Despite artificial intelligence rapidly ascending the corporate agenda, a significant proportion of organisations continue to grapple with turning AI investments into tangible business value, according to a new report released by PeopleStrong, Asia’s leading HR technology company backed by Goldman Sachs Alternatives.
The company today unveiled The AI Ground Report 2026, an extensive study examining the current state of AI adoption within human resources functions across Indian enterprises. Drawing insights from more than 500 HR leaders spanning 16 industries, the report provides a detailed assessment of how organisations are deploying AI and the barriers preventing many from realising meaningful returns.
The findings underscore AI’s growing strategic importance within HR. Nearly three-quarters (74%) of organisations now prioritise AI-led HR transformation, while 84% have already initiated AI-related programmes across various HR functions.
Yet beneath this momentum lies a notable disconnect between ambition and achievement.
According to the report, fewer than half of organisations actively implementing AI are satisfied with the outcomes delivered so far. Furthermore, 41% remain uncertain about the long-term business impact of their AI initiatives, highlighting concerns around scalability, effectiveness and return on investment.
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A key conclusion emerging from the study is that successful AI adoption is determined less by the speed of implementation and more by the strength of an organisation’s underlying HR technology infrastructure. Enterprises operating with extensible and integrated HR technology stacks are six times more likely to progress AI initiatives into live deployment than those relying on fragmented systems.
“The AI conversation in HR is entering a more decisive phase. The question is no longer whether organisations should adopt AI, but whether they are prepared to unlock value from it at scale,” said Mrigank Tripathi, President – Growth, PeopleStrong.
“Our research shows that AI success is less about the pace of adoption and more about the strength of the foundation beneath it. Organisations that invest in connected systems, unified data, and a clear HR technology strategy are significantly better positioned to move beyond pilots and drive measurable business outcomes. As AI becomes integral to how work gets done, competitive advantage will increasingly belong to enterprises that build the right talent infrastructure for the future.”
The report also challenges prevailing assumptions surrounding enterprise AI adoption. While sectors such as telecommunications, consulting and retail emerged among the most enthusiastic adopters of AI within HR, they also reported the lowest satisfaction levels, averaging just 3.14 out of 5.
This disparity suggests that accelerating AI deployment without first addressing foundational technology constraints may create additional complexity rather than meaningful business outcomes.
Among the report’s most significant findings:
- 69% of organisations remain in the exploration or pilot phase, highlighting a substantial gap between AI aspirations and enterprise-wide implementation.
- Organisations with extensible HR technology ecosystems are six times more likely to transition AI initiatives into live deployment.
- Data silos become increasingly problematic as adoption advances, rising from 34% during the pre-adoption phase to 53% during exploration.
- During the pilot stage, data silos contribute to a 21-point satisfaction gap between successful and underperforming AI initiatives, making data coherence one of the strongest indicators of success.
- More than 30% of organisations in advanced stages of AI adoption state that HR technology consolidation would be their highest priority if redesigning their technology architecture today.
The report concludes that AI itself is no longer the principal obstacle confronting enterprises. Rather, the ability to scale AI effectively depends on foundational capabilities including unified data architecture, integration readiness, platform extensibility and long-term technology planning.
Organisations that view HR technology as a strategic business asset — rather than a collection of disconnected tools — are best positioned to unlock sustainable value from AI and convert experimentation into lasting competitive advantage.
The AI Ground Report 2026 is available for download on the PeopleStrong website.
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