Research Hub > Agentic AI in Manufacturing: Is Your Organization Ready? | CDW
White Paper
12 min

Agentic AI and the Future of Smart Manufacturing

Manufacturers can leverage agentic AI, connected operations and secure IT and operational technology ecosystems to improve productivity, become more resilient and create a competitive edge.

IN THIS ARTICLE

The manufacturing industry has long struggled with disparate technology platforms supporting their IT and operational technology systems. But in recent years, IT leaders for many manufacturers have sought to minimize that separation, and agentic AI has emerged as one of the tools at their disposal. As noted in a recent report from Snowflake, “There’s a major shift toward AI-enabled execution as it becomes central to operations and optimization. And that optimization is no longer occurring in isolation, but throughout the organization with the aid of agentic AI.”

For manufacturers, AI offers an opportunity to find hidden patterns in their operational data, potentially helping to improve efficiency, employee productivity and safety while moving toward more autonomous operations. But many AI initiatives get stuck in the pilot stage, failing to scale to full production. To successfully implement AI, organizations must lay a foundation for automation, including connected data ecosystems, edge-to-cloud computing, digital twins and robotics.           

In manufacturing, agentic AI refers to autonomous software systems that monitor real-time shop floor conditions, reason through operational goals and carry out complex workflows, typically within human-defined boundaries and with human oversight at key decision points.

While agentic AI has enormous potential benefits, it also gives IT systems more access than ever to physical assets, necessitating strong security controls and governance practices. Organizations can reduce risk by pursuing network segmentation, zero-trust security, data governance and continuous monitoring, and by enforcing strict compliance with data safety regulations. The organizations that see the greatest success with AI and automation are typically those that begin with high-value applications and take care to meticulously measure business impact, rather than those that race to adopt high-profile technologies.

Explore the technology that can help you modernize your manufacturing facility.

Hospital devices

Manufacturing’s Next Digital Evolution

For years, manufacturers have been investing in emerging technologies such as IoT sensors, connected machinery, robotics and advanced analytics, taking any opportunity to improve efficiency and safety while giving themselves a competitive edge.

AI represents the next step in this evolution. By finding hidden patterns, AI tools can help manufacturers make better use of the vast quantities of data currently being created by their existing solutions. In particular, agentic AI technologies promise to help organizations continuously monitor conditions, interpret information from multiple sources and even initiate responses within approved boundaries. Together, these capabilities give manufacturers the ability to move beyond reactive decision-making toward more predictive operations.

However, some manufacturers are understandably skittish about making large investments in a technology that is still emerging. Skeptics are wary not only of the accuracy and efficacy of AI tools, but also of their own IT environments’ ability to support agentic workflows. According to a 2026 Cisco report, 72% of manufacturers have more confidence in their AI strategy than in their network’s ability to support it. “The confidence gap is not merely a technical concern,” Cisco writes. “When the infrastructure cannot reliably deliver data throughput or the low-latency response times required by sophisticated AI models, the entire investment in AI software becomes a sunk cost.”

Still, the potential benefits of AI are motivating manufacturers to solve these problems. Organizations are grappling with aging workforces and persistent skill shortages, volatile supply chains, and increasing pressure to improve sustainability and comply with evolving regulations. Agentic systems help address each of these challenges by augmenting human expertise. For example, AI-powered assistants can help operators identify equipment issues before failure, recommend process improvements and automate repetitive administrative tasks.

To achieve these benefits, manufacturers must integrate their data environments, modernize supporting infrastructure and align IT and OT stakeholders around common business objectives. By building this foundation today, organizations can position themselves to harness the intelligent technologies that will drive the future of manufacturing.

15%

The projected compound annual growth rate of the global smart manufacturing market, from $446 billion in 2026 to $1.3 trillion in 2034

Source: fortunebusinessinsights.com, “Smart Manufacturing Market Size, Share & Industry Analysis,” July 20, 2026

back-to-top

Explore the technology that can help you modernize your manufacturing facility.

Manufacturing’s Next Digital Evolution

For years, manufacturers have been investing in emerging technologies such as IoT sensors, connected machinery, robotics and advanced analytics, taking any opportunity to improve efficiency and safety while giving themselves a competitive edge.

AI represents the next step in this evolution. By finding hidden patterns, AI tools can help manufacturers make better use of the vast quantities of data currently being created by their existing solutions. In particular, agentic AI technologies promise to help organizations continuously monitor conditions, interpret information from multiple sources and even initiate responses within approved boundaries. Together, these capabilities give manufacturers the ability to move beyond reactive decision-making toward more predictive operations.

However, some manufacturers are understandably skittish about making large investments in a technology that is still emerging. Skeptics are wary not only of the accuracy and efficacy of AI tools, but also of their own IT environments’ ability to support agentic workflows. According to a 2026 Cisco report, 72% of manufacturers have more confidence in their AI strategy than in their network’s ability to support it. “The confidence gap is not merely a technical concern,” Cisco writes. “When the infrastructure cannot reliably deliver data throughput or the low-latency response times required by sophisticated AI models, the entire investment in AI software becomes a sunk cost.”

Still, the potential benefits of AI are motivating manufacturers to solve these problems. Organizations are grappling with aging workforces and persistent skill shortages, volatile supply chains, and increasing pressure to improve sustainability and comply with evolving regulations. Agentic systems help address each of these challenges by augmenting human expertise. For example, AI-powered assistants can help operators identify equipment issues before failure, recommend process improvements and automate repetitive administrative tasks.

To achieve these benefits, manufacturers must integrate their data environments, modernize supporting infrastructure and align IT and OT stakeholders around common business objectives. By building this foundation today, organizations can position themselves to harness the intelligent technologies that will drive the future of manufacturing.

Explore the technology that can help you modernize your manufacturing facility.

Smart Manufacturing: By the Numbers

43%

The percentage of data that manufacturers act on from the data they collect; 37% of leaders cite the inability to effectively capture, understand, interpret and use data as a major internal obstacle to growth over the next year

Source: Rockwell Automation, State of Smart Manufacturing Report, May 2026

74%

The percentage of manufacturers that expect AI agents to independently manage 11% to 15% of routine production decisions within the next three years

Source: Snowflake, “Data Trends 2026: Manufacturing,” April 2026

49%

The percentage of manufacturing executives who report active deployment of AI use cases that are delivering business value, significantly higher than the cross-industry average of 28%

Source: KPMG, “Global Tech Report 2026: Industrial Manufacturing,” April 2026

Smart Manufacturing: By the Numbers

43%

The percentage of data that manufacturers act on from the data they collect; 37% of leaders cite the inability to effectively capture, understand, interpret and use data as a major internal obstacle to growth over the next year

Source: Rockwell Automation, State of Smart Manufacturing Report, May 2026

74%

The percentage of manufacturers that expect AI agents to independently manage 11% to 15% of routine production decisions within the next three years

Source: Snowflake, “Data Trends 2026: Manufacturing,” April 2026

49%

The percentage of manufacturing executives who report active deployment of AI use cases that are delivering business value, significantly higher than the cross-industry average of 28%

Source: KPMG, “Global Tech Report 2026: Industrial Manufacturing,” April 2026

cdw

Building the Intelligent Factory Foundation

Building the Intelligent Factory Foundation

Before manufacturers can deploy agentic technologies at scale, they need a modern technology foundation that supports visibility, connectivity and trusted data across the enterprise. Modern networking, security and IT/OT convergence are all foundational elements that should be in place before considering next steps.

Connected Data Ecosystems: Across industries, organizations have seen their early AI initiatives stall in the pilot stage due to disconnected data environments. In manufacturing, this problem often presents as “islands of automation,” with isolated solutions producing data silos that limit visibility across operations. Through sensors and unified data platforms, organizations can bring IT and OT data together, breaking down barriers between enterprise systems, production equipment and supply chain applications. By connecting data ecosystems, leaders can prepare their environments for AI solutions that can identify hidden trends and produce actionable insights.

Edge-to-Cloud Computing: The debate about where to place compute power is essentially over, with most organizations landing on a hybrid model that leverages on-premises infrastructure, cloud resources and edge computing capabilities. In manufacturing, organizations often separate insights that require real-time action at the edge from those that need further analysis. Also, manufacturing data is increasingly distributed across endpoints, users and operations, further increasing the need for edge solutions that can reduce bottlenecks and improve performance for mission-critical workloads. Networking upgrades may be needed to ensure that connections between these environments do not introduce latency or security issues.

Digital Twins: By simulating real-world physical environments in a low-stakes digital setting, digital twins let manufacturers take a “trust, but verify” approach to automation. These visual representations of assets and processes allow organizations to quickly test scenarios, predict outcomes and optimize operations before dedicating significant time and resources to efforts that are unlikely to provide value. According to Rockwell Automation’s 2026 State of Smart Manufacturing Report, 69% of surveyed organizations have either already invested in digital twins or plan to do so within the next year.

Robotics: Fixed robotic systems have long been a presence within many manufacturing plants, helping to increase throughput and ensure consistency on assembly lines. But increasingly, manufacturers are also looking to autonomous mobile robots that can move materials throughout facilities and perform inspections. While robots can create new efficiencies for manufacturers, they also make facilities even more dependent on robust connectivity. “These systems rely on a constant stream of data to function, and they are highly sensitive to even micro-seconds of latency,” notes Cisco in a 2026 report. “When the wireless network falters, the physical production line halts.”

Automated Operations: Manufacturing will always depend on human labor and insights. But by automating significant portions of their operations, organizations can reduce downtime, improve consistency and free up employees for higher-value tasks. Ideally, automation will compress the time it takes manufacturers to collect, analyze and act on information. Most automation efforts will start with automated insights and recommendations before moving on to autonomous decision-making.

Click Below To Continue Reading

arrow

The Impact of IT/OT Convergence

According to a 2025 study conducted by the Manufacturers Alliance Foundation and CDW, 71% of manufacturers have already started their IT/OT convergence journey, driven by security concerns and the need for innovation capabilities.

Among the report’s findings: 

Companies with mature IT/OT convergence are six times more likely than others to offer job rotation programs that cover both IT and OT functions.

Among companies with mature IT/OT convergence, 73% of respondents say teams effectively share resources such as budget and technology, compared with just 26% of companies with less mature convergence.

Respondents from companies with mature IT/OT convergence are more than twice as likely to express confidence in their ability to respond to data breaches, ransomware attacks and disruption of critical operations.

While network segmentation can prevent the lateral movement of threats across IT and OT networks, less than half (46%) of surveyed manufacturers have begun using segmentation in their OT network security programs.

back-to-top-white

Explore the technology that can help you modernize your manufacturing facility.

Nvidia Logo
Palo Alto
Schneider Electric Logo
Zebra

Jill Klein

Head of Emerging Technology and IoT

Jill Klein is the head of emerging technology and the Internet of Things for CDW. Jill is actively involved in the MxD Technology Advisory Committee and in industry research projects targeted at accelerating the adoption of IoT.

Oscar De Leon

IoT Strategist

Oscar De Leon is an IoT strategist at CDW with over 25 years of experience and a strong technical background in security, data networks, AI/ML, IoT, smart grid and smart city deployments, and industrial automation. De Leon has a proven track record of success at Honeywell, Dell Technologies, Aerotech, Analog Devices and Lucent Technologies.