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Large Manufacturing Companies In Asia Pacific Could Lose US$10.7 Million Due To A Cyberattack

Large Manufacturing Companies In Asia Pacific Could Lose US$10.7 million Due To A Cyberattack

A Frost & Sullivan study commissioned by Microsoft found that a cyberattack can cost a large manufacturing organisation in Asia Pacific an average of US$10.7 million in economic loss with customer churn being the largest economic consequence of a cyber breach, resulting in US$8.1 million of indirect cost. For mid-sized manufacturing organisation, the average economic loss was US$38,000. Furthermore, cybersecurity incidents have also led to job losses across different functions in more than three out of five (63 percent) manufacturing organisations.

While the impact of data vulnerabilities and breaches can be costly and damaging to the manufacturing organisations, its supply chain and consumers, the study uncovered that half (51 percent) of the manufacturing organisations in Asia Pacific had either experienced a security incident or were not sure if they had had a security incident as they had not performed proper forensics or data breach assessment.

The study further revealed that instead of accelerating digital transformation to bolster their cybersecurity strategy to defend against future cyberattacks, almost three in five (59 percent) manufacturing organisations across Asia Pacific had delayed the progress of digital transformation projects due to the fear of cyberattacks. Delaying digital transformation not only limits the capabilities of manufacturing organisations to defend against increasingly sophisticated cyberthreats but also prevents them from leveraging advanced technologies, such as artificial intelligence (AI), cloud, and the Internet of Things (IoT), to dramatically increase productivity, empower their workforce and deliver new service lines.

These findings are part of “Understanding the Cybersecurity Threat Landscape in Asia Pacific: Securing the Modern Enterprise in a Digital World” study launched in May 2018. The findings aim to provide business and IT decision makers in the manufacturing sector with insights on the economic cost of cyberattacks and to help to identify any gaps in their cybersecurity strategies.

The initial study surveyed a total of 1,300 business and IT decision makers ranging from mid-sized organisations (250 to 499 employees) to large-sized organisations (>than 500 employees), of which 18 percent belong to the manufacturing industry.

In calculating the cost of cyberattacks, Frost & Sullivan created an economic loss model based on the insights shared by the respondents. This model factors in two kinds of losses which could result from a cybersecurity breach:

  • Direct: Financial losses associated with a cybersecurity incident including loss of productivity, fines, remediation cost, etc; and
  • Indirect: The opportunity cost to the organisation such as customer churn due to reputational damage.

“The frequency and severity of cyberattacks targeting manufacturing organisations have increased significantly in recent years, underscoring the need to protect the ever-growing volume of data generated by and made available to manufacturing organisations,” said Kenny Yeo, Industry Principal, Cyber Security, Frost & Sullivan. “By integrating security into every digital process and physical devices, manufacturing organisations can not only mitigate the loss of intellectual property (IP) and customer data but also minimise downtime as well as remediation cost resulting from cyberattacks.”

 

Key Cyberthreats And Gaps In Manufacturing Organisations’ Cybersecurity Approaches

For manufacturing organisations that have encountered a security incident, data exfiltration, ransomware and remote code execution are the biggest concern as these threats have the highest impact and often result in the slowest recovery time:

  • Remote code execution is a unique threat that manufacturing organisations face, and it poses a grave threat to these companies as cybercriminals can remotely access and control their operations. This allows malicious actors to disrupt production and sabotage the business.
  • As manufacturing organisations need to adhere to tight schedules and strict deadlines, a ransomware attack – where cybercriminals encrypt files to restrict users’ access until a ransom is paid – can lead to production downtime and loss of customer confidence. Manufacturing organisations not only lose time and resources in dealing with the aftermath of the attack, but the entire supply chain will also be disrupted too.

Aside from external threats, the study also uncovered several key cybersecurity gaps in manufacturing organisations:

  • Complex security environment impeding recovery time: Contrary to the common notion that more security solutions will lead to greater efficiency, a large portfolio of cybersecurity solutions may not be a good approach to bolster cybersecurity. The complexity of managing a large portfolio of cybersecurity solutions may lead to longer recovery time from cyberattacks.

The study showed that nearly three in five (57 percent) manufacturing organisations with 26 to 50 cybersecurity solutions took more than a day to recover from cyberattacks. Conversely, only 26 percent of organisations with less than 10 solutions took more than a day to recover. In fact, 35 percent of them managed to recover from a security incident within an hour.

  • Traditional tactical viewpoint towards cybersecurity: Despite the growing sophistication and impact of cyberattacks, the study revealed that majority of the respondents (41 percent) hold a tactical view of cybersecurity – “only” to safeguard the organisation against cyberattacks. While only one in five (19 percent) viewed cybersecurity as a business differentiator and an enabler for digital transformation.
  • Security as an afterthought: If cybersecurity is not seen as an enabler for digital transformation, it will undermine manufacturing organisations’ ability to build a “secure-by-design” digital project, leading to increased vulnerabilities and risks.

The study revealed that only 26 percent of manufacturing organisations who had encountered cyberthreats considered a cybersecurity strategy prior to initiating a digital transformation project. The remaining respondents either thought about cybersecurity only after the commencement of their digital transformation projects or did not think about cybersecurity at all.

“Technology advances and innovations in intelligent manufacturing are delivering game-changing breakthroughs for leading businesses in every sector,” said Scott Hunter, Regional Business Lead, Manufacturing, Microsoft Asia. “As manufacturing organisations focus on increasing data-driven products and services to differentiate themselves in the global economy, building and maintaining trust within their ecosystem of partners and customers becomes an even bigger priority.”

“Cyber attackers are constantly looking for opportunities, so the more businesses know about their techniques and tradecraft, the better prepared they will be to build defenses and respond quickly. Building organisational resilience and reducing risk by adopting a security approach that includes prevention, detection and response can make a huge difference in the overall cybersecurity health of a manufacturing organisation,” he added.

 

Bolstering Cybersecurity Using Artifical Intelligence

AI plays a critical role in manufacturing organisations as they increasingly rely on machine learning automation to increase their efficiency and output by scale while reducing cost and downtime through predictive maintenance. AI is also a powerful tool that can enable manufacturing organisations to defend themselves against increasingly sophisticated cyberattacks. The study revealed that 67 percent of manufacturing organisations in Asia Pacific have either adopted or are considering an AI-based approach to improve their security posture.

Cybersecurity solutions that are augmented with AI and machine learning capabilities can autonomously learn what is normal behavior for connected devices on the organisation’s network, and swiftly identify cyberthreats at scale through the detection of behavioral anomalies. Cybersecurity teams can also put in place rules that block or quarantine devices that are not behaving as expected before they can potentially damage the environment. These AI-powered cybersecurity engines enable manufacturing organisations to address one of their largest and most complex security challenges as they integrate thousands or even millions of IoT devices into their information technology (IT) and operational technology (OT) environments.

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Outlook For Cloud Computing Market

Outlook For Cloud Computing Market

Based on findings by Allied Market Research, the global cloud services market was valued at USD 209.9 billion in 2014 but by 2020, it is expected to hit a value of USD 555 million with a CAGR of 17.6 percent for a forecast period of 2014-2020.

Briefly, cloud computing refers to the use of remote servers which are hosted on the internet to manage data rather than on a local server or a personal computer and it is used to refer to a common storage space through which all devices in a network can access data simultaneously. This means that cloud computing provides manufacturers with a cost effective means to access data at any time and from any location and it has been observed that companies can save more than 35 percent of annual operating costs when cloud computing is deployed.

Thus, the major driving force for the cloud computing market is cost effectiveness although factors such as functional capabilities and the increased adoption of cloud computing among small and medium enterprises have also contributed to market growth. However, the adoption of public and hybrid models of the cloud are lower due to the threat of data breaches and data leakages and this brings into effect the importance of cybersecurity in ensuring continued market growth.

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Interview With Mr. Pierre Teszner, President & Regional Director, Southeast Asia At Rockwell Automation

Interview With Mr. Pierre Teszner, President & Regional Director, Southeast Asia at Rockwell Automation

Asia Pacific Metalworking Equipment News is pleased to interview Mr. Pierre Teszner, President & Regional Director, Southeast Asia at Rockwell Automation regarding Rockwell’s achievements for 2018, the company’s aims for 2019, and the trends that will shape the industry in the following year.

1) Can you sum up your company’s focus and achievements in 2018?

Rockwell Automation is the world’s largest company solely devoted to industrial automation. The Connected Enterprise, which is how we implement smart manufacturing capabilities for our customers, is at the heart of everything we do. In 2018, our focus at Rockwell Automation has been to bring The Connected Enterprise to life for our customers.

With every action we took in 2018, we grew the strength of our distributors, system integrators and machine builder partners to bring the best automation and information solutions to our customers. Our partnership with PTC and the launch of our new branding towards the end of our fiscal year 2018, position Rockwell Automation tremendously well to bringing the Connected Enterprise to life for all customers and adapting it to local markets regardless of customer size, industry or geography.

2) What are your expectations on the regional economy in 2019?

The outlook for the regional economy of Southeast Asia for 2019 is positive. Factoring the risks inherent in the global trade and tariff arena, we do see a high likelihood for continued growth in the region supported by government investments (e.g. EEC Corridor in Thailand).

We also expect the FDI/ODI gaining strength into industries such as CPG (including companies involved with food production, packaged goods and beverages) and Oil & Gas.  Customers are particularly investing in Southeast Asia as a regional manufacturing hub as they perceive has fewer risks and less tariff exposure.

3) What business trends in Asia capture your interest for growth next year?

Next year, we’re focused on helping our customers take the first steps to digital transformation, or continue their journey, as companies are looking at digitisation to unlock increased productivity.

Rockwell Automation has a single-minded commitment to bringing the Connected Enterprise to life for all customers Together with our partners PTC and Claroty, we’re well positioned to bridge companies’ digitisation gap through scalable solutions that suit their unique business needs – either on a CAPEX or an OPEX (infrastructure or software as-a-service), or any combination needed.

4) What do you think is the key industry trend to watch out for 2019?

The key 2019 industry trends for Rockwell Automation are digital transformation and cybersecurity protection for our customers.

The key driver for digital transformation is the need to keep pace with the competition. Digital transformation enables organisations to optimise their existing processes and increase productivity and efficiencies within the business.

When it comes to cybersecurity, the best defence for companies is a good offence with a robust prevention and response plan to protect industrial control systems from ever-increasing cyberattacks.

5) What potential and opportunity do you see in the industry next year?

“To drive growth in the next 3-5 years, Rockwell Automation is focused on continuing to develop deep industry and country expertise and building our supplier and distributer networks. Additionally, with the region’s need for digitisation and cybersecurity we also see opportunities to help our customers to understand the world of digital transformation and the benefits that it offers.

“Through partnerships with the best universities, local governments, and Industry 4.0 agencies, Rockwell Automation is committed to elevating the industry and its needs by up-skilling students and re-skill working professionals so that the digitisation journey brings benefits to everyone.”

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ST Engineering’s Cybersecurity Solutions Gains Global Recognition

ST Engineering’s Cybersecurity Solutions Gains Global Recognition

ST Engineering’s DigiSAFE DiskCrypt M10 has received the CES 2019 Innovation Awards Honoree (Cybersecurity and Personal Privacy category) for its outstanding product design and engineering. The DigiSAFE DiskCrypt M10 is the world’s first ultra-slim encrypted data storage with two-factor authentication and hardware-based full disk encryption. Developed by the Cybersecurity business at the company’s electronics sector, the product enables highly secured data transfer within organisations, government agencies and critical infrastructures.

“It is an honour to be recognised globally as a leading developer of innovative technologies. Our ability to be deeply attuned with the global threat landscape and respond with innovative solutions that help global clients has enabled us to stay ahead in the fast-evolving cybersecurity industry. Our deep engineering expertise and indigenous capabilities give us the edge to enhance customer satisfaction, gain market share and win in a highly competitive marketplace,” said Mr Lau Thiam Beng, President of Cyber Security Systems Group, Electronics, ST Engineering.

DigiSAFE DiskCrypt M10 will be exhibited at the Innovation Awards Showcase at the upcoming CES 2019 in Las Vegas.

Expanding global reach into Sri Lanka and Vietnam

ST Engineering’s DigiSAFE range of products and solutions has been gaining traction in new markets. Its DigiSAFE Data Diode solution will be deployed for Electricity of Vietnam, the country’s largest power company in a pilot programme, and was selected over several global competing solutions. The DigiSAFE Data Diode solution protects the Supervisory Control and Data Acquisition, also known as control systems of industrial sectors and critical infrastructure such as transportation, energy and water treatment. The one-way data transmission solution enables the secure transfer of data from the industrial control systems to corporate information technology (IT) networks.

DigiSAFE is part of a suite of cyber security solutions developed by ST Engineering. Another area which the Group has an edge in, is the development of Security Operation Centres (SOC) having successfully designed, built and operated up to 13 SOC in Singapore and the region. In addition, it helped establish the design of Sri Lanka’s National SOC for the government of Sri Lanka, which was completed in December 2017.

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Is Vietnam Asia’s New Tiger?

Is Vietnam Asia’s New Tiger?

Vietnam’s growth has been astronomical. In 2019, the country is set to welcome a new National Innovation Centre, IoT Innovation Hub and produce its own domestic automobiles as VinFast gears up its production plant in Haiphong. This builds upon the country’s strong PMI outlook, which can also be attributed to the rise of Vietnamese steel conglomerates such as Hoa Sen Group and Hoa Phat Group. Regarding the country’s rise, Andrew Harker, Associate Director at IHS Markit has commented that, “The recent success of Vietnamese manufacturing firms in being able to generate strong new order growth continued in December 2018. This meant that 2018 as a whole was the best calendar year for the sector since the PMI survey began in 2011 and leaves the industry well placed to have a positive 2019 despite headwinds elsewhere in the global economy.” Article by Hazel Koh.

According to Li Baodong Secretary General of the Baoao Forum for Asia, Vietnam is recognised by the world’s most prestigious organisations as the new economic tiger of Asia. This is due to the fact that the country’s economy is rapidly emerging as one of the fastest growing globally with increasing international investments. For example, just based on the number of Chinese investments that the country has attracted to date, Nguyen Duc Chung, Chairman of the Hanoi People’s Committee has observed that a total of 425 ​​projects in Hanoi with total registered capital of USD 517 million has been recorded.

While Deputy Minister of Foreign Affairs, Le Hoai Trung, has attributed Vietnam’s success to its huge workforce that amounts to a population of at least 60 million working age adults and the country’s status as a dynamic, fast growing and stable economy. In fact, Vietnam’s Nikkei Purchasing Managers’ Index (PMI) in November 2018 reached 56.5 points which is the highest level that the country has attained in seven years, resulting in the country leading Southeast Asia in terms of its PMI ratings.

Striving Towards Self Sufficiency In Steel Production

Driven by rising steel demands and economic growth, Vietnam is looking to reduce its dependency on Chinese steel and has undertaken active steps towards this goal.This is evidenced as two of the country’s largest steelmakers look set to embark on multibillion-dollar capacity investments within the country.

In fact, Hoa Sen Group intends to spend VND 10 billion on production facilities in southern Vietnam’s Ninh Thuan province in order to capitalise on the area’s deep water ports to import raw materials and export its manufactured steel products. Although the company has yet to reveal the details of its new manufacturing facilities in Ninh Thuan, construction is scheduled to occur in 2019, with operations beginning in 2019. Hoa Sen’s new facility would possess a blast furnace, which is a tool that Vietnam still lacks, and would boost an additional capacity that would more than quadruple total outputs to 16 million tons a year in 2031.

Meanwhile, Hoa Phat Group, intends to build a VND 2.7 billion steelworks in the Dung Quat Economic Zone of Quang Ngai Province and aims to begin operations in 2020. This facility is projected to increase the company’s annual capacity to 4 million tons which would lift the group total by 130 percent. At the same time, the company will be developing a $170 million steel plate mill in Hung Yen Province, which is close to the Dung Quat facility.

Strategies To Overcome Uncertainties Induced By The Trade War

In 2018, disbursement of FDI projects in Vietnam reached a record high of USD 19.1 billion, showing the high confidence of foreign investors in Vietnam’s business and investment environments. This is an increase of 9.1 percent year-on-year amid global concerns over the tension caused by the US China Trade War. Additionally, the rapid growth of both privately and state run enterprises such as Vingroup or Viettel is an indication of Vietnam’s economy prosperity and the fact that the country’s business environment is capable of nourishing large corporations of global scale.

However, as tensions over the Trade War continue to escalate in 2019, uncertainly over the status of the global manufacturing sector has continued to plague the industry and much attention has been focused on Vietnam due to the country’s status as an emerging manufacturing hub. Currently, Vietnam is projected to capture some of China’s global market share in labour-intensive manufacturing, although, in the long-term it is uncertain if Vietnam will continue to benefit from the displacement of manufacturing from China. Thus, as the trade war drags on, experts have advised Vietnam to develop a new development strategy to evade potential risks. And Mai Vu Minh, a Germany-based investor and Chairman of SAPA Thale GmbH, has further commented that Vietnam must not merely react to changing winds but take action to innovate its way up the supply chain. He also added that this means that, “Entrepreneurs need to change to adapt new technologies, management style[s] and [strive towards] the Fourth Industrial Revolution”

Strong IPO Standings

In 2018, proceeds from Southeast Asia’s IPOs plunged 34 percent. This is the first decline in two years. However, despite the overall weakening of the region’s growth, Vietnam has emerged as the region’s fastest-growing economy and witnessed increases in its IPO presences that were significant enough to allow the country to overtake Singapore and Thailand.

In total, the Ho Chi Minh Stock Exchange topped the region’s exchanges in total IPO proceeds for 2018 with a value of USD2.6 billion. This is 3.7 times more than the figure for 2017. This can be attributed to the growth of local enterprises such as the Vietnam Technological and Commercial Joint Stock Bank, which raised USD 923 million in April 2018 alone.

The emergence of Vietnam as Asia’s hot IPO destination “is a synchronized result of government support, market reform, inflow of foreign capital and high pace of economic growth,” said Margaret Yang, a Singapore-based analyst at CMC Markets.

Future Outlook

Vietnamese Prime Minister Nguyễn Xuân Phúc has pledged support for the implementation of Industry 4.0 in Vietnam and this vision looks set to continue to be incorporated into the country’s national development strategies. During the opening ceremony for the Industry 4.0 Summit and Expo in 2018, Prime Minister Nguyễn Xuân Phúc had also said that, “Vietnam has actively researched and transferred new technologies such as the Internet of Things (IoT), big data and robotics in order to improve [the country’s] competitiveness and innovation”.

Thus, as we look towards Vietnam’s future, it is expected that developments in infrastructure systems, especially ICT and digital connection infrastructures, cybersecurity, IoT and foreign collaborations will continue to dominate the country’s manufacturing sector.

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Kaspersky Lab, Japan Appoints New General Manager

Kaspersky Lab, Japan Appoints New General Manager

Global cybersecurity company, Kaspersky Lab has appointed Tsuyoshi Fujioka as the new General Manager of Kaspersky Lab Japan and this will be effective from January 1, 2019.

With over three decades of experience in the IT industry, Fujioka will spearhead the continued strategic growth of Kaspersky Lab in Japan. He will be responsible for growing the company’s market share in both the B2B and B2C segments.

Fujioka is expected to extend the market footprint of Kaspersky Lab’s newest technologies, including the company’s solution for critical infrastructure. He will also take charge of strengthening relationships with key channel partners in the country.

Commenting on his appointment, Tsuyoshi Fujioka said: I am excited to take Kaspersky Lab Japan to the next level in terms of market growth, dynamic presence, and channel partnerships. Having worked in the IT sector of Japan for more than 30 years, I can attest that securing businesses, individuals, and the critical industry in the country is highly necessary. With Kaspersky Lab’s comprehensive security portfolio tailored to the cybersecurity needs of our customers, corporate partners, and even the critical verticals we have in Japan, I am sure that we can drive towards a brighter future here in the Land of the Rising Sun.”

Prior to his appointment at Kaspersky Lab, Fujioka held long-term senior leadership roles in IT companies including SonicWall Japan Ltd., and Check Point Software Technologies Japan, where he was able to deliver increased year-on-year business growth and seal valuable business alliances.

Cementing its growing presence in the region, Kaspersky Lab Asia Pacific (APAC) today also marks a wider reach with the inclusion of Japan in its territories. Japan joins the APAC segment headed by Stephan Neumeier, Managing Director of Kaspersky Lab Asia Pacific.

“Kaspersky Lab is going through an exciting phase in the Asia Pacific. We are growing exponentially, both in commercial and enterprise industries and I am delighted to welcome Japan and its new General Manager Tsuyoshi Fujioka to our dynamic Asia Pacific team. With him at the helm of this technologically-developed territory, I am confident that his experience and understanding of cybersecurity will give rise to breakthrough strategies and initiatives for this market,” said Neumeier.

“I have been working with this region since July and I have seen many bright spots for growth in the country. With it being at the forefront of the Industrial Revolution 4.0 due to its abundant intellectual and industrial assets, Japan is equipped to launch technological changes and we, as a cybersecurity company, want to ensure that security will not be left behind,” Neumeier added.

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Manufacturing Indonesia Launches With Industry 4.0 Focus

Manufacturing Indonesia Launches With Industry 4.0 Focus

Manufacturing Indonesia has launched today and aims at providing industry players with a better understanding of technologies behind industry 4.0 manufacturing. Occurring from December 5 to 8, 2018 at JI Expo Kemayoran, the event incorporats Machine Tool Indonesia, Tools & Hardware Indonesia, and Industrial Automation & Logistic Indonesia 2018.

Over 1,600 exhibiting companies from Canada, Germany, Indonesia, Japan, South Korea, Singapore, Taiwan, United Kingdom, USA, P.R. China, Sweden, will participate at the show which had previously attracted 34,000 trade attendees and industry leaders.

This year, an Industry 4.0 Showcase will be introduced and it will feature 9 major industry pillars including additive manufacturing, augmented reality, big data & analytics, cybersecurity, and autonomous robots.

“The essence of Manufacturing Indonesia is all about technology. The highlight is the Industry 4.0 showcase with the entire ecosystem of Industry 4.0 on display to uncover the potential of Indonesia’s smart manufacturing in the future. We strongly believe that growth is driven by technology and with it will enable manufacturers gain competitive edge through increased productivity. On this 32nd edition, we connect thousands of manufacturers together with technology and solution providers from over 28 countries and regions to support the “Making Indonesia 4.0” roadmap for a more efficient economy besides higher quality output in the industry sector,” said Maysia Stephanie, Project Director of Pamerindo Indonesia.

Indonesian Ministry of Industry has also initiated an industry 4.0 roadmap, Making Indonesia 4.0, earlier this year, which integrates industrial production and manufacturing with the new digital-based models in Indonesia. The goal of this initiative is drive the Indonesian economy into the top 10 rankings globally by 2030, which builds Indonesia’s current listing by the United Nations Industrial Development Organisation (UNIDO) as one of the world’s top 10 manufacturing industries.

A new feature this year is the co-location of Subcon Indonesia alongside the Manufacturing Indonesia 2018 Series of Exhibitions. Indonesia’s first subcontracting exhibition is held to provide a platform on opportunities for local subcontractors to present their capabilities in supporting market and industry needs. This is an effective way to bridge the gap between the machine makers and the end manufacturers which already exist and are actively present at the event across its various featured sectors.

Karnadi Kuistono, Chairman of Asosiasi Produsen Peralatan Listrik Indonesia (APPI) has also said that, “Indonesian manufacturing and electrical companies have followed International and Indonesian Standards (SNI) where production has been adapted to comply with required order or ready stock specifications. Although some materials and components for downstream industrial products are still imported, industrial and infrastructure projects can utilize on national design and engineering. This clearly will have a positive impact for national economic growth.”

Manufacturing Indonesia 2018 is a strategic converging point for all attendees with industry players and notable exhibitors including DMG Mori, First Machinery Trade Co, Jaya Metal, Kanematsu KGK, Mitsubishi Electric Indonesia, Somagede and Yamaha Motor Parts Manufacturing Indonesia.

Please visit www.manufacturingindonesia.com for more information.

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Stronger Public Private Partnership Required To Drive Industry 4.0 In Malaysia

Stronger Public Private Partnership Required to Drive Industry 4.0 in Malaysia

KUALA LUMPUR, MALAYSIA: IDC believes that the 2019 Malaysia National Budget recently announced by Lim Guan Eng, the Finance Minister of Malaysia, was an important incremental step in achieving Malaysia’s vision to become a fully connected digital economy. The recent budget focused on the Industry 4.0 blueprint, titled “Industry4WRD”, which aims to make Malaysia the prime destination for high-tech industries in the region. The government plays a central role in the successful implementation of a robust Industry 4.0 strategy by creating clear policies and priorities to support the private sector. Initiatives like Industry4WRD focus the energy and creativity of the private sector around a common mission to create an era in which AI, robotics, 3D printing, and IoT will take centre stage and lead to digital transformation in Malaysia. IDC believes that direct support for Public-Private Partnerships (PPP) is necessary to focus Malaysia’s resources and boost the economic growth of the country.

The Malaysian government is continuing to adopt the necessary policy changes and budget priorities to strengthen the economic foundation for digital transformation and technology investments. For example, on November 7th, Malaysian Technology Development Corporation (MTDC) Sdn Bhd invited small and medium enterprises (SMEs) to embrace the fourth industrial revolution with the launch of the Centre of 9 Pillars (Co9P) initiative. This centre creates a physical location for ecosystem partners to interact for the development and incubation of solutions based on nine technology pillars including; Big Data Analytics, Autonomous Robots, Simulation & Augmented Reality, Horizontal & Vertical Integration, Internet of Things (IoT), Cybersecurity, Cloud, Additive Manufacturing and Supply Chain. IDC forecasts the size of the Big Data/Analytics investment in Malaysia will be $US670 million in 2019 led by the Banking industry while spend on IoT will be US$2.2 billion with the largest investment going into Manufacturing (2018 Big Data Spending Guide, 2018 IoT Spending Guide).

For almost a decade, IDC has been chronicling the emergence and evolution of the 3rd Platform of technology; the drive into Cloud, Mobility, Social and Big Data/Analytics technologies. The adoption of these technologies has accelerated as enterprises commit to the 3rd Platform and undergo Digital Transformation (DX) on a massive scale. Malaysia’s digital economy is in the early stages of creating an infrastructure with key core technologies (cloud, big data/analytics, artificial intelligence [AI], mobility, social business, robotics, internet of things [IoT], and 3D printing) for better public services and an economic boost. Rapid advances in cloud computing, connected devices, mobile, social media and data analytics are contributing to the growth of SMEs in Malaysia. SMEs constitute 98.5% of the total businesses and will spend US$2.7 billion on new technologies in 2019, according to IDC’s 2018 Small and Medium Business Spending Guide.

“The growth of digital economies is becoming an ever more impactful part of the global economy. The transition to a digital economy is a key driver of growth and development because it can provide a boost to the country’s productivity across all sectors and it creates an attractive environment for new investments from outside Malaysia. As the fourth industrial revolution becomes a key driver of the digital economy, entrepreneurs and SMEs need to assess fundamental aspects of their business, including what products and services they sell, how they deliver them to the market, the new skillsets required and how they need to organize to support their operations. Now is the time to take advantage of the new policies of the government and partner to accelerate new digital businesses,” said Randy Roberts, Research Director IoT and Telco, IDC Asia Pacific.

IDC strongly supports the new government’s plan to launch the National Fibre Connectivity Plan in 2019. This plan aims to develop broadband infrastructure to achieve a target of 30 Mbps speed per customer in rural and remote areas of the country within 5 years. This plan follows the implementation of the Mandatory Standard Access Pricing (MSAP) announcement from MCMC earlier this year that has successfully lowered broadband prices in order to connect more citizens to the digital economy.

“The high cost of a broadband connection in Malaysia has been one of the reasons small enterprises have delayed moving their business online. Government policies that improve the affordability, access and speed of broadband connectivity will increase the adoption of digital services and show the readiness of the economy to support digital initiatives” said Randy Roberts, Research Director IoT and Telco, IDC Asia Pacific.

IDC has documented examples of successful Public-Private Partnerships in the region, including Indonesia and Singapore, where the combination of public policy and entrepreneurship is driving the digital economy including smart city and mobile commerce services. In order to ensure the success of the digital initiatives in Malaysia, the government needs to consistently communicate the country’s digital priorities. The private sector should then follow with investment and development of resources in those areas, including development of key skillsets in the workforce to retain local talent.

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Rockwell Automation Receives IEC 62443 Security Certification

Rockwell Automation Receives IEC 62443 Security Certification

Companies that want to protect critical information, productivity and safety in connected operations require products that are developed with security in mind. Thus, Rockwell Automation has developed a security development lifecycle (SDL) approach, which is now certified to meet the IEC 62443-4-1 security standard.

The certification confirms that Rockwell Automation product-development processes adhere to the security requirements in the IEC 62443-4-1 standard and the company is now using the certified SDL at all global development locations to support the development of all hardware and software products.

“Our certified SDL processes will help enhance security and support companies that are using a defense-in-depth approach,” said Shoshana Wodzisz, Cybersecurity Manager, Rockwell Automation. “And because our SDL is used at every Rockwell Automation development location, our customers can be confident that every product we put out is developed to an internationally recognized security standard.”

TÜV Rheinland performed the independent certification of the SDL, which is structured to help develop more secure products for a Connected Enterprise. Processes within the SDL include ongoing security competency on standards, technologies and tools, collaboration with partners to develop more robust, secure products, and comprehensive testing to verify that products meet established security requirements and conformance to relevant globally recognised standards.

More information about how Rockwell Automation embeds security into the product-development process is available here.

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Industry 4.0: Are Businesses Stepping Up To Be Future Ready?

Industry 4.0: Are Businesses Stepping Up To Be Future Ready?

Vincent Chong, President and Chief Executive Officer of ST Engineering shares his views on the adoption of Industry 4.0 in Asia.

The inaugural Industrial Transformation Asia-Pacific (ITAP), a Hannover Messe event, concluded in Singapore recently. As business leaders, experts, government representatives and other stakeholders gathered to discuss Industry 4.0, what emerged clear to all was that technology adoption across Asia remained uneven.

Is this a case of change not happening? Far from so. Industry 4.0 is very much an evolution rather than a revolution. Even as we speak, industries are transforming. Today, it is not a question of whether businesses are future-ready; it is whether businesses realise the implications of not participating in the fourth industrial revolution when it will move on regardless of their actions.

Industry Evolution

Driven by the rising operational costs and a human resources crunch, the local industry in Singapore understands that it is imperative to adopt Industry 4.0.

Even for ST Engineering as a technology and engineering group, digitalisation of the workflow at the Aerospace business or the “Aerobook” occurred more than 10 years ago.

This began with the adoption of Augmented Reality/Virtual Reality (AR/VR) and robotics, with other advanced technologies progressing only when the business case became clearer. Other possibilities were also adopted to redefine the company’s value proposition such as customer participation and mobile interfaces in the digitised process, improved interaction via AR between engineers and mechanics to reduce the time taken for repairs; reducing turnaround time and minimising inventory stock-keeping of aircraft parts through additive manufacturing. These have all led to productivity improvements of up to 15 percent to date. Looking forward, ST Engineering will also be certifying the use of unmanned aerial vehicles for aircraft inspection, which, when implemented will help to improve efficiency and minimise workplace accidents.

Furthermore, with technological advances in the company’s aerospace business, the company is able to drive goals to improve productivity and capture efficiencies which are essential in order to operate in higher-cost locations like Singapore, Germany and the US. This augments the company’s competitive differentiators in quality and value.

Challenges Of Transformation

Government support is not lacking for Industry 4.0. In March this year, the Economic Development Board (EDB) announced that it would be funding 300 companies to undergo assessments using the Singapore Smart Industry Readiness Index, so as to accelerate the industry transformation of small and medium-sized enterprises (SMEs), large local enterprises (LLEs) and multinational corporations (MNCs) across various industries. This follows the launch of as many as 23 industry transformation maps, public-private partnerships like Tech Labs (ARTC and SimTech), Tech Access and Tech Depot to help SMEs test and experiment with advanced manufacturing technologies, translate research to applications and access technologies easily. There have also been numerous workforce transition programmes.

Even as the government invests time and resources to move the industry, business leaders remain pragmatic. The push to transform will happen only where there are strong drivers. Many will start on the digitalisation journey, but will invest only when they can see immediate value in doing so.

Indonesia’s Minister for Industry Airlangga Hartarto, has observed that millions of Indonesians in the workforce will require training to be digitally literate under the country’s Industry 4.0 rollout plans. Additionally, Dr. Gunther Kegel, CEO of Pepperl+Fuchs, Germany, has said that his company had spent hundreds of training hours to ready the workforce. He also added that even with buy-ins for change, it requires transforming processes from computer-assisted ones to computer-dominated ones, and changing the way people have been working for the past 20 years.

What tends to happen however, as Singapore’s Minister for Trade and Industry Chan Chun Sing pointed out at the panel discussion, is that many companies “often get stuck” at the application stage of technologies, and “they never really go to Stage 3, which is the re-engineering part”. He was referring to the four stages of the technology industry known as DART: Diffusion, Application, Re-engineering and real Transformation. His view is that the mere application of technologies will not lead to real transformation, as it was only “mechanising, robotising and digitising current processes”.

Transforming the organisation thus requires a mindset shift from leaders and staff alike. It is Worker 4.0 who would be critical in the success of Industry 4.0, as Senior Minister of State for Trade and Industry Koh Poh Koon, said at ITAP.

Firstly, from constantly thinking pragmatically on just which technologies are needed on hand, managers and employees need to think more strategically and with a future-oriented view to consider the opportunities that Industry 4.0 can bring, and how best the business can harness these. They need to build the business and economic case, and not pursue technology for technology’s sake.

With the production of more proven use cases, the adoption rate of technologies will grow. It will grow even more quickly if business cases are clearly in sight and it will require senior leaders to take a top-down approach to drive implementation and overcome barriers and resistance for transformation.

Readying The Workforce

Minister Chan additionally observed that Singapore will need to compress the learning cycle; the conventional model of using the school system to churn out workers is a bit too slow for tomorrow’s needs. He added that the frontiers of learning will need to be in companies where there is constant experimentation, even as we rely on conventional learning for building fundamentals.

Similarly, organisations will welcome the development of more industry 4.0-related talents through the institutes of higher learning (IHLs) in the future. In addition to degree courses, on-demand micro-learning modules in areas such as autonomous systems, robotics, data analytics and cyber security should also be offered. This is also an area where corporates, government agencies and IHLs can work together to co-develop.

ST Engineering’s approach to training and retraining of the workforce for Industry 4.0 is multi-pronged, with the company’s top 100 managers attending data analytics and cyber security executive workshops in order to ensure that a mindset shift occurs from the top. Additionally, engineers are also put through courses that are targeted at further enhancing domain expertise.

For instance, 70 of the company’s engineers have already been trained at ST Engineering’s Cybersecurity Academy, which is a professional cyber security training school. And 350 of the company’s engineers attended a technical course in robotics and digitalisation, made possible by ST Engineering’s strategic partnership with Singapore Polytechnic, to create a bespoke Digital Transformation & Robotic course. Moving forward, the another 1,000 employees will be trained in a customised data analytics programme over the next one and a half years at the National University of Singapore.

Strategic Technology Centres have also be established to develop deep capabilities in areas such as data analytics and cyber security, to provide group-wide support in further differentiating products and solutions. Lastly, extensive collaborations with external technology partners and IHLs through Corporate Labs, Corporate Venture and Open Innovation Labs have also been carried out.

Are Businesses Ready?

Industry 4.0 is a major shift for many organisations. Are business leaders prepared to redefine and re-engineer their business models and processes by drawing from technological advances for real transformation?

If having platforms and infrastructure in place at both the country and organisation levels are not good enough an impetus for change, perhaps the reality of being left behind by competitors is.

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