Bridg­ing the gaps for SMEs to face In­dus­try 4.0

New Straits Times - - Busi­ness - The writer is the chief ex­ec­u­tive of­fi­cer of Malaysia Au­to­mo­tive In­sti­tute.

IN the pre­vi­ous ar­ti­cles, this col­umn dis­cussed new fron­tiers of op­por­tu­ni­ties for small and medium en­ter­prises (SMEs) by shift­ing busi­ness mod­els to­wards global value chain think­ing. In this ar­ti­cle, we delve fur­ther into the im­ple­men­ta­tion of such par­a­digm shifts.

It was 1876 when Alexan­der Gra­ham Bell patented the first de­vice that would even­tu­ally be­come the wired tele­phone. It took al­most an en­tire cen­tury for Mo­torola to demon­strate the first hand­held mo­bile phone in 1973.

The first smart­phones were seen at the turn of the cen­tury, less than three decades later. This year, smart­phones have evolved be­yond our imag­i­na­tion, mak­ing them our per­sonal as­sis­tants, and also al­low us to com­mu­ni­cate vis­ually with any­one around the world.

If it took a mere decade for the smart­phone rev­o­lu­tion to ren­der cop­per-wire ser­vices ob­so­lete, imag­ine what will hap­pen over the next few years in an au­to­mo­tive in­dus­try that utilises thou­sands of com­po­nents.

Dis­rup­tions will force busi­nesses to re­duce risk by fo­cus­ing on spe­cial­i­sa­tion to en­sure that the im­pacts of global dis­rup­tions are shoul­dered by many spe­cial­ists in the en­tire work process. This chain of busi­nesses will make up what will be re­ferred to as the “Global Value Chain”.

SMEs will need to de­velop ex­per­tise in a spe­cific ac­tiv­ity, or “val­ues”, in or­der to re­main com­pet­i­tive in a fu­ture world, where prod­ucts and ser­vices re­quire higher com­plex­ity, and this de­mand is ex­pected to grow at an ex­po­nen­tial rate.

As dis­cussed pre­vi­ously, it would be a daunt­ing task for SMEs, even large cor­po­ra­tions, to main­tain such ca­pa­bil­i­ties in­house, un­der one roof. This is sim­ply be­cause global dis­rup­tions are ex­pected to oc­cur at a higher fre­quency than pre­vi­ous tech­nol­ogy rev­o­lu­tions.

The sil­ver lining is that a break­down of spe­cial­i­sa­tion is an ad­van­tage for SMEs as smaller op­er­a­tions are much eas­ier to re­align to newer trends. The ques­tion that re­mains is how this can be done with lim­ited cap­i­tal?

In em­brac­ing In­dus­try 4.0, the gov­ern­ment recog­nises that heavy in­vest­ment is re­quired to en­hance dig­i­tal­i­sa­tion and con­nec­tiv­ity.

Is­sues sur­round­ing In­dus­try 4.0 com­pat­i­bil­ity re­quire cloud con­nec­tiv­ity and holis­tic pro­cess­ing of 3D col­lab­o­ra­tive de­signs, en­gi­neer­ing sim­u­la­tion, man­u­fac­tur­ing ex­e­cu­tion sys­tems, lo­gis­tics, telem­at­ics, af­ter­mar­ket data and 3D print­ing.

Con­ven­tional pro­cesses will need dig­i­tal up­grades, with the “In­ter­net of Things” and big data man­age­ment be­com­ing an in­creas­ingly ubiq­ui­tous fea­ture to re­main com­pet­i­tive.

To en­able busi­nesses, in par­tic­u­lar SMEs, to bridge this gap, the Malaysia Au­to­mo­tive In­sti­tute (MAI) has de­vel­oped such sys­tems within its cam­puses, open for lease by all in­dus­try stake­hold­ers. These sys­tems, de­vel­oped un­der MAI’s In­dus­try 4.0 ini­tia­tives, aim to as­sist busi­nesses, academia and gov­ern­ment or­gan­i­sa­tions in build­ing com­pre­hen­sion and in­te­gra­tion with fu­ture busi­ness tech­nol­ogy.

MAI’s cloud com­put­ing servers have been set up to ac­com­mo­date large amount of data, con­nected to the sys­tems men­tioned above for use by the in­dus­try.

Cou­pled with MAI’s hu­man cap­i­tal pro­grammes that cater to all in­dus­try needs within the man­u­fac­tur­ing and af­ter-sales sec­tors, this holis­tic sys­tem al­lows tech­nol­ogy pen­e­tra­tion into the SME work­flow with­out risk­ing high cap­i­tal in­vest­ments.

As these busi­nesses grow with tech­no­log­i­cal ca­pa­bil­i­ties, we are more than happy to as­sist com­pa­nies in de­vel­op­ing in-house ca­pa­bil­i­ties that are in line with the busi­ness needs of the fu­ture.

If you are a busi­ness owner, take a step into the fu­ture and con­tact us for more de­tails.

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