Industry 4.0 or “Industrial Internet of Things” (IIoT) is revolutionizing the producing middle class and corporations. It strengthens competitiveness, accelerates product development, and enables individual products. IIoT, also known as Industry 4.0, is more than just the technical digitalization of industry. The planning of new digital processes and their introduction are unthinkable without skilled employees. Qualification and competence management of all players, as well as personnel certification and an external view, are important success factors for the development of the smart factory of the future.

Industry 4.0 or Industrial Internet of Things (IIoT) is a collective term for digitization in industrial production. It involves the networking of machines, tools, and people in seamless digital end-to-end process chains. From the customer to production and suppliers, a completely digital performance chain is realized, through which all data is available for all process steps.

Manufacturing companies, in particular, are looking for a way to realize competitive advantages with technologies based on Big Data, AI (Artificial Intelligence), and Industry 4.0. The factory of the future is intelligent, flexible, automated, efficient, and sustainable. Large volumes of data should not only be manageable but also converted into Smart Data and used by Smart Data Services – from the store floor to after-sales service at the management level.

Currently, 17.7 billion IIoT connections are said to exist worldwide, Juniper Research reported in early November 2020. The British market researchers forecast an increase to 36.8 billion networked industrial things by 2025, which means they expect growth of over 100 percent in just five years. In their study “Industrial IoT: Future Market Outlook, Technology Analysis and Key Player 2020-2025“, the analysts identify smart manufacturing as the most important growth driver. In particular, the widespread introduction of 5G wireless technology, narrowband IoT and low-power wide area networks (LPWA) are playing a key role for new service offerings in the manufacturing industry. In the smart factory of the future, real-time data will enable the autonomous production of individual parts at the cost of mass production. For this to succeed, companies need qualified employees. The bottleneck for the introduction of Industry 4.0 lies less in technology. Rather, it is the people with the right skills to ensure that intelligent value creation is actually introduced successfully.

What’s the added value?

For a smart factory to be successful, it is not enough to simply connect machines, production planning, or Manufacturing Execution Systems (PPS / MES) with an IIoT solution. The work starts much earlier when a company also wants to create real added value with its Industry 4.0 project. The starting point should always be an assessment of how ready a company is for Industry 4.0. Just because a company already uses tablets does not mean that its IIoT maturity level is already particularly high. Very often media breaks, data silos, and data streams that end up in one system, again and again, prevent the creation of value from data and the use of all data where it is urgently needed.

While many companies initially focus only on their production, production planners often forget the external interfaces to suppliers and customers as well as the internal networking with ERP, merchandise management, purchasing, accounting, product development, after-sales, and quality assurance.

At the beginning of an Industry 4.0 project, a systemic view is therefore required to analyze the processes. Building on this, the processes must be adapted based on an IIoT strategy, which includes a detailed description of objectives and functions. The aim is to integrate the entire company, its suppliers, and customers into a fully digitalized end-to-end process.

The goal of this planning phase must be to network all systems and all stakeholders, all data silos, all potential data sources, right through to quality assurance and after-sales processes in a seamless digital Industry 4.0 process chain in the future. In doing so, companies often underestimate the challenges of their many incompatible interfaces. It is true that data is created everywhere. But it must also be understood by all networked systems. After all, data only unfolds its added value if it can also be utilized as needed. This means that every digital device, right down to a torque wrench, must be integrated in a way that it feeds its actual data into the system and can be controlled by it. Only through this consistent end-to-end process chain can production steps be consistently and continuously optimized and transparently monitored even years later in case of a complaint or maintenance. With these complex requirements for a new Industry 4.0 infrastructure, individual disciplines such as the IT department and production planning are often overtaxed by themselves. In each case, there is a lack of know-how and an overview of the whole as well as the company’s boundaries.

An external view is advisable for the Industry 4.0 realization for two other reasons: before hardware and software are purchased, the requirements must be precisely defined and it must also be verified that the planned adaptations to the company’s own processes in IIoT standard solutions such as MindSphere are possible at all and will bring the expected improvements. In addition, employees must also go through learning curves parallel to the process changeover.

Developing Industry 4.0 competencies of employees

After all, for Industry 4.0 innovations to be implemented successfully, employees must be able to keep up with the pace. The basis for this is a management system and an organization in which the dynamism and speed of a holistic and flexible end-to-end process responsibility are lived out. In contrast to industrial mass production, where the same operations, i.e. constant repetition, were always necessary for the manufacture of large numbers of identical products, the employees in an Industry 4.0 production facility need a different attitude and different skills. Agility, interdisciplinarity, and creativity cannot be arranged. Rather, it is a change process that affects the entire company and in which everyone must be empowered to play an active role in shaping it. In an Industry 4.0 production environment, machines, devices, tools, sensors, and people work together and must communicate with each other. Employees must operate the hardware and software, evaluate, interpret, and document data and interact agilely with the IIoT infrastructure. And they have to learn to do this. Parallel to the introduction of Industry 4.0, a qualification initiative must therefore be launched to build up the role-specific skills of employees.

Ideally, the change process of introducing Industry 4.0 should be accompanied by a dedicated training system that prepares all employees for the new world in a timely manner using virtual classrooms and hybrid forms of learning. In security-relevant areas, in addition to training and further education, personnel certifications are also required to be able to provide proof of the employees’ qualifications. The goal must be that with the start of IIoT live operations, all employees have an understanding of the processes and the supporting hardware and software that is adapted to their roles and tasks. Only when these conditions have been met can a company exploit the full potential of its new Industry 4.0 production facility through the interaction of people, technology, and processes.

TÜV Rheinland is one of the few players in the world that can offer integrated Industry 4.0 consulting from a single source. Experts for smart factory work closely with the specialists for competence development and competence measurement in IIoT. TÜV Rheinland is currently offering live online training courses on what digitization and Industry 4.0 mean for their own company and how their own business model can be made even more successful through digital manufacturing services. Experts present use cases to explain selected KPIs and show best practice examples from various industries. More information about an integrated Industry 4.0 strategy can be found here and also in German and Chinese.

Competence Management TÜV Rheinland Academy

When it comes to the future of work, the Institute for the Future (IFTF) in Palo Alto, California is convinced: “There will be a new partnership between people and machines that increases productivity. Human intelligence cannot be replaced. On the contrary, the work of the future will require new skills from employees.

The potential for future collaboration between humans and artificial intelligence (AI), robots, mobile end devices for augmented reality, and blockchain can already be seen in the existing basic technologies. For the IFTF, this collaboration at the workplace already begins with recruiting. They predict that the partnership of personnel with AI will allow more equitable selection processes to select candidates according to their skills and not according to gender, age or other biographical characteristics. The algorithms would also replace all too human prejudices in the composition of teams with a clear analysis of the machine, which puts together optimal teams from a variety of skills and personal characteristics. This leads to an increase in work productivity, a better working environment, and more intensive employee retention. As many as 67 percent of the managers surveyed by the IFTF can imagine using AI in the future to achieve more equal opportunities.

Future of Work: Enhanced skills through machines

If AI prevents hidden discrimination in personnel work, it will expand and supplement human skills in other contexts of work. For example, 70 percent of IFTF executives would like their employees to work with machines and robots to overcome their human limitations. At BMW’s mini-production facility in Oxford, for example, collaborative robots are already working together with people. Such CoBots are equipped with sensors so as not to injure their flesh and blood colleagues. However, colleague AI could also replace employees if they are not enabled to collaborate with AI. Especially for the use of AI for the analysis of large amounts of data, the employees also need the corresponding skills. In a 2019 study, Price Waterhouse Coopers asked 500 decision-makers which employee skills were relevant for AI use and to what extent. 81 percent felt that employees needed to understand the potential and limitations of AI. 80 percent each mentioned knowledge about secure and transparent AI as well as understanding and knowledge about data-driven business models. Few companies, however, have the correspondingly trained employees. For this reason, the introduction and successful use of AI will only succeed if companies simultaneously qualify their employees for the application. For the AI to be useful as a colleague in a team, it must be programmed with algorithms to suit the task and be equipped with the correctly formulated task to extract useful information from large amounts of data. This also makes it clear that human intelligence has to control what the AI then has to process.

AI deployment will not be successful without human intelligence

This need for training will also be triggered by a third technology that has already made its breakthrough in the gaming sector. Augmented and mixed reality with data glasses or mobile devices will also become established at work in the future, for example in design and planning. 3D visualization in an augmented reality allows building plans to be displayed in a room in which entire teams are simultaneously working on a complex problem. According to experts, the technology has great potential to increase team productivity in development tasks. In the IFTF study, 86 percent of executives said that they were planning to use new technologies to improve employee productivity.

Artificial intelligence will be irreplaceable in many “human” activities in the future: disease diagnosis, language translation, customer service, data analysis, production, design, and maintenance. But the algorithms will be written by humans, who in turn will have to monitor the AI. To achieve this, they need skills that hardly any university teaches today. But without human intelligence, the use of AIs will not be successful. For this, companies must first make their employees fit for AI use.

Competence Management TÜV Rheinland Academy

 

How do I move safely on the net? How do I recognize a fake profile? How do I judge online communication, how do I distinguish real news from fake news? What is a Meme? Where do I reveal too much of my private life and become a potential victim of identity theft? These are all questions of digital competence to which children and young people should have an answer. This makes them strong and resistant to the dangers of the internet and prepares them for their professional future. So far, however, digital competence is neither a teaching subject nor part of teacher training in Germany. TÜV Rheinland Academy in Germany is changing this – for example as a partner of DigiCamps. The resonance is unprecedented and has in the meantime the format of a movement, better said in the net speech: DigiCamps goes viral. The aim is to enable the specialists and managers of tomorrow to develop safely and healthily and to start here as early as possible: with schools and teachers.

2017 was the start of “DigiCamps – Life in Balance.” Since then, a republic-wide series has emerged that provides students, teachers, and parents with orientation on the World Wide Web. To provide didactically and pedagogically valuable information about the opportunities and risks of using the internet the social enterprise BG 3000 Service GmbH, the health insurance BARMER and TÜV Rheinland Academy Germany developed smart camps, teacher camps, trainee camps, and DigiCamps. Barmer is sponsoring the initiative, TÜV Rheinland Academy is one of the leading competence developers on board as part of the digital transformation. The primary motivation is that the acquisition of digital competence has to start early. Today and even more in the future, it belongs to the essential teaching contents such as reading, writing, and arithmetic. Parents and teachers must not be left alone with this task.

Optimizing the digital competence

A DigiCamp lasts three days and has a modular structure. It is aimed at students, mainly middle school students, teachers, and parents. In interactive workshops, they learn the safe and above all good use of digital media. The trainer teams consist of media educators, psychologists, nutrition and fitness experts and, above all, well-known social media influencers. Together, the participants deal with all facets of internet use and valuable digital competence. Questions about the functioning of Snapchat, Instagram, etc. are dealt with. The participants deal with the individual challenge of how to optimize their online self. They learn how to recognize addictive behavior in themselves and others and how to handle digital stress. By dealing with their usage patterns and without moral forefinger, the DigiCamps provide recommendations and orientation. Social media and mobile devices are part of life, but good use of them needs to be learned.

Hackers create “aha” effects

The DigiCamps start with impressive demonstrations that IT security specialists prepare according to age. With live hacking experiments, adults and teenagers will experience how quickly an e-mail account with weak passwords can be hacked. They are amazed when they experience the consequences of a travel ticket posted on Facebook and a thumbs up. A thumb recorded with an ordinary smartphone camera can be used to manipulate the fingerprint sensor on a mobile device. These “aha” effects about an unconsidered posting of personal information have a healing effect. Those who have participated in the DigiCamp will use their newly acquired digital competence and at least question their user behavior and ultimately change it.

Influencers clarify

Digital competences are also taught in the best sense of the word by social media giants at the DigiCamps, who have tens of thousands of subscribers on Instagram or YouTube. For example, Irina Engelke (287,000 followers) and Laura Grosch (132,000 followers) report on their Instagram channels during the DigiCamps. Sebastian Meichsner from Bullshit TV, among others, will talk about their YouTube projects with over 1.8 million followers.

Influencers of this kind, who are still in adolescence themselves, inform their peers about the mechanisms of action of these popular platforms. In the workshops, they appeal to their practical experience to use their minds in dealing with social media. Under their guidance and accompanied by pedagogues, the participants on the second and third day create their videos, create blogs, or other digital formats. They also deal with conditions of production and reception. In this way, children and young people learn playfully and concretely how to deal responsibly with these media.

Great interest in the format also from third parties

By the end of 2019, DigiCamps should have taken place in at least 100 schools. The objective of the project is that the teaching staff will then be able to offer their own teaching formats for digital competence in their schools with the extensive teaching materials of the initiative. In the meantime, word of success has spread, and the unique role played by TÜV Rheinland Academy in the interdisciplinary project has become known. Further organizations in Germany and Switzerland are interested in the realization of DigiCamps at schools and with education providers.

Competence Management TÜV Rheinland Academy

In the context of digital transformation, how can and how should managers and executives ensure with qualified leadership that teams and individual employees remain healthy, qualified and motivated – despite the stress brought on them by change and dynamic working conditions? For example, first of all be self-critical: After all, if things don’t run smoothly in the company, productivity and innovation rates fall short of expectations and the company falls steadily behind in the market, this can be caused by the coexistence of traditional and modern management models. Some executives like to cling to outdated models of staff management – and at the same time hope to somehow manage to survive the change. Dr. Sven Grote, who also talked about the TÜV Rheinland dialog “Human and health”, addresses the most important management myths.

“In management research, there is nothing that does not exist,” summarized the organizational psychologist Prof. Nerdinger back in 1994. Since then, the world of leadership models and approaches has been no less diverse. The management development alone is bringing forth numerous blossoms, from being a leader of horses and wolves to personality coaching, outdoor seminars with and without raft building and a variety of esoteric offers, just to name a few. The same applies to requirements imposed on managers. Here it is necessary to examine exactly what really makes sense, what requires further scrutiny (also in the sense of evidence-based management) and what is perhaps proven to be a myth.

Myth 1: Skills are a trendy subject.

Skills of managers and employees cannot be considered a temporary trend or fashion topic. Rather, it can be seen as the timeless core of entrepreneurial change and as a guarantor of success in industry 4.0. Leadership skills exceed knowledge and formal qualification and also focus on the practical application of knowledge. It proves itself especially in new, unknown situations. Leadership skills were already considered relevant in times of “relative stability”. This makes the importance of leadership skills even more important in “disruptive”, i.e. exponentially unstable times. The systematic definition and development of relevant skills remains an important management task.

Myth 2: Professional skills are not important.

This is a myth that has been around for many years, often from consultants or trainers. Accordingly, professional skills are not that important for managers. Much more important success factors are social skills and emotional intelligence. However, this statement is not accurate. No evidence can be found for this either in research or in practice. The following are rarely found in day-to-day business Executives who are successful in the long term without distinctive professional skills simply because they would not be accepted by employees. Limited professional skills cannot easily be compensated for by social skills such as empathy or intuition.

Myth 3: Social skills are the key to success.

Previous studies (with Prof. Kauffeld and Prof. Frieling) with real teams from companies according to the Kassel skills grid (today Act4-teams) have investigated the role of skills. The Kassel Skills Grid, KKR for short, is a method developed in 2000 at the Institute of Ergonomics at the University of Kassel for the “External assessment of problem-solving skills of workgroups”. A group of five to seven employees worked on a current and relevant problem from the operational process during 60 to 90 minutes. The process of dealing with the problem was written down and evaluated on the basis of the KKR. This study showed in particular the importance of professional, methodological and personal skills; social skills made less or hardly any distinction between effective and less effective problem-solving groups. 

Myth 4: Managers must be extroverted.

The available empirical data does not confirm this. There are numerous counter examples of highly successful and at the same time less extroverted executives and company founders. Executives achieve acceptance among employees and organizational effectiveness in very different ways, for example through perseverance, patience, loyalty to the company and its employees, openness and trust. Extroverted people may find it easier to reach leadership positions, but this does not necessarily make them more successful than others.

Myth 5: Industry 4.0 and digital change is a new phase in the life of German companies.

Many companies have been dealing with digital transformation, end-to-end processes and the development of new business models for years. Digital transformation has long been the focus of attention for future-oriented companies, even though it is currently experiencing new impulses and gaining momentum.

Myth 6: If you want to understand what digital transformation means, you have to go to Silicon Valley.

Because this is where the thought leaders, the trendsetters, the visionaries of the new work can be found. But essential aspects of corporate culture are “invisible”. Also many things cannot be transferred on a one-to-one basis. Although many of Silicon Valley’s management strategies provide new insights, they also involve well-known and familiar aspects. Certain concepts, such as agile leadership, risk degenerating into buzzwords.

Myth 7: Digitization is above all a question of technology.

There is a risk that digitization and industry 4.0 will be narrowed down to technological aspects. It is often not enough to offer an app. Solutions that are too simple then turn into “digital soap bubbles” that burst in practice. Sustainable digitization processes usually also involve aspects of cooperation, leadership, corporate culture and even values. Avoiding these issues may seem like an attractive shortcut, but it usually turns out to be a dead end. For successful digitization, companies need leadership skills. The aim is to reflect, communicate and systematically develop one’s own skills. Trying out, failing and learning are just as essential as the right communication. It is important to give employees freedom to communicate with each other, to know what they want and to let them know that their ideas are appreciated. Organizations that rely on skills can react more easily to major transitions, to change, to an unclear future such as what digital transformation brings. Try out, fail, discard, recognize your skills and gain new ones. None of this is a magic formula. But they may be tips that one should pay more attention to as a manager for the sake of successful leadership in times of disruption and digital transformation.

About Dr. Sven Grote: Owner of the consulting firm Fokus-K, with work and research focus on competence measurement, modeling, development, management. Other focal points are personnel and organizational development, leadership, training and transfer, group work, team diagnosis, development, management, company change processes, process support, large group events. Teaching activities at universities, i.a. Leuphana in Lüneburg, the DISC at the University of Kaiserslautern, Business and Information Technology School, Berlin, UNIKIMS, Kassel. https://www.fokus-k.de

Competence Management TÜV Rheinland Academy

Active competence management: door opener for a successful future

Effective competence management is an important instrument that many companies still criminally neglect. Although digital transformation places new and different demands on employees more than ever before. How can companies meet this challenge? The answer is to establish successful competence management.

Whether it is the first industrial revolution or digital change: well-trained employees and managers have always been indispensable for companies. What has changed with the fourth industrial revolution is the fact that almost every industry is currently experiencing serious upheavals in an unprecedented dynamic asking for a proper competence management. Artificial intelligence and information retrieval systems provide information within seconds, analyze facts and make forecasts faster than any human being can.

The knowledge-based society involves a change of paradigms. Competence management experts know pure technical and methodological knowledge is no longer sufficient to meet the challenges of the future. What is almost more important is what employees do with their skills, how they tackle problems in practice. Especially in complex situations, in which the known rules, old knowledge and skills are no longer sufficient to solve the problem, employees must be able to solve the unknown challenge themselves. And this is exactly what they need, the appropriate competence in several fields of action. This requires new learning spaces and new learning concepts through further training – and the introduction of systematic competence management.

Competencies are not “skills”

But: What exactly is competence management? Active and strategic competence management is an important tool to deploy employees according to their qualifications, to promote their careers and to pursue the competence requirements of the company which are necessary to achieve the goals they have set themselves.

The basis for competence management is a competence model that lists or respectively groups existing and required competences. A competency model consists of a set of key competences selected in accordance with a company’s business objectives. By way of example, these may include:

  • Professional competence: Specific knowledge, skills or abilities required to carry out professional tasks.
  • Methodological competence: the ability to tackle tasks and problems in a structured and effective manner. Learned working methods or solution strategies must be able to be applied and further developed independently.
  • Social competence: This is becoming increasingly important in the distributed world of work and self-organized work and includes all skills that are effective in relationships with other people.
  • Personality competence: This allows a person to act in a self-organized and reflexive manner. This requires the ability to assess oneself, to develop one’s own talents and to develop creatively.
  • Leadership competence: Developing organizational requirements, initiating change, guiding and enabling employees and teams belong in this area. This also includes reviewing performance and providing constructive feedback.

The last example shows that competence clusters cannot be viewed absolutely separately. Because a portion of social competence is necessary for constructive feedback.

Typical challenges, hurdles or errors

In the introduction of a proper competence management there are typical challenges, hurdles or errors like:

  • Identification of too many competences without comparison with the company goals.
  • Lack of or difficult identification of business-critical competences.
  • Confusion of specialist knowledge with competences or a one-dimensional focus on specialist competences.
  • No account is taken of competences that are not currently part of the job description or work organization, but will play an important role in the future.
  • Collecting competences without the participation of employees. They should know through their daily activities what competence they currently need for their tasks or what they are lacking.
  • No involvement of managers in the survey of the required competences.

Effective competence management: success factors

In fact, competence management reflects the corporate strategy. It is therefore essential that the company has a clear plan of what business goals it pursues, how it can achieve these goals and what competences it needs to achieve them.

Therefore, the analysis and definition of areas of competence and the definition of the concrete characteristics for tasks, activities and job profiles derived from them are indispensable. It is also important that the competences of employees are determined independently, comparably and reproducibly. Effective competence management does not only meant to develop relevant competence profiles. It is important to also install an independent competency assessment and assessment of the employees and to counter the results of the competence gap analysis. Developing programs that are suitable for closing these competence gaps is necessary. Those who do not have the necessary know-how in-house are well advised to call in external support.

Advantages of effective competence management

Conclusion: Effective competence management determines the current situation and a forward-looking inventory of the skills of all employees. By defining job roles and their associated competences, executives are able to identify strengths and skill gaps more quickly and thereby actively turn their attention on the employees’ performance drive. To this end, the company is actively counteracting the risk of a reduction in performance and reduced value added.

It makes sense to set up a competence management system as a strategic staff unit within the company. It can provide information on targeted learning opportunities for skills development with the aim of improving individual and organizational performance in order to achieve better business results. Training without added value for the company is a thing of the past, critical skills gaps are identified more quickly and actively closed. And: Experience has shown that effective competence management also increases satisfaction among employees and managers, which benefits the corporate climate, team motivation and thus productivity.