AI is breaking the tech trend hype cycle.

For decades, tech trends have followed a predictable pattern: an initial surge of hype as everyone races to gain an early advantage, followed by a dip when reality tempers expectations. The Gartner Hype Cycle has long defined this journey: excitement peaks, disillusionment sets in, and eventually the technology climbs again to maturity as true value and use cases emerge. 

But AI is breaking that cycle and eclipsing all other tech trends. AI is now the foundation for all modern technology, and it is fundamentally reshaping innovation as new capabilities emerge month after month. While some applications of AI falter without a strategy, the technology itself continues to climb. 

In recent years, technology leaders have chased the latest AI innovations, often prioritizing novelty over necessity. But AI advancement is outpacing organizations’ ability to apply it. Now, with unclear use cases, an impossible speed of innovation, and failing ROI from current AI investments, executives are finding themselves in what feels like the “trough of disillusionment.” But this isn’t a normal cycle where technology fails to live up to the hype. Instead, people are preventing widespread success.

The illusion of disillusionment stems from organizations chasing hype, not value. AI isn’t overpromised. It’s underutilized. The challenge isn’t whether AI can deliver; it’s whether organizations can harness its potential, adapt to its constant evolution, and lead in a world where AI is foundational. 

AI isn’t just changing software engineering; it’s fundamentally changing the end-to-end processes we have known to be tradition. Previous technology trends such as mobile and cloud impacted certain parts of the lifecycle, but AI is changing all processes, from ideation to delivery.

Humans are in the loop or in the way.

The most formidable barrier to AI innovation is not the technology itself, but the people who adopt, govern, and implement it. The future of AI innovation hinges on whether people act as catalysts for AI or block its potential. 

While AI systems excel at speed, scale, and automation, they still lack the nuanced judgment, ethical reasoning, and contextual understanding that humans provide. Humans in the loop ensure accountability, accuracy, and adaptability, turning algorithms into trusted partners rather than unchecked engines. 

As AI evolves, so will the role of the human in the loop. But all too often, we’re not getting humans in the loop. We’re getting humans in the way. Lagging employee adoption, consumer distrust, ineffective change management, and compliance paralysis are barriers that stall AI transformation and undermine its success. Explore more in our 2025 Executive Report and 2025 Consumer Study. 

AI is an amplifier. It magnifies both strengths and weaknesses within teams and across entire organizations. With AI, solid foundations become stronger, and existing dysfunctions become more pronounced.

AI is making automated experiences more natural.

Contrary to the fear that automation strips away empathy, the effective application of AI is actually making customer experiences feel more human than ever. (“Effective” being the operative word.)

Agentic systems over the past year have started being robust “task masters” that automate individual tasks faster or with more precision. As agentic systems evolve towards being more outcome-driven or goal-oriented, organizations have the opportunity to cultivate more human-centered customer experiences. Ultimately, the more advanced AI becomes in shaping consumer experiences, the less noticeable the technology will be to the end user, and the more natural it will feel. 

What truly resonates with customers is not only speed or convenience; it’s the feeling of being understood. AI is transforming today’s customer experience by creating interactions that feel less transactional and more relational. Intelligent systems can detect frustration, urgency, or delight in real time, allowing brands to respond with empathy and reassurance.

AI is giving rise to the prototype economy.

Companies expect faster ROI, and consumers expect immediate value. In 2026, the demand for rapid prototyping and accelerated product development cycles will skyrocket. The prototype economy is transforming how organizations innovate, driven by the relentless pace and possibilities of AI. 

Because previous product development lifecycles took time to create and deploy, there was a natural bias towards staying with previous investments as people invested significant effort in the process. As these time cycles diminish and the pace of creation increases, teams can throw away what’s not working and start fresh. The prototype economy frees us from our previous investment bias as the effort to create new is dramatically reduced.