Although there is no such thing as the ONE Latin America, we would like to focus here on a general overview of the current situation, fundamental hurdles and the great opportunities of Industry 4.0 between Mexico and Argentina. For the most part, we are talking about countries with large territories, natural resources and immense growth potential. However, instead of being on the path of sustainable growth, most are in a constant dichotomy between high hopes and repetitive setbacks of all kinds. What does this mean for the Fourth Industrial Revolution? Is Industrie 4.0 a utopia or rather a growth catalyst for LatAm?
Undoubtedly, there is not only an immense potential, but currently also huge interest in Industry 4.0 throughout Latin America. While advances in the past were mainly driven by big, multinational corporations, SMEs all over Latin America are increasingly getting aware of the opportunities and threats the current development means for them. With size comes complexity and synergy potentials are not only greater, but also more complicated to exploit due to manifold heterogeneity. Most companies of all sizes struggle when it comes to aligning investment and change programs across departments, sites and business units. Although potentials of Industrie 4.0 are generally acknowledged and manifold digitalization activities are already ongoing, they still lack an overarching Industrie 4.0 roadmap that balances costs and returns on short-, medium- and long-term.
Today, even most large companies still have significant challenges in Industrie 4.0 fundamentals such as computerization of processes and connectivity across equipment, IT systems and teams. Typical problems are media disruptions, lack and diversity of system interfaces as well as limited system use and skills. SMEs usually start from a much lower level in some areas, lacking standardized processes as a foundation for IT systems and digital solutions. While mid-sized and large companies typically deal with the cross-plant standardization of data structures at the process execution level, down to the store floor, SMEs tend to still work on the processes at the enterprise level. Central hurdles for all are legacy systems, outdated machines and long investment periods that place narrow limits on the vision of cyber physical systems. When it comes to IT, missing systems and processes can also be an opportunity to set open, compatible and flexible standards directly on a greenfield instead of dealing with the difficult transition of 1001 systems. "Make it digital from the start" is one of the great opportunities for Industry 4.0 in Latin America.
A central pillar of Industrie 4.0 is the ecosystem idea, which we have been pursuing in Germany and especially at RWTH Aachen Campus for more than 10 years. With increasing support from governments, associations and a wide variety of organizations, communities are also growing in several countries in Latin America. Instead of reinventing the wheel, many programs, hubs and funding pots rightly aim to harness the advances in research and application. In exchange with our regional partners and companies in LatAm, three needs come up repetitively:
Exchange with peers in I4.0 communities: Connect with your peers and built a powerful ecosystem will help you move faster while avoiding lots of mistakes (not all)
Continuous education on all company levels: Invest in your people to drive the change. This will help you develop, retain and attract the capabilities and personalities you`ll need in the future.
I4.0 program development & management: Define a consistent transformation program and a structure to follow-up on its execution.
The need for further training concerns the entire workforce. That includes broad training in the basics, focused building of expert skills but also the change of the company’s way of collaborating and taking decisions. Fears must be allayed, advantages explained in a comprehensible manner, and an understanding of one's own role developed. At the same time, it has become clear time and again that commitment and involvement of top management are essential and require intensive consideration of the concepts, implications and potential of digital transformation.
Beyond that, enabling a company-wide organizational structure that orchestrates transformation is key. After all, there is usually no shortage of pilot projects, POCs and ideas. Rather, there is a lack of clear prioritization, sequencing and synchronization of activities according to available resources and across departmental and plant boundaries. Your transformation program should consider your current baseline and the strategic focus. Have a look at our “Insights” below to learn more about holistic roadmapping and consistent management of the Digital Transformation.