Digitization and a gigabit society. Latest impulses.
Conference trends

Digitization and a gigabit society. Latest impulses.

The first quarter of the year is usually packed with exhibitions that promise ideas to fuel business performance and trends to shape the future. Here are my impressions.

For me, the last two weeks have been shaped by two of the major industry events:

  • LogiMAT in Stuttgart – one of the largest international trade fairs in the logistics sector with 1,280 exhibitors from 32 countries.
  • CeBIT in Hannover – described by the organizers as “the global event for digital business, with 3,300 exhibitors from over 70 countries.

Personally, my visits as a delegate were driven by curiosity about developments and interest in actual implementation examples in the area of digitization and particularly Industry 4.0:

  1. What’s the latest status on disruptive changes through digital transformation?
  2. Can we find new impulses and answers to take away for our own digital agenda and the collaboration with our customers?

Intralogistics trends at LogiMAT

Professor Doctor Michael ten Hompel, Head of the Fraunhofer Institute for Material Flow and Logistics (IML) explained in his lecture at LogiMAT that “intralogistics is on the threshold from automated materials handling technology to collective intelligence – or swarm intelligence – with automated guided equipment and vehicles in the warehouse.”

Automated guided vehicles (AGVs) in fact preordain the outlook for interconnected factories and the continued process of manufacturing and logistics growing together. Such AGVs can flexibly adapt to production processes and involved facility routes. Designed as slim modules, for example, they slide underneath containers in order to lift and transport these independently to assigned destinations. They are equipped with sensors to ensure safe interaction with people as well as equipment of lesser intelligence.

The term “autonomous” in this context, however, and in comparison with the development of road vehicles, should be used cautiously. The actual benefits of AGVs and their full performance capacity are only realized once they are connected to a network and interaction in terms of availability, schedules, routes, and order priority is established. Here are some examples I came across at LogiMAT:

  • “EVE” is the transport robot introduced by Serva Transport System GmbH designed to seamlessly connect all processes from goods receipt to product assembly.
  • The “TORU Cube” by Magazino GmbH represents a fully automated order picking robot with accurate access to individual objects on item level. Its gripper system actually reminds me of R2D2 from Star Wars…
  • The scanning portal presented by Datalogic supports automated identification at point of goods receipt, for example, or picking. Smaller parcels and polybags with affixed codes run through a scanning tunnel that ensures automatic and comprehensive reading of all markings.

Future outlook for intralogistics

The desired flexibility and automation of the flow of goods and corresponding data capture lead to previously strict processes being replaced by adaptable, self-organized, and dynamic processes. This is highlighted by new technological procedures.

iBeacons, for example, can probably be considered part of today’s base technology in this context. They are stand-alone Bluetooth transmitters with integrated sensors that register and document information including motion and environmental data, and that can function independently for years based on their low energy consumption. These advances make it possible for completely new solutions to emerge – for identification, capture, and control of goods.

Wearables in conjunction with mobile technology facilitate the arrival of augmented reality in intralogistics. Orientation, efficiency, and process reliability can be significantly improved by capturing commands in various forms including gestures through the combination of different devices including headsets, data glasses, smart watches, and cameras.

It’s obvious that these trends will also significantly impact software used for control of these devices. Especially in the area of usability, from apps to multi-touch swipe control, new principles of interaction and “experience” will be crucial for user acceptance.

Of course, new software paradigms and wearables were also introduced at CeBIT. For example, ProGlove – the winning product in the award category Industry 4.0. It’s an intelligent glove to support work in manufacturing through a series of integrated sensors and an RFID scanner. Pieces no longer need to be scanned separately – this is done automatically by the glove while the staff is working.

Digitization answers – or questions – at CeBIT

Expanding human senses by means of sensors and simplified handling of ever greater volumes of information through adapted use of “smart” devices were two of the central themes at CeBIT this year. As worldwide leading event for digitization of economy and society, it offered over 500 case studies in the area of digitization and the Internet of Things as part of the conference agenda.

When spending just one day at the exhibition, however, the odds of finding the right presentation for specific developments in logistics or supply chain management are similar to those of finding the needle in the famous haystack… ;).

“The Drone Master Summit” – so basically the summit of drone experts – I found rather entertaining. Competition and an ambitious approach are to spur technological progress to further advance and new business models to develop. Models in all varieties set no limits to imagination and on the technical front, it seems pretty much everything is possible. Inspiring, yes – tangible, not so much.

This clearly leaves open the question what the actual realm of the possible currently is and even the exhibition conference was not able to deliver an answer. This is where it comes down to politics, which introduces yet another important aspect of CeBIT: the political relevance of digitization.

What officials said on the role of digitization

“With CeBIT, digitization has moved to the first rank in the agenda of politics, economy, and society”, said Oliver Frese, Chairman of the Deutsche Messe AG.

Well, despite ongoing elections and overall turbulent times, the mere number of politicians present definitely emphasized this statement. Of course, the obligatory tour of the exhibition by German chancellor Angela Merkel left its mark and it speaks for itself that the photo of Merkel wearing data glasses was selected as key media visual.

Guenther Oettinger, EU Commissioner for Digital Economy & Society, clearly acknowledged the need for a common approach within Europe by promoting a digitally consistent inner-European market and Europe-wide legislation. “Because national borders would only apply partially when it comes to digitization”, further explained Oettinger.

And during the welcome night, Sigmar Gabriel, Vice Chancellor and Federal Minister of Economy, took the opportunity to announce the ”Digital Strategy 2025“, which largely centers on the nation-wide development of the fiber optic network by 2025 – with an investment of 100 billion euros.

“The gigabit society is the precondition for taking part in the digital economy. This also requires a change of thinking: the product should no longer be at the center of attention but instead digital platforms that create new services and consequently new sources of income between product and customer”, Gabriel explained.

What I took home: my conclusion

Despite ongoing initiatives and new innovations being introduced, we should bear in mind that transforming a company into a digital business is first and foremost a management challenge and only in consequence may technological difficulties arise.

New revenue opportunities open up primarily for realigned business models and according to Bitkom four out of ten companies were able to market new products or services as a direct result of digitization. But they also report that every 8th business had to take products or services off the market already due to digital transformation.

Of course, business models in the digital economy bet primarily on availability and use of data everywhere and anytime – without delay. Data and information, however, no longer only serve to support the physical flow of goods but bear actual value themselves. As such, data must be treated accordingly by businesses going forward, which requires very close collaboration between professional teams and IT departments.

None of this is truly new to us. My conclusion after visiting two leading trade fairs combining logistics and IT is therefore somewhat restrained. There is certainly more to report about other mega trends like big data, cloud, or 3D printing. But these buzzwords make it also quite clear that the technology front is still dominating. Truly disruptive business models, especially between partners in the value chain, are barely around and advances in the area of interconnection and automation seem to proceed rather slowly.

But, let’s all stay on our toes. Because, as we all know, developments in this area cannot be expected to advance in a linear way – this would be an incorrect, and dangerous, conclusion.

Have you joined any exhibitions or conferences in the first quarter of 2016? What’s your impression on digitization progresses and latest trends? How to you reflect this in your business strategy 2016? I look forward to your comments on LinkedIn.

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