Finally a framework to manage holistically Industrial Revolution 4.0

Introducing the Smart Industry Readiness Index Prioritization Matrix

I was really pleased to watch the official launch of the Smart Industry Readiness Index (SIRI) with its addition of the Prioritization Matrix at Hannover Messe on Monday 1^st April 2019.

This will become a very useful and relevant management planning tool to help manufacturers worldwide to determine and prioritize their necessary areas of focus with all the digital initiatives, based on an Industry 4.0 Maturity and their current performance.

This tool or readiness prioritization index has a real potential to finally bring organizational wide awareness and common language identification. It can help implementation in a number of significant ways.

This has been pioneered by The Singapore Economic Development Board (EDB), a very formidable Government entity within the development of Singapore over the years, and in consultation and growing support, from McKinsey & Co, SAP, Siemens, and TüV SüD.

The framework is a very systematic and I feel, a robust way, to focus on what matters to you in your own Industrial Revolution 4.0 journey (IR4). So often organizations do not have a clear vision, strategy or can develop a systematic roadmap for this form of transformation. It becomes overwhelming and a real challenge of where to start. Often the more you read, seek advice, the more you get confused.

I believe in this Smart Industry Readiness Index Prioritization Matrix you have a really useful framework that can give you the common language, understanding, and sense of direction, backed up with the why, where, what and when of managing out your own Industry 4.0 roadmap. The “how” comes from the advice you can then seek, armed with a greater holistic understanding of where you stand.

The Actual Smart Industry Readiness Index Prioritization Matrix

For me, it has the potential to be as catalytic as the Malcolm Baldridge Quality Aware that become such a movement behind quality that spurred in Europe The European Foundation for Quality Management (later to be renamed simply ‘EFQM‘)

Digital transformation is hugely complex. It is a transformation of epic portions. It is not one of those activities you can afford to leave to IT /OT or selected board members. This is requiring total company engagement as you transform your present physical world into a highly connected digital world, totally dependent on technology. It will have a social impact, significant shifts in talent needs and your workforce. It will require a very different strategy and a deep understanding and appreciation of technology.

Breaking complexity down

The changes will need to be new solution-driven ones, as much human-centric as ever, achieving increasing machine connection and offering a sustainable and inclusive approach as the final outcome. That makes this transformation the revolution it is seen to be, Industry Revolution 4.0. It has scale, scope, and complexity unlike what we have ever experienced before, as it requires us all to be more integrated and collaborative. To achieve this it is necessary to be all-embracing and comprehensive in our digital connecting up to leverage the gains this means.

The main effects of this IR4 are the shifts in customer expectations, on product enhancements, on collaborative innovation, and in different organizational forms. The merging of physical with digital will simply enhance value in some many different ways.

IR4 will have a huge impact but it needs framing and this is where the Smart Industry Readiness Index Prioritisation Matrix comes in.

Why I personally am relating to this framework and Singapore

Why do I see this Industry Readiness Matrix as important to put a significant level of support behind it?

Personally, a very strong identification. I lived in Singapore for 12 years followed by a further 3 years moving back and forth from Europe into Asia. I grew up in my consulting and advisory work on eight years of working with different Singapore Government Agencies and plenty of companies operating in Singapore and across S E Asia especially.

Singapore has a unique way to galvanize the resources and energy required to succeed. I worked with their EDB, MICA, MOE, Mindef, Spring, IE, the Prime Ministers PS21, often through the framework adopted to galvanize change and growth. These different frameworks included i-quality circles, scorecards, assessments, and audit approaches. They were based increasingly on the Business Excellence Assessment, I-Award for innovation.

That work of mine when in Singapore was also contributing to National Innovation Policy papers, building consortium studies, developing and contributing to different audit and public service innovation frameworks. I would certainly say “I cut my consulting and advisory teeth on innovation work” within Singapore and in S E Asia.

I really learned the value of organizing frameworks to help in this even when bureaucracy sometimes got in the way. You witness first hand how theses frames do truly galvanize change, as well as to allow you to benchmark, compare entities, their robustness and ambitions and then this gets others to relate.

A new initiative developed by the EDB, Singapore

So when you hear of the announcement of this Smart Industry Readiness Index Prioritization Matrix, as announced on Monday 1^st April 2019, you certainly sit up and become alert to what this can bring.

The smart part is how the Singapore EDB has drawn in and collaborated with McKinsey & Co, SAP, Siemens, and TüB SüD. This can have the real potential to go well beyond the borders of Singapore, through S E Asia and well beyond in its organizing framework to manage Industry 4.0. My respect for the EDB is significant, I kept approaching them constantly while I was in Singapore. I will always remember the Golden Egg, Buttons and Threads, but that story is for another day.

I have worked with SAP and am working with Siemens so this makes it even more compelling to understand and relate too. They are very serious to advance the Industry 4.0 revolution.

Siemens can leverage this framework in multiple ways

Siemens has made a massive investment in their Digital future and also has a dedicated business unit, effective 1^st April 2019, renamed Digital Industries. with about 78,000 employees worldwide and businesses generated revenue of around €14 billion within the Business Unit. They are firmly fixed on providing as many solutions towards Industry 4.0 as they can. Where they presently struggle is in its complexity, the ability to communicate this holistically for recognition and adoption at the client level, to what this change really does mean. This SIRI Prioritization matrix is a great place to start and engage with their clients.

They, Siemens are rapidly building use cases, have experienced technicians, engineers, and solutions to enable the client to relate too and argument their understanding of what needs to be in place and clearly, where Siemens can play a very active contribution in solutions.

Recently, Joe Kaeser, Siemens CEO, has been appointed recently as Chairman of the Asia-Pacific Association, the Asia-Pacific Conference of German Business (APK), the place where German and Asian business interests meet. I certainly believe this Industry Readiness Index would be one initiative that can eventually become “showcases” of member organizations to Asian companies, as a further collaborative space of the association as a value-add.

Relating South East Asia, Siemens and the Fourth Industrial Revolution

I recently wrote four articles for the internal Siemens Ingenuity Knowledge site focusing on different aspects of the Fourth Industrial Revolution specifically in S E Asia, although many of these can be universally applied. These were highlighting challenges, realities and the need to adapt differently. If you have a chance to read them I’d appreciate it.

The main question in these posts was this: Are South East Asia ready for the Fourth Industrial Revolution?

Part 1: How big is the challenge really?

Part 2: The application of innovation, the Asian way

Part 3: What are the real opportunities to invest in S E Asia

Part 4: The Roadmap for the Digital Revolution

These posts give a greater outline of the challenges relating to companies in South East Asia. Putting to use the framework offered by the EDB and its partners. Actually they tie in fairly well,  it will help them considerably to manage the challenges and achieve a more collaborative environment where Government, Society, and other organizations work far more together in forming and exchanging on Industry 4.0 challenges.

The Smart Industry Readiness Index Prioritization Matrix is aimed to go global

I think the Prioritization Index will be highly welcome to organize around, for all organizations grappling with the complexities and challenges 4IR requires, not just in Asia but for all organizations anywhere in the world.

For example, Siemens have some incredibly talented engineers but the ability to communicate the Industry 4.0 story is one that needs to be communicated across an organization, that has the real need to resolve this global challenge.  I really believe this organizing framework significantly advances they story and positioning, if they fully take this on, in their own adoption services.

This framework, if seen in the way I see it, can become highly central to Siemens transformation story and association/collaboration and service provision into clients or potential ones. It gives a more holistic story across the organization. A common language and awareness frame.

The ability to assess manufacturers to focus areas of transformation and bring these four inputs yields an impact value which represents the relative benefit that a company will gain from progressing across the 16 index dimensions, by a single band of each dimension. Different bands will show different impact levels so the Manufacturer will be able to quantitatively identify the focus areas of prioritization they should take.

This Prioritization Matrix enhances the Index with a computational tool with many algorithm references of hundred of use case studies available. ones that help companies identify and recommend focus areas and digital initiatives to prioritize, based partly on their individual readiness score, and current financial performance, part of the SIRI tool.

So this collaboration of partners is coming together around the Smart Industry Readiness Index Prioritization Matrix to enable customers to start their assessment, to identify gaps and where the opportunities are to work upon. It has both a technical and practical application.

What I like it does not prioritize on technology, a place a specialist would focus, it balances this out with Process the OT specialist with Organization. The three need to be recognized as the THREE core building blocks. It works on evaluating EIGHT pillars and SIXTEEN Dimensions.

In classic Singapore ways it suggests four pragmatic steps of 1) Learn key concepts and build a common language for alignment, 2) Evaluate the existing state and readiness level for Industry 4.0, 3) Architect the transformation strategy and implementation roadmap that works for you and finally 4) Deliver that is offering impact and sustaining transformative initiatives.

In Summar: Industry 4.0 has multiple challenges

I certainly believe this Smart Industry Readiness Index and its Prioritization Matrix provides an interesting management planning tool. In summary, it provides a real acceleration towards becoming IR4 ready. Including:

• Readiness, speed, the scope of technological and digital change will spur very different business models and opportunities within the Region.  Singapore through the EDB in promoting this initiative, does provide a really valuable contribution in a diagnostic tool, to the challenges of Industry 4.0, across the whole organization.
• There are layers of complexity that need peeling away and given more focused attention with so many challenging tasks in developing industrial enablement across the Region, that need to continue to promote productivity, growth, and inclusion. Through taking this SIRI approach of evaluating the different three Building Blocks, eight Pillars and sixteen Dimension approach, they help break down much of the complexity
• The “paradigm shifts” from the type of manufacturing of lower value add, to those that “add” and can be leveraged to build national capability is possible for many, through taking this combination route of industry 4.0, infrastructure enhancement, through digitalization and innovation means a well-structured and thought through the journey.
• If the framework delivers on its promise it stands Singapore and others in a strong forefront to deliver Industry 4.0 to gain a real competitive advantage and hopefully scale up in new ways.
• We have questions of scale and complexity but helping to construct a clear vision, strategy and a systematic roadmap reduce the challenges. This framework delivers the start point and quantifies impact and gaps.
• Knowing where to start, what to scale and be able to sustain are all great but to get a tool that can show you the impact on the bottom line and the effects this has on your profit makes it highly valuable and then having diagnostics that are pointing to the best positioning where this change progression needs to take place makes it exciting to determine
• For Siemens, and the other partners, it is to find the right balance for being a critical enabler of this transformation through providing their services, their vast insights to clients across the globe and a rapidly growing use case database will offer a powerful acceleration. To be a critical and essential partner in this transition and through this framework, they can play a significant part in accelerating Industry 4.0.

I think the Smart Industry Readiness Index Prioritization Matrix can fundamentally change the “tipping point” in more rapid adoption and acceptance of the need to embrace and convert to Industry 4.0. It offers something highly valuable, I want to engage more with this as it evolves.

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The Prioritization Matrix is available to all manufacturing companies globally and interested parties should contact EDB or their respective parties t learn how to utilize the application for their facilities. A downloadable copy of the matrix can be found here.