19 December 2019

Digitalization trends: What to expect in 2020

On the cusp of a very exciting, inspiring, and enlightening 2019, I wanted to share my thoughts on what digitalization-related trends we should expect to see in 2020. It’s my take on what will take off from an Industry 4.0 point of view. I have found inspiration through numerous conversations, dozens of articles, a good amount of observation, and just a gut feeling. This also lets me reflect on how I’ve approached people on the confusing and vague topic that digitalization can be and how this will impact my approach in 2020.

First off, I really can’t believe that 2019 is almost over. It has been a whirlwind of a business year with abundant travel to conferences, tradeshows, customer meetings, and more. On the private side, my two boys have kept my wife and me busy with soccer, music, and other activities. Now that we have some downtime coming up, it’s a good time to reflect on what was great, what was not so great, and what needs improvement. Over the past few months, I’ve been observing how people’s understanding of Industry 4.0 has changed. It has gone from “Tell me what it is and why I should care” to “Enough talking. Let’s see some examples with a clear return-on-investment (ROI).” Having come to that major realization and understanding that digitalization is reaching maturity in the US marketplace, I will definitely modify how I address the topic moving forward. And with that, let’s have a look at the trends moving into 2020. 

1. Increased focus on specific solutions

This is probably the number-one change I see for 2020. Previously, my conversations focused on awareness; for example, what Industry 4.0 is and why it’s so important. Now, the conversation has shifted to become much more focused on demonstrating specific, real-life solutions that can be implemented. People have had enough of the fluff and want tangible solutions with proven value. So, that’s the first trend I see happening in 2020. 

2. We need to know the ROI

With more focus on specific results, there will inevitably be more attention on being able to demonstrate a solid ROI. Many Industry 4.0 strategies focus on individual pilots with very little regard to the bigger picture, which leaves very unclear answers to questions like, “Why are we doing this in the first place?”, “What are we trying to achieve?”, and “What is the overarching goal?” This is where the importance of a clearly defined digital transformation roadmap and a well-defined ROI for each of the elements on that roadmap comes into play. Naturally, management wants to see a positive ROI on any project, but there has been so much hype about getting Industry 4.0 pilots going that this topic has been somewhat neglected. That is going to change in 2020.

3. Digital twin for process will see many more use cases

This brings me to the third trend, which involves the digital twin. Those of you who know me are aware that the digital twin is near and dear to my heart in any conversation about Industry 4.0. That’s because it is such an essential element of what Industry 4.0 is all about. In its ideal form, the digital twin allows you to design your product or process using virtual tools to test and validate your designs with software. Once the real product or process has come to life, input from the use case can be fed back into the design phase to improve the updated product. It is a very powerful concept but not one that is easily created. Conscious investments are necessary and since the digital twin is not an out-of-the-box solution, it takes time to get there. The rewards, however, are pretty astounding, and it makes an investment worth considering for most companies. Continued investment in the digital twin is an idea that will continue to mature in 2020.

4. People, people, people

Technologies such as artificial intelligence, machine learning, prescriptive maintenance, and cloud computing are all integral parts of why we’re even talking about Industry 4.0, and major reasons I’m writing this blog. Personally, I don’t think that this should be the case. The conversation should be about people. No technology will ever take off if it is not accepted by the people using it, and no ROI will be reaped if people don’t have a clear understanding of how a specific technology can help them make their lives easier. Instances are popping up of businesses using both technology and the human element to combine the best of both worlds. Technology is used to categorize something, or someone, based on behaviors, preferences, history, etc., and a real person will adjust the recommendation based on their knowledge or expertise in a specific area. This is a perfect example of using technology as a means to an end but not a goal in and by itself. I believe we’re going to see more examples of successfully adding the human element to computer algorithms in 2020, especially with the advent of 5G.

5. Customer outcomes will drive Industry 4.0 projects

The last trend I see happening in 2020 is an increased focus on customer outcomes. As mentioned, my conversations have typically been about how to use technology and not necessarily why you should use it. It has also been about preparing for megatrends in our society such as baby boomers retiring, digital natives entering the job market, and the ability to grab data much more easily than ever before. In reality, it should be all about the customer and what kind of experience you’d like them to have when interacting with you. Most discussions I have had have been surprisingly void of that one crucial component, and it wasn’t until after I attended an industry-focused conference this fall that the lightbulb went off loudly and clearly. Industry 4.0 provides us with the tools that enable us to rethink the customer process journey for the better, and that is really what should drive any future investments. I see this becoming a hot topic of conversation in 2020, and most definitely one that I will continue to explore next year and beyond.

What’s your take on this? Do you think there’s something I missed or could have gone more into depth with? I’d love to hear your feedback.

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