23 July 2026

New Forrester research finds AI ambition outpaces readiness across tertiary education

Tertiary institutions across Australia and New Zealand are investing in AI to improve student outcomes and operational efficiency, but many lack the integrated systems, connected data and workforce capabilities needed to deliver more personalised student experiences, according to new independent research from Forrester.

Commissioned by TechnologyOne, the study surveyed more than 300 education leaders across Australia and New Zealand and found that while AI is rapidly becoming a strategic priority, many institutions continue to be held back by fragmented systems, disconnected data and capability gaps.

The research reveals a significant AI readiness gap. Just 21% of education leaders believe their institution’s current systems can effectively support AI-driven capabilities, while only 10% report having fully integrated student and administrative systems. Less than one third (29%) believe their institution has the skills and resources needed to fully leverage the systems already in place.

At the same time, institutions are under growing pressure to improve student outcomes while maintaining financial sustainability. The study found 87% of respondents identified financial sustainability as a top priority, alongside improving student experience at 86% and strengthening recruitment and enrolment outcomes at 83%.

The most common AI use cases target some of the sector’s most immediate operational challenges, including student self-service enquiries, identifying at-risk students and admissions processing.

TechnologyOne Executive Vice President for Education, Mark Jones, shared that higher education leaders understand the potential of AI, but technology alone won’t deliver the outcomes they seek.

“The institutions generating the greatest value from AI are not necessarily those spending the most. They are the ones investing in connected data, integrated systems and the capabilities needed to turn insight into action. AI can accelerate progress, but it cannot overcome fragmented foundations,” said Mr Jones.

Forrester’s research also found that fragmented systems continue to impact both operational performance and student outcomes. Almost half (47%) of respondents said disconnected student data limits their ability to provide proactive and personalised support, while just 11% strongly agreed their systems deliver a consistent, high-quality student experience across all touchpoints.

The report concludes that institutions do not need perfect data before they begin. Instead, success depends on establishing connected, governed and continuously improving data foundations alongside investments in workforce capability and operating models. This will be critical as institutions seek to improve student retention, deliver more proactive support and create consistent experiences across the student lifecycle.

“The conversation has moved beyond whether institutions should adopt AI to how quickly they can realise value from it. Many institutions are investing in AI because they want to improve student outcomes, retention and operational efficiency. But AI is only as effective as the foundations beneath it. If student data remains fragmented across systems, institutions will struggle to deliver the connected and personalised experiences students increasingly expect,” said Mr Jones.

Download the full report, Reshaping Student Success Through AI In Tertiary Education Within ANZ to explore the findings and recommendations