Manufacturers Aren’t Ready for AI: Infrastructure and Connectivity Gaps Prevent Growth and Increase Risk, Warns Report

Wednesday 13 August 2026, Sydney, Australia. Manufacturers aren’t equipped to support AI innovation, despite high investment in AI, reveals Coevolve’s Manufacturing Edition of its annual Global Business Connectivity Outlook Report 2025–2026.

The special edition of the Report canvasses the views of global manufacturing leaders on current industry opportunities and challenges, including shifting AI and technology adoption priorities. It also looks at key barriers to innovation and automation, and the hidden costs of downtime across diverse geographies.

The report shows that 33 percent of manufacturing leaders are prioritizing investment in AI. Infrastructure is lower on the list of executive priorities, with network architecture top of mind for only 17 percent of leaders. A further 17 percent are investing in cloud solutions, and just 8 percent are investing in security.

The data points to a gap in AI readiness. The right digital foundation and secure connectivity strategies are key to ensuring manufacturing operations continue uninterrupted, and AI transformation succeeds.

“AI adoption is clearly the top priority for today’s manufacturers as they look to drive growth, productivity and innovation. Yet without robust infrastructure, secure connectivity, and reliable network performance in place first, leaders will struggle to support AI traffic and scale these initiatives,” says Tim Sullivan, CEO and Co-Founder of Coevolve.

The report reveals that almost 1 in 2 manufacturing leaders (40 percent) are implementing new systems and technologies over the next 12 months. This is a positive sign for future innovation in manufacturing.

However, the research also revealed that 40 percent of leaders are not upgrading internal systems at all, meaning long-term transformation is being overlooked. With many leaders simply planning to review and audit existing systems, this oversight is holding manufacturers back and exposing them to greater risk.

“Many manufacturers are focused on what AI can do for their business but are paying less attention to the foundations that make those outcomes possible. When connectivity and security aren’t aligned, organizations face more than just cyber risk. They can experience operational inefficiencies, inconsistent performance across sites, increased downtime and a reduced ability to scale new technologies effectively,” says Ciaran Roche, CTO and Co-Founder of Coevolve.

“The challenge isn’t AI itself. It’s whether organizations have the operational foundations needed to support it. Manufacturers can’t expect consistent outcomes from AI and automation if they’re operating across environments with different levels of connectivity, performance, and security maturity. Those gaps ultimately create risk, complexity and barriers to growth,” he adds.

To learn more from industry experts and insights on manufacturing trends in 2026 and beyond, download the Global Business Connectivity Outlook Report: Manufacturing Edition 2026.