A new report from Cisco identifies significant barriers to AI adoption across the global manufacturing sector, highlighting how the transition to AI technologies is placing unprecedented demands on manufacturers’ existing infrastructure.
According to the “2026 State of Industrial AI: Report for Manufacturing,” which involved over 350 manufacturing decision-makers across 19 countries and 21 industries, 96% of manufacturers believe that wireless connectivity is critical to AI success, yet 56% report that unreliable connectivity frequently disrupts their operations.
Meanwhile, cybersecurity emerges as a double-edged sword in industrial AI adoption, with almost half citing it as their top concern and biggest networking challenge for AI-enabled operations. Despite this, 81% of manufacturers expect AI to enhance their cybersecurity posture, particularly in improving detection, monitoring and resilience capabilities.
The report also revealed a significant gap in cross-functional collaboration between information technology and operational technology
Also highlighted a significant gap in collaboration between information technology (IT) and operational technology (OT) teams in the manufacturing sector, which directly impacts AI outcomes.
Nearly half of manufacturers reported minimal to nonexistent collaboration between their IT and OT departments and about one-third identified this divide as a substantial obstacle to successfully implementing and scaling AI-driven operations.
When asked about desired outcomes, 58% pointed to productivity enhancements, while approximately half sought cost reductions, and 35% hoped to gain an edge over competitors.
In his statement introducing the report, Cisco Secure Routing and Industrial IoT Senior Vice President and General Manager Vikas Butaney noted that the findings demonstrate AI’s significant capacity to boost industrial efficiency and safety, while also acknowledging the various hurdles companies face during this major transition.
“AI is playing an increasingly critical role in cybersecurity for OT, where the scale and complexity of machine data demand intelligent, automated approaches that go beyond human capabilities,” Butaney said.
“We hope this report serves as a valuable resource, offering context and benchmarks to guide your strategy, partnerships, and innovation initiatives,” he added.
This latest industry analysis builds upon Cisco’s previous industrial technology research published in 2024 and was conducted in association with Sapio Research.
