The Fourth Industrial Revolution or Industry 4.0 was first introduced in 2011 by the German government. Since then, companies across the world have been trying to adapt this concept. Lithuania is not an exception.
Therefore, during the discussion with dr. Anna Sadowska, a researcher at the Kaunas University of Technology School of Economics and Business under the project of ERA Chair “Industry 4.0 Impact on Management Practices and Economics” (“In4Act”), the president of the engineering and technology industries association of Lithuania “LINPRA” Tomas Jaskelevičius raised the topic about the current state of Industry 4.0 across Lithuanian companies – how it is changing, and what could be done to improve the situation.
According to the representative of LINPRA, in the last five years, Industry 4.0 across Lithuanian companies is getting the speed. T. Jaskelevičius says that progress is visible directly in the efficiency and productivity of the companies, on the growth of the industry, and competitiveness in the market. However, he points out that there is a lot that companies can do to improve the situation.
“We can say that about half of the companies are advanced. But we still have a quite high percentage of businesses that have to invest in the necessary digitalization equipment. So, we are on the right track, at the right speed, but many things need to be learned. Especially when it comes to business management, business efficiency, and management efficiency”, says the president of LINPRA.
T. Jaskelevičius believes, that in order to improve the situation, businesses should identify major current and upcoming challenges of Industry 4.0. T. Jaskelevičius claims that one of the biggest challenges to the Lithuanian industry now is the investments.
“Businesses owners must understand that if you invest in Industry 4.0 this investment will pay back in several years. Of course, it is not a quick payback, but it allows the business to be sustainable and continuous. Also, behind the investment decisions, there are the owners of the companies. In Lithuania, the age of businesses owners usually is over 60 or 70 years old. And this as well gives a challenge to the investment for the long-term payback time”, says T. Jaskelevičius.
Although Industry 4.0 is about technologies, one of the main keys of this field, according to T. Jaskelevičius, is people skills. The president of LINPRA mentions that successful design and implementation of Industry 4.0 initiatives consists of good engineering and business skills.
“Usually, hard skills like how materials react, machines work come from the university. But some problems can occur when it comes to the business mindset. You can create the best product, you can make the nice setup of the factory, but in the end, your solution must be competitive and it should pay you back. Otherwise, it will be useless”, explains T. Jaskelevičius.
When talking about the required skills, usually the question arises who should be in charge of developing these skills? T. Jaskelevičius points out that nobody will give the companies skilled people, except if they train them by themselves. The universities can provide students with the basic skills but after all a business has to take care of particular skills.
“Of course, universities must keep in mind businesses needs because they are direct customers of universities. If the students can offer higher-order skills, businesses can pay them a better salary. In the end, as higher salaries businesses pay, higher taxes are paid, and as higher taxes are paid, higher financing is going to universities. And this circle is running like this”, says T. Jaskelevičius.
Finally, the president of LINPRA mentions the need for public policy in facilitating the transition to Industry 4.0 in Lithuania. He believes that only organizations that work closely together can lead to good results.
“First, the stakeholders, the training organizations, the businesses must inform the policymakers of their needs and requirements. After that, policymakers have to gather all this information, identify which data to prioritize, and at last, make decisions. If we compare these processes in Lithuania 10 years ago and now, we can see that we are moving forward”, says T. Jaskelevičius.
The discussion is a part of the “In4Act” project, implemented by the Kaunas University of Technology School of Economics and Business researchers and financed by the European Union project “Horizon 2020”.