​Are Kiwi businesses open to robotics and automation investment?

​Are Kiwi businesses open to robotics and automation investment?

Administrative processes and red tape proving a challenge.

Nearly half of New Zealand businesses are interested in investing in robotic processes and automation within the next 12 months, as the so-called fourth industrial revolution continues to gather pace.

With four in ten Kiwi organisations seemingly on board, businesses across the country indicated a willingness to learn about the benefits of drone technology, artificial intelligence (AI), big data, product assembly and services automation.

As captured in the latest round of the Alleasing New Zealand Equipment Demand Index (the Index), one quarter of businesses surveyed across the country would consider investing in product assembly and service automation.

This emerged as a key investment priority for New Zealand firms, likely given the associated productivity enhancements and reduced labour input costs, particularly in sectors such as manufacturing, construction and retail where repetitive tasks are common.

Delving deeper, big data and AI are also attractive for businesses (21.9 per cent and 10.8 per cent respectively).

On a location basis, minimal difference exists with forty four per cent of firms based in Auckland interested in robotics or automation, comparing to 41.4 per cent in Wellington and 44.3 per cent of companies based throughout the rest of the country.

Alleasing CEO, Daniel Blizzard, believes the early interest in automation and digital integration will give New Zealand firms a future advantage over Australian neighbours, with more than half of businesses located across the Tasman not considering investing in such technologies.

“The Index data shows New Zealand firms have a clear appetite for learning more about the next wave of digitisation and automation, and indeed making the decision to invest in it,” Blizzard said.

“Although corporate adoption of these technologies is still in its infancy in New Zealand, the Index data is very promising and suggests firms are already thinking of the major cost, productivity and control benefits on offer, as described by the likes of Accenture.”

Another area of focus for the Index this round was to understand whether time consuming administrative processes are negatively impacting capital equipment acquisition programs.

When asked which administrative process has the most negative impact on their asset acquisition program, more than a third (44.3 per cent) of New Zealand businesses reported tax compliance.

Meanwhile, issues under the tax compliance umbrella, which were specifically classified as barriers to growth, include the ever changing tax framework and the corporate tax rate.

Examining the data further, little variance exists by business size or location, which suggests tax compliance is a universal concern for New Zealand firms and changes are required to improve underlying business confidence and capital expenditure.

“To achieve revenue growth, maximise productivity and adequately prepare for the future, New Zealand businesses need to become increasingly focused on maximising their capital structure,” Blizzard added.

“In addition to this, businesses are suggesting that they want more from the New Zealand government in terms of finding ways to encourage investment and improve productivity.”

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