Looking ahead to Industry X.0
Many in the industry will be more than aware about how the fourth industrial revolution, aka Industry 4.0, has significantly transformed the way products are manufactured and how digitisation has revolutionised the manufacturing sector. While the Industry 4.0 is yet to transcend to its fullest potential, talks about the more advanced Industry X.0 concept have already started doing the rounds. But what exactly is Industry X.0?
What is Industry X.0?
Industry X.0 is a term coined by Accenture meaning the use of advanced technologies to restructure existing products and services from design and engineering to manufacturing and support that speeds up operational efficiency and enterprise-wide growth. It is a methodology whereby the consulting firm, in conjunction with the World Economic Forum, developed and adopted metrics and formulae that are able to assess the value of digital transformation, both at a societal and industrial level.
To help make the new coinage easy to understand, Accenture senior director, Eric Schaeffer, explains: “Industry 4.0 is manufacturing-centric; it’s on the shop floor. Industry X.0 does not only focus on manufacturing industries. The word digital has a technology connotation to it. Industry X.0 is slightly broader. It is how digital is going to transform the industry.”
Why is Industry X.0 important?
According to Accenture, only 13% of businesses have realised the full impact of their digital investments, which has allowed them to attain cost savings and create growth. The optimal mix of technologies could save large companies up to $16 billion.
In its research report, titled ‘Combine and Conquer’, Accenture reveals that bringing together five digital technologies – AR/VR, machine learning, mobile computing, big data, and autonomous vehicles – can help organisations achieve extra savings of more than $85,000 per employee on average. What’s more, a slightly different combination of autonomous robots, mobile computing, autonomous vehicles, 3D printing and machine learning, could assist organisations achieve additional market capitalisation of only more than $6bn on average.
Combining technologies would differ across industries and segments, however, the results in terms of cost savings will be significant despite industry. For instance, mixing AI, big data, autonomous robots, 3D printing, and blockchain can help companies in the industrial-equipment sector achieve extra cost savings of more than $43,000 per employee. Likewise the sector, which has an average employee base of just over 37,000, could realise total savings of more than $1.6bn on average. If we consider oil and gas companies, combining AI, VR, and big data could achieve more than $16bn in market capitalisation.
How Industry X.0 can actually benefit organisations?
Collaborating and matching digital technologies to create value is not enough. In order to leverage the true potential of Industry X.0, companies must also need to redesign their operating models, production and value chains, which is what Accenture calls ‘Industry X.0 businesses’. These businesses are continuously changing their way of functioning, as there is a change in technology, eventually benefiting from it.
Industry X.0 businesses are not just experimenting with social, mobile, analytics, and cloud, but also constantly incorporating digital technologies to manage top as well as bottom-line growth. These businesses integrate the Industry 4.0’s core operational efficiencies and trying out combinations of advanced digital technologies to continuously develop new and hyper-personalised experiences in business-to-consumer as well as business-to-business framework.
To conclude, there is no standard digital roadmap for implementing Industry X.0 yet. According to Schaeffer, it is mostly about experimenting and a lot of failing. As he puts it, “if the digital vision does not come from the leadership of a company, it will be extremely difficult for the enterprise to transform itself. It has nothing to do with just digital… it is all about change management”.