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Industry 4.0: how future-proof is your company?

Business Design & Innovation

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In our current society, everything is being further and further technologized. Some experts state that that a new era has begun; the era of Industry 4.0. Xavier Gabriëls provides us with a clearly outlined definition of what Industry 4.0. exactly is: “Industry 4.0. is the new, exponentially growing technology which makes it affordable to make materials and machines smart and which can communicate via internet. In this process, a lot of data is collected. Because of this, companies can provide their clients, who become more demanding, with innovative products and services. The downside is that this innovation makes certain activities redundant.”

This change naturally has an impact on companies: some jobs will be replaced with technology, while that technology will pave the way for new jobs. Above that, our society changes continually due to the rapid technologization. It is of the utmost importance that companies are responsive to those changes. “A lot of typical companies move like an oil tanker, while maneuverable startups move to the other side as a speedboat and can conquer the world in a few years’ time.” (De Tijd)

To give companies an idea how well they are prepared, KPMG and Antwerp Management School worked together. They started up a research project which targets how companies should adjust to the changing context. “The research project ‘Industry 4.0.’ wants to hand companies the necessary tools and devices to transform and formulate the necessary advices to tackle the volatile future perspective.”

Triple A: Ambidexterity, adaptability, and agility

A new technological industrial revolution does not necessarily mean the end for all companies. Xavier Gabriëls mentions a few possibilities how a company can profit from the wave of innovation. “You can use the new technology to market your product more efficiently. For example, in concurrent engineering, you can simulate the next step in the development process, while still operating in the previous phase.” Machines can be turned on and off when needed and can continually carry out quality controls, which makes that errors are quickly recognized. By using datamining, you can predict the future and accommodate your supply chain based on that information. And there are many more examples: the possibilities are endless.

To be able to survive in the competitive environment of the 21st century, it is important that companies possess certain characteristics. Via the research project, AMS and KPMG distilled three essential characteristics which are crucial to ward your company for the future. Based on those characteristics, they developed a tool which indicates the extent to which companies are prepared for what is to come. First of all, there is ambidexterity: “the art to simultaneously rationalize, be cost conscious, and renew.” A second characteristic is adaptability or the ability to adapt to the future as a company. Finally, there is agility: the dexterity to watch over the coming changes. The tool also measures the company’s preparedness to adapt their business models. The tool gauges the partnerships and how they are currently held in position.

Application for companies

If a company meets these three standards, they can receive a triple A label from KPMG: Ambidexterity, Adaptability, and Agility. That label is synonymous for a flexible company which is forward-looking. Companies with a triple A label are ready to tackle the future; they are flexible and not crusted in an old frame of reference. They have the will to adapt to society. Above that, they possess the possibility to estimate the new evolutions in the landscape and anticipate the changes. In short, companies with a triple A label have higher chances of surviving in the climate of Industry 4.0.

As a company, it is useful to know how you are doing. Are your business models adapted to the future? Do you have a decent view on the changing landscape? Are you prepared to implement changes? Via the tool, developed by KPMG and AMS, companies would be able to measure this. Up to now, this tool was only applied to companies which participated in the study. At the moment, they are working to make this tool available to the public.