Boao-Review-No-13-AWS-Artikel-Industry-4.0

Jul. 2015 No.13 ISSN 2095-4212 www.boaoreview.comJuly 2015October 2013拾 月 号The Blue Economy: HowChina Can Inspire AfricaGunter PauliFounder of ZERI; Author of the BlueEconomyIndustry 4.0: A GermanPerspective on a GlobalChallengeAugust-Wilhelm ScheerFounder of IDS ScheerSimple Rules: How to Thrivein a Complex WorldKathleen EisenhardtS.W. Ascherman Professor at StanfordUniversityDon SullSenior Lecturer at the MIT Sloan Schoolof ManagementThe Greek Region of Attica:Dedicated in Serving theCommon Interest of GrowthRena DourouRegional Governor of AtticaAn Important Step TowardRMB InternationalizationMichael ZhuSenior VP of First Eagle InvestmentManagementReining in theBull MarketA stock market listing should not only eliminate economicbottle-necks, but also deliver rapid capital appreciationas well the solid foundations for future growth. Theregulatory authorities must achieve a sustainable level ofmarket climb, while companies need to deliver strongerresults to justify their rising valuations.

Macro EconomyBy August-Wilhelm Scheer4.0IndustryThe Industrial Big ChangeA German Perspective on aGlobal ChallengeProf. Dr. August-Wilhelm ScheerProfessor for Business Informatics; inventor ofthe ARIS concept; entrepreneur; shareholder andchairman of the advisory board of Scheer GmbH018 Jul. 2015

WWW.BOAOREVIEW.COMThe Industry 4.0 age definitely has begun, whichimplies deep changes in the drivers of businessmanagement for industrial companies. The newfeatures of success will be individualization,decentralization, self-direction, service orientationand transparency.New information technologies led by the Internetof Things are impacting all significantfunctions of industrial companies and areleading to new business models with new products,services and business processes. The question is,who will qualify as a successful early mover and pioneerfor such profound changes? In this context oneshould not only look at the opportunities providedby new technologies but also consider and evaluatethe readiness of economic entities to leverage thearising opportunities.Leading edges of new German technologiesGermany, for example, is in a good starting place forthe digitalization of industrial companies. The automotive,electrical, chemical and mechanical engineeringindustries, along with their suppliers, are innovativeand preparing themselves for the Big Change. This impliesdramatic changes in three relevant process areas,namely those of the factory, of product developmentand of logistics. However, they can’t start from scratchand must consider the backgrounds of their existingbusiness. Products made by mechanical engineers lastfor many years and, for the most part, manufacturershave committed themselves to offering spare parts andmaintenance services for many years to come; this canhinder major changes to the product offering. In directcomparison, countries which are just beginning to buildtheir industrial bases can invest in new Industry 4.0technologies without regard to the past, thereby providingthemselves with a competitive advantage. Theintroduction of new technologies such as 3-D printing,for example, increases the development speed of newproducts through the faster development of prototypes.Large industrial companies in Germany have theirown substantial IT departments which support productdevelopment and the automation of the manufacturingprocess. Many companies are now hiving off their ITdepartments as companies in their own right in orderto enable the sale of their know-how also to other industrialenterprises or to provide platforms for ‘smart’services for third parties. This can further stimulatethe implementation of Industry 4.0.. Thanks to newtechnologies customers can issue orders, change themor cancel them, through many different channels suchas standard computers, laptops or smart phones. Allchannels must be usable by each other. A client’s easeof access to its supplier, together with individualization,leads to an increase in change requests and therefore toJul. 2015 019

Macro Economy4.0higher demands on flexibility during the whole orderprocessing, manufacturing and product development.The client can wish a change in its original productdefinition practically just moments before the start ofthe manufacturing process. The challenge for innovativecompanies is to directly meet and satisfy theseneeds.A particular strength in Germany is also its industrialsupply base with companies that manufacturemachines for other industrial companies. Thesecompanies already possess a high degree of expertisein automation technologies and work together withinternational hardware and software manufacturers.They already implement new I4.0 technologies in theirfactories such as the so-called Cyber Physical Systems(CPS). These are software intensive production systemsconnected to the internet and able to communicatewith each other as well as with intelligent materials.The high flexibility of CPS makes possible the strongindividualization of the manufacturing process as theprocess changeover of the system takes place with noloss of time and therefore also with no costs. For thisreason the manufacture of quantities with lot size 1 ispossible at the cost of mass production. Additionally,these companies already make use of the cost-effectivestorability of mass data in the production process, pricereductions in storage devices and new “in memory” databasetechnologies being the enabler. Sensors measurethe condition of machines, materials and productionperipherals in real time. Analytical evaluation processesthen use actual conditions to trigger immediate actionsand beyond this give indications of expected futuresystem behavior. I would assume, that especially thosecompanies which manufacture machines are very closeto the vision of a real time self-directing, extremely decentralizedfactory — a smart factory.Risks in the development of new technologyNonetheless, we constantly have to face the dangerof losing our leading position in I 4.0, as severalbranches in other countries and on other continentslike Asia, have equally identified the I 4.0 concept asa path to growth. I am convinced that one decisiveelement in the development of German industry willbe the so called “Mittelstand” which implies medium-sizedand often family-owned companies. Theyrepresent the backbone of German economics; theyhave proved to be flexible and proactive when it comesto changes in the markets. But with I 4.0, they have toface and accept a complete change in system. Only ifthese companies commit themselves to this throughinnovation and adopt industry 4.0 processes, we can besuccessful in our pioneering task and thus stabilize thebasis for economic welfare in our country.Another risk for Germany can be found in its dependenceon collaboration with international hardwareand software manufacturers which means that it is notalways up to date with the latest developments andcannot influence further development in real time andaccording to specific needs. I am glad that the federalgovernment has identified the respective problemsand is therefore attempting to build new competenciesthrough a targeted support program for the researchand foundation of new start-up companies.The Industry 4.0 age definitely has begun andimplies deep changes in the drivers of business managementfor industrial companies. The new featuresof success will be individualization, decentralization,self-direction, service orientation and transparency.020 Jul. 2015