How are engineering leaders navigating speed, agility and cost pressures in the age of AI?

Engineering and R&D pulse 2026 is essential reading for chief R&D officers, engineering heads, CTOs, innovation directors, and senior leaders in finance and supply chain functions. It provides guidance on how to:

  • Apply multiple AI modalities through a structured deployment approach to unlock value at scale.
  • Transform engineering for flexibility to balance cost, speed and agility demands.
  • Broaden access to global talent and invest in workforce development to address talent shortages.
  • Expand the engineering partner ecosystem to unlock capacity for impact

Read the research brief to discover the trends, organizational shifts, and technology priorities redefining competitiveness in engineering and R&D.

Read an executive summary below.

Click to read ER&D PULSE REPORT 2026

Key findings in Engineering and R&D pulse 2026:

  • Performance metrics are slipping: 78% report rising engineering costs; nearly half say design and development timelines have increased. Talent shortages, legacy systems, and weak innovation cultures compound the challenge.
  • AI is transforming engineering outcomes: Over 75% of executives expect AI to deliver 20–50% improvements in productivity, time-to-market, and cost reduction. 84% plan to increase AI investment, with China and Japan leading the charge.
  • Preparedness gaps remain: Fewer than one-third feel ready to tackle geopolitical uncertainty, supply chain shocks, and talent shortages – underscoring the need for agility and resilience.
  • Digitization and diversified outsourcing are key levers: Organizations are fast-tracking digital scenario planning and expanding outsourcing models – including performance-based and revenue-sharing partnerships – to boost agility and align with outcomes.
  • Human ingenuity matters: Despite AI’s rise, only 15% believe it can replace the creativity and problem-solving of human engineers – highlighting the importance of talent development.

Download the research brief to discover the trends, organizational shifts, and technology priorities redefining competitiveness in engineering and R&D.

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