I attended Future Steel Forum 2017 in Warsaw, Poland last week, where I talked about a key issue for our industry - ‘The Digital Revolution - The Human Factor and Inertia’. We are essentially creatures of habit and the same applies to organisations. Why modify what has always worked?
This is Inertia in a nutshell, a tendency to do nothing or to let things remain unchanged. This typically makes sense, and helps to maintain a sense of order and normality – being cautious can be sensible, as discovered during the 90’s dot com bubble. But such thinking can also lead to complacency and missed opportunities. If we choose to stand still during a period of dramatic change, we may be able hold firm for a while but eventually we may find ourselves left behind.
We tend to overestimate the effect of a technology in the short run and underestimate the effect in the long run. — Roy Amara, Institute for the Future (IFTF)
We are in the midst of the Fourth Industrial Revolution, with a myriad of powerful and affordable new software and hardware tools on offer. Buzzwords such as Industry 4.0, IoT, Smart Manufacturing and so forth that can be confusing, but if applied skilfully, they can deliver greater productivity, increased efficiency and substantive innovations that were previously out of reach.
As an industry we cannot afford to dismiss this imminent paradigm change and must embrace the array of new technologies available not simply because they are there but because they will be a key driver of competitive advantage. Whether to meet the need to continue to reduce C02 emissions or the demand for building the smart cities of the future - what is required is the adoption of a new mind-set, one that sees industry 4.0 as a facilitator in developing a continual process of improvement, rather than a one-step solution.
A company’s successful entry into this new landscape will depend upon its ability to overcome inertia and whether they have:
During our recent Technology Committee meeting (TECO), a number of steel companies noted how they have either already started integrating digitisation, or hold plans to introduce significant initiatives over the next two years. Early adopters who manage this change effectively are likely to gain a clear competitive advantage from being able to deliver value-added products and services while making more efficient use of raw materials and energy.
The ongoing digital revolution presents numerous opportunities for the steel industry but we must strike while the iron is hot. What do you see as the biggest push and pull factors on our industry in embracing the digital era?