How intrapreneurship can drive the fourth industrial revolution
New technologies are changing the way we live and ‘the fourth industrial revolution’ are the words on everyone’s lips. With the development of artificial intelligence, the Internet of Things, robotics, big data, and mobile telephony, big businesses in the UK need to act quickly, smartly and efficiently to keep up with the latest innovations and technology.
The way big businesses discover and implement innovation is shifting, with the launch of venture teams, accelerator panels and internal incubators bringing a start-up mentality to corporate organisations. Big businesses are embracing this concept of ‘intrapreneurship’: an entrepreneurial approach whereby teams and individuals are driving new venture ideas from within the organisation.
Intrapreneurship or corporate entrepreneurship has been adopted by some of the world’s most successful companies, such as 3M, GE, Intel, and Xerox for several years. It is a great approach to maintain relevance and keep the company agile, customer-centric and innovative. Only recently has this concept become widespread and openly embraced.
Intrapreneurship can be defined as an entrepreneurial activity within a large, established business, usually to address a new market opportunity or develop a new way of doing things, outside the normal scope of activities. Intrapreneurship is also a change of mindset – thinking like an entrepreneur: seeing new opportunities, being completely customer-driven, making the most of limited resources, and above all moving quickly.
Within many big businesses there are talented people with brilliant new ideas. The challenge is working out how to realise these opportunities and bring these ideas to life. Large companies have become very effective at doing one thing well and often struggle to change direction or embrace something new. This is where intrapreneurship comes in.
With the development of new digital technology and business models, more and more people are becoming intrapreneurs. Employees tend to move around more often, so intrapreneurs are adept at landing in a company, making an impact immediately, delivering one or two big initiatives and then moving on to another company.
Companies are also more willing to collaborate and work in partnership than they used to, recognising that no one company can do everything itself. Organisations often look to acquire start-ups and SMEs to enhance their offering, but you can’t rely on acquisition alone for business growth. Acquisitions can be a great way to bring in new complementary capabilities and technology and can refresh the entrepreneurial spirit and culture within established companies – so a combination of intrapreneurship and acquisition can work well.
BT is a great example of a company that has diversified with the development of new ventures like BTVision and BTSport, which have transformed BT from a telephone company to digital media business.
British Gas established a Connected Homes division in 2012 to access new markets and develop totally new ways of working. It still had strong links to the parent company, but offered the speed and innovation typically seen in much smaller companies.
Speed is key when it comes to intrapreneurship. These dedicated, purposeful teams can cut through the corporate layers that can often slow big companies down. There are other benefits to businesses, such as the ability to explore and experiment in new market areas before making a big financial commitment, and the impact on the wider workforce – intrapreneurial projects bring new energy and direction to a business.
We are witnessing an increase in the launch of venture teams, or internal ideas incubators, as well as in investment in research and prototype development. It’s essential for businesses to work collaboratively with experts in this field, listen to creative new ideas from all levels of the company and encourage a culture of change and innovation to facilitate commercial growth.
Peter Sayburn is co-founder and CEO of Market Gravity
5 Minutes With PwC on AI and Big Data in Manufacturing
Please could you define what artificial intelligence is, and what Big Data is?
AI is the ability of a machine to perceive its environment and perform tasks that normally require human intelligence, and it’s a whole field of different technologies, techniques and applications.
Big data is a set of tools and capabilities for working with, for processing, extremely large sets of data.
How does AI and Big Data work together?
Big data is just one of the enablers of AI, though as we see increasing volumes of data, it’s one of the most important
How can this be applied to a manufacturing setting?
Broadly speaking, there are many benefits of AI, and the use of data, which include reducing costs, minimising human error, and increasing productivity and efficiency. The important thing to consider is any setting - for the use of any technology - is what is the problem you are trying to solve? Be it merely automating repetitive tasks or to reinventing the nature of work in factories by having humans and machines collaborate in order to make better and faster decisions.
Why should manufacturers use AI and Big Data when adopting smart manufacturing capabilities, what is the value for manufacturers?
One view is, again, the economic benefits of AI, which come in manufacturing as a result of:
1. Productivity gains from automating processes and augmenting the work of existing labour forces with various applications of AI technologies.
2. Increased consumer demand due to the increased ability to personalise and tailor manufactured products, along with higher-quality digital and AI-enhanced products and services.
Manufacturing (and construction industries) are by nature capital intensive, and in our 2018 report, “The potential impact of AI in the Middle East,” we estimated that the adoption of AI applications could increase the sectors’ contribution to GDP gains by more than 12.4% by 2030.
How can AI and Big Data help manufacturers to evolve in the Industry 4.0 revolution? What about those already looking at Industry 5.0?
It’s really about the investment you make now, in order to futureproof your business.
We typically see two broad strategies or approaches to the adoption of AI. There are things that we can do immediately, without any recourse to Big Data - which is to adopt technologies we describe as Sensing, those involving computer vision, for example. There are plenty of use cases where these can be used immediately in manufacturing, such as for automatic fault detection. However, there is a longer term play which requires investing in data - getting the right collection mechanisms in place, storage, data governance, Big Data capabilities etc - in order to develop increasingly valuable machine learning driven AI use cases. This is absolutely necessary for long term adoption success.
What is the best strategy for organisations looking to realise the value of AI and Big Data in manufacturing?
AI and Big Data are only one part of a successful smart factory. The organisations that lead on AI adoption are those who have already made the most progress in digitising core business processes. In order get ahead in using AI solutions at scale, there are a number of technology investments and organisational decisions to be made, including:
1. Digitising processes ultimately leads to improved ability to generate data, and in the manufacturing setting - with many 100s of sensors generating 1000s of measurements in real time, the result is Big Data. Data is key to building AI so reliable and accurate data acquisition, management and governance are key. The production line and factories play a critical and direct role in the data-acquisition process.
2. AI strategy, both long and short term, begins with the use cases, the business applications. Manufacturers need to ask where they want to use AI and gather these use cases together and prioritising projects based on a balance of expected impact and complexity of implementation.
Of course, in addition to technology and business processes, people are at the heart of any successful technology adoption. AI teams need to be composed not only of data scientists, also data engineers and solution architects to enable their work, data stewards to ensure accuracy, and increasingly so call “Analytics/AI translators” who are able to communicate with business leaders and technology experts. Culture is also key, and manufacturers need to enable a data and AI-driven culture, building trust in data and algorithms by educating their workforce about AI and its capabilities, how best to extract value. It’s not just the positive of course, but also the risks and limitations, as these when encountered without expectations having been set, can significantly impact willingness to invest.
What are the challenges when it comes to adopting AI and Big Data in manufacturing?
has shown that one of the major challenges to implementing AI is uncertainty around return on investment (ROI). As I said, there is significant investment required for a long term data and AI strategy to be successful, and expectations around the time to see tangible returns must be set realistically.
Many companies also struggle with the data side: collecting and supplying the data that an AI system needs to operate, and ensuring that it is accurate. Again, this speaks to the bigger investments required in digitisation.
Some of the main challenges for manufacturing companies with implementing AI at a scale from our research include:
- 40% → Technologies not mature
- 40% → Workforce lacks skills to implement and manage AI
- 36% → Uncertain of return on investment
- 33% → Data is not mature yet
- 32% → lack of transparency and trust
- 24% → Work councils and labour unions
- 22% → Regulatory hurdles in home & important markets
One element highlighted here, particularly around lack of trust, and labour unions, is that AI is typically misrepresented in the media as “replacing” workers, and taking jobs. Yes, there are efficiency gains to be made from automation, as there have been since the first industrial revolution. But we believe that Data and AI are at their most valuable when they are used to augment workers, enhancing their abilities and the products being manufactured.
Another challenge we’re starting to see emerge is cyberattacks increasingly targeting interconnected equipment and machinery in smart factories. PwC recently hosted a webcast, in cooperation with the National Association of Manufacturers in the US and Microsoft to discuss this.
What are the current trends in AI and Big Data in manufacturing?
- We see companies putting slightly more focus on adding AI solutions to core production processes such as the engineering, and assembly and quality testing
- Safety is of significant importance, with techniques adopted in protocol adherence capabilities (for example maintaining safe distance from specific machinery) being adopted in more every day scenarios for COVID-19 protocol adherence
- There is considerable interest in predictive maintenance for large machinery involved in manufacturing processes, and also supply-chain optimisation
What do you see happening in the AI and Big Data industry in manufacturing in the next 12-18 months?
Honestly, I think we’ll see a continuance of where we’ve already been going for the last 12- 18 months. AI and data are already being used in manufacturing but this use doesn’t get as much attention in the media as, say, healthcare, but the success stories are there, and they will continue as operations continue their digital journeys.