Industrie 4.0: Interview with Prof. Henning Kagermann

future of production | Acatech-president on the future of industry

Why is Industry 4.0 such an important topic?

Kagermann: Because it allows companies to produce individualized products for the price of a mass produced item, opening up a new dimension of industrial manufacturing to them. It also provides a high degree of flexibility, thus increasing their ability to withstand shocks in volatile global markets. Finally, we can shift more production back to our high-wage country once again, because in Industry 4.0 knowledge and ability count. The environment benefits from Industry 4.0 as well: according to estimates, resource efficiency in manufacturing could rise by 30 to 40 percent.


How can that be achieved?

First, through the further merging of the real and virtual world by means of cyber-physical systems. As a result, every object will have a digital model in future with which we can do many things in virtual space. For instance, much better simulations of products and production processes will be possible, meaning that less energy and resources have to be expended in trial runs. Also new is the increasing connectedness within manufacturing and along value chains. This leads to a higher degree of automation, improved manufacturing quality, faster innovation cycles, and lower consumption of resources. Since all physical objects can be interconnected via the internet, we can, for example, make just-in-time logistics even better and prevent machine failures through predictive maintenance. Both prevent idle periods in production, thus saving resources.


The manufacturing of the future needs to be decentralized and to run autonomously. How realistic is this scenario?

That is the logical consequence of the Industry 4.0 approach, because increasing networking and centralized production control are not compatible – such a system would be too rigid and inflexible. In future, therefore, the conventional control pyramids are set to dissolve: The intelligence will migrate to small units such as tool carriers or vehicles that interact autonomously. In this respect Industry 4.0 is similar to a Copernican revolution. The self-organization of manufacturing is the only way to implement Industry 4.0.


Are established providers of central control systems facing the threat of sliding into insignificance?

I do not believe that, because these companies have gathered a great deal of know-how and practical experience in recent decades, and they have a precise understanding of the processes in manufacturing. It is conceivable, however, that new providers will pick out and occupy lucrative parts of the value chain. I have experienced that with SAP in ERP systems: Salesforce has occupied a small and very attractive segment in customer relationship management and left the less attractive parts to others. This can also happen with Industry 4.0, aided by the fact that we can now interlink various basic services via software-defined architectures. That makes it easier for new providers to pick out the prime cuts.


How strong is Germany in the key technologies for Industry 4.0?

We are world leaders in some of them. Our companies are very strong in embedded software that controls machines or cars. We also know a lot about company software that is hugely important for the vertical integration of data. Then there is our vast expertise in semantic technologies for machine-to-machine communication and in the real-time analysis of large volumes of data. What we lack a little is major suppliers of internet technologies and cloud computing as well as a feel for the B2C market – yet that is especially important, because Industry 4.0 also makes individual products possible. What is more, customers will demand isolated products and services less, opting rather to put together individual packages from products and services: smart services. For example, car ownership is becoming less important for young people – they combine car-sharing and other modes of transport as needed in order to travel conveniently from A to B. Much will depend on these intelligent services and business models. Only those who intelligently interlink smart services and Industry 4.0 can expect to be successful.


Other countries are also focusing on the manufacturing of the future. Can only one country win this race?

Kagermann: No, several bases will be established. It is our task in Germany to remain at the cutting edge of development and to implement the technology successfully. We should be a leading market for Industry 4.0 – otherwise we will quickly drop down the ranking of the most competitive nations. And we should remain a leading supplier of state-of-the-art production technologies. Our prosperity and full employment in the future therefore depend on Industry 4.0. Not being successful is simply not an option.

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