AI drives productivity, but CEOs struggle to turn gains into growth

• About half (Singapore 45%, global 50%) of CEOs surveyed cite AI as biggest driver of material productivity gains, yet a fifth (Singapore 20%, global 23%) struggle to convert gains into measurable financial outcomes.
• Only 9% (global 16%) of Singapore CEO respondents have strong confidence in measuring AI ROI and have real-time visibility into AI costs and returns.
• An overwhelming 92% (global 72%) of Singapore CEO respondents expect skills shortages to become a greater barrier to growth than access to capital.

Despite geopolitical uncertainty, slower macroeconomic growth and rapid technological change, CEOs remain firmly focused on creating their own momentum. According to the latest EY-Parthenon CEO Outlook Survey of 1,200 CEOs across 21 countries, which includes 40 from Singapore, growth is increasingly being driven from within, with AI adoption boosting productivity. The challenge for CEOs is translating those gains into measurable business value through deliberate decisions on operating models, talent and capital allocation. 

AI delivers productivity gains

AI is emerging as a source of productivity improvement for organizations, with about half (Singapore 45%, global 50%) of CEOs surveyed identifying AI technologies as the single largest contributor to productivity gains over the past 12 months, ahead of business process redesign (Singapore 33%, global 46%). Rather than treating these gains as a short-term efficiency win, 50% of Singapore respondents (global 48%) are reinvesting the additional capacity into innovation and transformation initiatives aimed at supporting future growth.

Yet as AI adoption accelerates, attention is shifting from efficiency to value creation. While CEOs report tangible operational improvements from AI, many are struggling to translate those into meaningful growth and profitability. Legacy systems, organizational complexity and regulatory requirements continue to be limiting, with a fifth (Singapore 20%, global 23%) of leaders surveyed saying that AI-driven gains are often absorbed before they fully translate into bottom-line results.

The findings suggest that the competitive challenge is no longer whether AI can simply improve productivity, but how effectively organizations convert that productivity into sustainable business value.

The AI ROI challenge

CEOs surveyed still struggle to measure and quantify the impact of AI investments. While more than half (Singapore 57%, global 56%) of respondents report at least some reliable visibility into AI costs and returns, only 9% of Singapore respondents (global 16%) shared they have clear, real-time visibility of ROI. Almost a third (Singapore 30%, global 24%) can track some AI costs but remain limited in their ability to assess overall ROI, highlighting an emerging gap between AI adoption and organizations’ capacity to measure value creation. 

Sriram Changali, EY-Parthenon Asean and Singapore Strategy and Execution Leader, says:
“It is clear that AI is creating productivity gains; yet productivity is but a small part of the value that it can bring. Too often, CEOs and management teams deploy AI within individual functions rather than incorporate into the end-to-end workflow, from production through to consumption, to create value for customers. Hence, CEOs and boards need to identify AI-driven business models and value pools that drive growth; capturing those opportunities will require organizations to realign their operating models, talent and capital, turning AI from an efficiency tool into an engine for measurable value creation at scale.”

Skills become the growth constraint

CEOs overwhelmingly see AI as a workforce transformation issue rather than a blunt instrument for changing headcount. An overwhelming majority (Singapore 98%, global 80%) believe that AI will have a greater impact on roles, skills and ways of working than on workforce size over the next three years.

Yet workforce readiness is emerging as a major concern. More than half (Singapore 60%, global 47%) of respondents say their organizations are not developing AI skills quickly enough to keep pace with innovation. As well, 92% of Singapore respondents (global 72%) believe skills shortages will become a greater barrier to growth than access to capital within three years.

The findings suggest that while organizations are rapidly adopting AI, many are finding it harder to develop the skills and capabilities needed to realize its full potential. Reskilling is already a key driver of productivity, cited by 50% of Singapore CEO respondents (global 33%). Yet only 22% of Singapore respondents (global 15%) say overall productivity gains are being reinvested in workforce development, underscoring the need for leaders to simultaneously invest in both AI and talent if they are to sustain long-term growth. 

Changali says:
“AI literacy must be built at every level of the organization. While employees need the skills to apply AI effectively and responsibly, it is just as critical for the C-suite and boards to have the necessary AI literacy to distinguish isolated experimentation from enterprise value, challenge assumptions on risk and returns, and make informed investment and business decisions to unlock and drive greater value. Without that leadership capability, organizations run the risk of just scaling activity rather than creating impact — investing in more AI without fundamentally improving how the business competes, operates and grows.”

Growth through portfolio optimization

While growth remains a priority, CEOs are becoming more selective about how they achieve it via their portfolios. Leaders are focused on balancing speed, control, cost and flexibility while reducing execution risk. Rather than relying on a single route to growth, leaders are combining innovation, alliances, partnerships, acquisitions and divestments to build capabilities and deploy capital more effectively. As a result, 72% of Singapore CEOs surveyed (global 69%) say their growth strategy is focused more on strengthening the existing business than on rapid market expansion, signaling a preference for steady, sustainable growth amid continued uncertainty.

A majority of CEOs surveyed (Singapore 85%, global 96%) plan to pursue some form of transaction in the next 12 months. In addition to acquisitions (Singapore 58%, global 51%), leaders are actively pursuing strategic alliances (Singapore 55%, global 60%) and joint ventures (Singapore 50%, global 47%). Additionally, CEOs are prioritizing divestments, as organizations look to release capital, reduce complexity and sharpen strategic focus with 46% of Singapore CEO respondents (global 51%) planning to pursue a divestment in the next 12 months. 

AI adoption is also expanding across transactions, with 60% of Singapore CEOs surveyed (global 46%) piloting AI in selected activities, while 32% (global 45%) report using it across multiple or most transaction activities. Respondents see the greatest opportunity in using AI to identify value earlier (Singapore 48%, global 45%), improve decision-making and accelerate deal execution (Singapore 50%, global 35%), helping organizations identify opportunities earlier and invest more effectively. The priority for CEOs is to create a business that can respond quickly as markets and technology continue to change.

Geophin George, EY-Parthenon Asean Transactions and Corporate Finance Leader:
“AI’s value in transactions goes beyond informing which deals to pursue. Applied across the deal lifecycle, it can accelerate diligence, sharpen valuation, identify synergies and risks earlier, and strengthen either post-deal value creation or integration. The advantage will go to companies that use AI not just to make better decisions, but to execute with greater speed and precision and create more value from every transaction.”

To read the full report, please visit: https://www.ey.com/en_sg/ceo/ceo-outlook-global-report

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About the survey

The Global EY organization conducted an anonymous online survey of 1,200 CEOs from large companies around the world between August and September 2026. The survey aimed to provide valuable insights on the main trends and developments impacting the world’s leading companies as well as business leaders’ expectations for future growth and long-term value creation. Respondents represented 21 countries (Brazil, Canada, Mexico, the United States, Belgium, Luxembourg, the Netherlands, France, Germany, Italy, Denmark, Finland, Norway, Sweden, the United Kingdom, Australia, China, India, Japan, Singapore and South Korea) and five industries (consumer and health; financial services; industrials and energy; infrastructure; technology, media and telecoms). Surveyed companies’ annual global revenues were as follows: less than US$500m (19%), US$500m–US$999.9m (20%), US$1b–US$4.9b (31%) and greater than US$5b (30%).