AI adoption still lags in India Inc’s talent strategy as only 9% use it: Deloitte study

In a business landscape defined by disruption, digital transformation and evolving workforce expectations, India Inc. is putting leadership continuity at the heart of its growth agenda. According to Deloitte India’s Talent Readiness Study 2025, 78 percent of organisations have institutionalised formal succession management frameworks, a sharp rise from 72 percent in 2024.

This decisive shift reflects how Indian businesses are moving beyond traditional HR processes to build resilient, future-ready leadership pipelines that can navigate uncertainty and sustain competitiveness. The growing emphasis on structured succession planning signals a maturing view of talent as a strategic enterprise priority, one that aligns leadership readiness with business transformation, governance and long-term value creation.

The study, covering 156 organisations across the manufacturing, services and life sciences industries, highlights how businesses are reimagining their talent strategies amid technological disruption and evolving workforce priorities. It highlights five emerging priorities shaping India Inc.’s next wave of talent readiness: succession planning for CXO readiness, family business succession, AI-driven talent decisions, increased investment in high-potential talent management and specialist tracks for high-potential talent.

To identify and develop leaders of tomorrow, three in four organisations in India have adopted formal high-potential talent management processes and now define high-potential talent as a person who is “ambitious” and demonstrates “next-level capability”. In 2024, it was characterised as “high performer” and “next level capability”. India Inc. also has 24 percent women as high-potential employees, with their representation becoming increasingly skewed negatively as one progresses to higher levels of management.

“Organisations today are operating in a world where talent defines transformation. In this era of accelerated change, leadership is no longer confined to the corner office; it is distributed, data-informed and deeply human. We are witnessing an evolution and rapid adoption of the potential management system, a system that quantitatively and longitudinally measures the capability of an individual, akin to the stage performance management was in 1.5 decades ago. The future of leadership development is transitioning from ‘buy’ to ‘build’, with increased focus on functional and digital skill development in addition to behavioural or leadership competencies. As the wave of next generation talent takes over, structured, guided and professionally led leadership development is the new mantra in India’s family enterprises,” said Dr Neelesh Gupta, Partner, Deloitte India.

India’s family-led enterprises are redefining their leadership playbook. The study finds that most next-generation leaders (57 percent) step into business between the ages of 24 and 27. Four in five of these leaders progress to board-level roles within the first five years of their joining. Additionally, 60 percent of family enterprises now include spouses in active business roles. This reflects a move towards shared governance, inclusivity and future-oriented professionalisation of legacy structures.

Three out of four organisations (74 percent) have institutionalised high-potential (HiPo) programmes, while 77 percent offer fast-track career opportunities to accelerate leadership growth. However, only 20 percent of organisations have embedded AI and analytics into these programmes, signalling a major opportunity for digital integration in talent management.

Despite rising digital ambitions, only 9 percent of organisations currently use AI tools in succession management. Most respondents (74 percent) reported minimal data use, indicating an emerging frontier where AI can power deeper talent insights, from mapping collaboration networks to predicting leadership success profiles.

As India’s growth story accelerates, the findings underscore that the country’s talent agenda is entering a new era, one defined by readiness, resilience and reinvention. Organisations that align capability-building with business strategy, harness AI to unlock workforce intelligence, and empower emerging leaders will not only future-proof their enterprises but also shape the next generation of India’s corporate leadership.