Facing the challenges with automation
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In November 2025 Schneider Electric unveiled new global research titled “Open vs. Closed: The $11.28M Question for Industrial Leaders.” The report reveals that closed industrial automation systems are quietly eroding competitiveness, costing mid-sized organisations an average of 7.5 percent of their revenue.
The research, conducted by Global Analysts firm Omdia, highlights how these costs stem from operational inefficiencies, downtime, compliance retrofits, and delayed production, issues often masked by the perceived reliability of legacy automation systems. For large enterprises, losses average $45.18 million, while smaller manufacturers face even steeper proportional impacts, losing up to 25 percent of annual revenue.
Traditional, hardware-defined automation systems, built for static environments, struggle to meet today’s dynamic industrial demands. Their rigidity turns routine updates into costly technical projects, while proprietary architectures limit data access, reducing visibility and responsiveness.
At the core of the challenge is hardware complexity. Most companies operate across 2 to 10+ distinct platforms, each with unique maintenance needs. This fragmentation drives vendor dependency; 30 percent of issues require specialised support, and this strains workforce efficiency due to niche technical expertise required at a time when companies are facing workforce and skills shortages. Siloed systems also hinder predictive maintenance and fast issue resolution, leading to costly downtime and lost productivity. These inefficiencies scale across operations, limiting agility.
The research underscores an urgent need for transformation. Open, software-defined automation offers a scalable, future-ready solution that modernizes legacy systems, accelerates ROI, and strengthens industrial competitiveness and resilience.
By decoupling software from hardware, manufacturers gain the flexibility to integrate multi-vendor systems, adapt quickly to market shifts, produce small batches efficiently, and close engineering skill gaps. Real-time data becomes actionable, driving smarter decisions, boosting productivity, and reducing costs at scale.
Schneider Electric customers are already realising these benefits. Many begin with pilot projects or asset-level trials, then expand to full-plant or multi-site deployments, unlocking full data ownership, improved quality control, and greater cost transparency, while protecting existing investments.
Richella Odebrecht is a Senior Vice President (SVP) of Global Marketing for Industrial Automation at Schneider Electric, with a background in industrial design and extensive experience in corporate communications, marketing, and digital strategy within large global corporations. She previously held leadership roles in communications and marketing at ABB, LafargeHolcim, Holcim, and The Linde Group, and earned a degree in Industrial Design from Pforzheim University.
At the recent Schneider Electric Press Conference in London, she explained the need for companies to be more agile and responsive in a rapidly changing industrial market.
“Facing the challenges with automation, it is necessary to be more agile and responsive. Sustainabiity and productivity can be achieved through digital transformation, while recognising the new demands of AI. Vendor lock-in costs for mid-sized companies are £8 million per year or 7.5 percent of annual revenue.”
The gathered industrial press were shown a demonstration of Schneider Electric’s EcoStructure Automation Expert (EAE) software. This represents the first truly open software-defined automation on the market, and offers one unified automation platform across all control applications, for example logic and motion control.
Neil Smith leads Schneider Electric’s global team that creates, promotes, and supports its unique solutions portfolio for the Consumer Packaged Goods segment which includes ProLeiT and AVEVA, as well as external partners. He joined Schneider Electric in 2014 through the acquisition of Invensys, a business that he
led in Australia and New Zealand through the integration period, after which he became the head of Process Automation for Schneider Electric’s Pacific Zone. He then added responsibility for the Industrial Software business to his scope and was subsequently promoted to Senior Vice President of the Process Automation business in Asia Pacific. Neil is passionate about technology and its role in helping to combat climate change, and is a strong advocate for the digital transformation of industrial segments to help all parties, from end users, process OEMs, OEMs and system integrators, to become more efficient, profitable, and sustainable.
As he explained at the press conference: “My focus is on helping industry become more competitive in the global market.”
He noted that automation should be attractive, not a problem, enabling people rather than laying them off. Open software enables the transition to digitisation.
“Automation should support rather than restrain, providing greater flexibility, efficiency and growth,” he added.
Schneider Electric (UK) Ltd
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