Preparing for the Fourth Industrial Revolution - Seismic change ahead: 42 - Dti

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Preparing for the Fourth Industrial Revolution - Seismic change ahead: 42 - Dti
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                                      Seismic change ahead:

     preparing for the Fourth Industrial Revolution

        the dti | IPAP PT 1: 2017/18-2019/20
Preparing for the Fourth Industrial Revolution - Seismic change ahead: 42 - Dti
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      A qualitative leap into an unpredictable future

                                                                                                                                 Degree of
From Industry 1.0 to Industry 4.0                                                                                               complexity

First                         Second                        Third                             Fourth
Industrial                    Industrial                    Industrial                        Industrial
Revolution                    Revolution                    Revolution                        Revolution

based on the introduction     based on mass production      based on the use of               based on the use of
of mechanical production      achieved by division of       electronics and IT to             cyber-physical systems
equipment driven by           labour concept and the use    further automate
water and steam power         of electrical energy          production

                                              First conveyor                        First programmable
                                              belt, Cincinnati                      logic controller (PLC)
        First mechanical loom, 1784           slaughternouse, 1870                  Modicon 084, 1969

         1800                                      1900                                          2000 Today                          Time

                                                                                              the dti | IPAP PT 1: 2017/18-2019/20
Preparing for the Fourth Industrial Revolution - Seismic change ahead: 42 - Dti
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                                     Process re-shaping under Industry 4.0

     • The current manufacturing process                                               Current manufacturing process
       comprises isolated and automated
       cells. Each single cell seeks
       optimisation of its operations, and                                                                                                          Standardised products
       manufacturing is a step-by-step
       process where each participant
       play its own role.
                                                           Suppliers
     • Communication between                                                                                                                         Technical quality control
       participants is rather limited                                                                                                                (Hand-held, shop-floor)
       (especially with those further along
       the supply chain), as the supply
       chain remains particularly long.                                                                Factory
                                                           Logistics
     • Manufacturing of final products is
       based on mass production and                                                                                               Final products
       economies of scale in order to
       achieve maximum efficiency.
                                                                          Process transformation under Industry 4.0
                                                                                                                              • Industry 4.0 will transform the manufacturing
                                         iCloud                                                                                 process by making it more interconnected.
                                                                                                                                Sensors and digital systems will allow
                                                                                                                                production to speed up, and make supply
                                                                                                                                chains more efficient and flexible.

                                                                       Digital production               Customised products   • Digital production will enable companies to
                    Suppliers
                                                                                                                                monetise data generated, as more flexible
                                                                                                                                supply chains will enable production of
                                                      Sensors                                                                   custom-made and smart products.
                     Logistics                                                                          Virtual production
                                                                                                                              • The Industry 4.0 concept is based on nine key
                                                                                                                                technological pillars (SEE NEXT PAGE), which
                                                                                                                                will reshape product design and production
                  Computer / server                              Physical production                       Smart products       and create new business models and revenue
                                                           Humans communicating with robots                                     streams.

                    the dti | IPAP PT 1: 2017/18-2019/20
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                A reconfigured industrial                                                                                              A reconfigured industrial
                      landscape: 1                                                                                                           landscape: 2
Enabling technologies                                                                                                    Job families in decline and on the rise

                                                                                                                                                                                                               Architecture and Engineering

                                                                                                                                                                                                          Computer and Mathematical

                                                                                                                                                                                               Management

                                                                                                                                                                                            Business and Financial Operations

                                                                                                                                                                                           Sales and Related

                                                                                                                                                      Installation and Maintenance

                                                                                                                                                Construction and Extraction

                                                                                                                              Arts, Design, Entertainment, Sports and Media

                                                                                                                                         Manufacturing and Production

                                                                                                                          Office and Administrative

                                                                                                                                           -6             -4          -2             0                2             4            6
                                                                                                                                                                 compound growth rate, 2015-2020 %

                                                                                                                                                           Source: Future of Jobs Report, World Economic Forum

Online source:
https://www.bcgperspectives.com/content/articles/engineered_products_project_business_industry_40_future_productivity_
growth_manufacturing_industries/

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                          Jobs and skills: migration, change and response

         Prospect of almost unlimited new opportunities; but                  Accelerating change in forms of employment: from ‘job’ to
          knowledge and ICT skills critical to unlocking them                             short-term contract to ‘livelihood’

              Many jobs are threatened by redundancy                            Existing jobs also go through step-changes in the skill
           Others job types grow rapidly but unpredictably                                  sets required to perform them

                                                                          Industries with wide product ranges (such as food and beverages),
 By importing Industry 4.0 technologies and combining them with low        commodity producers (metals, agriculture) and precision-driven
  costs of production factors, emerging countries can leapfrog in the       (pharmaceuticals and electronic components) are most likely to
  value chain and solve societal issues, including creating decent jobs     invest in Industry 4.0 (This could be crucial for the SA economy)

                                                                             Upskilling is essential to ensure economic survival and social
        Strong collaboration and consensus required between                 consent; a critical responsibility falls on the state and business
     government, academia, science councils, business and labour              for continuous, targeted training and re-training initiatives

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                                  Early South African areas of response

 Aggressive technology acquisition, transfer                            A much stronger institutional
                               and diffusion;                           architecture to support technology
   Securing inward investment from global                               transfer - building on excellent examples
 OEMs in key strategic value chains to build                            like the Technology Localisation
             global competitive capabilities                            Implementation Unit at the CSIR
[e.g. Mining and mining capital equipment;
          fuel cells; aerospace and defence]

    Stepped up research and development                                 Strong institutional arrangements and
      and commercialisation efforts, led by                             programmes to support innovation: tax
        the DST and its institutions, in close                          incentives to encourage acquisition and
                 collaboration with the dti                             innovation in production capabilities, new
                                                                        systems, processes, products and exports.

                                                                  the dti | IPAP PT 1: 2017/18-2019/20
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