Manufacturing organisations are gearing up for the tsunami effect of Industry 4.0 and are actively engaged in rethinking the business processes, the integration with the digital ecosystem for production as well as customer outreach. They are formulating the gameplan for dealing with enormous chunks of data being generated from multiple channels to derive timely analytical inputs that could shape the strategy of their businesses. Even as they are evaluating the relevance of technologies such as sensors, robotics, IoT, 3D technologies, augmented reality, cloud computing and others, they are already being drawn into the digital ecosystem which necessitates adaptation due to new ways of functioning brought on by other stakeholders.
The concept of Industry 4.0 that germinated in Germany is sparing no business – big or small and has become a global phenomenon with the connectedness of businesses and customers increasing day by day as well as the rapidly advancing analytics and business intelligence capabilities, the increasing trends in machine-human interfaces and the emerging potential for interoperability. The investment made in the emerging new wave of digital technologies by the leading manufacturers around the world has resulted in significant cost reduction, enhancement of revenues, increasing safety for the workers at the sites in addition to reduced risks and human errors thus creating a strong case for integration with the digital ecosystem.
Industry observers are hoping Industry 4.0 and the resultant gains could possibly pave the way for manufacturing sector to achieve its target of increasing its contribution to GDP from the current 15% to 25%. With 45% of India’s manufacturing output being attributed to the SMEs which account for 40% of the workforce, the impact of Industry 4.0 is equally relevant for this segment too.
The successful transition to Industry 4.0 will depend upon the organisation’s ability to foster digital culture and employees’ capability to adapt and work differently. The traditional production thinking would have to transition towards design thinking. The requirement is for more and more interdisciplinary skills rather than specialised skills with analytical competencies becoming critical for every job. Digital culture in organisations requires moving away from functioning in silos to collaborating not just between various functions within the organisation but collaboration across organisation boundaries and sharing of ideas and knowledge to nurture innovation – at the same time protecting the intellectual property of the respective businesses.
Not only is there concern for job losses on account of increasing automation and digital transformation, most jobs are transforming from being labour intensive to being skill intensive. According to the recent World Economic Forum’s Future of Jobs Survey, significant number of jobs will require cognitive abilities, systems thinking and complex problem solving capabilities by 2020. On account of inadequate pool of skilled talent resources, employers continue to cite lack of relevant technical skills and soft skills required at workplace as the key reasons for the challenges faced in recruiting for technical and sales jobs. The overall gross enrolment ratio (GNER) of India is only 69% as compared to 100% for BRICS nations.
The enrolment of students in vocational education for India stands at 3% whereas that of China is 46% and Russia is 52%. For India to be competitive in the manufacturing industry, there is an urgent need to make education system closely aligned with the emerging needs of the industry ensuring the talent pool is readied for the industry with the requisite skills and ability to cope with the digital work environment.
With a vast number of people to be skilled and upskilled expeditiously, the need for quality trainers, appropriate infrastructure and cost effective methods for delivering training have become critical. Recognising that all learning content cannot be constrained by the limited boundaries of the training programmes or restricted to the predefined curriculum, businesses are implementing learning platforms supported by AI, tools for dynamic curation of content from multiple sources as well as augmented and virtual reality tools.
Industry 4.0 is viewed by some of the developed countries as an opportunity to make their manufacturing base stronger but the tide could turn in favour of India by bringing together its unique advantages in IT, engineering, the youthful workforce, the growing economy and the resultant opportunity for a large domestic market in addition to being the smart factory for the world. The key to realising this goal is to recognise the importance of people factor and shift the competitive edge from cost arbitrage to skills advantage.
Uma Ganesh is CEO, Global Talent Track, a corporate training solutions company