Artificial intelligence (AI) is no longer a future ambition for New Zealand organisations – it’s a reality for the vast majority. Datacom’s recently released 2025 State of AI Index reveals a country that is rapidly embracing AI, with 87% of organisations now using some form of AI, up from 66% in 2024 and just 48% in 2023. The pace of adoption is striking, but the next challenge is clear: scaling AI effectively across organisations to unlock its full potential.

In keeping with results from the AI Forum’s recently released biannual snapshot of AI adoption, Datacom’s report shows that 88% of organisations using AI report a positive impact on operations, with productivity gains leading the way. In fact, 89% of AI users cite productivity improvements as the top benefit, followed by enhanced decision-making (42%), cost reduction (30%), and improved customer experience (26%).

Among those seeing productivity gains:

• 20% report significant improvements (25%+ time saved or output increase)
• 28% report moderate gains (10–25%)
• 35% report minor improvements.

These results demonstrate that AI is a business enabler. Organisations are using AI to automate repetitive tasks (68%), optimise workflows (51%), and enhance data analytics and reporting (54%).

Datacom Group CEO Greg Davidson – who will be speaking at this year’s 2025 Aotearoa AI Summit – describes AI as “the single biggest and most significant technology shift that we’ve seen in decades”.

“The opportunities around AI are almost endless and over the past year our focus at Datacom has been identifying use cases – both for our own business and our customers – and building innovative solutions that are delivering tangible results while also ensuring organisations have the right foundations and technology in place to support future ambitions.

“In the session at the Aotearoa AI Summit I’ll be sharing some of the use cases that are proving to be transformative for organisations, including Datacom.”

Scaling remains a challenge

Despite the momentum revealed by Datacom’s State of AI Index, the report also shows that only 12% of organisations have scaled AI across their entire business, and nearly half remain in the exploratory phase. This signals a critical gap between experimentation and enterprise-wide transformation.

Datacom’s Director of AI, Lou Compagnone, highlights the issue:
“Creating a proof of concept with today’s consumer AI tools is relatively straightforward, but productionising these solutions reveals critical challenges around data readiness, system integration, security and long-term maintainability.”

To scale AI successfully, organisations need more than tools, they need strategy that encompasses:

• Clear business objectives for AI
• Robust data governance
• Technical foundations
• Talent development
• Cross-functional coordination.

Compagnone suggests establishing an internal AI council or AI Centre of Enablement can help organisations coordinate efforts and scale responsibly.

The report also identifies several barriers to scaling AI:

• Lack of internal capability or skills (32%)
• Data quality and integration challenges (22%)
• Uncertainty around governance or regulation (16%)
• Staff resistance and lack of buy-in.

While 55% of organisations have an internal AI policy, only 29% have formal ethics or safety guidelines. Alarmingly, 52% of leaders say “shadow AI” – the use of unapproved tools – is a problem in their organisation.

Security concerns are also rising. A quarter of senior leaders feel unprepared to manage AI risks, and 57% express concern about loss of control over AI systems.

Call for more support and training

It is also clear that New Zealand organisations are asking for more help and guidance with their AI journey.

The report shows:

• 55% want industry best-practice frameworks
• 40% seek access to external training
• 31% want government-developed frameworks.

Despite asking for greater guidance from government, 49% of leaders are not confident in the government’s ability to manage AI risks and opportunities. This highlights the need for stronger collaboration between industry and government to ensure AI adoption is responsible and that it yields the results New Zealand needs to keep pace with developments in global markets.

As Datacom Group CEO Greg Davidson prepares to speak at the 2025 Aotearoa AI Summit later this month, the message is clear: AI adoption is surging, but scaling requires intentional effort. His talk, titled “From vision to value: harnessing the AI advantage for Aotearoa”, will explore how AI can support national competitiveness, economic growth, and security – but only if we get the foundations right.

Datacom’s full 2025 State of AI Index is available to download:
datacom.com/stateofAI

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