Something does not add up about artificial intelligence in New Zealand. On paper we are enthusiastic adopters. A study by Deloitte Access Economics, commissioned by 2degrees and published in late April, found that 82 percent of New Zealand businesses now use AI in some form. Yet over the same stretch the country’s productivity numbers went backwards. Labour productivity fell 0.7 percent and multi-factor productivity dropped 0.9 percent. If AI is the great efficiency machine we keep being promised, someone forgot to tell the national accounts.
The contradiction is worth sitting with, because it says something important about how the technology is actually landing in Kiwi workplaces. Almost everyone has switched it on. Far fewer have changed how they work because of it.
That is the real story behind the adoption figures. When a business tells a survey it uses AI, more often than not it means someone on the team has started leaning on the AI features baked into tools they already owned. A summarise button in an email client. A draft-this option in a word processor. A smarter search box. These are genuinely useful, and they are also almost frictionless, which is exactly why take-up looks so high. What they are not is transformational. Bolting an assistant onto an unchanged process makes that process slightly faster. It does not make the business meaningfully more productive, and it certainly does not show up in the multi-factor productivity statistics.
The businesses pulling ahead are doing something harder. They are redesigning the work itself around what the technology can now do, rather than sprinkling it on top of yesterday’s workflow. The same Deloitte research found that small and medium firms using AI earned roughly $400,000 more than comparable non-adopters in the last financial year, while large firms were ahead by about $59.1 million. Those are not the returns you get from a summarise button. They are the returns you get when a company rethinks how a quote is generated, how a customer enquiry is handled from first click to final invoice, or how a backlog of unstructured information becomes something staff can actually query.
Liza van der Merwe of Deloitte Access Economics put it plainly in the report. “Progress depends on building mindset, systems, and skills in tandem. When these come together, businesses are far better placed to turn AI into real productivity gains.” The order matters. Systems and skills, not just software.
From where I sit, running a web design and development agency, this pattern is familiar and a little frustrating. We see it constantly with websites. A business adds a chatbot to a site that is otherwise a digital brochure and wonders why nothing much changes. The chatbot answers a few questions, the customer still cannot check stock, still cannot book, still cannot self-serve the thing they actually came for, and the enquiry lands in the same inbox it always did. The AI is real. The workflow around it is not. Value appears only when the whole journey gets rebuilt so the technology has something to connect to. That is unglamorous work. It involves plumbing, data, and process far more than it involves clever prompts, and it is the part most businesses underestimate.
This is also where the skills gap bites. Roughly four in ten businesses that have not adopted AI point to a lack of in-house expertise as the reason, and that expertise is not really about knowing which chatbot to buy. It is about being able to look at how a company runs and see which parts can be redrawn. Most small firms simply do not have that person, and they are wary of spending money to find out they were sold the wrong thing.
To its credit, the Government has noticed. In January it launched an AI advisory pilot for small businesses, run through the Regional Business Partner Network of fifteen providers around the country. Eligible firms can get co-funding of up to 50 percent of the cost, capped at $15,000, to develop a proper AI implementation plan with guidance on privacy, data handling and responsible use. The initial pot is modest at $765,000, and the pilot is deliberately small, aiming for at least 51 participating firms. Sitting behind it is a larger commitment of $70 million over seven years for AI research through the new New Zealand Institute for Advanced Technology.
Small Business Minister Chris Penk framed the reasoning simply, noting that “AI has enormous potential to drive economic growth and increase productivity across New Zealand’s economy.” The pilot is worth a look for any owner who has felt stuck at the summarise-button stage, precisely because it funds the planning rather than the tool. That is the right end to start from.
None of this is an argument for adopting AI as an article of faith. The most common mistake I see is treating the technology as the goal. It is not. The goal is a faster quote, a shorter queue, a customer who can help themselves at eleven at night, a team freed from retyping the same information into three systems. Start with the problem that costs you time or money, be honest about whether it is actually an AI problem or just a broken process, and only then ask what tool fits. Plenty of the businesses seeing real gains got there by fixing the process first and adding the intelligence second.
New Zealand’s high adoption rate is not the achievement it appears to be. It mostly measures how easily AI has been switched on, not how deeply it has been put to work. Closing the gap between those two things is the actual opportunity in front of us, and it will be won by the firms willing to change how they operate rather than the ones hoping a clever feature will do it for them. The productivity numbers will start moving when more of us do the harder half of the job.
Roger McSaveney is General Manager of Forge Creative, an Auckland web design and development agency.
What has your experience of AI at work been so far, a genuine change or just a faster version of the same old thing? Share your thoughts in the comments below.
This article was written by AI, briefed to report the facts, hopefully without some of the bias people bring to the job 🙂
Leave a Reply