Dubai, UAE – Businesses in the United Arab Emirates (UAE) and Saudi Arabia are embracing artificial intelligence (AI) and machine learning (ML) to drive their digital transformation goals, according to a new study commissioned by Eaton, a power management company. The research highlights a growing confidence in digitalization efforts, with fewer companies viewing legacy technology as a barrier.
The study, conducted by S&P Global Market Intelligence, surveyed over 120 digital transformation leaders from the utility, data center, building, and manufacturing sectors across the Middle East. It reveals that only 23% of respondents in 2024 identified legacy technology as a significant impediment to digitalization, a notable decrease from 33% in 2022. This 10% shift reflects the rapid adoption of emerging AI and ML applications, which have shown tremendous potential to revolutionize business operations.
Qasem Noureddin, Managing Director at Eaton Middle East, emphasized the significance of the findings. “Businesses in the UAE and KSA are accelerating their efforts towards digital transformation,” he said.
“This report highlights the critical role of digital technologies in driving business objectives. The demand for data centers has surged, fueled by advancements in AI and other cutting-edge technologies. Sectors such as manufacturing, utilities, and building management are leveraging these innovations to achieve digital transformation and sustainability goals, aligning with national objectives,” he added.
Sector-Specific Insights
The study’s findings shed light on how different sectors are advancing their digitalization strategies:
Data Centers
Data centers are scaling up operations to meet growing demand, with 42.3% of companies focusing on facility upgrades, 38.6% on expanding capacity, and 32.8% on improving IT asset performance utilization. The surge in AI-driven technologies is cited as a major factor in this expansion.
Utilities
Utilities face challenges with outdated infrastructure, with 55% of respondents identifying it as their biggest hurdle. However, the sector anticipates a significant rise in grid capacity requirements over the next decade, with 40% predicting an increase of up to 49%. Investments in AI are expected to help utilities optimize grid performance and meet future demand.
Manufacturing
Manufacturers are increasingly turning to AI to enhance their sustainability and operational efficiency. The study found that 66% believe AI can facilitate decarbonization and improve their environmental, social, and governance (ESG) scores. Additionally, AI is seen as a critical tool for boosting electrical energy monitoring (55%), advancing digital twin technology (68%), and enabling predictive maintenance applications (64%).
Building Management
Building operators are integrating digital technologies to achieve sustainability targets. The study reports that 54% of large building owners plan to install building management systems within the next year to optimize energy use. Furthermore, 66% view AI as a promising tool for predicting space utilization and enhancing operational efficiency.
