Recently, I was fortunate enough to be invited by the Employers Federation of South India (EFSI) to speak at an event on the topic of – Evolution of HR practices due to the impact of technology. The talk was great and highly relevant for the technology transformation that Bosch India is undergoing at present. Core manufacturing is going through major changes, and this is drastically impacting HR practices both at a strategic and operational level. In this post, I’ll be sharing how I’m changing myself to meet this challenge.
Industry 4.0 – Positive or negative disruptor?
Before proceeding, it is important to understand what Industry 4.0 is. Industry 1.0 began with the introduction of the steam engine in 1784; in 1870, the emergence of the electrically operated conveyor belt led to Industry 2.0; personal computers and the internet kickstarted Industry 3.0 during the 1980s and 1990s; and now, Industry 4.0 is the next industrial revolution that has been around since 2010. It consists of:
- Smart manufacturing
- Factories of the future
- Networking of machines, people and software
- Integration of the physical and digital worlds
To understand the importance of these industrial revolutions, we also need to look at the socio-economic impact that they caused. With Industry 1.0, swift urbanization led to the rapid growth of cities and improvements in standard of living. Industry 2.0 enabled production to scale up massively, leading to the development of large corporate entities, industrial careers and the rise of the middle-class in society. Industry 3.0 heralded the application of new technologies, ERP, electronic banking and more. So, the question is – how big an impact will Industry 4.0 have on our lives and productivity?
While some are apprehensive about the impact of the connected industry to society and jobs, we must realize that every industrial revolution has led to a period of adjustment and change. It may seem intimidating at the outset, but previous revolutions have certainly improved lives and the nature of work and made us more productive. Industry 4.0 will be no different.
I distinctly remember protests against computerization during my childhood, but today it has become part of our lives. The misconception today is that the connected industry will replace every human with a machine. I firmly believe this is a myth and will never happen. There is another misconception that Smart Manufacturing is a very expensive affair. Instead, connected industry will make processes leaner and create more opportunities by encouraging man and machine to work cohesively.
Is Industry 4.0 an opportunity or a risk?
To get an answer, it is imperative to find relevant data. According to Business Intelligence, by 2020, we will have more than 1 billion connected objects in our factories, up from the current number of 237 million. This represents an annual growth rate of more than 55 percent globally. As per the Journal on International Federation of Robotics, China uses 27 times more robots than India on an almost similar population base. OECD data also suggests that labor productivity in India is below other emerging markets. However, the strength of India is its 1.32 billion population, of which more than 350 million are active internet users.
Moreover, we also have more than 250 million active social media users. This is thrice the population of Germany. It is projected that by 2020, this number will reach 500 million, which will still be about 40 percent of our population. We also have 703 million mobile phone users in India who collectively use 1.7 exabytes of mobile data every month. The point here is that there is tremendous scope in India, as Indians LOVE TO STAY CONNECTED.
This is probably why government initiatives such as ‘Make in India’ hold immense promise for industries to align with the government. By getting involved in transformational initiatives such as Industry 4.0 and connected living, they can bring about a massive revolution in the Indian manufacturing industry. As a result, future jobs will be different from today’s and will require a different set of skills altogether.
The biggest challenge with regards to Industry 4.0 is to build competence for competitive advantage. Automation may make some repetitive jobs redundant for sure, but it will also create exciting new jobs that demand new skills. Looking at the future of mobility, we can see that we are on the verge of an incredibly rapid transition to an entirely new automotive transmission system that will make it cheaper and easier to own a car. In this race, India is not far behind and industries are already preparing themselves.
Barriers to Industry 4.0
There is still some anxiety about the role of workers in future factories as robots become widespread. According to Professor Bauermhanst from the University of Stuttgart, factory workmen will move from the role of commander to captain, and finally, to conductor as tasks for production workers and knowledge workers merge. Routine tasks and clerical work will be taken over by machines, but new forms of cooperation and communication will emerge. They will demand increased decision-making and task delegation.
This will require novel qualifications in digital competency. My personal opinion is that Industry 4.0 thus needs to be given its due importance and be driven by senior leadership across organizations and also via training programs. As we continue our journey to connect man and machine in the physical world, barriers are sure to arise in the form of big data management, need for high bandwidth servers, data security, skill availability and the war for talent. For the HR industry in particular, the challenge is providing industries with a flexible workforce that is catered to the world of Industry 4.0.
In my next post, I’ll be talking about some success stories and examples of collaboration between Industry 4.0 and modern HR practices.
Note: Views expressed in this post are exclusively the author’s personal opinion and do not necessarily represent the company’s viewpoint.