Australia’s unclear AI vision to exacerbate productivity woes

As the rest of the world continues to speed-run AI implementation, some organisations have claimed that Australia is being left behind, providing flaws across the board.

A new study from ServiceNow has claimed that Australia is moving backwards in terms of its race to harness and integrate AI – decreasing by 10 points in AI readiness over the past year.

According to the AI platform, Australia’s “backwards” AI integration is on the decline due to poor planning, lack of skills, and strategic misalignment, threatening jobs and national productivity.

The data shows that ServiceNow’s AI Maturity Index for Australia has dropped to a score of 36/100, with just 10 per cent of Aussie organisations claiming they are prepared to innovate their business through the use of AI, despite 82 per cent acknowledging its potential.

The lack of strategy across organisations is concerning, as 71 per cent of business leaders have thus far failed to structure the skills needed to manifest an AI strategy, with almost two-thirds (63 per cent) lacking the resources to execute such plans.

With productivity remaining as a major talking point since the federal election and centrepiece to Labor’s upcoming Economic Roundtable, many have touted AI as a key driver for increasing Australia’s low productivity rates over the next half decade.

ServiceNow claimed that research from the Productivity Commission predicted that 670,000 Australian roles are set to be automated by 2030.

“Our nation is at a tipping point, and without immediate action, weak AI strategies and talent shortfalls could derail Australia’s productivity ambitions,” said ServiceNow’s employee experience director, APAC, Danielle Magnusson.

“But for those with strong leadership, an enterprise-wide AI platform, and an upskilling agenda, AI offers a clear path to smarter, faster, more resilient business.”

“Productivity sits at the heart of the debate around Australia’s economic growth. While government inquiries are useful for keeping the spotlight on the issue, businesses need to take practical steps now to keep pace with the rate of global technological change.”

HR Leader recently spoke with Matt Loop, vice president and head of Asia at Rippling, who also stressed the importance of technology in fixing productivity issues occurring throughout Australian businesses.

“Our recent survey of 500 business leaders shows almost three-quarters (74 per cent) plan to lift productivity by investing in technology, and more than one-third (36 per cent) see that investment as the most important lever for driving gains.

“The message is clear: Aussies recognise technology as a key differentiator. The opportunity lies in acting on this knowledge. Modern HR and payroll software cuts hours of admin each week, gives leaders real-time cost visibility, and simplifies compliance across different states and markets,” Loop said.

“Too often, debates paint business and labour as opponents, yet better technology can raise the bar for everyone. When leaders couple the right tools with upskilling and clear goals, output rises, staff feel respected, and the wider economy benefits.”

Although businesses may be struggling to keep pace with the rapidly evolving technology, it’s crucial that they begin to map out legitimate strategies on how it can benefit their organisation.