British-Australian mining giant Rio Tinto has employed autonomous trucks, excavators and drills recently to create the first workerless iron ore mine in Western Australia. The drivers – if they can still be called that – work out of a remote operations centre hundreds of kilometres away, where data scientists mine data collected from the vehicle’s sensors. This dynamic, known as the ‘human and digital recombination’, is but a single step on the path to a changed workplace, as connectivity and automation drive the transition to digital on an unprecedented scale.
Real-time analysis, together with emerging digital technologies and intelligent digital processes, have upended the workplace as we know it; and businesses are today subject to a deep cultural shift in work organisation, culture and management mind set. The impact is a shift towards workers looking at available information as opposed to ‘explorative surgery’ measures when the damage is already done.
Human and digital recombination, cutting-edge decision making, realtime adaptation and experiment-driven design are pushing this transformation, not just in manufacturing but in every conceivable area of the workplace. And while the technology has done much to facilitate the transition to digital, the challenges are many.
Aside from Rio Tinto’s automated vehicles, other software-enabled, manufacturing- friendly marvels are around the corner, such as kilobyte-rich radio frequency identification (RFID) tags. Basically position finders at present, tomorrow’s tags will have so much storage capacity that they will act like transponders and actually tell people what to do.
As Siemens’ Markus Weinlander, Head of Product Management, predicted: “[RFID tags] can make a major contribution to the realisation of Industry 4.0 by acting as the eyes and ears of IT. For the first time, transponders will be able to carry additional information such as the production requirements together with their assembly plan. All of this will be readable at relatively large distances.”
These ‘fat tags’ will do more than boost automation. They will also make companies more nimble-footed and, say experts, allow small businesses to compete with the giants. According to Weinlander, the new wave of RFID rags will greatly facilitate customised products because they will contain all the essential information for small runs. “To remain competitive in today’s global market environment, many companies have to be able to produce in tiny batches without higher costs”, he said.
Other practical benefits are likely. For instance, maintenance and repair work will be made simpler, faster and more timely. As BCG Consulting points out, technicians will identify any problems with a machine from a stream of realtime data and then make repairs with the help of augmented-reality technology supplemented, if necessary, by remote guidance from off-site experts. In this way, downtime per machine will be reduced from one day to an hour or two.
In this brave new world of hyperconnectivity, the ‘digital worker’ – a data-driven individual skilled in converting information into revenue – will stand in the middle and direct traffic, as it were. As SAP put it in its D!gitalist magazine, the digital worker will “create instant value from the vast array of real-time data.”
Instead of the traditional approach of gathering, processing, and moving data around while spending valuable time creating reports, digital workers will be forced to move towards predictive, scenario, and prognosis-based decision- making. SAP’s article goes on to explain: “The speed of information and data is driving such significant change in how and where we work that the digital worker is becoming a critical resource in decision-making, learning, productivity, and overall management of companies.”
Hyperconnectivity has led us to a new era, where Peter Drucker’s “knowledge worker” has come to an end and the “digital worker” now needs to step up and create instant value from the vast array of real-time data
In organisations where data-savvy individuals may know more about what’s happening than the boss, the top-down hierarchy will be overturned. In short, everybody will be a leader in their own particular area of expertise. “The traditional management and organisational model is quickly getting outdated in the digital economy, and true leaders are changing their management approach to reflect this”, said SAP. Senior executives will have to be more visible and approachable for employees and customers alike – in short, both colleague and captain.
“[Managers] must juggle a distributed contingent workforce with digital workers who require real-time analysis, prognosis, and decision making. At the same time, they must develop the next generation of leaders who will actively take responsibility for innovation and engagement”, said SAP.
If done properly, this new collaborative workplace could reduce the complexity that bedevils most large organisations in an era of globalisation. According to the Economist Intelligence Unit, 55 percent of executives believe their organisational structure is ‘extremely’ or ‘very’ complex and 22 percent say they spend more than a quarter of their day managing complexity. More than three-quarters say they could boost productivity by at least 11 percent if they could cut complexity by half.
But will the superconnected workplace destroy jobs? BCG Consulting thinks not. In a study of German manufacturing released in October, the think tank concluded that higher productivity actually equals higher employment at home. “As production becomes more capital intensive, the labour cost advantages of traditional low-cost locations will shrink, making it attractive for manufacturers to bring previously off-shored jobs back home”, the study predicted. “The adoption of Industry 4.0 will also allow manufacturers to create new jobs to meet the higher demand resulting from the growth of existing markets and the introduction of new products and services.”
Experts such as Ingo Ruhmann, Special Adviser on IT systems at Germany’s Federal Ministry of Education and Research, agree with this finding. “Complete automation is not realistic”, he told BCG Perspectives. “Technology will mainly increase productivity through physical and digital assistance systems, not the replacement of human labour.”
However, it will be a new kind of human labour. “The number of physically demanding or routine jobs will decrease while the number of jobs requiring flexible responses, problem solving, and customisation will increase”, Ruhmann predicts. For most employees, tomorrow’s workplace should be a lot more fun.
Part of the series: Our Digital Planet: Data-Driven Business Frameworks Are the Future. In a Hyperconnected World, the Collaborator Is King
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