Singapore Lead the Way of ASEAN’s Industry 4.0 Revolution
The next wave of digital disruption is rapidly changing the economy as it sweeps through the different sectors across business, communications, impacting society and the individual. While the disruptions brought by technologies are catalysts of the change, they are also the transformative element of the manufacturing sector. From the mechanization of the manufacturing and processing industry in the First Industrial Revolution to the rise of automation in the Third Industrial Revolution, technology-inspired disruptions have always been the driving force behind each successive Industrial wave.
Today, Industry 4.0 is more than just a buzzword. It signals that the world is advancing from the automation and machinery of the Third Industrial Revolution to the Fourth Industrial Revolution, via smart systems using data and machine learning; the Internet of Things (IoT) and Artificial Intelligence. As these disruptive technologies (e.g. 3-D printing, the IoT) sweep through the manufacturing sector, the management of global supply chains and factory processes will change.
Industry 4.0: The Transformation Opportunity of ASEAN’s Manufacturing Industry
Over the years, ASEAN has seen accelerated and monumental economic growth which demonstrates its vibrant economic growth. ASEAN is expected to be the fourth-largest economy by 2030 in the world with digital transformation as the key driver behind its growth. With the accelerating pace of Industry 4.0, ASEAN is not immune to the digital transformative force brought by Industry 4.0. In fact, the deployment of technologies of the Industry 4.0 will create opportunities for ASEAN countries to go beyond conventional phases of industrial development, and unleash a world of micro-transactions.
For example, payments and logistics will undergo a revolution with the rise of blockchain technology. The advanced blockchain technology will allow small companies to interact with each other on a trusted basis despite the fact they have never met each other. A McKinsey study revealed that Industry 4.0 technology adoption would help ASEAN to capture up to US$600 billion of the US$3.7 trillion in global benefits expected from Industry 4.0 by 2025.
The Singapore Economic Development Board launched the Smart Industry Readiness Index in November 2017, with the objective to help manufacturers start on their transformation journey. Three foundational components are identified as, Process, Technology and Organisation. These components are then broken down into 8 sub-components of Operations, Supply Chain and Product Lifecycle under Process; Automation, Connectivity and Intelligence under Technology; Talent Readiness and Structure & Management under Organisation. These are subsequently incorporated into an assessment matrix which companies can use to evaluate and measure, taking no more than two days to complete.
Therefore, we can safely say that Industry 4.0 will be the primary catalyst behind the rapid growth of ASEAN’s manufacturing industry.
Singapore is Poised to Lead the Way
ASEAN countries are catching up with the pace of Industry 4.0 where member countries such as Thailand and Malaysia are rapidly developing policies and plans to integrate technologies into their manufacturing sector. As ASEAN adopts the Industry 4.0 technologies, intra-ASEAN collaboration and partnerships are crucial to ensure easier resource sharing and market expansion. Manufacturing sector is one of the key pillars of Singapore’s economy. Its manufacturing industry is the top player in many fields such as aerospace, semiconductors, chemicals and biomedical sciences. As the world’s most competitive economy, Singapore’s manufacturing industry has been gaining momentum to embrace Industry 4.0 to strengthen its competitiveness on the global stage.
Advanced technologies of Industry 4.0 have created opportunities for high-level integration of information, communication, and systems via the digitalisation and automation of manufacturing processes. As Singapore rolls out strategic initiatives in smart manufacturing, the city-state strives to not only supporting the transformation but also in contributing thought leadership and sharing best practices with the rest of the region. Furthermore, Singapore’s business environment is vibrant and conducive to the development of innovative manufacturing solutions where the government has earmarked time and money to empower Singapore’s smart manufacturing solutions.
Industry 4.0 heralds the new age of manufacturing and supply networks with greater reliability and lower costs. It offers remarkable opportunities for manufacturers to become more competitive. Productivity is expected to soar with the adoption of advanced technologies. Industry 4.0 will help Southeast Asia’s manufacturing industry to advance and reassert its reputation as the global manufacturing hub.