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Digital Transformation – A Digital Platform for Industry 4.0

A nice image representing the clash between a green environment and the needs of industry and market leading to its exploitation. The Finnish view of integrating Industry 4.0 with the Circular Economy aims at transforming this clash into a synergistic endeavour made possible by rethinking the whole life cycle. Image credit: Tulevaisuuden tutkimuskeskuksen blogi

After considering the abundance of Digital Platforms for Smart Cities (and the need to converge on a limited subset with my vision of achieving that through the adoption of a semantic layer –more of this in the last part of this discussion) I would like to consider the Digital Transformation of the whole production (including supply, distribution and operation chain), what is called –mostly in Europe- Industry 4.0.

The landscape is still fragmented but it is different from the one of the digital transformation of cites, reason being that in Industry 4.0 the major players are industries, mostly private, operating with a different setoff constraints, namely a strong look a quarter results.

The landscape is fragmented but one can attempt a classification of approaches in terms of Digital Platforms in four trends:

  • End-to-end platforms
  • Cloud based platforms
  • Connectivity platforms
  • Data platforms

End-to-end platforms are looking at the whole set f processes, providing an integrated set of hardware, software, security functions, connectivity fabric and management tool to sustain a new value chain. Their strong point is the potential effectiveness since everything is right sized and nicely fit with everything else. Their weakest point is … the same! An industry would require a complete repositioning that is difficult to manage in the transition phase. A government institution, designing a long term vision and plan may well adopt this approach but a single company is unlikely to buy it. Initiatives like the ones in Finland and Germany may be set in this category.

Finland National Initiative on Digital Industry stems from the vision of making the future manufacturing in synch with the Circular Economy. Image credit: Aalto University

Finland has taken an holistic view considering Industry 4.0 and the circular economy (the economy of embedded recycling) as a single goal that can be achieved only by reconsidering the whole value chains and related processes. This requires significant investment in research and the Finnish Government is betting on it.

The German Government sees the transition to a Digital Industry has a further evolutionary step of manufacturing. Image credit: GTA

Germany is leveraging on its strong position of industrial enabler (It is usually said, with some simplification but it makes the point, that Germany creates the tools China use in manufacturing products that the US market consumes) and its Government has set the goal of transitioning its industrial capability to leverage the cyberspace. The plan is Industrie 4.0 and it is targeting 2020 (actually that may turn out to be an intermediate step towards a full Digital Transformation).

Both cases, used as slightly different examples, are based on the same approach: a rethinking of the whole manufacturing value chain. They are Government Initiatives that use a variety of levers, from investment in innovation to research coordination at universities to fiscal support for industries buying into the transformation. They include the lay out of advanced -low latency- communications infrastructures (under the 5G Banner), the orchestrated deployment of IoT, the set up of a (walled) Open Data Framework and so on. The main issue is setting up an effective orchestration capability, attracting industry and creating a de facto standard.

The new EIT Manufacturing was set up exactly in this spirit. The activities of EIT Digital in the Digital Industry area, on the contrary, are much more focussed and do not pursue this global approach.

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