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NTT DATA reveals GenAI’s growing impact on manufacturing, but warns of critical gaps

NTT DATA research shows GenAI is transforming manufacturing, but warns of critical risks in infrastructure, workforce skills, and governance.

NTT DATA has released new research revealing how manufacturing firms across the globe are embracing generative AI (GenAI) to enhance efficiency, innovation, and competitiveness. However, the study also points to key weaknesses in governance, infrastructure, and workforce readiness that could undermine progress.

GenAI uptake drives performance and innovation

The report, titled Feet on the Floor, Eyes on AI: Do you have a plan or a problem?, draws insights from more than 500 manufacturing leaders across 34 countries. It highlights a widespread belief in GenAI’s potential to transform manufacturing operations, especially when combined with technologies like the Internet of Things (IoT) and digital twins.

According to the findings, 95% of global respondents – and 97% in Asia Pacific – reported that GenAI is already improving operational efficiency and financial outcomes. Additionally, 94% (99% in APAC) believe integrating IoT or edge data into GenAI models will boost the accuracy and usefulness of AI outputs. Meanwhile, 91% (APAC: 97%) anticipate better physical asset performance and more resilient supply chains through the combination of GenAI and digital twins.

Manufacturers are using GenAI most often in areas such as supply chain and inventory management, knowledge management, quality control, research and development, and process automation. Prasoon Saxena, Co-Lead of Products Industries at NTT DATA, Inc., said: “AI is streamlining processes and redefining what’s possible across the entire manufacturing value chain, from supply chain predictions to quality control. GenAI can help organisations achieve flexibility in fast-changing business environments, especially in the face of uncertain tariff policies worldwide.”

Barriers to full-scale GenAI adoption

Despite growing confidence in AI’s role in manufacturing, the report also exposes major challenges that organisations must overcome. A key issue is outdated infrastructure. While 92% (APAC: 91%) of manufacturers said legacy technologies are slowing down key initiatives, fewer than half have conducted a comprehensive assessment to determine whether their systems are GenAI-ready.

There is also concern over the ability to integrate necessary technologies. Although a large majority expect benefits from combining IoT data with GenAI, many companies remain unsure about whether they can implement such integrations effectively.

Ethical and responsible AI practices are another concern. While nearly all manufacturers acknowledge the importance of governance, only 47% globally (48% in APAC) said their organisations follow a strong ethical AI framework that balances risk and value creation.

In terms of human capability, workforce readiness remains a major stumbling block. Two-thirds of respondents – and 53% in APAC – said their employees do not have the skills required to work with GenAI, putting their organisations at risk of falling behind.

Another operational challenge is data management. Only 41% of manufacturers globally (46% in APAC) strongly believe they have sufficient data storage and processing capacity to handle the demands of GenAI applications.

Planning and governance needed for long-term success

While GenAI presents clear opportunities for innovation and growth in manufacturing, NTT DATA’s findings suggest that a lack of planning and governance could leave many companies vulnerable. The pressure is now on leaders to ensure their technology, talent, and ethical standards are robust enough to support the next wave of intelligent automation.

“The most successful manufacturing organisations have already integrated GenAI into essential operations,” Saxena said. “Companies failing to plan, deploy and govern GenAI strategically will not only have a problem, they may be planning to fail.”

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