By Barbara Frei, Executive Vice-President, Industrial Automation, Schneider Electric
The events of the past year have been a wake-up call for the world. On top of
the climate crisis came an energy crisis that forced companies, governments
and households to think much harder about how to reduce their energy needs
and greenhouse gas emissions. In Europe, warning of power cuts and energy
rationing over the winter thankfully did not come true. But there will be more
winters. So we need to keep doing more, and faster, to build our resilience to
The industrial sector – and industrial transformation – has a huge part to play in this.
After all, many industries are still heavily reliant on coal and other fossil fuels. And
the sector’s energy consumption still represents almost 40% of the global total today.
So embracing resource, energy, and operational efficiency – enabled by
digitalisation and software-centric automation technologies – will not only help tackle
the energy and climate crisis head-on, but will also give industrial companies the
license to operate resiliently and competitively into the future.
Staying focused on industrial transformation and efficiency
The good news is that transformative technologies exist, in the form of the advanced
manufacturing and AI-driven industrial automation technologies of Industry 4.0.
Step inside Schneider Electric’s Le Vaudreuil plant in northeast France, for example,
and you can witness the technologies of the fourth industrial revolution in action.
From one unified control centre, it is easy to keep track of power usage, control each
process and follow the real-time performance of all the plant’s machines and assets.
Dashboards display operational data from every corner of the 14,000-square-meter
shop floor, giving operators instant updates and alerts on production-line
bottlenecks, and insights into the effectiveness of machinery and processes. An
army of driverless vehicles and collaborative robots are part of the ebb and flow of
the site’s production.
Taking industrial transformation to the next level – from single site to
Lighthouses of this kind – as the name suggests— are showcase facilities that
can guide others in the sector as they seek to overcome the challenges, and scale
the opportunities, of the fourth industrial revolution. Since the start of its smart-
factory transformation in 2018, Le Vaudreuil has reduced both energy use and
carbon emissions by 25%, and the site’s material waste by 17%, for example.
And yet, the uptake of such technologies at scale remains below where it could
be. And it is limited mostly to large corporations, with smaller and medium-sized
players still on the side lines.
What’s more, impressive as all this is, we’re just at the start of the journey.
The next chapter in the industrial transformation story is to implement digitised
manufacturing technologies not just in single sites, but across complete production
and logistics networks, and throughout entire supply chains.
Imagine the benefits of standardizing the exchange of data between IT systems,
such as Enterprise Resource Planning (ERP) software, and the operational
technology on the shop floor. Or being able to access orders and inventories from
interconnected suppliers and partners to improve planning, manage recalls and
anticipate supply risks. Or tackling not just your own company’s direct carbon
emissions but also your scope 3 emissions by working across your supply chain
Moreover, the high cost of energy, combined with the falling cost of onsite solar
generation, means process electrification and local microgrids make more sense
than ever for anyone seeking to lower their costs and emissions. And digital
technologies allow industries and manufacturing sites to adjust the energy demand
of their production process based on the energy supply mix and availability.
Industrial transformation requires a mindset shift
All of this can be challenging, of course, particularly when sites operate in silos,
using different legacy systems, standards, approaches, and processes.
It requires companies to fundamentally re-think how they approach industrial
transformation. They need to ensure it happens in a systemic, digital, data-driven,
and interoperable way that allows them to scale value and operational performance
throughout the entire enterprise.
They must get on board with the concept of operating as one integrated
organisation. This means focusing on more than just short-term productivity and
leveraging the full potential of technological change to become the industries of the
And they need to set out a clear technology roadmap establishing strong IT/OT
governance around data and cyber security.
Last but definitely not least, successful industrial transformation is about people. It
entails making big efforts to attract digitally-savvy people from diverse backgrounds
and generations, and continuously offering employees the chance to upgrade their
skills and capabilities.
As jobs in industries and manufacturing evolve, governments and corporates have a
role and a responsibility to provide quality training and incentivise education, and
where necessary, support and work with small and medium-sized firms, in particular.
But at the end of the day, the long-term potential benefits hugely outweigh the
challenges. And with neither the energy crisis nor the climate crisis going away
anytime soon, we really have no choice.
So, let’s get serious about taking transformation to the next level. That means
doubling down — not slowing down — on enterprise-wide, data-driven efficiency, and
investing in training and skills opportunities for the workforce of tomorrow. Do that,
and we’ll have the sustainable, innovative, and resilient industrial companies that the