Manufacturing has to make an ally of digitation

In industry, change is a constant. One after the other — the steam engine, the assembly line, and information technologies — changed the way that goods are produced, delivered and consumed by society.

Today, we are in the midst of the fourth industrial revolution that is blurring the lines between the physical and digital, and in doing so, is fundamentally transforming not only the way we manufacture goods, but the way we work, live and relate to one another.

Big data, the internet of Things, and digitisation are driving this change. Data analytics are bringing efficiencies and innovation to product and service development; machine parts have digital twins to ensure safety and identify risks; and robotics are beginning to play a role in mass production.

It is a new era, and not every organisation will survive. Many legacy manufacturing companies are at a crossroads, unable to keep pace with these changes and embrace these new technologies to drive their businesses forward.

It is against this backdrop that the UAE is undergoing its own transformation. Guided by UAE Vision 2021, we are evolving from a past reliance on oil and gas to a diversified, knowledge-based economy that is driven by technology and innovation. Manufacturing and industrialisation are vital to this transformation. As industries beyond oil, we are a key part of economic diversification and job creation.

That’s why it’s important that the first Global Manufacturing and Industrial Summit (GMIS) took place in the UAE. Bringing together more than 1,200 captains of industry, heads of state and policymakers, GMIS created one of the first global platforms to discuss the future development of the global manufacturing sector, a sector that accounts for nearly 20 per cent of global GDP.

It is now clearer than ever that as the UAE takes its place as a world-class industrial hub, we need to champion education for our employees, technological innovation, and environmental sustainability 1.

The fourth industrial revolution is technical and data-intensive. This means that our people must be well-equipped with those skills, but the reality is there is a global shortage in qualified personnel. Statistics from the McKinsey Global Institute suggest that by 2020 there will be a shortage of 38 million to 40 million workers with tertiary education and 45 million workers with secondary education.

Industries must tackle this challenge head-on if our businesses are to survive and thrive.

At EGA, we have seen our investment in sponsoring university education for Emiratis, and delivering continuing education and training programmes for our employees pay off through high retention and innovative idea generation. In the era ahead, we will need to build on this to harness big data and analytics to respond to our employees’ needs quickly and develop targeted, long-term strategies across the supply chain.

As we ensure our people have the skills and adaptability to navigate the fourth industrial revolution, we must also ensure that our strategies are fit for purpose and that we are embracing the dynamics of digitisation to shape future business models. One out of three global companies continues to use low-risk, low exploration strategies.

These approaches hinder growth, and for those of us in the industrial sector, that is not an option. Industrial and manufacturing companies need to be bold about innovation if they wish to continue to grow. Consider where we could be if we embraced greater variation in our processes, from nano materials to advanced robotics.

Ultimately, embracing the fourth industrial revolution will make our businesses, and our national economy more resilient and sustainable for the long-term. As businesses become more networked and data-driven, they become leaner and more agile, better able to respond to new trends and quicker to capture market opportunity.

There is no doubt that it takes great effort to keep pace with the constant change brought by a data revolution, the internet of Things and digitisation. But in doing so, industrial and manufacturing companies — as pillars of the national economy and a driver of future growth — have the opportunity to build a legacy for the future.

The writer is Managing Director and CEO of Emirates Global Aluminium.