More competitive and sustainable thanks to digitization

Digitization is enabling German industrial companies to conserve resources, save energy and reduce CO₂ emissions. A representative survey by the digital association Bitkom found that 81% of companies use Industry 4.0 to produce more sustainably. Digital applications therefore play a prominent role in climate protection. At the same time, over 90% of companies see Industry 4.0 as a crucial prerequisite for remaining competitive on an international scale in the future. Other positive effects include reduced susceptibility to errors (61%) and changes to conventional business models (58%).

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Enormous savings potential

A key lever for achieving the climate targets is a massive reduction in CO₂ emissions. German industry can make a significant contribution to this. By accelerating the use of digital technologies, up to 64 million tons of CO₂ can be saved in Germany in 2030. Digital twins, for example, play a central role in simulating and optimizing products or processes and in increasing the level of automation. This in turn reduces manual intervention and the use of materials.

Industry 4.0 has established itself

Nine out of ten companies rely on Industry 4.0, either already using corresponding applications (65%) or planning to use them (25%). In 2019, the proportion was only 74%. In only 8% of companies are there currently no plans or activities whatsoever with regard to Industry 4.0. On average, companies spend 6% of their annual revenue on digital investments.

Artificial intelligence (AI) is a key technology for industry. 38% of companies use it – for example, in process automation (66%) and in data analysis for process monitoring (64%). For a quarter of companies, AI is not an issue at the moment. Factors that can stand in the way of the use of artificial intelligence include a lack of data (42%), the high cost of implementation (40%), a lack of standards (32%) and ethical reasons (28%).

Full potential: digital twin and IoT platforms

One in three companies uses the digital twin. This is the virtual image of a physical object that makes it possible, for example, to speed up production and maintenance processes. In addition, the digital twin increases the availability of machines and systems. 19% of the companies surveyed are in the planning stages for the digital twin. For just under 30%, its use is currently out of the question. The reasons cited are a poor database (51%), a lack of standards (38%) and uncertainties regarding cost-effectiveness (23%). However, more than 80% of companies are convinced that the importance of the digital twin will increase in the next five years.

IoT platforms are another important element for digitalization in industry. They are used by 35% of manufacturing companies, and another 30% plan to use them in the future. The respondents see the greatest opportunities in remote monitoring and real-time insights into manufacturing processes. Other goals associated with IoT platforms include speeding up processes (42%), predictive maintenance (39%), increasing revenue (40%), improving quality (36%) and reducing costs (31%).

Impact on the labor market

The increasing digitization of industry is having an impact on the labor market. Seven out of ten companies believe that Industry 4.0 will create new jobs for well-trained skilled workers. As the framework conditions for jobs in the industrial environment are changing, 77% of companies are investing specifically in further training for their employees to familiarize them with the new technologies.

61% expect jobs for low-skilled workers to disappear in the future. On the other hand, digitization also means that demanding tasks can be performed by less qualified employees – for example, by having more highly qualified colleagues instruct them remotely with the help of augmented reality glasses. Half of the companies are convinced that even rather low-skilled workers will carry out complex tasks on the basis of Industry 4.0. In addition, 91% assume that the increased use of robots will reduce physical stress in factories.

Medium-sized companies must catch up

SMEs have the greatest need to catch up with regard to Industry 4.0 – at least according to their own self-image. Only 30% of companies with 100 to 499 employees see themselves as Industry 4.0 pioneers, while 58% see themselves as laggards. Among companies with 500 or more employees, 54% see themselves as pioneers and only 37% as laggards.

Most frequently, the introduction of Industry 4.0 fails due to a lack of financial resources (81 %), while two-thirds of companies cite data protection requirements as an obstacle. Other factors include IT security (61%), the complexity of the topic (58%) and a lack of skilled workers (51%).

What is particularly interesting is that one in three companies says it simply does not have the time to deal with digitization. This attitude could prove risky. After all, in the future, almost 100% of industrial business will be digital. Digitization should therefore be high on the list of priorities for industrial companies.