The future of technology and automation
Heavy industry is no stranger to advancing technology. Mining, agriculture and manufacturing have relied on machines since the first industrial revolution more than 200 years ago.
Beyond the revolution - how technology and automation are changing the industrial landscape.
Today we are in what experts call the Industrial Revolution 4.0: Industry driven computerisation. Underpinning this change is the Internet of Things (IoT) – the collective term for a range of sensors and connected technologies.
In the next 25 years it is predicted we will see advances in this, robotics and artificial intelligence that will drive even bigger changes. This won’t just change how these industries work, it could well make huge changes to the societies and economies around them:
- The way we do business will change, right down to how companies are organised
- The jobs landscape and workers’ lives will be dramatically different 25 years from today
- A drive for increased sustainability will dominate agriculture
To understand what is behind this change, we will be looking at the following seven key trends:
- Sensors will make for smooth operations
- Technology will speed up local manufacturing
- Technology will drive growth in mining as well as solve regulatory concerns
- Low cost labour will become less of a differentiator
- Agriculture is buckling under rapidly growing global demand for food
- Where industrialisation of food production has failed, automation can succeed
- Technology will be the key component of change
Sensors will make for smooth operations
In manufacturing, one of the biggest benefits of using IoT has been sensor technology. Heavy plant is a critical part of the business but when it goes wrong, it often needs significant downtime for repair. This can be inconvenient and expensive.
Sensors can identify faults and even predict when machinery may fail. This lets operators schedule servicing more effectively and stop problems before they get bigger. A report from General Electric about sensors says that machine downtime has been reduced to 1% in some areas. Unplanned downtime has gone down by nearly 20%.
Mining is another heavy plant industry which has benefited from IoT improvements. Getting advance notice of problems in hostile mining environments is even more important. Engineers can plan properly for maintenance that needs to happen deep underground, at sea or in very remote areas such as the Arctic.
Smooth operation isn’t the only goal. New technologies are going to mean far more to industry than just keeping things running.
Technology will speed up local manufacturing
Today, to get the benefit of economies of scale, manufacturers have to produce large volumes from a single site. Often, the creators also have to be nearby to be able to consult on designs or discuss prototypes.
Advances in automation and robotics are making it possible to produce locally, on a small scale, but still think globally. Printing company HP uses industrial 3D printing to create parts and products for its machines around the world. This is much cheaper and quicker than waiting for them to come out of a standard factory production line. Product design and build can now happen anywhere.
This has three main benefits. Firstly, companies can manufacture close to the consumer. Products have less distance to travel which is better for the environment. Secondly, local production is cheaper and faster. Finally, it creates ‘just in time’ production. Goods can be produced when they’re needed and in the amounts that are required . This keeps waste down and makes the end to end process more efficient.
Technology will drive growth in mining as well as solve regulatory concerns
The massive growth in using new technologies is good news for mining. Demand has shot up for components and the metals that they’re made of. Lithium, for example, is vital for smartphones, laptops, electric vehicles and anything else that depends on long life, high powered batteries. It was hardly used at all a couple of decades ago. Now it’s a rich source of income for mines.
Technology companies are going as far as to partner with some mines to make sure they can get hold of the raw materials they need. Tesla signed early stage agreements  with smaller mining companies to create a gigafactory using lithium in Nevada.
“Technology companies are going as far as to partner with some mines to make sure they can get hold of the raw materials they need.”
That being said, the pressure is also on the mining industry to meet strict environmental regulation. Demand for energy to power these new technologies means mines have to find new resources and new ways of getting at them. Controversies around fracking and using fossil fuels are just two issues the mining industry has to navigate.
Legislation is hitting some areas hard. South Africa’s Business Live: Financial Mail reported that Southern Africa only attracts 4% of global mining investment compared to 14% in Canada and 13% in Australia. The report puts the 10-point difference down to the antagonistic relationship between mining companies and South African regulators.
Mining companies can turn to technology themselves to help improve their relationships with regulators and get the sector moving again. They can use drones, sensors and real time data to show how well their operation is performing. The data from these sensors offers a transparency into operations that gives regulators confidence that the mining company is acting responsibly. Technology will also help smaller companies by reducing the cost of compliance.
Low cost labour will become less of a global differentiator
Automation means fixed costs. For a company, which in turn means more economic stability. Human labour is a variable cost. It follows that increasing the amount of automation in a business increases fixed costs. Therefore, variable costs – such as labour - could be reduced.
It doesn’t always follow that increasing automation will lower the number of jobs. But there are implications for nations that have depended on low labour costs to attract business.
In 1994, China had less than 10% of the world’s manufacturing output. By 2015 this exceeded 25%. China and India have been popular manufacturing bases because their labour costs were lower than in developed nations. Growth in automation has levelled that playing field. Over seven per cent of China’s workforce is at risk from ‘automatability’.
“In 1994, China had less than 10% of the world’s manufacturing output. By 2015 this exceeded 25%.”
The World Bank highlights this issue in their report ‘Trouble in the Making? The Future of Manufacturing-Led Development’ . It says that manufacturers will choose to locate to areas with strong technological abilities instead of choosing somewhere purely for its low labour costs.
The report says that nations who relied on low labour costs alone to attract industry will need to adapt. This is something that will have to happen at country level but individual companies can contribute. They need to make sure they understand where change is leading and explore new opportunities or upskill their employees.
Not every sector is under threat and there are opportunities for at risk businesses to shift focus. Ethiopia, for example, relies heavily on clothing and footwear. These aren’t easily automated and so labour will be a factor for the foreseeable future. Jobs in manufacturing such as design, distribution and service are also more secure.
“The report says that nations who relied on low labour costs alone to attract industry will need to adapt.”
Food processing and other commodities are also less at risk from automation. Brazil, for example, will keep thriving in this sector, based on its $44.2bn exports in this area in 2016.
Businesses can't automate everything but they will make the most of what can. This inevitably means their workforce will have to change to match.
Companies need to make sure that their employees have the skills to cope with the changing workplace. They will need forward-thinking business plans that can adapt to future technological change.
Governments need to attract industries that need labour and cutting edge technology. To do so, they will need to provide education to meet those companies' needs.
Agriculture is buckling under rapidly growing global demand for food
Conversations about technology in industry tend to focus on cost or efficiency. When it comes to agriculture, discussions take an altogether more urgent tone.
As the author of IBM’s Cognitive Precision Farming case study announces:
“We are running out of food.”
That case study reveals that, in 30 years, the world will have more people than farms can support. The UN Food and Agriculture Organisation claims that we need to grow 70% more food by 2050. This is to feed a population that is expected to grow by 2.3bn more people worldwide.
At the same time, estimates suggest that 40% of food in the US is wasted, costing around $165bn. The problem is largely due to distribution. Food is rarely consumed where it is produced.
“40% of food in the US is wasted, costing around $165bn. The problem is largely due to distribution.”
Over the last 20 years we have been innovating our way into an agricultural disaster. Food production has escalated, pest control dominates and consumers demand unseasonal food all year round.
This has created a raft of problems for the environment but one clear example is monoculture. By trying to produce lots of one type of food we reduce the diversity of food growing environments. This makes pests hard to police and disease difficult to stem. We resort to using more chemicals and the production cycle becomes even harder to sustain.
Where industrialisation of food production has failed, automation can succeed
Where crops were once lost to the onset of adverse weather conditions or wastage, they can now be managed by drone technology and weather sensors.
Examples include the Precision Crop Management Testbed from Infosys and Skata Seed. It uses sensors to track plants round the clock while drones help farmers understand soil conditions and plant health. It also delivers information back to farmers who can use it to make informed decisions.
These are useful solutions but they also cause problems of their own. Farmers today face such a large volume of data to manage and understand it becomes impossible to act on all of it.
"Farmers today face such a large volume of data to manage and understand it becomes impossible to act on all of it."
Using machine learning software like IBM's Watson helps because it is more than just data management. Machine learning goes further by processes the information and focuses on the most relevant insights.
This would lead to finding new links in the data as well as identify what information matters. Farmers can also benefit from data sharing. Artificial intelligence adapts recommendations as it learns from the larger amount of data. The insights are also available in real time. This is critical when farmers need to act to stop a crop failing.
The issue of monoculture and food distribution is still under debate. There is no doubt that volumes need to increase by 2050, as per the UN’s findings (above). But if agriculture relies on mass production, it also needs desperate measures such as genetic modification and pesticides, to keep food volumes up.
To meet food demand, agriculture needs to make technology local. Innovators also want to answer the thorny issue of food miles. They are looking to technology to create smaller-scale, efficient and local agriculture. Design Indaba created Protofarm 2050 , farming that can take place inside cities to reduce fuel miles. Alternatively, there is vertical farming – growing food up walls – using existing buildings instead of trying to find more agricultural land.
Technology would be working with nature rather than trying to manipulate it. It will allow producers to farm locally and intelligently, reducing waste, transport costs and pollution. Sensor technology will manage water use while genome editing can improve crop resilience. Instead of big, bloated farms, technology is turning agriculture into a precision instrument.
Technology will be the key component of change
The evolution of technology is inevitable. From big business to energetic start-ups, it has handed industry the power to make all kinds of changes and improvements.
Whether it’s IBM Watson’s intelligent software plotting better land management, Tesla creating its own future energy supply or HP creating 3D-printed parts where and when it needs them, technology is about to change the way we work beyond all recognition.
Government participation will be critical. Skills are changing, education is needed and infrastructure will have to adapt to new labour forces and new ways of using buildings, transportation and land.
As a smartphone and IoT generation, we are becoming used to the rapid pace of change. In the next 25 years we expect change and can begin anticipating what we need to do to meet it.
The world of lubricants is no exception. Factors such as robotics, artificial intelligence (AI), and increased machine automation will be a partner and in some cases, a catalyst. What it will not be is optional.