Common reasons why AI projects fail: It’s not about technology
Every January, gyms overflow with new members. Treadmills are packed. Spin classes have waitlists. By March, the crowds thin. By April, they're gone. The equipment sits idle, and the memberships continue to auto-renew for people who stopped showing up months ago.
This pattern is so predictable that gyms build their business models around it. Your AI implementation follows the same arc, and the reasons are identical.
RAND Corporation research confirms that over 80% of AI projects fail—double the failure rate of traditional IT initiatives.1 BCG found that 74% of companies struggle to achieve any value from AI.2 MIT's research is even more sobering: 95% of generative AI pilots fail to deliver measurable business impact.3 So what gives, why do AI projects fail? Organizations aren't failing because AI doesn't work. They're failing because they approach AI the way failed gym-goers approach fitness.
The problem isn't technology. It's the approach.
Why AI projects fail: a lack of consistency
New gym members want transformation without a process. They expect visible results in weeks, not months. When progress inevitably stalls, they interpret the plateau as failure rather than the natural phase of development. They waste months on ineffective routines and skip personal trainers because they seem expensive, never building the habits that turn effort into outcomes.
Sound familiar? BCG's research reveals that 70% of AI implementation challenges stem from people and process issues4, not the algorithms or the models. Organizations rush to deploy AI because competitors and peers are doing it, not because they've identified specific problems worth solving. They expect ROI in weeks when the work requires months. When initial pilots hit inevitable friction, they abandon ships rather than iterate.
Where the approach breaks down
The failure patterns are predictable. RAND Corporation's research identifies the most common root cause: organizations misunderstand or miscommunicate what problem actually needs solving.5 They pursue AI because it's exciting, not because they've identified a specific business problem where AI is the right solution.
Skills gaps compound this issue. Despite 75% of companies adopting AI, only 35% of workers received any training in the past year. Among those who did, 74% rate their organization's programs as average to poor. 6 You can't expect transformation from a workforce that hasn't been equipped to deliver it.
Organizational silos make scaling nearly impossible. BCG found that leaders who succeed pursue half as many AI opportunities as laggards but scale twice as many. One of the top causes of corporate AI projects failing is due to scattered experimentation across disconnected departments, producing pilots that never reach production.
Then there’s data quality, the obstacle everyone expects. Informatica found that 43% of executives cite data readiness as their top concern, yet winning programs allocate 50-70% of their timeline and budget to data preparation before any process development begins.7 Most organizations rush past this foundation work, eager to get to the algorithms.
What methods actually work to prevent AI project failure
The people who meet their fitness goals have a few things in common: they hire trainers for accountability and expertise, they commit to showing up even when progress feels invisible, they push through plateaus instead of quitting, and they focus on sustainable habits rather than a quick fix. AI success follows a similar pattern.
MIT found that purchasing AI solutions from specialized partners succeeds twice as often as internal builds, yet organizations persistently try to go it alone.8 McKinsey's research shows that the 6% of companies generating real AI value are three times more likely to fundamentally redesign their workflows, commit more than 20% of digital budgets to AI, and treat implementation as organizational transformation rather than technology deployment.9
The truth is that AI transformation requires the same unglamorous virtues as physical transformation: patience through plateaus, expertise to guide the process, consistent investment over time, and the humility to recognize that sustainable change is slow change. The question isn't whether you've started an AI initiative. It's whether you'll still be committed in April.
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Endnotes
- James Ryseff, Brandon F. De Bruhl, Sydne J. Newberry. “The Root Causes of Failure for Artificial Intelligence Projects and How They Can Succeed.” RAND. August 13, 2024. https://www.rand.org/pubs/research_reports/RRA2680-1.html. ↩
- Nicolas de Bellefonds, Tauseef Charanya, Marc Roman Franke, Jessica Apotheker, Patrick Forth, Michael Grebe, Amanda Luther, Romain de Laubier, Vladimir Lukic, Mary Martin, Clemens Nopp, and Joe Sassine. “Where’s the Value in AI?” BCG. October 24, 2024. https://www.bcg.com/press/24october2024-ai-adoption-in-2024-74-of-companies-struggle-to-achieve-and-scale-value. ↩
- Sheryl Estrada. “MIT report: 95% of generative AI pilots at companies are failing” Fortune. August 18, 2025; Findings garnered from "Preliminary Findings from AI Implementation Research from Project NANDA" by Aditya Challapally, Research Period: January – June 2025 https://fortune.com/2025/08/18/mit-report-95-percent-generative-ai-pilots-at-companies-failing-cfo/. ↩
- Bellefonds. “Where’s the Value in AI?” BCG. October 24, 2024. https://www.mckinsey.com/capabilities/quantumblack/our-insights/the-state-of-ai. ↩
- Ryseff, “The Root Causes of Failure for Artificial Intelligence Projects and How They Can Succeed.” RAND. 2024. https://www.rand.org/pubs/research_reports/RRA2680-1.html. ↩
- Alex Singla, Alexander Sukharevsky, Bryce Hall, Lareina Yee, and Michael Chui, with Tara Balakrishnan. "The State of AI in 2025: Agents, Innovation, and Transformation" McKinsey & Company. 2025. https://www.mckinsey.com/capabilities/quantumblack/our-insights/the-state-of-ai. ↩
- Preetam Kumar. "The Surprising Reason Most AI Projects Fail – And How to Avoid It at Your Enterprise" Informatica. CDO Insights Survey. March 31, 2025. https://www.informatica.com/blogs/the-surprising-reason-most-ai-projects-fail-and-how-to-avoid-it-at-your-enterprise.html. ↩
- Challapally."Preliminary Findings from AI Implementation Research from Project NANDA" MIT. June 2025 https://www.informatica.com/blogs/the-surprising-reason-most-ai-projects-fail-and-how-to-avoid-it-at-your-enterprise.html. ↩
- Alex Singla, Alexander Sukharevsky, Bryce Hall, Lareina Yee, and Michael Chui. “The state of AI in 2025: Agents, innovation, and transformation” McKinsey. November 5th, 2025. hhttps://www.mckinsey.com/capabilities/quantumblack/our-insights/the-state-of-ai. ↩