Artificial intelligence (AI) is key to growth for North West businesses, but implementation at scale remains the exception – new research has found.

Three-quarters (75%) of regional businesses surveyed as part of a report from BGF – the UK and Ireland’s most active growth capital investor – and Beauhurst, view AI as a growth driver, outweighing the national average (66%). At the same time, seven in ten (70%) North West business leaders believe AI is important to their long-term growth ambitions.

The Unlocking Value from AI report, which draws on independent research from more than 250 SME founders and C-suite leaders, reveals that AI is already playing an important role in the majority (72%) of businesses nationally, while 84% have become more optimistic and trusting of AI in the last 12 months.

Despite this perceived value, the report found that one in five (20%) are still exploring where AI could add value in their business and another 15% are still in the piloting and prototyping phase. In fact, 60% of regional respondents admit AI is only integrated in some key business functions, or that there is minimal integration.

SME leaders in the North West cited their biggest challenges around AI adoption, which include security constraints (50%), legal or regulatory risks (45%) and employee adoption and change management (25%).

Although regulatory exposure (45%) and loss of customer trust (40%) are viewed by regional SME leaders as key long-term risks of AI adoption, seven in ten (70%) North West businesses already have a responsible AI policy in place. The results highlighted ownership and governance as a priority, with more than half (55%) planning to appoint a senior leader to drive AI in their business.

Harry Jones, partner and head of BGF in Manchester, commented: “The debate is largely finished about whether AI matters strategically, but a gap remains between ambition and integration. The barriers are not necessarily technical – AI tools are accessible, the models are capable, and the obstacles to getting started have never been lower. Many businesses are held back by organisational and cultural issues.

“Regional business leaders recognise that the foundations of resilient growth increasingly mean AI and the data that underpins it. But our conversations with portfolio companies are evolving – from evaluating AI as an emerging technology, to harnessing it as a strategic value driver. While confidence in AI has rarely been higher, implementation at scale remains the exception. The focus now is on helping businesses to translate intent into impactful and sustainable delivery which we are supporting through our in-house AI team that sits within BGF’s Value Creation offering.”