SaaS adoption drives growth for manufacturers in Australia, NZ
Investment in Software-as-a-Service (SaaS) technologies is set to play a central role in driving agility and growth across the manufacturing sector in Australia and New Zealand, according to findings from Rockwell Automation's 2025 State of Smart Manufacturing Report.
The report incorporates insights from 1,560 manufacturers worldwide, including 85 organisations based in Australia and New Zealand. It highlights that manufacturers in the region already dedicate 30% of their operational budgets to technology, with 71% adopting production monitoring solutions and 64% implementing asset performance management tools as part of their smart manufacturing strategies.
The findings emerge against a backdrop of concern regarding Australia's declining productivity, which saw its steepest annual drop on record in 2022-23. Industry analysts and government bodies have highlighted the need for substantial investment in both digital tools and workforce capability enhancement to reverse this trend. According to a report by the Tech Council of Australia, artificial intelligence is expected to generate up to 200,000 AI-related jobs in Australia by 2030, with projected economic gains exceeding AUD $100 billion, primarily attributed to productivity improvements.
Despite considerable investment in digital transformation, the adoption of smart hardware in Australia and New Zealand has shown signs of slowing. Only 24% of Australian and New Zealand manufacturers are currently utilising collaborative robots, a figure that trails behind the United Kingdom (30%) and Brazil (31%).
Anthony Wong, Regional Director for the South Pacific at Rockwell Automation, commented on the relationship between people and technology amid ongoing sector changes. "Today's advancements are unlocking opportunities where people and technology together will define our future," Wong said. "As the report shows, global manufacturers are using smart solutions to navigate disruption and gain agility. With the right technology and talent, we can simplify complexity and lead confidently through change."
Cybersecurity remains a priority in the manufacturing sector as threats to digital infrastructure continue to escalate. The Australian Government has committed between AUD $15 billion and AUD $20 billion over the next ten years to bolster national cyber defences. Businesses are also identifying cybersecurity as a worthwhile investment, with 41% of surveyed organisations in Australia and New Zealand reporting that cybersecurity initiatives offer the highest return on investment.
While there are significant opportunities arising from Generative AI and Causal AI, these technologies bring associated risks, including data poisoning, AI hallucinations and model theft. Despite these concerns and government warnings, 95% of participating organisations in the region have either already invested in or plan to invest in Generative AI and Causal AI technologies. This rate is higher than the adoption levels reported in Japan (91%) and South Korea (93%). Some companies are using causal AI to enhance supply chain transparency and support data-driven decision-making.
Cloud and SaaS adoption is gaining momentum among manufacturers, with the regional market for SaaS projected to grow at a compound annual growth rate of 10.1% between 2025 and 2030. This growth is expected to see the market reach USD $57 billion by the end of the decade. The SoSM 2025 Report also notes that 89% of manufacturers in Australia and New Zealand have invested in or intend to invest in Cloud and SaaS technologies, trailing Canada (95%) and Brazil (100%), but indicating a strong rate of adoption.
The report identifies other technology adoption trends in Australia and New Zealand. Digital twins and simulation technology have an adoption rate of 28%, similar to that of Canada (27%) and Germany (28%). Edge computing has been adopted by 71% of manufacturers, surpassing Canada (67%) and Germany (68%), but trailing behind France (85%) and India (80%).
Robotic process automation (RPA) is currently implemented by 35% of surveyed firms, compared with 50% in Brazil and 46% in the United Kingdom. Additionally, an additional 41% plan to invest in RPA within the next five years. Enterprise asset management (EAM) solutions have been deployed by 68% of companies in the region, which matches adoption in Germany but remains behind Brazil (83%) and China (79%).
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