly half of organizations have a skewed perception of where theyare today. some think they’re pace setters when, in reality, they’re at the back of the field. others areoverly cautious, thinking they’re not ready, when they’re actually more advanced than they believe.this distorted view increases the risk that organizations fail to take the actions necessary to delivervalue or fail to capitalize on investments already made. by reading this report, you’ll have your eyes opened to the risks of misunderstanding your digitaland ai readiness, and use that sense check to plot a path to future success. rachel laycockchief technology officer, thoughtworks the digital and ai readiness index what is the digital and ai readiness index? the digital and ai readiness index assesses and compares the level of technology adoptionacross different organizations. it aims to provide insight into what it takes to lead the market,where improvement opportunities lie and how to gain a competitive edge in a dynamic digital world. how was the index created? respondents were asked to what extent their organization has implemented 27 technologies/solu