The survey concludes that industrial companies could significantly increase their competitiveness by modernizing closed automation systems - by an average of 11.28 million US dollars per year, according to the survey. The reason: closed systems impair efficiency, agility and cost-effectiveness.

Hidden costs of classic automation

Closed industrial systems cause around 7.5% annual revenue loss for mid-sized companies due to downtime, inefficiencies and expensive compliance upgrades. Responsiveness also suffers: 77% of installed systems require physical updates, while fragmented platforms increase complexity and make quick action difficult.

The survey by analyst firm Omdia also shows that losses are caused by operational inefficiencies, downtime, compliance upgrades and delayed production - often masked by the supposed reliability of legacy systems. According to the survey, the average losses for large companies amount to 45.18 million US dollars, while smaller manufacturers feel an even greater proportional impact, losing up to 25% of their annual turnover.

High complexity, limited transparency

Traditional, hardware-defined automation systems, originally designed for static environments, are increasingly reaching their limits in the face of dynamic market requirements. Their rigidity turns even routine updates into costly projects, while proprietary architectures restrict access to data, reducing transparency and responsiveness.

According to the survey, a key factor is the growing complexity of hardware: many companies work with two to more than ten different platforms - each with its own maintenance requirements. This fragmentation leads to high vendor dependency: 30% of problems require specialized support, which further exacerbates the shortage of specialists. Isolated systems prevent predictive maintenance and rapid problem resolution, which in turn leads to downtime and loss of productivity.

Open, software-defined approaches as a solution

The study emphasizes the urgency of transformation. Open, software-defined automation offers a scalable and future-proof way to modernize legacy systems, accelerate return on investment and strengthen competitiveness in the long term.

Decoupling software and hardware would give manufacturers more flexibility: They can integrate systems from different providers, adapt more quickly to market changes, produce small batches efficiently and bridge gaps in skilled labor. Real-time data becomes usable and enables smarter decisions, higher productivity and lower costs.

Schneider Electric reports that many customers are already starting with pilot projects or plant tests and later expanding these to plants or multiple sites. The advantages are complete data ownership, improved quality control and greater cost transparency - without having to give up existing investments.

Comments on the survey

Gwenaëlle Avice Huet, Executive Vice President Industrial Automation at Schneider Electric, emphasizes the importance of the results:

"This study confirms what our customers tell us every day: Industrial systems need to adapt as quickly as their markets. What's particularly encouraging is that smaller companies - the backbone of our economy - stand to benefit the most from annual savings that are reinvested in innovation and growth. Open, software-defined automation is a proven solution that enables industrial companies of all sizes to build resilience, drive innovation and thrive despite rapidly changing consumer demands, regulatory pressures and market volatility."

Omdia analyst Anna Ahrens also emphasizes the relevance of an open system architecture:

"In response to increasing pressure, industry leaders are deploying tactical solutions to maintain their core priorities of growth, competitiveness and trust. In a world where product lifecycles are shortening, supply chains are breaking and talent gaps are widening, agility and flexibility are no longer an option. They are essential for survival. Every quarter that a company defers the cost of closed-loop automation ecosystems means another $1 million+ in lost value - money that could be reinvested in growth and innovation."

Four central cost factors

According to the study, the annual costs of closed systems are divided into four areas:

1. lack of operational agility and resilience - 6.1 million US dollars
Inflexible hardware systems slow down reactions to market changes. 77.4% of functions require physical modifications. Modification costs are between 25,000 and 50,000 US dollars per hour, for companies with a turnover of over 1 billion US dollars even 250,000 US dollars per hour.

2. optimization and efficiency - 2.28 million US dollars
Maintenance costs, downtime and a shortage of skilled workers are a burden on companies. Companies manage an average of 2-10 industrial systems; 29% even manage more than 10 platforms.

3. quality errors and data maintenance - 1.2 million US dollars
Proprietary systems create data silos. Only 28% of organizations have real-time insights; about half report that 20-39% of critical data is not available in real time.

4. sustainability and compliance costs - 1.7 million US dollars
Regulatory changes require expensive hardware retrofits and drive up costs.

Methodology

The study, conducted by Omdia, is based on ten interviews with executives from various industries - including oil & gas, food and beverage, water and wastewater, metals and other manufacturing. In addition, 320 participants from the energy and chemicals, manufacturing, mining, metals and minerals, warehousing and water, wastewater and waste sectors were surveyed. The study was conducted between September and October 2025.

Source: Schneider Electric