Preparing for Industry 4.0

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Penang Monthly provides a quick clarification of what the biggest buzzword of the coming year is about.

What is Industry 4.0? At a very high level, it is about the integration of cyber-physical systems (CPS) and the Internet of Things (IoT) to enhance the productivity, efficiency and flexibility of production processes. It is the pursuit of “smart factory” capabilities.

More succinctly, UBS, in a whitepaper to the World Economic Forum’s Annual Meeting 2016, labels the development as a shift towards “extreme automation and connectivity”. In the foreword of the white paper, UBS acknowledges that “the global economy is on the cusp of profound changes that are comparable in magnitude to the advent of the First Industrial Revolution, the development of the assembly line production, or the invention of the microchip”.

Tech Dome Penang's Walking Robot Workshop.

The global financial services company proposes the growing role of robotics and artificial intelligence (AI) in business, government and private life. It also sees ever deeper and faster communication between and also among human and machines. This “extreme connectivity” will neutralise the obstacle of distance and time in our transactions.

The pace of extreme automation and connectivity in global manufacturing can be gleaned from the market growth of its key industry products. In a blog for Singapore’s Economic Development Board, a senior executive of Swiss automation giant ABB quotes the International Federation of Robotics (IFR) estimate that 200,000 industrial robots were installed worldwide in 2014. IFR predicts that number to grow 10-fold in 2017.

An industry PR newswire reports a forecast that the market for radio-frequency identification (RFID) chips will grow 350% to US$47.5bil by 2027.

Accenture’s report in 2015 estimated that US$14.2tril will be added to the world economy over the next 15 years from Industry 4.0’s capabilities.

The world’s biggest economies are jumping on the Industry 4.0 bandwagon – for good reason: better returns through higher productivity and greater efficiency, all thanks to machines and systems that can autonomously coordinate production processes.

A Wooden Robot Workshop conducted by Tech Dome Penang.

Engineered into these smart machines is the logistical ability to react to unexpected changes in production requirements. These self-monitoring manufacturing equipment would be able to control each other vertically through the entire value chain, and horizontally across the entire factory or geographical network, delivering the desired results and providing management with real-time insight on the status of the factory.

Productivity and efficiency through time and cost reduction in these smart factories are expected to be on an unprecedented scale. Industries will be wider and more deeply digitised, and value creation will take on a new dimension through disruptive technologies, presenting new and novel business models and opportunities. Think 3D printing, AI, drones, driverless cars – the race has already begun among the auto giants to steer the first commercially viable driverless car into the market place.

Key challenges to the new economy include cyber security and intellectual property management. Despite the risks, the flow of Big Data through the network of autonomous systems is critical to extract better insights, enabling more effective and faster execution. Equipped with powerful analytics, the autonomous systems can trawl through an ever larger variety of data (increased complexity) in greater volume and at greater velocity than before.

In its white paper, Extreme automation and connectivity: The global, regional, and investment implications of the Fourth Industrial Revolution, UBS researchers note that the level of success a nation can garner from the Fourth Industrial Revolution will be determined by how an economy and labour force adapt to the changing economic structure.

A common thread in discussions around Industry 4.0 is the concern for the lack of relevant skillsets. Experts lament that education systems are evolving much slower than skill-set demands. As much as 50% of jobs today will be obsolete in the new economy driven by extreme automation and connectivity. Moderates think that the figure is closer to 50% of 50%.

However, it’s not all gloom and doom: experts agree that new jobs will also be created from the transformation. In the same breath, the analytics and guestimates warn that the new jobs will not be lowskilled or routine chores (think robots).

UBS admits that it is “usually difficult to envision today what the jobs of the future might be”. The EU Research on Industry 4.0 states that “the digital skills required are of a much higher calibre and a more interdisciplinary character than those required for basic digital literacy”.

For the new work environment, the call from hiring managers will be for people with skills in science, technology, engineering and mathematics (STEM). The need for seamless collaboration and effective analytical skills across wide domains and the flexibility to move from project to project demands knowledge as varied as the spectrum of STEM disciplines. The desirable aptitudes are curiosity, creativity, the passion to make things better and the ability to see the bigger picture. A view from the silo of a single discipline is no longer credible in the new world.

Smart grids, clouds and block chains will be the new critical infrastructures. Intellectual properties, which are vulnerable to plunderers, will be the dominant asset.

Future work will revolve around being responsive in an environment of heightened and widened connectivity driven by the ubiquity of mobile devices with humongous processing power and storage capacity. The speed of shared intelligence is the winner’s edge.

Launch of STEM Penang.

Closer to Home

Malaysia’s Budget 2018 allocation of RM250mil to promote STEM education clearly indicates the government’s intent to come out on top in the Fourth Industrial Revolution.

In Penang, Chief Minister Lim Guan Eng initiated the formation of Penang STEM last year to place importance on STEM and Industry 4.0.

Penang STEM was set up to drive synergy through its centres (Penang Math Platform, the Penang Skills Development Centre, the Penang Science Cluster, the Penang Digital Library, Tech Dome Penang and @CAT) to deliver opportunities for a coherent STEM curriculum to students and professionals across the length and breadth of the state. As Lim says, “I expect to see Penang STEM playing a big role to help create human talent to drive and support the Digital Economy and the Fourth Industrial Revolution.”

It is a crucial platform to empower our current and future labour force, as well as emerging entrepreneurs, with the right mindset and skills for the Fourth Industrial Revolution. With our talents, perhaps we will see self-driving cars on our roads – or other ground-breaking innovations – soon enough.

Stuart Lim gets a high from turning ideas into words, visuals and humour, and gets lost peeking through the viewfinder.



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