The Internet of Things and Industry 4.0 are casting doubt on existing business processes and business models. This revolution presents German companies with an opportunity they cannot afford to overlook, says Dr. Bernd Pätzold, CEO of PROSTEP AG, in this interview.
Dr. Pätzold, how many intelligently networked devices do have in your household at the moment?
In our two-person household, two computers, two iPads, two iPhones, an NAS server, two cars, the heating system and radiators, and the TV are connected to the Internet. Even our toothbrushes can exchange data via the Internet. If I've counted correctly, that is at least 13 devices, without including the countless virtual devices that we use in the form of services. This was not a deliberate decision on our part, it simply evolved.
Do you sometimes have to explain to your friends what the Internet of Things and Industry 4.0 actually refer to?
Pätzold: Yes, and sometimes also allay concerns fueled by reports in the media, such as the one in Focus about the threat to five million jobs. It is typical of us Germans that we always first see the risks instead of using our strengths to actively shape the changes and capitalize on them.
Is the IoT just hype, as was the euphoria about CIM in the past, or is it really set to revolutionize our economy?
Pätzold: I don't think that CIM was merely hype. The idea was just implemented differently than we had anticipated back then. When I switched to the private sector in 1990 after completing my doctorate, the automotive industry was on its knees. It had, however, accepted the challenge of lean manufacturing and radically changed the way it developed and manufactured products, which is certainly one of the reasons for its leading position today. PROSTEP was, by the way, a product of this revolution and has done well out of it. That's why I think it's fantastic that we are once again on the threshold of a fundamental change that offers our knowledge-oriented society outstanding opportunities. But we can't afford to overlook them because otherwise – as with almost every revolution – heads will roll, i.e. there will be winners and losers.
Frage: What is actually so revolutionary about this industrial revolution? Networking is, after all, nothing new.
Pätzold: It is networking of a different quality – we are moving from a hierarchical structure to a network of autonomous entities that interact intelligently. But what is revolutionary isn't actually the network itself but rather the fact that the devices collect and exchange data, which makes new services possible and thus shifts value creation. It is the data relating to the product and production that comprises the actual value as far as the customers are concerned.
Here in Germany, the fourth industrial revolution is primarily taking place in the digital factory. Is that not a short-sighted way of looking at things?
Pätzold: In this country, focus currently does lies predominately on the further development of our production processes. As important as this is, it doesn't mean that we can ignore the changes in the products and business models. Smart products, smart services and smart factories must all be developed simultaneously.
What are the key technological drivers behind intelligent networking?
Pätzold: I personally was impressed by the development of the Raspberry Pi Zero, a fully-fledged computer with half a gigabyte of main memory and a target price of five US dollars. If you add sensor technology, which is also becoming smaller and cheaper, you can provide very ordinary products with a great deal of intelligence. Combined with the next mobile telecommunications standard, G5, this opens up possibilities that we cannot yet completely comprehend.