The Digital Transformation in a Planet going through a (R)evolution

By António Henrique Almeida, Business Development Manager, Tec4Industry

In a context of extreme industrial competitiveness, there is a clear trend towards customer focus. In other words, contrary to what was normal in the post-war period, in which customers were particularly detached from the industry and only bought what companies decided to put on the market, today’s customers are able to choose the product that best suits their needs, thanks to an extended offer. In the automotive industry, the same manufacturer presents different car models, capable of adjusting to the different needs of each individual (urban, small SUVs, large SUVs, MVPs, electric, sports cars, etc.). For example, Mercedes produces more than 50 different vehicles, in order to maximise and democratise its target audience. Apple has also been developing iPhones, iPads, computers and other devices in different ranges, colours and sizes and with different characteristics, something rare during the Steve Jobs era.

This paradigm shift has had a considerable impact on several fields, from product design and development to the management of processes, operations and logistics of industrial companies. On the other hand, our planet is going through a critical moment, since natural resources are increasingly scarce and nature’s ability to resist the environmental impact caused by the evolution of civilisation is increasingly diminished, reaching a point of no return that requires an effective and urgent action by different actors and entities worldwide. Nowadays, younger generations are much more aware of these subjects, valuing products resulting from more sustainable materials and production processes.

This global context has been challenging the status quo and the economic, financial and political dynamics that currently exist between major world regions, as we know them. For instance, countries like China, which have always invested in highly efficient and inflexible production systems, in order to respond to mass demand, are inadequately prepared to meet these challenges. This reality creates a new opportunity in more traditional regions, including Europe, which has been specialising in high flexibility sustainable industries, in order to keep adapting to the demands and needs of end customers.

In this sense, we must realise that, in the midst of this evolution and extreme changes, we can find opportunities and new challenges for different regions – which until now were in the process of outsourcing their economy. In other words, regions that present competitive disadvantages due to labour, legal and social aspects – with a direct impact on their secondary sector – may nowadays find new opportunities to stabilise this balance between different economy sectors.

In fact, this is the time to act. This is the time to balance the global industrial scale, by taking advantage of each region’s specialisation. In my opinion, it will be essential to maintain a greater balance between mass production industries and industries focused on the customer (mass customisation). In this regard, both Europe and the United States have been making efforts to position themselves and to benefit from these changes in the global industry. In fact, initiatives such as Industry 4.0 (i4.0) and Smart Factories have allowed European and American companies to advance and promote a digitisation process, in order to increase their flexibility and intelligence, crucial to keep adapting to the needs of the market – thus enabling the management of a greater range of products, with gradually shorter life cycles. In addition, this process also supported their efficient consumption of raw materials, energy and natural resources.

Furthermore, it is important to explore new opportunities created by this digital transformation, in order to create original and more sustainable business models and bring customers closer to the manufacturing industry. Hence, it’s imperative to explore concepts such as servitization, in order to create communication channels between end customers and industrial companies, enable new services and improve the lifecycle of products, as well as their recycling and evolution/upgrade. Last, but not least, it is crucial to take advantage of technology to improve working conditions in industry, thus attracting younger, talented people to the industrial sector – which ought to be perceived as the basis for the sustainability of the European economy.

How should INESC TEC position itself in this context? In my opinion, this setting represents an excellent opportunity for our institute to endure as a reference entity for the industry. We must understand this generalised awareness as a prospect to put into practice everything INESC TEC has been developing since its establishment. In other words, based on research, innovation and technology-based development, INESC TEC should take advantage of its multidisciplinary knowledge to help the Portuguese business fabric and to complement – or lead – the 4^th industrial revolution in the country’s strategic areas,

From this perspective, it is important to develop and present innovative services and strategic partnership opportunities to companies: from the support to the creation and determination of R&D projects in key emerging technologies (Robotics, A.I., Digital Twin and Simulation, Augmented Reality, etc.), to the maturity assessment and definition of technology road maps (complying with the strategic growth strategies), as well as the provision of advanced training actions on the different fields and technologies that characterise the 4^th industrial revolution.

Maintaining the balance between basic research and the integration of emerging technologies into high TRL solutions, understanding and relating the potential of technology and the needs of companies, as well as supporting the transfer of this knowledge to industry, will be essential to preserve INESC TEC as an entity of excellence and added value in Portugal.