Industry 4.0 and Implications for European Regions
Lisa De ProprisProfessor of Regional Economic Development, Birmingham Business School
RSA Winter Conference 2017MAKERS - Smart Manufacturing for EU growth and prosperity is a project funded by the Horizon 2020-MSCA- RISE - Grant agreement number 691192.
MAKERS - Smart Manufacturing for EU growth and prosperity is a project funded by the Horizon 2020-MSCA- RISE - Grant agreement number 691192.
Contents
Introduce MAKERSDefine I4.0Present a broader interpretation of I4.0Levels of disruptionReadiness
MAKERS - Smart Manufacturing for EU growth and prosperity is a project funded by the Horizon 2020-MSCA- RISE - Grant agreement number 691192.
What is MAKERS?
• A network of business, academia and policy• In UK, France, Italy, Spain, Sweden, US, Singapore,
Switzerland • Research agenda: to under the drivers, enablers
and dynamics of a new manufacturing model for Europe.
MAKERS - Smart Manufacturing for EU growth and prosperity is a project funded by the Horizon 2020-MSCA- RISE - Grant agreement number 691192.
WP1 Industry 4.0
WP8
Industrial Policy WP2
Innovation &
knowledge transfer
WP 3
SMEs and LPSs
WP4 Reshoring
WP5
Glocal value chains
WP6
Sustainabilty
WP7
Skills
MAKERS - Smart Manufacturing for EU growth and prosperity is a project funded by the Horizon 2020-MSCA- RISE - Grant agreement number 691192.
Technological change
MAKERS - Smart Manufacturing for EU growth and prosperity is a project funded by the Horizon 2020-MSCA- RISE - Grant agreement number 691192.
Revolution or evolution?
Evolutionary - revolutionary
MAKERS - Smart Manufacturing for EU growth and prosperity is a project funded by the Horizon 2020-MSCA- RISE - Grant agreement number 691192.
Schumpeter and Kondratiev (1930s-1940s)
Nelson and Winter (1980s)
Christopher Freeman and Carlota Perez
Dosi – technological paradigm
K1 K2 K3 K4 K5
1800 1850 1900 1950 2000s
Indices of economic activity
Steam CottonRailwaysIron Steel
Electricity Chemicals Autos
Electronics Synthetics Petrochemicals
now
MAKERS - Smart Manufacturing for EU growth and prosperity is a project funded by the Horizon 2020-MSCA- RISE - Grant agreement number 691192.
Kondratiev’s Long Waves
Technological revolution
Perez 2004, 2010
• Technology follows a trajectory
• Crucial time between the demise of the obsoleting one and the emergence of a new one technological hole
MAKERS - Smart Manufacturing for EU growth and prosperity is a project funded by the Horizon 2020-MSCA- RISE - Grant agreement number 691192.
Technological revolution
MAKERS - Smart Manufacturing for EU growth and prosperity is a project funded by the Horizon 2020-MSCA- RISE - Grant agreement number 691192.
time
Indicator of economic trend Technological
holeKogler
“knowledge space
4th Industrial revolution
Biotech, nanotech, neurotech, green &
renewables, ICT & mobile tech, 3D, AI, Robotics,
sensoring & space tech, drones
MAKERS - Smart Manufacturing for EU growth and prosperity is a project funded by the Horizon 2020-MSCA- RISE - Grant agreement number 691192.
EU def of Industry 4.0
Efficiency driven arguments
• Smart and webbed factories
• Large plants • Large firms or multi-
national firms• Mass customisation
• AI- IoT – robotics- automation• Cyber-physical systems (smart
ordering, scheduling, control and delivery systems, ‘big data’.
• New combination capital & labour • lower inventory upstream, in
process and downstream.• Max productivity
MAKERS - Smart Manufacturing for EU growth and prosperity is a project funded by the Horizon 2020-MSCA- RISE - Grant agreement number 691192.
Berger 2014- Industry 4.0
• Industrial excellence– production process
sophistication
– Degree of automation
– Workforce readiness
– Innovation intensity
• Value network– VA
– Industry openness
– Innovation network
– Internet sophistication
MAKERS - Smart Manufacturing for EU growth and prosperity is a project funded by the Horizon 2020-MSCA- RISE - Grant agreement number 691192.
Berger 2014
In MAKERS Broader
MAKERS - Smart Manufacturing for EU growth and prosperity is a project funded by the Horizon 2020-MSCA- RISE - Grant agreement number 691192.
Technological revolution
Perez 2004, 2010
• Growth effect depends on impact on economy and society ( techno-economic paradigm) “the way socio-institutional structures are organised”(Perez 2010:194)
MAKERS - Smart Manufacturing for EU growth and prosperity is a project funded by the Horizon 2020-MSCA- RISE - Grant agreement number 691192.
Disruptive change
MAKERS - Smart Manufacturing for EU growth and prosperity is a project funded by the Horizon 2020-MSCA- RISE - Grant agreement number 691192.
Take one technology: remote sensoring
transport
Home
Medical devices
machinery
agricultureMAKERS - Smart Manufacturing for EU growth and prosperity is a project funded by the Horizon 2020-MSCA- RISE - Grant agreement number 691192.
IoT
Cloud
Industry 4.0
MAKERS - Smart Manufacturing for EU growth and prosperity is a project funded by the Horizon 2020-MSCA- RISE - Grant agreement number 691192.
I4.0
New markets Personalised flexibleArtisan customisation
New business models
(gig economy & servitisation)
Local supply chains
Sustainability core
New production
spaces(Connected factory)
New technologies
Enable disrupting change at regional level
Regional level
National level
MAKERS - Smart Manufacturing for EU growth and prosperity is a project funded by the Horizon 2020-MSCA- RISE - Grant agreement number 691192.
Regional InnovationScoreboard2017
MAKERS - Smart Manufacturing for EU growth and prosperity is a project funded by the Horizon 2020-MSCA- RISE - Grant agreement number 691192.
Regional InnovationScoreboard2017
MAKERS - Smart Manufacturing for EU growth and prosperity is a project funded by the Horizon 2020-MSCA- RISE - Grant agreement number 691192.
Regional InnovationScoreboard2017
MAKERS - Smart Manufacturing for EU growth and prosperity is a project funded by the Horizon 2020-MSCA- RISE - Grant agreement number 691192.
MAKERS - Smart Manufacturing for EU growth and prosperity is a project funded by the Horizon 2020-MSCA- RISE - Grant agreement number 691192.
Key issues
• Co-creation
• New ways of consuming, using, accessing or free-riding
• Servitising consumption and sourcing
• Downscaling
• Rethink products and processes from an ecological perspective
Regional index
MAKERS - Smart Manufacturing for EU growth and prosperity is a project funded by the Horizon 2020-MSCA- RISE - Grant agreement number 691192.
0.30
0.40
0.50
0.60
0.70
0.80
0.90
1.00
0.00 2.00 4.00 6.00 8.00 10.00 12.00
Employment in high-tech sectors by NUTS 2 regions-% of total employment 2016
MAKERS I4.0 Readiness index
Pinch points for change
• Limited awareness of change • Vested interests and resistance to change• Risk and uncertainty• Delusion about the inevitable supremacy of
ONLY services• Belief that businesses & market know better
MAKERS - Smart Manufacturing for EU growth and prosperity is a project funded by the Horizon 2020-MSCA- RISE - Grant agreement number 691192.
Innovation matrix
National scale
Vision targetSustainability
Institutional framework-key actors
Technology
Key new(enabling) technologies
Regional innovation system
Triple /quadruple helix
Sector
IDs, clusters, industrial commons
Regions’ acceleration
• Political understanding of scale of change information and education
• Design and communicate clear vision shared vision
• Join tech with sectors understanding regional applicability promoting technology adoption and application
MAKERS - Smart Manufacturing for EU growth and prosperity is a project funded by the Horizon 2020-MSCA- RISE - Grant agreement number 691192.
Thank you
www.makers-rise.org
MAKERS - Smart Manufacturing for EU growth and prosperity is a project funded by the Horizon 2020-MSCA- RISE - Grant agreement number 691192.