Why Industry 4.0 will drive Europe’s recovery

Why Industry 4.0 will drive Europe’s recovery

As a term, the ‘digital transition’ may sound vague and ambiguous, but it is a real phenomenon. It is a broad suite of technologies and processes transforming our work and lives. It was on the European Union’s agenda well before the Covid hit, but the pandemic’s shock to the system showed how much we still need to change to face the challenges ahead. Thanks to 5G, digital platforms, and other online applications, we are overhauling our economy and many of our daily routines.

Our manufacturers are already adopting the principles of Industry 4.0, which translate digital practices to manufacturing.

What is Industry 4.0? It is the combination of traditional industrial platforms and practices with the latest smart technology. It is about tying 5G and gigabit connectivity with digital applications like the Internet of things (IoT), the cloud and artificial intelligence (AI) to create a step-change in manufacturing, which is still the backbone of Europe’s economy. The result is more automation, higher productivity and a human workforce freed up for higher-value tasks.

This is a huge opportunity and connectivity is the key. Digitalisation and 5G open a range of possibilities to make factory floors smarter and safer. They can create immersive experiences, with augmented reality (AR) and virtual reality (VR) bringing fresh approaches to manufacturing.

Industry 4.0 is already showing incredible promise where it is used. For example, in Foxconn’s plant in Komárom, Hungary, which makes high-end enterprise servers and gaming PCs: in June, it launched Hungary’s first industrial 5G private network, ensuring information security, enriched capacity to meet industrial needs, and customizability. Thousands of metres of cable disappeared, freeing up space for new creative and flexible solutions. Foxconn also started to use HoloLens devices - mixed reality smartglasses - in both their test hall and assembly plant.

Another example is the Vodafone Automotive plant in Varese, Italy, which makes automotive components like telematic devices, sensors and alarm systems. In 2015, the plant began adopting Industry 4.0 solutions, using collaborative robots, automotive storage and integration systems. As smart machines talked and co-operated, they enabled tweaks to production planning based on real demand. Meanwhile, sensors monitored plant performance, so potential maintenance problems were flagged up early.

This drastically cut operating costs to help the Varese plant compete with low-cost countries. Production capacity rose by four million products using the same manufacturing space, or three times more output. Productivity was up by 4% year-on-year and efficiency by over 10%, while energy use and waste fell.

The rollout of Industry 4.0 also gives Europe a chance to re-assert itself in the global industry. In recent decades, as tech giants became the biggest forces in business, European firms fell behind their rivals in the United States and China, who set terms for the online consumer economy. Europe must use its manufacturing strengths to bring European values into the online industrial economy. This will boost European competitiveness and secure its strategic autonomy.

This is all very exciting. But businesses alone cannot deliver the promise of Industry 4.0. It needs a push from public authorities, and a partnership between industry, governments and society.

Europe must urgently prioritise investment in 5G and gigabit infrastructure. EU countries need to roll out 5G connectivity and 5G-enabled solutions, building on the momentum of the EU’s Recovery and Resilience Facility to boost private investment in 5G and telecoms.

Europe can make the most of Industry 4.0 by incentivising investment and removing regulatory barriers. We can foster homegrown digital infrastructure and services while setting global standards that others aspire to. That means helping networks transition away from being monetized by a handful of global technology platforms towards a fairer, more sustainable and less congested system that optimises internet traffic. This would rebalance the relationship between tech giants and the European digital ecosystem. New industrial strategies should allow European players – including telcos – to compete successfully in global data spaces, so we can develop a European data economy built on true European values.

This ties in with the EU’s broader priorities. As governments build back better to create more inclusive, stronger and resilient societies, digital infrastructure will transform Europe into a global powerhouse. It will help the EU re-establish its industrial edge and turbocharge the digital green transition.

High-value manufacturing and industry sectors across Europe support millions of highly skilled jobs. By enabling the next generation of innovative companies to scale up and prosper, Europe can rise and compete with global rivals. At the same time, we can tackle dependencies on outside technology and build more resilient supply chains, infrastructure and services.

Of course, Industry 4.0 is still evolving. But we all need to work together to help European businesses adapt, upskill and move ahead to take advantage of these fabulous technologies that really can change our lives.

By Nadia Benabdallah, Group Network Director in Technology, Vodafone

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