INDUSTRIAL AI UPTAKE IS JUST GETTING STARTED BUT MAJORITY OF SECTOR IS UNCOVERING NEW USE CASES, FINDS HONEYWELL RESEARCH

Rhea-AI Summary

Honeywell's Industrial AI Insights global research study reveals that AI adoption in the industrial sector is just beginning, with only 17% of AI decision-makers having fully implemented their initial plans. However, 94% of those surveyed plan to expand their AI utilization, indicating strong enthusiasm for the technology. The study highlights key benefits of AI in industrials, including:

- Efficiency and productivity gains (64%)
- Improved cybersecurity and threat detection (60%)
- Better decision-making through real-time data (59%)
- Increased work flexibility (49%)
- Greater job satisfaction (45%)

AI is seen as a solution to address the industrial skills shortage by enabling faster upskilling and reskilling of workers. Despite challenges such as C-Suite understanding and resource justification, the pace of AI adoption is expected to increase as new solutions demonstrate clear benefits to workforce productivity, safety, and reliability.

Positive

• 94% of surveyed AI leaders plan to expand their AI utilization
• 64% of respondents cite efficiency and productivity gains as a key benefit of AI
• 60% report improved cybersecurity and threat detection from AI implementation
• AI is seen as a solution to address the industrial skills shortage
• AI enables faster upskilling and reskilling of workers

Negative

• Only 17% of AI decision-makers have fully implemented their initial AI plans
• 37% feel that their C-Suite doesn't fully understand how AI works
• 48% say they are having to continually justify or request resources for AI implementation

Tech Expert

The findings from Honeywell's research study underscore the transformative potential of AI in industrial settings. With only 17% of AI decision-makers having fully implemented their AI plans, it’s evident that we are in the early stages of industrial AI adoption. However, the high rate of discovering new use cases (over 90%) suggests that AI’s applications are expanding rapidly. In particular, the potential for AI to enhance productivity, cybersecurity and decision-making underscores its broad utility. From a technical perspective, the integration of Generative AI and advanced analytics will likely enable more sophisticated and real-time data processing, driving further efficiency and innovation.

Moreover, AI's capability to upskill and reskill workers addresses a critical challenge in the industrial sector: the skills shortage. AI’s role as a “co-pilot” for less experienced technicians can significantly enhance operational reliability and safety, reducing human error. This technological advancement is essential as industries face a retiring workforce and a gap in experienced technicians.

In summary, the ongoing AI integration in industrial environments promises substantial improvements in operational efficiency, safety and workforce development, positioning AI as a pivotal technology in shaping the future of industrial operations.

Market Research Analyst

The enthusiasm for AI investment in Honeywell’s study is nearly universal among industrial leaders, with 94% planning to expand their AI utilization. This high level of commitment reflects a significant trend: businesses are increasingly recognizing the tangible benefits that AI can provide. These include heightened productivity, enhanced cybersecurity and better decision-making capabilities. As more businesses showcase successful AI implementations, we can expect a domino effect, where late adopters feel the pressure to incorporate AI to stay competitive.

However, there are barriers to adoption. A notable 37% of respondents indicate that their C-Suite does not fully understand AI and nearly half face challenges in securing resources for AI initiatives. This points to a broader issue of knowledge and resource gaps within organizations, which could slow down AI integration. For retail investors, this dichotomy presents both opportunities and risks. Companies that can overcome these barriers and demonstrate clear ROI from AI investments will likely see enhanced market performance and investor interest.

From a market perspective, the survey indicates that AI’s future in the industrial sector is promising but contingent on overcoming internal obstacles. Investors should look for companies that are not only adopting AI but also effectively managing the associated organizational and resource challenges.

Financial Analyst

Honeywell’s research provides valuable insights into the current and future state of AI in the industrial sector. The fact that AI leaders are uncovering new use cases and plan to expand their AI investments suggests a growing market potential. For investors, this translates to potential revenue growth as AI-driven efficiencies and innovations could lead to cost savings and new revenue streams.

However, the challenges highlighted—such as the lack of understanding in the C-Suite and the need for continuous resource justification—are critical factors that could impact the pace of AI adoption. Companies that can effectively address these issues are likely to be the frontrunners in reaping the benefits of AI. Therefore, investors should consider not only the AI capabilities of a company but also its leadership and strategic vision for AI.

From a financial perspective, the integration of AI into industrial operations represents a significant opportunity for value creation. The potential for improved productivity, enhanced safety and better decision-making can lead to stronger financial performance. Investors should closely monitor companies that demonstrate a clear and effective AI strategy, as these are likely to offer better long-term returns.

Workforce productivity, flexibility, and safety are cited as key gains from AI applications along with its potential to address the industrial skills shortage

CHARLOTTE, N.C., July 23, 2024 /PRNewswire/ -- Honeywell (Nasdaq: HON) today released the findings of its Industrial AI Insights global research study, which captures the state of Artificial Intelligence (AI) in the sector. While only 17% of AI decision makers around the world have fully implemented their initial AI plans, more than 9 in 10 say they are uncovering unexpected new use cases whether they are in the prototyping, launch, or scaling stages of AI implementation.

The research also finds AI leaders are "sold" on AI for industrial applications. The enthusiasm for a deeper commitment to AI investment is nearly universal, with 94% of those surveyed saying they have plans to expand their utilization of AI.

"There is no question that AI is currently at a pivotal moment," said Kevin Dehoff, Honeywell's Chief Strategy Officer. "With the advent of Gen AI and more sources of data from advanced analytics, Industrial AI is poised to grow exponentially, and the possibilities are endless for revenue growth and employee satisfaction."

AI Unlocks Workplace Benefits
When asked for their thoughts on the impact of AI on industrials, nearly two-thirds (64%) of AI leaders cited efficiency and productivity gains among the most promising benefits. Sixty percent say improved cybersecurity and threat detection result from AI and 59% report better decision making due to real-time data generation.

Several other benefits of AI for workers were also cited by respondents, including:

• Increased work flexibility (49%)
• Greater job satisfaction (45%)
• More time for skills development and creative thinking (44%)
• Increased workplace safety (39%)

Skills development is crucial in today's economy with baby boomers retiring and fewer replacements entering the workforce. Through AI, employers can more quickly upskill and reskill workers. AI will transform industrials as it enables workers to perform jobs at higher levels, providing greater job satisfaction while increasing productivity and addressing the skills shortage.

Lucian Boldea, President and CEO of Honeywell Industrial Automation, offered one direct example: "There can be tens of thousands of instruments, equipment, and valves needed to process and manufacture a product and many of the parts we supply manufacturers require highly experienced technicians for operation and maintenance – and there are fewer and fewer of those experienced technicians available. With AI training and AI as a "co-pilot" the skills of a less experienced technicians can more quickly be upgraded, turning them into more elite experts that perform tasks based on enterprise knowledge and best practices. In turn, plants' operations can run more safely and reliably by dramatically reducing human error."

What's Next for AI
While the enthusiasm for AI to expand is palpable, there are still some challenges in the way of full adoption. More than a third of survey respondents (37%) feel that their C-Suite fully doesn't understand how AI works and almost half (48%) say they are having to continually justify or request resources needed to implement AI plans.

"Businesses of all types recognize that AI is transforming our world and creating new possibilities. For building operations – such as hospitals, campuses, and offices – it is clearly the future. As AI orchestrates controls that regulate HVAC, lighting and electricity usage, it helps to improve safety, operational and sustainability outcomes," said Billal Hammoud, President and CEO of Honeywell Building Automation.

All of this suggests the pace of change will be driven by compelling use cases that can be measured in terms of improved business performance. As new solutions demonstrate clear benefits to workforce productivity, safety, and reliability, AI adoption will dramatically increase with the potential to transform industrial operations.

To learn more about the survey results and Honeywell's work in AI and automation, please visit www.honeywell.com/us/en/ai/research.

Methodology
Honeywell commissioned Wakefield Research to survey AI leaders around the world. The online survey, which was conducted from April 22 through May 2, 2024, involved 1,600 executives in 12 global markets (US, Brazil, Canada, China, France, Germany, India, Japan, Mexico, United Kingdom, Kingdom of Saudi Arabia and United Arab Emirates). Each respondent works at a company with at least 1,000 employees that is currently using AI to automate processes and tasks. All respondents are influencers or decision makers related to the use of AI within their departments or across their organizations.

About Honeywell
Honeywell is an integrated operating company serving a broad range of industries and geographies around the world. Our business is aligned with three powerful megatrends – automation, the future of aviation and energy transition – underpinned by our Honeywell Accelerator operating system and Honeywell Forge IoT platform. As a trusted partner, we help organizations solve the world's toughest, most complex challenges, providing actionable solutions and innovations through our Aerospace Technologies, Industrial Automation, Building Automation and Energy and Sustainability Solutions business segments that help make the world smarter, safer and more sustainable. For more news and information on Honeywell, please visit www.honeywell.com/newsroom.

Media Contacts:
Mary-Ellen Harn
+1 (704) 816-0713 
MaryEllen.Harn@honeywell.com 

Dawn Wotapka
+1 (631) 943-3782 
Dawn.Wotapka@Honeywell.com

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SOURCE Honeywell

FAQ

What percentage of industrial AI decision-makers have fully implemented their initial AI plans according to Honeywell's research?

According to Honeywell's Industrial AI Insights study, only 17% of AI decision-makers in the industrial sector have fully implemented their initial AI plans.

What percentage of surveyed AI leaders plan to expand their AI utilization in Honeywell's study (HON)?

Honeywell's research shows that 94% of surveyed AI leaders plan to expand their utilization of AI in the industrial sector.

What are the top three benefits of AI in industrials according to Honeywell's research (HON)?

The top three benefits of AI in industrials, according to Honeywell's study, are: 1) Efficiency and productivity gains (64%), 2) Improved cybersecurity and threat detection (60%), and 3) Better decision-making due to real-time data generation (59%).

How is AI addressing the industrial skills shortage according to Honeywell's findings (HON)?

Honeywell's research indicates that AI is addressing the industrial skills shortage by enabling faster upskilling and reskilling of workers, transforming industrials by allowing workers to perform jobs at higher levels and increasing productivity.

What challenges are industrial companies facing in AI adoption according to Honeywell's study (HON)?

Honeywell's study reveals two main challenges in AI adoption: 1) 37% feel that their C-Suite doesn't fully understand how AI works, and 2) 48% say they are having to continually justify or request resources needed to implement AI plans.