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The New Industrial Revolution: Opportunities for the World
Lecture at Science and Technology Policy Institute, Seoul, November 6, 2014
Address by Peter MarshAuthor, “The New Industrial Revolution: Consumers,
Globalization and the End of Mass Production”
www.petermarsh.eu
Twitter @petermarsh307
(Hyundai Heavy Industries robotic assembly line)
“There’s a new zeitgeist: I’m seeing a global manufacturing renaissance” :
Jeff Immelt, chief executive, General Electric
Global re-industrialisation on the agenda
But don’t expect a boom in manufacturing jobs
Plant run by Mindray medical equipment group in S China
US factory employment fell by 5m between 2000 and 2013 (17.2m to 12.2m)
EU lost 7m manufacturing jobs 2000-13 (38m to 31m)
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The New Industrial Revolution:
Opportunities for the World
•What manufacturing means
•Global trends
•Impact of digital thinking/tech convergence
•Opportunities
Manufacturing: the key factors
• Creative force behind 10bn unique products
• Accounts for 16 per cent of world economy
• Source of new ideas, fresh thinking and stimulates
services activity
• Employs about 300m people (one third in China) or 1
in 25 of the population
• Contributes to falling prices: manufacturing prone to
deflation (compared to services)
• World contains about 1.5bn large manufactured
objects –of which less than 2pc are “connected”
Manufacturing requires four components…
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MATERIALS
T
SKILLS
ENERGY
CAPITAL
…now a fifth enters the picture
DIGITAL
TECHNOLOGY
AIDS MANUFACTURING
THROUGH FACILITATING
TECHNOLOGY
CONVERGENCE AND
BOOSTING:
CONNECTIONS
CREATIVITY
CUSTOMISATION
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The New Industrial Revolution:
Opportunities for the World
•What manufacturing means
•Global trends
The last 3,500 years
• Pre-industry (1,500BC to 1500 AD) : Iron Age, glass production, metals
• Proto-industry (1500- 1780) ;Venice shipyard (c.1500)
• First Industrial Revolution (1780-1850): steam power, textile
machinery
• Second Industrial Revolution (1840-1890) : communications; railways,
telegraph
• Third Industrial Revolution (1860-1930): science based methodology;
electricity, chemistry
• Fourth Industrial Revolution (1950-2000): computers, electronics
• Fifth Industrial Revolution (2005-?): connections, creativity,
customisation, helped by ICT/technology convergence
World GDP – gross value added by category
0
10,000
20,000
30,000
40,000
50,000
60,000
1970 1980 1990 2000 2010
$b
n*
Financial services, Government spending
Transport, storage and communication
Wholesale, retail trade, restaurants andhotels
Construction
Manufacturing
Mining, Utilities
Agriculture, hunting, forestry, fishing
Source: UN*constant 2005 prices
World manufacturing shares 2012
Asia43%
Europe26%
N America22%
S America3%
Africa2%
Rest of world4%
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China sets the pace
Global manufacturing output, 2012
2556
1994
1076
687
316 280 262 254 240 233 220 210 205 186 162 130 123 121 113 111
$bn, current pricesWorld total: 11,426
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* Estimate Source: UN, IHS Global Insight
Japan manufacturing output and employment
8
10
12
14
16
18
200
300
400
500
600
700
800
900
1000
1100
1970 1980 1990 2000 2010
mill
ions
$bn*
Manufacturing output Manufacturing employment
Sources: UN; BLS*constant 2005 prices
US manufacturing output and employment
10
15
20
25
500
1000
1500
2000
1970 1980 1990 2000 2010
mill
ions
$bn*
Manufacturing output Manufacturing employment
Sources: UN; BLS*constant 2005 prices
South Korea manufacturing output and employment
0
1
2
3
4
5
6
7
0
50
100
150
200
250
300
350
1970 1980 1990 2000 2010
mill
ions
$bn*
Manufacturing output Manufacturing employment
Sources: UN; BLS*constant 2005 prices
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The New Industrial Revolution:
Opportunities for the World
•What manufacturing means
•Global trends
•Impact of digital/technology convergence
17
The New Industrial Revolution:
Opportunities for the World
1. CONNECTIONS
2. CREATIVITY
3. CUSTOMISATION
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CONNECTIONS
Information/materials pathways
(encompassing INTERNET OF THINGS)
Design at a distance
Services addition
Connected manufacturing: will influence many sectors
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PRODUCTION
BUILDING/MINING
ENERGY
FLIGHT
Y
TELECOMMS
AGRICULTURE
TRAFFIC
HEALTHCARE
New breed of networking/smart grid/dispersed design companies (Sigfox of France/Nuri Telecom
of S Korea/Libelium of US)
A potential boost to broad range of tech-based businesses spread globally
Sensor/system makers: from top left, clockwise, Crompton Greaves (India); Zytronic (UK); Sensor
Instruments(Germany); Worldsensing (Spain)
New industries based on smart sensors/new materials/electronic control: “smart buildings”
From top :Metaswood,Finnish maker of novel building materials; Coodo of German(mobile buildings);
Polysolar of the UK, manufacturer/developer of PV glass .
Holovis (UK): world leader in projection/design systems; applications in manufacturing, simulation-based training, films, gaming
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The New Industrial Revolution:
Opportunities for the World
2. CREATIVITY
Blending of technologies
Environmental enhancement
Niche thinking
Shigenobu Nagamori of Nidec (Japan): move to reduce energy consumption of electric motors
(250bn in the world)
Arvedi (Italy): a €600m gamble on “endless strip” process to improve steel’s environmental performance
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The New Industrial Revolution:
Opportunities for the World
3. CUSTOMISATION
Mass personalisation
3D printing
Robotic tools
MED-EL of Austria: leader in cochlear implants
Founders Dr. Ingeborg Hochmair and Prof. Erwin Hochmair
New materials: carbon fibre composites
A range of new products/parts is possible
(Beijing Long Yuan workshop)
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The New Industrial Revolution:
Opportunities for the World
•What manufacturing means
•Global trends
•Impact of digital/tech convergence
•Strategies
Transfer skills/ideas globally (Crompton Greaves power company, India)
Inside Crompton Greaves’ Belgium factory
Combine technologies, using lessons from different sectors (LSIS, South Korea power
system business)
Focus on new products with a purpose (Electric motors to cut energy use, Novotorque of
California)
Emily Liggett, chief executive, and Alan Crapo, chief technical
officer, at Novortorque
Even with global connectivity, local “clusters” remain important
(IMA packaging machine leader, part of key engineering centre for small companies in Bologna)