Manufacturing is being squeezed from all sides. Consumers want personalized products, fast. Shareholders demand more efficiencies, higher returns and new sources of growth. New entrants with digital-first operating models and more agile production systems are stealing market share from industry incumbents. On top of these calls for manufacturers to up their competitive game is the need for more sustainable production systems. Manufacturers consume 54 percent of global energy and are responsible for 20 percent of all greenhouse gas emissions.
The World Economic Forum, in collaboration with Accenture Strategy, launched a project to determine how Fourth Industrial Revolution (4IR) technologies might enable manufacturers to increase competitiveness, while also helping to deliver on the United Nations Sustainable Development Goals. The resulting white paper quantifies the potential impact of 4IR technologies on production systems in two of the world’s leading manufacturing hubs.
The findings are clear: Competitiveness and sustainability need not be at odds. 4IR technologies make both goals attainable.
The 4IR value opportunity: 2 scenarios
The eastern state of Andra Pradesh in India is fast emerging as a major hub for automotive and electronic
manufacturing. Within the state’s automotive sector, the World Economic Forum study identified three technologies
poised to drive sustainable production. They are: Collaborative Robotics (cobotics 2.0), Workforce Augmentation
(with Augmented/Virtual Reality), and Bio-Based Plastics. By 2022, these technologies could generate more than $3.3
billion in annual value. In the electronics sector, 3D Printing, Digital Traceability of Minerals (based on Blockchain),
and Advanced Electronic Design Automation (AEDA) are the 4IR technologies to watch – potentially delivering $1.7
billion in annual value.
Even more dramatic results are possible in the state of Michigan, which is the birthplace of the modern automotive
industry and home to 20 percent of US auto manufacturing jobs. There, the analysis found that Workforce
Augmentation, Cobotics 2.0, Smart Digital Twins and Metal 3D Printing have the potential to create more than $7
billion in value in the next five years. Equally important, a 5 percent reduction in worker safety incidents, a 20 percent
drop in road accidents, and a 620,000-ton reduction in in CO2 emissions prove these technologies’ importance to the
creation of a more sustainable industry.
Where to next?
Government agencies and businesses in Andra Pradesh and Michigan are now taking steps to capture the 4IR opportunities, but the insights generated by the deep-dive analyses in these locations have wider applications. Namely, they prove the business value of 4IR technologies in production systems, while providing a roadmap for manufacturers around the world who strive to be both more competitive and more sustainable.