Smart Industry – how digitalization is transforming products, processes and businesses

NewsFebruary 17 2022

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Isn’t it strange, how hard it is to remember life before the arrival of the smartphone? The tremendous power of technology is transforming everything. Right now, digitalization is hitting the industrial sphere full force, reshaping and reinventing product after product, company after company, industry after industry.

Just as the phone has become so much more than a device for, well, making phone calls, industrial products are transforming by integrating computing power, sensor technology, and connectivity.

Reshaped by their new capabilities, “the things” are starting to talk – to us and to each other. They are forming networks and systems, exchanging data, becoming smarter and increasingly autonomous and thereby helping us solve the challenges of modern society, paving the way for smart cities, smart homes, smart logistics, smart power supply and much more.

Looking at the industrial sphere, it makes good sense to label this structural shift Smart Industry.

Others call it Industry 4.0, Smart Manufacturing, the Industrial Internet or Internet of Things. Although not completely interchangeable, these terms describe the same overall innovation push, driven by advancements in cloud computing, big data analytics, mobile broadband and not least, social media and social business.

The data driven car

A car is the perfect example of what the physical products we use in our everyday lives can do, when they become increasingly software and data driven.

Managed by a large number of Electrical Control Units, the modern car is a computer on wheels, running millions of lines of code. It’s constantly monitoring itself and its surroundings with hundreds of sensors. It connects to mobile networks and satellites and can send the data it generates back to the manufacturer, to be used to develop new functionalities, for instance driver assist technologies even more advanced than the ones currently available.

The car’s connectedness also makes way for the creation of new digital business models, like car sharing apps, car insurance based on your driving behavior, or road tax according to where and how much you drive. To sum it up, while still fulfilling its initial purpose of transporting people from A to B, the modern car is also offering its passengers a string of digital services and serving as a node in the complex, networked ecosystem of modern mobility.

Smart products, smart production

Not only industrial products are being reinvented by this digital transformation. Industrial processes are changing as well. Plants and production lines are connecting and communicating, enabling more efficient supply chains and logistics, predictive maintenance, smart services and much more.

To produce goods in more efficient and sustainable ways and enabling fast adjustment to customer demands, the Smart Factory comprises a wealth of technologies, such as robotics, augmented reality, and digital twins. Systems are integrated deeply into each other, and real-time data from every part of every production line can be accessed from virtually everywhere. The factory connects to outside systems as well, while at the same time being heavily guarded by cyber defense mechanisms.

In short: Digital transformation has arrived at the factory gate, taking the megatrend of industrial automation to a whole new level.

IT and OT converging

Just as the modern car illustrates how digitalization is transforming the physical things around us, it also illustrates the evolution of the skill set needed to develop these products.

There is an integration happening: Information technology and operational technology – traditionally referred to as engineering – are coming together. While mechanics and hardware continue to be indispensable, there is a steeply rising demand for solutions incorporating artificial intelligence, data analytics, digital twins, security by design, cloud, edge computing etc. Software is becoming increasingly important in product development, not only in the automotive industry, but in many other industries as well.

However, that convergence of IT and engineering is easier to put into a PowerPoint slide than to implement. Consider this: The average lifespan of a car is 12 years, while its digital platform is likely to be outdated much sooner. On top of that, customers expect constant upgrades and rapid introduction of new features, because that’s what they’re used to in the world of consumer electronics.

No wonder, car makers are currently investing vast sums in making the worlds of software and hardware fit together.

The skill set needed

The shift towards making physical products smart, connected, and software-driven is happening across industries. But the effort needed to digitalize industrial products and services is often underestimated.

The skill set required to realize the Smart Industry vision reveals the complexity of the task: You need to master the complete technology chain, from hardware and mechanics to embedded solutions, software architecture, cloud and edge computing, cyber security etc.

In other words: It’s all about combining horizontal and vertical knowledge.

“Horizontal” meaning the cross-domain technologies of industrial digitalization, which are more or less the same regardless of application. “Vertical” meaning in-depth knowledge of the specific domain you’re developing technology for. Requirements vary depending on the application. The ground rules change, depending on whether you’re developing smart solutions for automotive, aerospace, defense, life sciences, farming or the food industry.


Moving fast

Things are moving, and they are moving fast. You may feel an urge to ignore statements like “Software is eating the world” or “Every product is a service waiting to happen”. But no doubt these are prophecies to be taken seriously. Digitalization of products, processes and services will happen product after product, system after system, company after company, industry after industry.

But always, developers need to take the physical world into account, because although future products will come with a digital layer and a multitude of services attached, they still exist in the physical world.

And take our word for it – the physical world can be rather tricky. Everything that can be digitalized will be digitalized, eventually. It’s happening fast with two of the three main factors in the digital shift: digitalization of processes and digitalization of business models. But number three, integrating digital features deep into physical products, seems to be the complicated one.

For that, companies need R&D specialists with domain knowledge at least as deep and detailed as their own. And equally important, they need specialists with just as much expert knowledge of the fundamental, domain-independent building blocks of industrial digitalization as well.

That exact combination is what we are offering.

Uniquely positioned

AKKA is uniquely positioned as a global player within industrial digitalization. We offer the complex skill set needed to support the evolution towards everything getting automated, connected, smarter and digitalized.

The industrial sphere is increasingly focusing on data, and on how to turn data into action and value. As the Smart Industry trend is reshaping every industry and every business, we will lead this transition, through a unique combination of product engineering know-how and software expertise. Our knowledge enables new products, processes and business models that are truly digital. By connecting everything, using data more intelligently, and building smarter products and systems, we are contributing to a more efficient, productive, and sustainable world.