Great minds and technology drive a new era of innovation
GE has been proud to partner with The Australian in the Powering Australia series, which has brought together some of Australia’s best minds to explore critical themes around Australia’s future competitiveness.
As the series draws to a close it is worth reflecting on some of the key thoughts and ideas that have emerged, and the path we need to set to ensure Australia’s future success.
Across all our thought leaders there was universal recognition that a dramatic transformation is occurring in industry. The pace of change is accelerating and new opportunities are being created at the intersection of technology and data.
There are three driving forces behind this transformation.The first is the merger of hardware and software, and the integration of cloud-based analytics with industrial machinery. At GE, we call it the “Industrial Internet”. The rapid decline in the price of electronic sensors means it is now cost-effective to equip industrial machines with thousands of networked sensors that make them increasingly able to analyse their environment.
Machines can talk to us, and each other, in ways that will drive exponential leaps in productivity and efficiency. We can shift from reactive to preventive maintenance—fixing machines before they break, dramatically reducing unplanned downtime. We can increase the efficiency of individual machines as well as entire systems to reduce delays in hospitals and air traffic, and increase the efficiency of power distribution.
These changes have the capacity to add between $10-15 trillion to global GDP over the next two decades. For example, if we use data and analytics to improve fuel burn efficiency in the commercial aviation industry by 1 per cent it will deliver savings of more than $2 billion a year. If we use predictive analytics to reduce downtime in the oil and gas industry it will generate over $5 billion a year in productivity gains. The power of the Industrial Internet is enormous.
The second driving force is Advanced Manufacturing, which links design, product engineering, manufacturing, supply chain, distribution and services into one cohesive and intelligent system. Digitally connected factories and supply chains that are flexible and agile can bring new products to market in half the time and at a fraction of the cost.
New techniques like additive manufacturing, or 3D printing, will allow us to accelerate the cycle of design, prototyping and production.
Engineers today can ‘print’ a prototype, test it, adjust the digital design as needed, and reprint an improved version—all using the same additive manufacturing machines. This translates to increased speed and flexibility of production.
Additionally, brilliant factories that connect all aspects of the manufacturing process will allow real-time adjustments to the production process and to supply and distribution logistics. All of this adds up to more productive, efficient and lower cost manufacturing, which has the potential to help Australia rediscover its competitive advantage and reverse the declining trend of manufacturing in Australia.
The third force is the Global Brain. This is the collective intelligence of human beings across the world, integrated by digital communication networks. We now take for granted the ability to cooperate seamlessly with colleagues in different locations via email, cloud-based file sharing platforms, and video-conferencing. Now, open source platforms and crowd-sourcing are quickly emerging as effective ways to aggregate masses of people together, no matter where in the world they sit.
Individual companies are starting to gain expertise that extends well beyond their four walls, accessing larger pools of talent. The Global Brain is redefining the relationship between employers and employees, to the benefit of both. Companies gain flexibility, while people gain access to a broader audience for their entrepreneurial skills and talents. As global economic growth brings connectivity to millions more people the Global Brain will become vastly bigger, more diversified and more powerful in the coming decades.
For Australia, where distance has forever been our enemy, this can be transformational. Digital connections can collapse distance, bring us closer to the rest of the world, and expand our reach of influence.
Together the Industrial Internet, Advanced Manufacturing and the Global Brain are set to radically redefine the competitive landscape across industrial sectors, and will impact international competitiveness and trade patterns as well as the distribution of global growth.
Companies that combine the digital and the physical worlds will open entirely new dimensions in the way they operate and the value they can provide to customers and shareholders.
In Australia we need to develop a new economic model to take advantage of this change. We need to reboot efficiency and competitiveness in Australia’s traditional areas of strength, such as commodities and energy, as well as create new markets.
We need to develop a diversified advanced manufacturing sector and position the country as a regional hub for high value-added services. We are well positioned to lead this kind of industrial transformation, but investment in education and innovation will be key.
The education system must give greater emphasis to science, technology, engineering, and mathematics (STEMs). As technology is set to play a growing role in the economy, STEM occupations will grow at a much faster rate than the rest. The bar on basic scientific literacy needs to be raised, starting at a very young age. In addition, education and workplace training should evolve towards a culture of life-long learning, re-skilling and adaptability to thrive in a fast-changing economic environment.
Government must make it easier for new and innovative enterprises to emerge. There needs to be less red-tape and bureaucracy. The flexibility of the labour market must be enhanced to facilitate the rapid allocation of human talent to meet job demand. The Government must create policies that promote global competitiveness.
Initiatives like the National Broadband Network (NBN) and the establishment of Industry Growth Centres are a step in the right direction. So too is the Prime Minister’s Innovation and Competitiveness Agenda, which correctly proposes measures from the classroom to the boardroom, because no one is immune to the challenges and opportunities of the transformation now under way.
Business must continue to invest in new markets and technologies. We must invest to close the skills gap. We must work closely with governments and each other to create opportunities across new industries.
At GE, we know we have a role to play in this. Since our Jandakot technology and learning complex opened in Perth in 2012, we have provided more than 45,000 hours of critical training and skills development to our people and our customers in the oil and gas, mining and transportation sectors.
In 2012 we launched an ecomagination challenge, which sought out disruptive technologies for a low carbon future. We also have a $20 million partnership with the CSIRO where we are collaborating in research to address global challenges around healthcare, materials, energy, resources and analytics.
The Powering Australia series has reinforced the fact that technology and innovation is disrupting the world at a faster pace than anyone could have imagined. The pace of change will present new challenges for individuals, companies and for Australia’s global competitiveness, but it will also be a major source of opportunity for everyone. It is the primary force that can ensure sustainably higher growth in jobs and incomes. In an increasingly globalised economy, embracing the disruptive forces shaping industry can secure Australia’s competitiveness for the next generation.
To downlaod GE's Future of Work in Australia white paper, click here.
This was reposted from The Australian