Rockwell Automation has released its 11th annual State of Smart Manufacturing report, with Asia Pacific findings revealing that 95% of manufacturers in the region now consider digital transformation essential to their competitiveness — ahead of the 90% global average — as artificial intelligence adoption and cyber risk intensify across the sector.

The report, which draws on responses from 1,560 manufacturers across 17 countries, shows APAC manufacturers moving firmly from early-stage experimentation to broader implementation. Seventy-one percent of APAC organisations plan to increase AI and machine learning usage in the next 12 months, with AI augmentation projected to grow from 34% of manufacturing operations today to 54% by 2030.

AI and Cybersecurity Delivering Measurable Returns

Generative AI has emerged as a central driver of manufacturing transformation. Forty percent of APAC respondents cited its impact on workforce challenges, while 39% pointed to its role in long-term competitiveness. Cybersecurity platforms and generative AI were also ranked among the technologies delivering the highest return on investment over the past 12 months, at 37% and 32% respectively.

Cyber risk is a persistent concern: 50% of APAC manufacturers reported experiencing at least one cyberattack in the past year. Despite this, confidence in resilience remains high — 83% said they believed they could prevent or contain a future incident. IT systems and enterprise networks were identified as the most vulnerable areas by 42% of respondents.

Workforce and Data Gaps Remain Key Barriers

“This year’s findings show a region accelerating execution through scaling AI, hardening cyber defences and building the workforce capabilities needed to sustain growth,” said Scott Wooldridge, Regional President, Asia Pacific, Rockwell Automation. “What stands out is both the ambition and the realism. Across the region, manufacturers understand that digital transformation is the critical operating standard.”

Despite the momentum, significant gaps persist. Only 42% of collected data is currently used effectively, with data security cited by 26% of respondents as the leading barrier to unlocking AI’s full potential. Workforce challenges are also acute: change management and rising labour costs and skills shortages were each flagged as top obstacles by 40% of manufacturers, while just 41% reported that their workforce had participated in reskilling programmes over the past year.

Looking ahead, AI and machine learning (51%) and automation (46%) are viewed as the most critical capabilities for sustaining competitiveness over the next five years. The 2026 State of Smart Manufacturing report was conducted by Sapio Research in association with Rockwell Automation, covering sectors including consumer packaged goods, food and beverage, automotive, semiconductor, energy and life sciences.