Digital technologies are transforming industry and manufacturing – a phenomenon known as Industry 4.0 – but for smaller enterprises, adapting to this new era can be a significant challenge. Professor Chris Ivory is part of an international collaboration helping these companies to prepare for the digital future.
The revolution will not be televised, but it will, it appears, be fully automated. During the last two decades, digital technologies have redefined almost every aspect of our economy and, in particular, industry and production.
Where manufacturers once had to stockpile parts, they can now 3D-print them on demand. In transport, artificial intelligence has transformed commercial aircraft into autonomous robots able to pilot themselves; road vehicles will soon be able to do the same. Computers and devices routinely exchange information without consulting us and can now select us for interview and even fire us, without a human decision-maker in sight.
"We’re in the middle of a technological upswing as big as the switch from steam to electricity."
Like it or not, this wave of digital transformation is a revolution that is redefining the way all of us will live and work. However, while many larger companies have the resources to adapt with relative ease, smaller and medium-sized businesses often hesitate to take the plunge.
Since 2017, Professor Chris Ivory, Director of our University’s Innovative Management Practice Research Centre (IMPact), has been part of a project helping smaller firms to stay competitive as the digital future dawns. It is called ‘Grow-In 4.0’ and is pooling research by universities and centres in the North Sea region: Denmark, Germany, Belgium, the Netherlands, and the UK.
“We’re in the middle of a technological upswing as significant as the switch from steam to electricity,” Chris says. “It took manufacturers 25 years to figure out how to wring productivity out of that. We want to help today’s companies move a little faster.”
Digitisation is having a profound impact on industry and manufacturing because it affects almost every aspect of production. Imagine, for example, a company that processes concrete. Such a firm can now install sensors in its machinery to monitor throughput, pressure, temperature and wear – all in real-time. The data is used to adjust processes and schedule repairs with enormous efficiency gains.
However, technology takes time to embed and exploit, and small and medium enterprises, in particular, cannot afford to expend time and resources by experimenting with digital improvements in the way that larger companies can: they need to understand the benefits available and be ready to put them to good use.
Grow-In 4.0 aims to give these firms the guidance and information they need to do this. Using Government assessments about the challenges of Industrial Revolution 4.0 for smaller businesses, the team has developed various tools that will help them to adapt.
"It is important to think not just about what technology does, but how your business should change with it."
Chris, for example, has created a ‘Benefits Identification’ process which helps firms explore potential new investments before they make them. “Say a manufacturer hears about a new technology that alerts you when your drill heads are blunt,” he says. “The first question should be: how can I ensure that buying it will pay off?” Will the company, for example, now be able to eliminate time-consuming manual checks on its equipment? “It is essential to think not just about what technology does, but how your business should change with it.”
Grow-In 4.0 has developed many such guides. Others offer support on how to identify future workforce skills needs, how to calculate returns on investment, how to track productivity gains, how to encourage open-mindedness about change and how to assess where a firm stands in terms of digital readiness. The project team is now starting to test these tools through focus groups and training sessions with various companies. In collaboration with The Welding Institute, Cambridge Chambers of Commerce and Opportunity Peterborough, Chris and his colleagues will drive engagement with companies in the East of England. By 2020, the complete ‘toolkit’ will be freely available online.
Chris himself is sanguine about the wider implications of Industry 4.0. It will, he says, inevitably involve job losses and some companies failing. “We are doing this project because we want to give our region’s companies the best chance possible,” he says. “But history tells us that many firms and jobs will still vanish.”
Yet the prognosis is not entirely bleak. If industry can make more for less, then products themselves inevitably become more affordable. “This has happened before, when we mechanized farming and factory production,” Chris points out. “Making things more affordable brings more goods into the reach of more people. Efficiency also releases workers from production to create new goods and services – perhaps even to solve pressing societal issues around health and the environment. Ultimately, Industrial Revolution 4.0 is a milestone in human progress. In that sense, it is hugely important and a great time to be a innovation researcher.”
The IMPact research centre examines practice and theoretical issues related to the use of technology and new social, management and business practice. We believe that enterprise and innovation, along with social, organisational and economic transformation, are key to the future prosperity, sustainability and wellbeing of the UK and global economy.
We work with the Triangular Alliance, a local government, social enterprise and university partnership that develops innovative approaches to achieve sustainable economic growth. Our involvement bridges the gap between practice, policy and academia.
If you’d like to access our research expertise, contact Julian Gibbs, Partnerships Development Manager for the Faculty of Business and Law, on 01245 683564.