A mind sharpener guide for plastics engineers, product developers, industrial managers & business developers

This infographic presents you a quick guide to evaluate or generate successful business ideas in the new economy. The key messages are based on ideas described by Peter Thiel and Gary Vaynerchuk.

I hope you find it useful!

Till next time and #findoutaboutplastics

Herwig

[Infographic] Plastics Industry - Business Development à la 0 to 1

European (Plastics) Industry and its struggle with Industry 4.0

Most companies created in Silicon Valley in the last 20 years offer disruptive software solutions which elevated the digital platform business models a lot. We all know Amazon, Uber, and Google, because they added value to our lives by making things easier, faster and cheaper. These use mainly network effects.

Europe was in a deep sleep regarding digitalization developments in the past 20 years. The good news is that Europe still has a chance in the second half of the digitalization game. There is a strong physical based company foundation in Europe and now it’s time to connect software solutions with physical machines by using the Industrial Internet of Things (IIoT). Machine-to-machine technologies and sensors are already available but its integration and operation over a cloud based IIoT is new. This will enable operational efficiency and will allow companies to re-industrialize/re-invent certain areas and, as a result, get a better perception of the customer needs. Consequently, IIoT will play a key role in the landing of (Plastics) Industry 4.0 in Europe.

Gilchrist et al. [1] concluded that to obtain significant gains, the IIoT just needs to bring 1% savings in cost/inefficiency.

Here are some examples:

• Aviation: fuel savings of 1% per annum brings savings of $30 billion.
• Gas-fired generators: fuel savings of 1% brings operational savings of $66 billion.
• Oil and Gas industry: reduction of 1% in capital spending on equipment per annum would return around $90 billion.
• Agriculture, transportation, and health care industries: here the same 1% rule holds true.

IT systems have matured over the past years and impart now confidence in senior business leaders to move toward the digital transformation.  This can already be seen in a global context where countries such as USA, China and India hold a leading position [2]. What about Europe?

In the past years, the EU has developed into a more regulated environment which is not unleashing for entrepreneurial spirits. This can be noticed in the amount of laws and other regulations which have been implemented. Thoskov [3] presented a study entitled “55 years of European Legislation”. According to the latter, since its foundation in 1957 in Rome, the EU adopted more than 100,000 legislative acts.   These days, on average, 80 directives, 1200 regulations and 700 decisions per year are approved by the EU. As a result, small and middle companies can be easily delayed and held back by the amount of regulation. This environment is neither friendly to the creation of new businesses nor to the widespread of existing ones in a digital world.

Overall, the European mindset needs a change! In my opinion, a new view on the long-lasting archaic concepts of education, work and lifestyle is needed. Following, we discuss each of these topics:

• Education: Generally, to the majority of the EU it can be said that the education system got stuck in the late 1980’s and 1990’s. The way we teach and the content of what we teach becomes more and more outdated as digitalization progresses, i.e. a lot of content currently thought in schools can be at any time accessed through our phones.  This may mean that the nowadays children despite being digital natives and able to handle all digital technologies, will not be equipped with the necessary skills or mindset to tackle the future.
  In Education 4.0, new online education models will challenge given systems. Analytical thinking, connecting the dots of industrial issues, discussing in a cross-functional and global way needs to be stronger than ever in our toolbox. Simple things will be solved by virtual assistants, aka computers. Dueck [4] explains that you will only get well paid for things that the computer cannot do. This leads me to work 4.0.
• Work: The 40 hour workweek is still the status quo, together with semi-home office solution. The 9-to-5 social agreement was once decided as the best solution for industry, and thus, most governments build their social systems on this basis. Despite all current working processes being more and more optimized, which means that we can do more in less time, we still fill up the bottle to 40 hours! 
  Jason Fried [5] gave a good Ted talk on the topic “Why work doesn’t happen at work”. When people start operating from everywhere at every time, the current management system creeps to its border of use. Work 4.0 says goodbye to the classic known time registration systems and really focus on delivering. Dueck [4] concluded that all administrative things will disappear. Consequently, people can really focus on the job itself and the task density will increase. As a result, people will really need to perform and the work pressure will be even higher.
  Solutions to standard businesses problems and generally business topics can be more and more found by individual Internet searches, and, thus, digital businesses will require a higher contribution of professionals with specialized knowledge. Low specialization jobs, which require short training to be up to the job task, will still exist but will be competitive and volatile. To sum up from a human resources point of view, Work 4.0 will focus rather on specialty than simplicity, e.g. cake designer or creator versus cake maker.

• Life: Industry 4.0 or from a worldwide perspective the IIoT will enable the establishment of fully automated online businesses. This will result in additional personal time. Time   together with flexibility to travel and try out things you really want to do, but could not yet do will be the new currency.  This may also give you the opportunity to make several “mini-retirements” instead of traditionally waiting until retirement. Such concepts are presented and shaped by Tim Ferris in his book the 4-hour workweek [6].

Last but not least, we must be accepting of the increasing diversity of our societies in a globalized economy! I am optimistic about the upcoming changes and there will be up and downs which we will have to tackle through, but in the long run digitalization will increase the wealth of the worldwide societies, not only Europe! We need worldwide growth in wealth!

I invite you all for having a look at my Digital PlasticsRevolution series, which presents different “impactors” full with ideas on how to tackle successful digitalization in Plastics Industry. Impactor 1 of the series presents to you 5 ideas to get your digital plastics revolution started.

Thanks for reading!

Till next time and #findoutaboutplastics

Herwig

Literature:

[1] Alasdair Gilchrist: Industry 4.0: The Industrial Internet of Things, Apress. 2016

[2] Keith Breene, World Economic Forum: The10 countries best prepared for the new digital economy

[3] Dimiter Toshkov: 55 years of EU Legislation  

[4] Gunther Dueck: Industrie 4.0 digitale Revolution eindrucksvoll erklärt - GunterDueck 2016,

[5] Jason Fried: Why work doesn’t happenat work,

[6] Tim Ferris: The 4-hour work week

2016 in the rear-view mirror!!!

Dear readers,

First of all I would like to thank you all for your comments, likes and shares of this blog in 2016! I will do my best to keep up your interest in 2017!

­In this post, I present you a sum up of the most popular blogs I wrote over the past year!

Plastics and Processing

• Polypropylene Roller Coaster  
• Polymer injection moulding &reciprocating screws: successful since ever, but what will happen in thefuture?
• My top 5 favourite apps forpolymer engineering operations (incl. video)
• Injection moulding of oralpolymer-based drug delivery systems - 5 takeaways of my Ph.D.
• Optimizing your injection moulding production – my 5 How’s

Plastics Pioneers

• LEGO®-founder Ole Kirk Christiansen &family
• Jack Welch and his uprise in GEPlastics

Digitalization and New Economy

• Why the New Economy reshapes the plasticsindustry and what you need to know for helping reshaping it too!
• Plastics Industry: Level upyour Digital Game! – 5 ideas to get your Digital Plastics Revolution started

Leadership

• Digital Leadership in thePlastics Industry – A chance to speed up innovation?

I look forward to present you the follow up of such topics in 2017!

Greetings & #findoutaboutplastics

Herwig

Plastics Industry: Level up your Digital Game! – 5 Ideas to get your Digital Plastics Revolution started (Digital Plastics Revolution Series – Impactor 1)

Digital welcome message at the Lisbon airport.

Welcome to my blog series entitled Digital Plastics Revolution!

 

In our daily lives we have noticed that digitalization and especially Industrial Internet of Things (IIoT) initiatives are moving at a faster speed compared to some years ago. At this speed more and more disruptions occur in all type of industries. Digitalization is literally transforming one industry after the other. This includes also the plastics industry.

 

In this series I will explore and present the key elements of digital transformation and how these can be used in the plastics industry. Each part of this series presents a major key stone and is called therefore impactor.

So, let’s get started with impactor 1:

Following are my 5 ideas on how you can get the digital revolution started in your plastics business:

1) Digital Technology Platforms (DTP’s): Nowadays, new Digital Technology Platforms (DTP’s) constantly evolve. These are the major building blocks to get your digital business alive. Gartner suggests that companies should have a mix of 5 DTP’s [1]. These should be related to information systems, customer experience, analytics and intelligence, the Internet of Things and business ecosystems. In addition, DTP’s allow your business partners to connect with you from any location and device. Therefore, simply put: get familiar with DTP’s and learn how they can be used in your business.

2) Start creating digital ecosystems: We have to be fit to move in more and more complex networks and interconnected systems. Keeping the current hierarchical structured type of businesses will not help you dealing with this kind of complexity, however, moving toward an ecosystem approach will. Ecosystems are opened up systems and allow much more cross-functional activities [2]. Our whole business leadership structure should change. Digital Leadership should be based on an above-hierarchy, team concept which allows faster innovation.  Bigger companies often re-structure and re-organize to become “leaner”, but to the majority, the old hierarchal systems are kept. This is often influenced by political interest of protecting individual (high) positions within the business.  Fact is that the corporate culture and mindset needs to change! 

3) Awareness of the New Economy and its principles (winner-takes-it-all; zero-to-one with 10x improvements [3]): Although the internet is already 20 years old, the New Economy is still evolving and new possibilities as well as challenges come along with it. In my opinion, awareness of its main working principles is necessary for reforming and growing your business.  In a nutshell “the winner-takes-it-all” meaning that the best and most used platform gets the monopoly of the market. This principle was also coined by Peter Thiel with the expression zero-to-one [3].  Therefore, improvements in proprietary technology should be in a scale of 10x so that new businesses may succeed. In addition, based on a quote of Gary Vaynerchuck [4], you need to start asking yourself every day in the morning: “How can I put myself out of business?” In this way you challenge yourself to stay on top of your business. This is especially true when your business is doing great, because  then you tend to oversee the fact that somewhere a little start-up is already working on your downfall.

4) Clear vison and self-awareness: Your plastics business needs to agree on a vision which includes the digital transformation. This comes along with transforming the whole company culture including the employees’ mindsets. Everyone needs to lean in on their personal side to avoid digital illiteracy. Your company and you need to live, communicate and use methods from the year you’re actually living in (e.g. learning how to use tools like Google trends to see when a trend starts to manifest).  

 

5) Establish the role of a Chief Digital Officer (CDO): We need CDOs in C-suites to push the digitalization in plastics industry forward! This is also a clear sign to address the importance of the ongoing changes. The Strategy& Chief Digital Officer study [5] showed that only 6% of global companies (1,500 largest companies) have established the position of a CDO. However, this number is rapidly increasing. The consumer-focused industries have here the lead together with large companies. Bottom line: suggest your CEO to hire a CDO or find motivated people in your organization who can take up on such a position. This will help speeding up things!

In impactor 2 of this Digital Plastics Revolution Series I will present to you 2 major strategies to enhance digital transformation in plastics industry!

Thanks for reading!

Till next time and #findoutaboutplastics

Herwig

Literature:

[1] Kasey Panetta: Gartner’s Top 10 Technology Trends, http://www.gartner.com/smarterwithgartner/gartners-top-10-technology-trends-2017/

[2] Pearl Zhu: Digital Master: Debunk the Myths of Enterprise Digital Maturity (2015)

[3] Peter Thiel: Zero to One, Notes on Startups, or How to Build the Future, Crown Business; 1 edition (September 16, 2014)

[4] https://www.linkedin.com/pulse/20131116202726-10486099-i-m-in-the-business-of-always-trying-to-put-myself-out-of-business

[5]      Strategy&: The 2015 chief digital officer study, http://www.strategyand.pwc.com/reports/chief-digital-officer-study