By Scott Wright

PEOPLE should not fear the impact on jobs from the growing influence of robots and artificial intelligence.

Henrik von Scheel, the Danish strategist credited with coining the concept of the Fourth Industrial Revolution, has declared that robotics and other industry 4.0 technologies can deliver “unparalleled opportunities” – without sacrificing workers.

“You really shouldn’t be afraid of artificial intelligence,” said Mr von Scheel. “Because people work with people; people connect to people and people sell to people.

“And this is also the core element of the fourth industrial revolution. People are key to our ability to adapt to new technology, to apply new skills, to be innovative and to see a future.”

Mr von Scheel was speaking ahead of his appearance at the forthcoming Scottish Manufacturing Advisory Service (SMAS) National Manufacturing Conference 2021, which will be hosted by Scottish Enterprise online on June 15 and 16. The event is expected to bring together some 600 manufacturers from around Scotland.

The fourth industrial revolution, also known as Industry 4.0 and 4IR, refers to the automation of traditional manufacturing and industrial practices, using modern smart technologies. These include robotics, analytics, artificial intelligence, augmented reality, nanotechnology, wearable technology, advanced materials and the internet of things – the world of connected devices.

Mr von Scheel, a management consultant, became known as the concept’s originator when he was part of a team advising the German government on its digital strategy after the 2008 financial crisis.

He said companies should concentrate on making their software and systems more efficient instead of focusing on reducing headcount.

“The biggest value comes from your people, because they deliver your service – so don’t cut this,” Mr von Scheel said. “But with the software, you can optimise the hell out of this. Then you can look at how you skill up your key people to use the software in the right way to deliver your service.”

According to Mr von Scheel, Scotland could gain a competitive advantage if manufacturers focused o adding value to products, rather than trying to make things as cheaply as possible. He suggests this would involve investing upfront in Industry 4.0 technology to deliver long-term operational excellence, while allowing companies to make products that are lower in cost and of higher value to customers.

“The fourth industrial revolution is the biggest structural change in the past 250 years,” Mr von Scheel said. “It delivers unparalleled opportunities for growth and productivity. But in an age of disruption, you also need to rethink how you differentiate what you do, to serve your customers better than the competition.”

Mr von Scheel noted that focusing on a few, very specific fields has been the secret to Germany’s success, explaining that the country has come to be dominant in the mid-market in certain sectors. He suggested that Scotland could benefit from a similar approach.

“Germany has 2,471 mid-market leaders globally,” he said. “This means these companies lead in very specific fields. The German government is not going for big-bang companies like Google and Amazon. They’re going for the mid-market. They just need to be the leader globally in specific fields. And this is the same thing Scotland should focus on. Ten to 15 per cent of Scotland’s economy should be mid-market companies who are leaders in very specific fields. For example, an oil and gas company that is focusing on advanced materials from renewable resources.”

The SMAS National Manufacturing Conference, themed Making Scotland’s Future, will showcase how Scottish manufacturers have responded to the pandemic and economic challenges.

It will also focus on how they improve their supply chains and invest in digital technologies to increase their competitiveness – and also help Scotland meet its target of generating net zero emissions by 2045.