A book called The Fourth Industrial Revolution by Dr Schwab describes how the fourth revolution is fundamentally different from the previous three. The fourth revolution combines the physical, digital and biological worlds. These new technologies will impact all disciplines, economies and industries.
The Fourth Industrial Revolution demands that CEOs take responsibility for the massive transformation of their businesses and for the extraordinary impact that this transformation will have on wider society.
– Pierre Nanterme, Accenture CEO
Already in 2016 The World Economic Forum at Davos stated that almost half of the jobs in the USA were at risk, because of Industry 4.0. However, Industry 4.0 also has great potential to drastically improve the efficiency of business and organizations and help regenerate the natural environment through better asset management, potentially even undoing all the damage previous industrial revolutions have caused. According to the report issued by Deloitte, over the next decade, the U.S. could be short of 12 million skilled workers. As a result of this, manufacturers are looking for ways to increase manufacturing efficiencies by doing more with less.
What is Industry 4.0
PICTURE 1: Industrial Revolutions
The first industrial revolution brought mechanization through water and steam power. The second revolution was mass production and assembly lines using electricity. The third was the adoption of computers and automation. Now, the Fourth Industrial Revolution is upon us. It is a fusion of fast technological breakthroughs in the physical, digital, and biological spheres. Technology breakthroughs in fields such as 5G, the Internet of Things (IoT), Big Data, Analytics, Artificial Intelligence and Robotics are significant on their own, but when combined we are talking about the enormous benefits of Industry 4.0.
- IoT. The Internet-of-Things (IoT) are where devices such as industrial sensors connect to the internet and to each other. IoT requires connectivity. 5G helps the evolution of IoT by improving the interaction between different platforms as well as enabling more devices to become connected.
- 5G. 5G will recode the whole concept of mobile connectivity. 5G brings a new-market disruption, which opens a completely new blue ocean of opportunities. 5G pushes industries to seek entirely new use cases for connectivity. 5G offers a completely different performance. 5G pushes a shift from the hardware business to the software business. 5G will change how people use and communicate with technology. It will change how different technologies communicate with each other. All this will take place faster and more reliably than ever before. Mobile internet will be faster than ever. High bandwidth and low latency will transform whole industries through new ways of connecting production processes and products.
- Big Data. There is more data available than ever. As the amount of data increases, new innovations and technologies to utilize the promise of this data are constantly created. Big Data can be filtered and turned into Smart Data. Fast Data aims for real-time data processing, where data is processed when it arrives. In the field of Big Data technologies like Artificial Intelligence, Machine Learning and Deep Learning can be used to analyze the data.
- Software ecosystems. With 5G, IoT, Big Data and Artificial Intelligence, the differentiating factor will be software capabilities. New capabilities are all about thinking outside the box. Ingenuity regarding what can be done with technologies, and how they can be applied to solve tomorrow’s challenges. This is a crucial mindset across every technology-related industry.
PICTURE 2: Industry 4.0 is a fusion of fast technological breakthroughs in the physical, digital, and biological spheres. It is not a single innovation, it is all the innovations combined.
The key to achieving the potential of Industry 4.0 is a collaboration between stakeholders from (traditional) industries and technology partners. This requires a new agile mindset and cultural shift. In short, Industry 4.0 will bring a new productivity shift, while smart machines keep getting smarter as they get more data, and factories will become more efficient, productive and less wasteful.
We Are the First Generation that Can End Poverty, the Last that Can End Climate Change.
– UN Secretary-General Ban Ki-moon
Forbes vs Uros
Markus Meukel from McKinsey & Company dropped big numbers regarding the promise of IoT at the annual Nordic IoT 2019 keynote speech. According to Mr Meukel “IoT is the most impactful technology revolution” creating an estimated 10 trillion annual turnover globally by 2025. Sounds insane, doesn’t it. However, just this week a Finnish IoT company Uros presented its growth figures.
And Uros CEO Jerry Raatikainen stated “What we are seeing now is the IoT market growing; the sector will be huge. We will leap into the year 2022 with the same rate of growth”. Mr Raatikainen is saying that a small technology company from Northern Finland will hit 50 Billion turnover in a few years. This underlines the effect the Industry 4.0 phenomenon offers for large companies. Industry 4.0 will change the game big time.
Industry 4.0 Examples
- Logistics: Optimize the routes of individual parcels and vessels (car, truck, ship) for efficiency and productivity. Automate everything. For example, Kalmar aims to optimize terminal processes. Zalando to use robots to pick packages. DHL is investing big time in Industry 4.0.
- Manufacturing: Smart manufacturing is a major application of the Internet of Things (IoT). For example, Fastems provides numerous references, where they have automated manufacturing lines around the world. Another interesting case example is the Bosch factory, where implementing radio-frequency identification-based tool management, embedding sensors to machines and analyzing real-time machine data and inventory, the factory renovated its manufacturing infrastructure and is able to understand and eliminate output losses and predict machine interruptions before they occur. Lean manufacturing principles, which form the backbone of smart factories, are being increasingly integrated into everyday operations. Adoption of lean manufacturing and the transition to data-led practices can increase the competitive edge of manufacturing. To improve manufacturing efficiency, one must backtrack from the customer. In today’s rapid cycle of customer demand, the linear design-manufacture-market-sell process does not increase competitive advantage, because demand forecasting is never as effective as ongoing collaboration. When customers are participating continuously in product design and make updates to their orders, they achieve a more productive relationship.
- Process Industry: The Industrial Internet offering by Valmet combines process technologies, automation and services, which will turn the benefits of the Industrial Internet into reality. Metso is focusing on providing sustainable solutions for the processing and flow of natural resources by means of Industry 4.0 and Digitalization.
- Food Production: Autonomous farming is taking agriculture to the next level. Agriculture 4.0 uses artificial intelligence to analyze the data from satellite imagery, weather forecasts, flying drones and IoT sensors on the field for crop modelling and for precision agriculture. For example, John Deere is pushing the boundaries on what can be achieved in the area of autonomous farming machinery.
- Mining: Sandvik AutoMine already provides full fleet automation with automatic mission and traffic control capability. Sandvik OptiMine analytics system creates a transparent model of the mining operations improving efficiency and safety.
- Business Disruption: Rolls-Royce has pioneered a pay-by-use approach in its jet-engine business; other manufacturers have followed. Rolls-Royce has turned from an RnD and manufacturing company to a data analytics company. Some say, that Rolls-Royce started the whole subscription economy of today’s Netflix and Spotify culture.
- IPR Business: Today, many manufacturing companies have deep expertise in their products and processes but lack the expertise to generate value from their data. SAP offers consulting services that build on its software. Qualcomm makes more than half of its profits from intellectual-property royalties. Manufacturers might offer consulting services or other businesses that monetize the value of their expertise.
We Are Creating a Better Future
Adopting Industry 4.0 technologies will help countries and businesses achieve sustainable growth. Industry 4.0 capabilities will enable faster design, novel products, reduced risks, optimized processes and the elimination of waste. New technologies will contribute to companies’ economic success. But they will also fulfil a social purpose, by contributing towards improving people’s lives. New technologies like artificial intelligence and edge computing can make people’s work less error-prone and create more room for creative tasks. These are technologies that will enable us to stay successful.
Kalmar is a Global company providing cargo handling solutions and services to ports, terminals, distribution centres and heavy industry. Cargo handling and the container handling process is getting more and more automated. Looking at container terminal yards such as Hamburg or Rotterdam, it is clear that the automation of certain processes has already started.
The Gofore team consisting of Jonna Iljin, Joel Bergström and Christopher Klose participated in the Kalmar CoCreate workshop at the Terminal Operations Conference Europe in June 2018. During this conference within just 2 days, a new service idea was created. In this blog post, I will talk about what happened during this trip, what we did on the conference itself and what steps we have taken to reach our goal. This will give you a brief outlook on how you can enrich the creation of new services and how to look beyond the “obvious”.
The so-called Automated Guided Vehicles (AGV’s) are just one example of automated machinery which is already getting tasks via navigation computers. AGV’s coordinate routes to ensure that vehicles don´t collide with each other on the yard. These AGV´s are driving within a predetermined zone which is fenced and restricted for humans to enter. This means that as long as a human doesn´t enter the designated zone, the container handling process will continue smoothly. However, as soon as a human enters the fenced area all machinery has to stop to ensure safety. This raises the safety level for maintenance workers if they have to work on a vehicle that has broken down, but nevertheless, accidents do happen and then the whole process has to stop.
The Gofore team were given the task to find solutions using the title, “how to create secure working environments for people in the fully automated terminal yard”. Kalmar wanted to generate ideas and find solutions.
We were able to discuss and learn about the differences between manually operated and automated container terminals from container terminal managers, from our Kamar mentors, and from other stakeholders in the container supply chain. We also learnt about deep-sea terminals and how they differ to short-sea terminals in terms of their processes, security and safety measures.
Arrival in Rotterdam and Team Dinner at Restaurant Thoms
This was the first time for me in the Netherlands and it was clear right from the beginning that Rotterdam is different to other cities I have visited. The city centre of Rotterdam has an unusual architecture which draws attention to it and you start wondering if people actually live in these buildings. Also unexpected to me were the cyclists. I mean, the Netherlands and the Dutch are known for cycling a lot, but having separate cycle roads alongside ‘normal roads’ is something which you don´t see too often in other countries. But even more fascinating to me was that no cyclist was wearing a helmet, which made me think “is it safer to wear a helmet or to build separate cycle roads?”
In the evening we had our first official meeting at Thoms, a restaurant close to the city centre of Rotterdam. There we first met the organizers from Kalmar, the other two teams participating in the Co-Creation, and our mentors from Kalmar who supported us during these days. Our mentors also helped with many insights and helped us find people who could give us more information from different perspectives. Mingling with all these people and getting an idea of what Co-Creation means to Kalmar, it was clear that we were all excited about the end results which would be presented on Wednesday to the TOC audience.
After getting to know each other during the aperitif, we continued with a long and copious dinner. Salad, carpaccio and muscles came as starters and it already felt as if this would be the main dish, but we continued with wonderful tasting steak and gilthead. It tasted amazing. While eating we were able to share many stories and have discussions about stereotypes from different countries and if they are true or not. It already felt as if had been acquainted for more than just an evening and it got pretty late. But all evenings have to end at some point, so we got a Dutch dessert called ‘warme brood pudding’ and had some rest before the real work started.
Beginning the journey
At 9 o´clock we had the first meeting of the day at the Co-Creation booth to go through upcoming events and the time we would have for ideating and preparing our pitch.
We even got amazing hoodies for the event! After that, we were able to prepare our material and get ready to dig into a new area which we haven´t known before.
But how did we start in this unknown area?
We knew we didn´t have much time so it was important to understand the whole container handling process quickly. Therefore we interviewed our mentors, terminal managers and other visitors to TOC Europe in the morning. We soaked up all the information and wrote as much as possible down on post-it notes.
I need to say this – it was a mess! So many insights, so many new terms and so many risks. After several hours of questioning and trying to understand what was happening, we needed a break. By now it was time for lunch, and breaks are always good if you have something to eat.
After lunch, it was time to structure all our information. We summarised our insights and with these insights written down, we were able to find bottlenecks and map these to the container handling process.
In the afternoon we had to start ideating what kind of approaches would be reasonable? What might be the right way? Which constraints would we face?
To not drift too far away with our ideas and visions, we constantly explained our ideas to our mentors and to terminal managers. This helped us to narrow down the options and look into the near future rather than a period 50 years from now.
After rushing through the day, the finishing time came quicker than expected and with it the feeling that a break to settle down all our thoughts was necessary.
We spent a relaxing evening in Rotterdam collecting our thoughts and running through our ideas, we knew that the next day would be tough!
Continuing where we ended the day before, final tweaks were made to our presentation in the morning and final interviews and discussions were completed to ensure our idea was correct. We prepared our pitch and started to align our speeches to form one cohesive proposal, and I have to say, Deadpool would have been proud of the growing hand in our speech.
Even though we only had a couple of minutes per team for our pitch, it was a nice experience and seeing so many people interested in our outcome gave us even more certainty that this was a great success. Many visitors and Kalmar members attended the final pitch and appeared to be deeply interested in our ideas.
To conclude the Co-Creation session, we were invited by Kalmar to their TOC after-party which was a blast. A great location, fantastic food and music and many more people who we were able to discuss our ideas and relax with.
There is only one thing left to say, a big thank you to all the Kalmar people who made this possible. It was an amazing experience, even though exhausting. Seeing so many people interested in thinking outside the box made it clear that there is still a lot of work to do. We are excited at the prospect of taking our ideas forward and helping shape the future with Kalmar – stay tuned for more blog posts!
Additionally, we have to say thanks to the great photography team who made not only beautiful pictures but also made a great video as well. Have a look here: TOC video