Four technologies driving digital transformation in the next five years
14 Mar 2022
DIGITAL transformation marks a radical rethinking of how organisations use technology, people, and processes to change business performance fundamentally. In the next five years, key technologies — artificial intelligence (AI), the Internet of Things (IoT)/5G, automation, and blockchain — promise to enable better how companies use data-driven insights to improve operations and boost return on investment.
These four technologies create a new futurescape that some futurists call the fourth industrial revolution or Industry 4.0. They will also shape small and medium-sized business investment strategies and priorities across industry sectors.
Through policies like the National 4IR Policy and Industry4WRD, Malaysia aims to transform its key economic sectors like manufacturing to be competitive in the greater global ecosystem. Across all economic sectors, the goal is to improve productivity by 30% before 2030. Beyond economics, being well-verse in the application of these technologies provides Malaysians an improved quality of life.
Artificial intelligence (AI)
Accenture defines AI as “a constellation of technologies — from machine learning to natural language processing — that allows machines to sense, comprehend, act, and learn.”
Enterprises of all sizes can benefit from AI applications that optimise cloud processing, enable faster deployment of IT, and boost operational efficiency. “AI is no longer a ‘nice to have’ or a set of cool tools to impress management,“ notes the Accenture report. “AI and data strategies are becoming the core of business.”
As AI becomes a mainstream technology, companies need to develop roadmaps for implementation over the next five years to ensure they have the right talent to integrate and scale it.
Scaling AI is critical. Three out of four C-suite executives surveyed by Accenture believe that if they don’t scale AI in the next five years, they risk going out of business entirely. One industry looking to scale AI and machine learning in the coming years will be the global manufacturing sector.
Manufacturers can implement digital tools and deploy robotics as part of a strategic transformation of their production processes. For example, they can build an AI-based cloud platform to increase the accuracy and efficiency of its product inspection processes. This can improve production efficiency while reducing system load and operating costs.
The Internet of Things (IoT) and 5G
As the new 5G wireless standard is deployed worldwide and operators in Malaysia have launched 5G services since December 2021, it promises to accelerate IoT solutions — with speeds as much as 100 times faster than 4G. 5G will also “allow next-generation networks to compete head-on with wired broadband systems including those built with today’s fastest fiber-optic technology,“ notes a Harvard Business Review (HBR) report.
The evolution of IoT over the next five years will fuel a more connected economy. “Few emerging technologies offer more transformative potential for forward-thinking companies than the IoT,“ says another HBR report. “The reason: It combines sensors and sophisticated software analytics to process large volumes of operational data.”
Automation is the cornerstone of digital transformation. Gartner defines “automation” as “how organisations use technology to accomplish tasks that once required human judgment or action”. Now, a new era of what Gartner calls “hyperautomation” will feature advanced computing technology — including AI and machine learning — to rapidly identify and automate all possible business processes.
As the Gartner report notes, hyperautomation includes tools for discovery, analysis, design, automation, measurement, monitoring, and reassessing business processes and data.
The automobile industry is already using hyperautomation to improve production efficiency. The automakers developed an Industry 4.0 IT platform that uses the industrial IoT to configure assembly processes. Today’s automobile factory features a distinctive modular design, using digital sensors and robots in a collaborative and connected environment.
Each vehicle moves through the production floor via automatic guided vehicles that autonomously transport the car to the appropriate work island. Electronic monitoring of the production process provides data insights that are available instantly, giving workers control over every aspect of production, on-site or remotely.
The fourth technology poised to impact digital transformation is blockchain technology. Blockchain, which is evolving beyond cryptocurrencies like bitcoin, will give different industry players the ability to use a secure distributed ledger for all processes and documents. These include contracts, transactional records, financing documents, and recordkeeping. A distributed ledger is a secure database shared by multiple consenting parties and synchronised across multiple sites, companies and/or locations. A blockchain provides an open, distributed ledger that can record transactions between various parties that are verifiable and permanent.
The Converged Future
The convergence of AI, IoT, automation, and blockchain means that business leaders need to look at integrating these technologies into their daily operations.
“An organisation has a far better chance at succeeding when its operating model — or how the organisation creates value — is aligned to its strategy,“ notes an HBR report. “The good news for companies born before the digital era is that they often quickly understand the value in transforming to agile, adaptive, and responsive enterprises because they already have the other intangibles in place: Strong brands, an entrenched customer base, established sales methods, and partners — suppliers, distributors, and technology.”
Looking ahead, companies of all shapes and sizes — from start-ups to centuries-old brands — must understand how to use the convergence can effectively achieve meaningful digital transformation in their corner of the global business ecosystem.
This article is contributed by Epicor Asia regional vice-president Vincent Tang.
Source: The Sun Daily