Industry experts from SAP, Orange Business Services and Delloite speak to Intelligent CIO Africa about the impact of the fourth Industrial Revolution in Africa.
Industry 4.0 describes the digitisation and automation of traditional manufacturing and production methods and is an opportunity to streamline processes, enhance efficiency and improve safety.
A 2016 study by Deloitte titled ‘Industry 4.0, is Africa ready for digital transformation’ found that adoption of the smart technology that enables Industry 4.0 within the manufacturing industry was still at foundation stage. However Chief Technology Officer at SAP Africa, Simon Carpenter says that this is not through lack of interest: “When we talk to customers in South Africa there is growing evidence of an interest in the concepts and technologies of Industry 4.0. Many SAP customers have already adopted solutions like SAP Plant Connectivity and Manufacturing Intelligence and Integration, which is a step in the right direction.”
Obstacles to Industry 4.0 in Africa
When considering reasons why Industry 4.0 might be slow to take off in Africa, Carpenter said: “There are a few challenges that appear to be universal. Firstly, and historically, the worlds of business and operational technology have been distinctly separated. So, a significant organisational (re)design effort and change management is needed in order to drive the end-to-end, or top floor-to-shop floor, perspective that is needed to make Industry 4.0 real.
“Secondly, and perhaps understandably in conditions of muted economic growth and uncertainty, CFOs and CEOs who may not yet fully comprehend the advantages of Industry 4.0 are reluctant to make the necessary investments. Lastly, South Africa lacks the kind of government support for Industrialisation that is evident in more advanced economies such as Germany, where the notion of Industry 4.0 was born.”
The Deloitte study identified connectivity and accessibility as key prohibitive factors for a slow adoption of Industry 4.0 in Africa. Deloitte’s Africa Manufacturing & Automotive Leader, Karthi Pillay also assigned this to a “general reluctance to invest in new knowledge and technologies within government and industry, as the current economic environment forces South African manufacturers to save costs first and spend less on innovation.”
Carpenter believes education and skills are also major factors attributing to the slow uptake as “Industry 4.0 is a STEM-heavy environment” and that “CIOs are most concerned about cost – whereas there should be a stronger focus on value.”
Preparing for a ‘smart’ future
Commenting on Deloitte’s 2016 report, Pillay said: “The majority of our interviewees believe that Industry 4.0 will have a strong impact in the coming years on Africa and the South African manufacturing industry in particular. At the moment, however, manufacturing in South Africa is going backwards in its percentage contribution to GDP. The question we have to ask ourselves at this moment in time is, do we continue on this path of deindustrialisation without complementing it with Industry 4.0, or do we try to reverse the decline? If it is to be the latter, then it will require a getting together of the right minds to define where manufacturing is going in South Africa.”
Mark McCallum, CTO & Head of Solutions, sub-Saharan Africa, Orange Business Services believes that Industry 4.0 in Africa is coming fast and will continue picking up speed: “As technology and solution providers lower the cost of entry and improve services reach and availability then the adoption path becomes easier and timed shorter.” In the meantime, he offers the following steps for organisations looking to prepare for a ‘smart’ future:
• Implementing the bimodal approach whereby new technologies and digital are brought in in parallel for a scaled and phased approach to the adoption of these technologies
• Structuring a well-defined strategy and roadmap to implement and show benefits to the business
• Capitalise on new and lower cost connectivity technologies
• Limiting continued use of proprietary solutions and services, which lock organisations into their current path