Despite high investment in artificial intelligence, most public and private sector organizations are still failing to see meaningful returns – a problem rooted not in technology but in culture and measurement, a top federal official said Monday.
Speaking at the GovAI Summit in Arlington, Va., on Oct. 27, Navy Chief Technology Officer (CTO) Justin Fanelli said many agencies risk falling behind as private-sector innovation accelerates unless they act quickly to translate AI investments into measurable outcomes.
“There are at least 30% of any organization that will never disrupt themselves; they’ll be disrupted,” Fanelli said, adding that cultural resistance, not access to tools, is what holds back progress.
Fanelli, who also serves as a professor at Georgetown University, said that while enthusiasm around AI adoption is growing, it’s “not sufficiently” fast to keep pace with innovation. He pointed to the private sector’s lead in AI maturity as evidence of the government’s challenges in aligning incentives and measuring success.
“We know income, we know input, we know spend – those are all on the left side, it comes down to outcomes … the only thing better than high output is high outcomes,” said Fanelli, explaining that quantifiable returns on AI investment would help further AI adoption.
The difference between organizations in AI progress is how they convert that investment into results and prove success, he explained, which then leads to confidently scaling AI.
“We’re going to ultimately need to change the way you do business, which means you’re going to have to convince non-believers, which means you need data and scores,” said Fanelli.
To get there, Fanelli said organizations should start “proactively experimenting, iterating, [and] getting smarter,” instead of “letting things sort themselves out,” which he warned can be “very slow” and result in a few winners and leave everyone else trying to catch up.
This means teaching employees how to leverage AI to support their day-to-day responsibilities, investing in people and company culture, and embracing self-disruption.
“There are people who will disrupt themselves or disrupt the situation … it’s probably right now a matter of how you spend your time and where you are,” Fanelli said.