SMEs Investing in Industry 4.0. The New Way to Scalability through Open Innovation.
Imagine a beehive whereby bees communicate on multiple levels, interconnectivity is key and resources are managed efficiently. Similarly, the main manufacturing and digital components of Industry 4.0 perform individual tasks but are interdependent.
Industry 4.0 is a lot like a hive of bees working, each on their own task, but in accordance with each other without the direct involvement of humans (or the queen bee).
Industry 4.0 is the combination of traditional manufacturing and industrial practices in an increasingly technological world of industry. Industry 4.0 combines and connects digital and physical technologies to drive more flexible, responsive and interconnected enterprises capable of making more informed decisions.
It includes cyber-physical systems, the Internet of things, cloud computing and cognitive computing among other technologies.
The concept of “revolution” behind the Industry 4.0 phenomenon refers to the gradual shift from incremental to exponential growth and scalability.
Since the first industrial revolution in the 19th century, industrial business models used machines to create increasing and linear results. Digital business models instead use network effects and interconnectivity and are exponential.
According to KPMG the component markets of Industry 4.0 are estimated to be worth more than US$4 trillion by 2020.
This means that businesses (startups and larger companies included) are able to benefit from embracing Industry 4.0, increasing the worth of the manufacturing sector by billions and creating thousands of jobs. SMEs, today are not fully benefiting from it but they could by working with startups developing solutions to digitize factories and making them more efficient.
Innovative solutions are developed every day by tech startups and SMEs. For opportunity-cost and more lean processes, SMEs (or mid-caps) and corporates should leverage the market offer instead of developing in-house products.
If productivity and scalability are the goal, open innovation is the way to go.
HOW OPEN INNOVATION CAN IMPROVE MIDCAPS’ GROWTH
Open Innovation – the increasing embrace of external cooperation opposed to exclusively internal and traditional research – is a must for all companies, regardless of their size, industry or age. However, in Europe we see that mostly large corporates are active in open innovation, while mid-size companies forming the backbone of European industry are still out of the game. Startups can help mid-size companies accelerate their growth by helping them to find new, more efficient, business models.
Specifically, 3 areas have been mostly neglected:
- Hands-on preparation on Open Innovation and startup-collaboration
- Curated mid-caps<>startup matching that is conducive to deal making, at scale
- Sharing best practices in Open Innovation among European companies
THE SWEET DEAL
In response to this, Mind the Bridge has launched with the support of DG GROW (EASME/COSME 2017/017) a pilot for matching mid-size companies with startups. The goal is to expose mid-sized companies to Open Innovation and effectively engage with startups. The pilot focuses on larger entities (mid-caps) rather than small companies.
In order to provide mid-caps with an immersive and innovative experience, the matchmaking with mid-caps/startups is hosted during highly curated matching activities at the most prestigious European Stock Exchanges or Chamber of Commerces. The goal is to connect international scaleups, corporates and investors operating in specific verticals, initiate qualified business conversations and spot technology trends.
Are you a mid-size company? The benefits to attend the matchmaking activities are the following.