Gen AI in corporate functions: Looking beyond efficiency gains
Gen AI in corporate functions: Looking beyond efficiency gains
https://www.mckinsey.com/capabilities/operations/our-insights/gen-ai-in-corporate-functions-looking-beyond-efficiency-gains
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Generative AI is already adding value for corporate and business functions. Here’s how it could add more.
In less than two years, generative artificial intelligence (gen AI) has become a mainstream tool with applications across almost every area of the economy. New McKinsey research shows that corporate and business functions—including finance, human resources, and customer care, among others—are ramping up their investment in gen AI technologies. A year ago, early adopters were experimenting with pilot projects based on “minimum viable product” gen AI tools. Now a significant minority have deployed gen AI use cases across their organizations.
Those users are broadly satisfied with their gen AI efforts. In our latest survey of senior business leaders (see sidebar, About our research), more than 75 percent of those who have deployed gen AI tools at scale say that those systems have met or exceeded expectations. Yet the data also suggests that companies are only scratching the surface of gen AI in corporate and business functions. While companies are experimenting with multiple use cases for the technology, even the fastest movers have only rolled out one or two full-scale gen AI applications.
The potential of generative AI is too great, and the risks too significant, for today’s approach to continue. Our research provides some clear hints about ways companies can generate more value, more quickly from their gen AI efforts. Specifically:
1- Most companies are pursuing efficiency gains with gen AI, but leaders believe the real value of the technology will accrue from applications that transform the effectiveness of business functions.
2- Overcoming barriers to gen AI development, deployment, and adoption requires a structured and systematic approach. Leading players tend to be those who centralize the management of gen AI technologies. That helps them take a holistic perspective on value creation through gen AI, and implement effective governance structures to accelerate deployment while managing the associated risks.
Where we are now
Comparing this year’s survey with its counterpart from 2023, we see a dramatic acceleration in the engagement with gen AI technologies. The proportion of organizations that are actively using (as opposed to just experimenting with) gen AI in their corporate functions has increased by a factor of five, from 4 percent to 22 percent of CXOs reporting their function has rolled out technology for at least one use case. Furthermore, of the organizations with successful deployments, more than half are using gen AI daily, with less than 5 percent of respondents reporting intermittent usage of once a month or less.
While uptake of gen AI has increased across the board, our survey reveals significant differences in the pace of evolution within different functions. The IT function has the highest maturity among those in our survey, with 36 percent of respondents saying they have deployed gen AI use cases. Customer care, HR, and legal are in the middle of the pack, with around a quarter of respondents actively using the technology. Only 6 percent of finance leaders say that they have rolled out gen AI applications.
That interfunctional difference can be attributed to several factors. IT teams may have better access to the skills needed to develop and integrate gen AI tools, for example. And the faster-moving functions have identified clear use cases, such as coding support in IT, customer-facing chatbots in customer service, and gen AI tools that can review and summarize documents for HR and legal teams.
Efficiency versus effectiveness
Our survey found that the most frequently adopted use cases for gen AI tended to favor applications that focused on automating tasks to improve efficiency: reducing the time and employee effort required to complete certain tasks. Effectively, these organizations are using gen AI to supercharge or even replace conventional digitization approaches such as robotic process automation (RPA). A smaller number of respondents are targeting greater effectiveness with gen AI: using the new technology to enhance service levels, improve business outcomes, or add new capabilities.
Today’s focus on efficiency is probably because simpler, tactical uses of gen AI have been easier to deploy. In the medium term, we expect companies to be more ambitious about the application of the technology. In part, that’s because it can be hard to turn small time savings into meaningful cost savings. Today’s gen AI systems are capable of automating parts of roles, rather than whole jobs, making it difficult for companies to redeploy people freed up by automation. It’s also because effectiveness offers much more potential value. Improving forecast accuracy, understanding markets more deeply, or optimizing capital allocation might unlock truly significant cost savings and growth opportunities.
Leaders recognize the potential to apply gen AI in more strategic ways. For example, in the finance function the most frequently pursued use cases that had either been piloted or fully deployed include cost analytics (by 47 percent of CFOs responding to our survey), optimizing accounts payable approvals (44 percent), and fraud prevention checks (also 44 percent). These more tactical applications contrast with the most popular use cases CFOs plan to pursue in the future, such as cashflow optimization (which 46 percent plan to pursue next year) and revenue forecasting (which 30 percent plan to pursue), where the focus is on improving the effectiveness of the finance organization.
Building a gen AI engine
On average, the CXOs we surveyed believe it will take another three to five years to capture significant value from gen AI deployments in their functions (with between 55 and 80 percent of respondents, depending on specific function, falling in this range). Leaders cited a wide range of issues they believe are hampering their gen AI ambitions, with inaccuracy and security risks at the top of the list, followed by challenges in selecting appropriate use cases for investment
These are valid concerns, but we believe they are exacerbated by the way many companies are approaching gen AI development. Often that means a highly distributed, bottom-up approach, with individual functions and business units conducting their own gen AI experiments and pilots with limited oversight or central coordination.
In our survey, 35 percent of organizations that followed an enterprise-wide approach to gen AI investments have already successfully deployed at least one use case, while functions that pursued gen AI in a single business unit or region had only a 24 percent success rate. Companies were also ten percentage points more likely to be actively using gen AI when the underlying data was owned by the organization’s global business services (GBS) unit, rather than its IT function.
These findings add weight to the idea that gen AI is too important a technology to leave to chance. Centralizing the oversight of gen AI development within the organization is a key enabling step that allows companies to make better decisions about where, how, and when they deploy gen AI in their corporate functions. Specifically, we believe that companies should establish structures and processes that enable them to do three things:
1- Develop a robust perspective on where gen AI adds value. Ensure the organization is prioritizing investments with a clear sense of how and where gen AI can add value and what this value is.
2- Establish clear, comprehensive, and holistic governance for gen AI deployment that emphasizes central oversight and centralized allocation of resources, to drive enterprise-wide progress in priority areas and provide guidance and oversight for responsible use.
3- Rewire ways of working instead of just automating tasks. Take a wider view of gen AI deployment that goes beyond the technical aspects of the solution to ensure that the technology is embedded into day-to-day workflows.
NYC Hotel Week supports city's winter demand during softer period
Campaign targets different, value-conscious set of travelers to New York
Times Square in New York City. (Getty Images)
https://www.costar.com/article/128546171/nyc-hotel-week-supports-citys-winter-demand-during-softer-period?
New York City’s lodging industry has launched its annual NYC Hotel Week when more than 150 properties across the city’s five boroughs offer discounts and other promotions.
Despite its name, NYC Hotel Week actually takes place over several weeks from Jan. 2 to Feb. 12.
Why is a promotion needed for one of the busiest hotel markets in the U.S.? Julie Coker, president and CEO of NYC Tourism + Conventions, said the initiative aligns with her agency’s other promotional programs NYC Restaurant Week, NYC Broadway Week and NYC Must-See Week. NYC Hotel Week aims "to create an ultimate value period for global travelers visiting NYC and to boost tourism and hospitality businesses citywide,” she said.
Combining these programs has contributed to increased travel spending across New York City's five boroughs during the slowest tourism period each year, Coker added.
“With easy access via car or train from across the Northeast, visitors can experience the best of all five boroughs without peak-season prices or crowds,” she said.
The first two months of the year are typically the lowest demand period for New York City hotels. In 2025, January saw hotel occupancy of 70.1%, and February's was 73.4%, marking the lowest and second-lowest months respectively. Year-to-date occupancy for the market through November was 83.8%, with the highest monthly figure reaching 89.6% in October.
The first quarter of the year typically accounts for about 17% of New York City's total visitation, Coker added.
John Beck, regional director of IHG Hotels and Resorts, said the Crowne Plaza HY36 Midtown Manhattan in the city's massive Hudson Yards mixed-use complex originally joined the NYC Hotel Week promotion when it launched in 2022 because every hotel in town needed the business coming out of the pandemic.
As the industry has grown stronger and tourism has returned, participation in the program has grown to be more about giving travelers additional options for their trips to New York City.
“We’re fortunate to be in a prime location with strong demand drivers, so we don’t participate because we ‘need the business,’“ Beck said.
The Crowne Plaza HY36’s base demand is already supported by major events such as Professional Bull Riding and concerts at Madison Square Garden, the International Toy Fair, the Westminster Dog Show, and Knicks and Rangers games — all happening during the NYC Hotel Week period, Beck said.
“It’s always funny when we talk about ‘slow’ periods in New York City because our slow periods are still busy compared to other major U.S. markets,” he said.
While other cities conduct similar hotel promotions, Beck said “nothing compares to the sheer scale of New York.”
“We have the most vibrant and diverse hotel landscape, and we pair Hotel Week with Restaurant Week and Broadway Week," he said. "It truly gives travelers discounted access and incredible promotions to experience New York City at its fullest.”
And while business remains strong in winter, hotel operators say the city can still use a boost.
Justin Arest, owner of the Kixby Hotel in the Herald Square area, said early January through early February is one of the slowest stretches for New York hotels. Leisure demand to New York City drops after the holidays, and business travel hasn’t fully ramped up. Occupancy can fall noticeably without a coordinated promotion, so NYC Hotel Week “extends the hotel’s marketing reach far beyond what any single hotel could achieve on its own,” he said.
Kellie Ann Cahill, senior commercial director for Hilton's managed properties in New York and New Jersey, said the promotion is important for the Hilton New York Times Square and Tempo by Hilton Times Square because it not only supports demand in the market “but also delivers added value to our guests while fueling the city’s energy.”
Chris Rynkar, area general manager of Generator and Freehand Hotels, said the benefit goes beyond the exposure for his company's New York properties during the off-peak season.
“This initiative also allows us to support the city’s tourism ecosystem,” he said.
Arest described The Kixby's participation "as a commitment to the industry.”
He added that while recent rate growth has drawn attention, “inflation-adjusted ADR in New York City remains below its 2019 pre-pandemic peak, even as operating costs continue to rise.”
Does it work?
In 2025, the Crowne Plaza HY36 saw “great penetration” from the promotion, especially over weekends where upwards of 10% of guests were booked under the NYC Hotel Week offer, Beck said. Affordability seems to be top of mind based on guest feedback.
“They almost always mention the value of this time period combined with discounted Broadway tickets and the ability to experience participating restaurants at, in some cases, half the cost of what it would have been a month earlier,” he said.
The event helps expand the pool of travelers who consider their hotel, and many consider expanding their stays due to the perceived value they're receiving, Beck said.
“What’s another $200 a night in the grand scheme of things when staying at the Crowne Plaza HY36 Midtown Manhattan is an easy, seamless experience where I’m pampered and taken care of?” he said.
The Freehand New York normally expects an additional 500 bookings in correlation with the promotion, Rynkar said. In addition, it helps capture an entirely new wave of guests for who may not have considered visiting New York City during peak periods, when travel has become increasingly expensive and there is a heightened demand for hotel rooms.
Properties participating in the promotion submit results to New York City Tourism + Conventions each season, and The Kixby tracks its own numbers internally, Arest said. Bookings tied to the NYC Hotel Week rate code show clear incremental pickup between January and early February when compared with past years. The program, he said, “generates real, measurable business.”
Marketing NYC Hotel Week
The winter NYC Hotel Week promotion “is everywhere you look,” Beck said. He added that NYC Tourism + Conventions “does a wonderful job marketing it across the U.S. and around the globe.”
The campaign “reaches key feeder markets and manages to get this promotion into every living room, every travel blog, every podcast — they really amplify it,” Beck added.
At the property level, Beck said the Crowne Plaza HY36 promotes the campaign to its loyal guests who tend to stay during the winter period.
“Throughout the year, when we’re interacting with guests, we take notes on things they may want to return to New York for, and if any of those align with Hotel Week offerings, we reach out to them directly,” he said.
When NYC Hotel Week started, there were 120 participating properties offering 22% off standard retail rates and today there are more than 150, offering a 25% discount, Coker said. The program continues to grow in popularity and as of late 2025, there was a 33% year-over-year increase in traffic to the campaign's website.
We Hate These 11 Vacation Upcharges! Do Everything You Can to Avoid Paying Them
neirfy/iStock
https://www.fodors.com/news/photos/vacation-upcharges-to-avoid
Kelly Magyarics
When traveling, be prepared to dodge needless upcharges.
Restaurant Surcharges
On cruises and at all-inclusive resorts, meals are typically built into the price of the trip. But if you have your eye on an upgraded cut of steak, lobster tail, foie gras, or other premium menu selections, it might cost you extra. Even more egregious are restaurants tagged as “specialty dining” that aren’t part of your package, leading to FOMO if you want to experience a five-course tasting menu or sushi dinner—a policy that’s especially irritating if other options are limited. Do your research before booking to see how many (and which) restos are included, making sure you have enough variety during the length of your stay.
Spa Facility Charges
There’s been an uptick lately in spa “hydrotherapy circuits,” which often amount to no more than glorified pools and hot tubs with jets and different temperatures. Call us underwhelmed. These trendy yet overhyped facilities always incur an average fee of $50 or $75—sometimes even if you book a pricey massage or facial. Besides the fact that they’re just way overpriced for the experience, they tend to get boring very quickly. And attendants instructing you to jump under a freezing cold rain shower or plunge pool or stay in the stifling sauna for an allotted amount of time might make the experience downright uncomfortable.
In-Room Bottled Water
Hotel rooms are often stocked with water bottles adorned with tags inviting guests to enjoy the refreshment—for upwards of $7, $8, or even $10 a pop. Why must a basic need like hydration be so spendy, especially since you might be using the water to fill your coffee machine for your morning java? When it comes down to it, the tap water might be perfectly fine (and even better than bottled in places like Iceland or Switzerland). We hope more hotels follow the trend of daily glass bottles of filtered water in rooms or refillable stations on every floor—and providing a reusable bottle during your stay to cut down on single-use plastics.
Lost Towel Card or Room Key Fines
Enough already with the towel cards. No guest should need to trade a piece of plastic for a basic pool or beach amenity, nor be made to fear a fine for not returning their scratchy, stained, worn beach towels at the end of the day. Ditto for losing your bracelet room key at an all-inclusive resort, which might have been attached too loosely at check-in and easily slipped off in the pool or when you were bodysurfing. Both of these charges are a total racket.
Resort Fees
This mandatory fee can add an extra $25 or $50 to your nightly room charge. While the reservation agent or front desk attendant will rattle off all the amenities the resort fee covers, they’re often ones that you should be getting anyway, like beach chairs, use of the fitness center, wi-fi, and bike rentals. The kicker is that you pay this fee whether or not you use the perks, and most likely you won’t be allowed to opt-out. Some booking sites don’t list this add-on when you’re comparing properties and you’ll only see it at check-out, so read the fine print and decide if the extra coin per night is worth it.
Wi-fi on Cruises
We get it: you want to stay in touch, post photos, or stream a movie in between endless meals, lounging on the pool deck, and onboard diversions. Cruise lines know it too, charging around $10 per day for wi-fi access. While Royal Caribbean’s Zoom wins awards for its speed and reliability, wi-fi on other cruise lines is often painfully slow, especially during the evenings when many passengers are back in their staterooms. And if you have to get work done, keep in mind that VPN access may be blocked. Avoid paying these exorbitant fees by purchasing a package where it is bundled in with other services like beverages and excursions. Or if you have a good data plan, set your devices to airplane mode until you’re at port and then get your fix.
Overpriced Cabanas
Of course renting a cabana or a daybed should come with an extra charge, considering you often get a food and beverage credit, replenished water, towels, and a butler to attend to your every need. But sometimes the price for exclusivity is over the top. When the chairs are the same run-of-the-mill seating as the rest of the pool deck and you’re basically paying $250 for shade and a fancy fruit platter, you might want to reconsider.
Fitness Classes
Resorts might have a packed daily calendar of activities, from crafts by the pool in the morning to wine tasting at happy hour to evening trivia. But wellness seekers may be more interested in fitness offerings than a mixology class or chef demo. While aqua aerobics in the main pool may be a freebie, that beachfront morning yoga or HIIT class you saw listed in the app or on the resort channel of your television might set you back $30 each time. We understand paying for individualized sessions of personal training, but anything else should be a guest amenity.
Morning Coffee or Tea
More hotels are outfitting their rooms with high-quality coffee makers like Nespresso or Keurig. But still commonplace—and way less exciting to wake up to—are outdated, small drip coffee pots with pods filled with weak grounds. If you can’t make a decent cup of joe in your room (with filtered water that’s included, obviously), you shouldn’t have to pay $5 to buy a cup at the cafe downstairs. The norm should be lobby stations thoughtfully set up with coffee, cream (including a non-dairy option), sweeteners, and a curated selection of tea bags.
Rental Fee for Non-Motorized Activities
The fine print at most resorts states that non-motorized beach equipment like SUP, kayaks, floats, snorkel gear, and Hobie Cats are free for guests to use, while Jet Skis, underwater scooters, and the like are not. And that policy totally makes sense. But every once in a while, you’ll come across a property where you have to pay to rent items in the former category, which is pretty greedy since they’re low-maintenance and already set out on the sand anyway.
Hilton Punishes Hotel After It Cancels ICE Bookings
Jude Wilson/Unsplash
https://www.fodors.com/world/north-america/usa/minnesota/minneapolis-st-paul/neighborhoods/minneapolis/experiences/news/hilton-removes-minneapolis-hotel-after-ice-agent-booking-refusals-spark-controversy
DHS criticized the independently-run hotel.
The Department of Homeland Security (DHS) criticized the Hampton Inn, located in the Lakeville suburb of Minneapolis, for canceling bookings for ICE agents. In a post on X, DHS alleged that Hilton Hotels had maliciously canceled its reservations as part of a coordinated campaign. The post included screenshots of an email that read, “We have noticed an influx of GOV reservations made today that have been for DHS, and are not allowing any ICE or immigration agents to stay at our property. If you are with DHS or immigration, let us know as we will have to cancel your reservation.”
Hilton and Everpeak Hospitality, which operates the hotel, both released statements apologizing and reaffirming that they do not discriminate. Hilton Hotels distanced itself from the independently operated hotel’s actions and said they do not reflect Hilton’s values. However, the company also confirmed it had rectified the matter. Everpeak stated it welcomes all guests, adding, “We are in touch with the impacted guests to ensure they are accommodated.”
A day later, the hotel was removed from Hilton’s website. In a statement on X, the hotel chain said the owner had confirmed resolution of the issue, but that a recent video had made it clear the hotel was not meeting Hilton’s standards. “As such, we are taking immediate action to remove this hotel from our systems. Hilton is—and has always been—a welcoming place for all.”
The video refers to influencer Nick Sortor entering the Hampton Inn while posing as a federal agent and asking for a reservation. The front desk staff, unaware they are being filmed, inform him they are not accepting bookings from DHS agents. Sortor cites the statements from Hilton and Everpeak affirming a welcome for all, but the hotel clerk politely states that it is against their policies.
It is unclear whether the hotel still has an affiliation with the global chain, but it can no longer be booked through Hilton’s website.
The Political Background
In his second term, President Donald Trump has increased immigration detentions as promised in his campaign. More than 328,000 people have been arrested since January, most with no criminal records. U.S. citizens have also been affected, and there have been reports of deportations of immigrants to countries where they have no ties. Masked agents have been recorded detaining people in schools, courtrooms, and residences, with more violent videos showing agents shoving people or breaking car windows, frightening communities. Consequently, there is growing apprehension about unidentified cars and people in vests appearing in neighborhoods.In recent weeks, Minnesota has come under the president’s scrutiny.
In an unfortunate incident, 37-year-old U.S. citizen Renee Nicole Good was shot and killed by an ICE agent in Minneapolis on Wednesday. The city has erupted in protests against federal agents.
This occurred after the Trump administration deployed 2,000 immigration agents to crack down on the Somali community in the state, following alleged fraud accusations by a conservative YouTuber. The administration has also blocked child care payments and admitted to planning the “largest DHS operation ever.” This has led to tensions between federal agents, state leaders, and residents.
Residents have shown their discontent by impeding agents, demonstrating outside hotels where agents are suspected to be staying, and alerting each other about masked individuals in their neighborhoods.
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