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Nokia's Pekka Lundmark on why connected industry matters

Nokia's Pekka Lundmark on why connected industry matters

It came as no surprise when Oxford Dictionaries named ‘WFH’ as one of its words of the year.

For many of us, working from home became the norm in 2020. And the commute from the house to the office was replaced by a shuffle from bed to desk. 

But for all that, what percentage of the locked-down workforce could do their jobs from where they live?

Despite decades of the internet, constant connectivity and incredible smartphone penetration, the answer is just ten percent; and overwhelmingly those with steadier, more white-collar jobs. The other 90 percent didn’t have that luxury.

This digital divide is visible elsewhere too.

Seven in ten factories have no “smart” elements, meaning workers in those factories find it harder to social distance.

And e-commerce accounts for only about 16 percent of retail sales. Meaning many vulnerable people must still visit crowded shops and towns, even if they feel unsafe.

Why is that?

An uneven revolution

Let's rewind a few decades.

The explosion in computing in the 1990s saw about 70 percent of private IT investment flow to digital industries – banks, marketing and so on – often associated with higher salaries and white-collar jobs.

That was fine in principle, as long as those sectors also provided around 70 percent of private employment. But the real figure was more like 30 percent.

The big employers were the so-called physical industries, including farming, manufacturing and healthcare. Despite their outsize role in job creation, they had to make do with relatively scant ICT investment. And as a result, productivity, profits and pay went up in those white-collar sectors. Elsewhere, they stagnated.

But there is good news.

Because while overall ICT spend is projected to grow at around 6.5 percent annually over the next decade, it will be weighted towards those critical physical industries. The historic 70/30 ratio will flip to more like 35/65 in favor of those hospitals, factories and farms.

Why now?

The obvious question is: why are we so sure that this is the turning point?

The answer is: because recent advances in connectivity have unlocked capabilities that are particularly relevant to physical industry

For example, some of those advances include network latency and reliability down to the sixth decimal point; sensors everywhere, collecting real-time data; software and analytics to crunch that data; and machine learning to ensure a continually improving process.

Nokia is using this technology today, with more than 1,000 enterprise customers. 

For example, working with one partner, we built an industrial LTE network and paired it with an automated assembly line with "digital twin" simulations. It connected all their robots, intelligent spaces, artificial intelligence (AI) and virtual operations without cables.

The result was a greater understanding of when reconfiguration would be required and untethered machines that could be reconfigured more quickly. And therefore, massive operational improvements and cost reductions.

Another excellent use case is with a household-name logistics company. 

The longer it took them to deliver a package, the higher their costs. So we worked with them to build a fully automated private wireless network with wholly scalable analytics. Across three of their airport hubs, the customer has put sensors on every pallet and vehicle. Crews and inbound trucks are sent straight to available loading bays based on which trucks need unloading and cargo type, the number of packages on each trailer, their destination, and the remaining hours left on the driver's shift.

This new process led to a potential ten percent increase in throughput. And when you consider that individual airports handle up to five million tons of cargo per year, the gains can be significant.

Shifting to agriculture, we worked with Omar, a peach farmer in Algeria, using Nokia's Worldwide IoT Network Grid team to put soil probes beneath his irrigation lines.

They collect information on soil temperature, humidity and evaporation. These readings are analyzed by machine learning, compared to historical data, and the irrigation pipes then release just enough water to optimize soil nutrition. As a result, water consumption fell by 40 percent, while revenues rose by five percent after its optimized yields.

I could go on. But the bottom line is that no sector will escape upheaval. 

And here's the kicker: all the technologies, all the services, all the software I mentioned earlier are available from Nokia today. 

Getting involved now will help people and processes get used to digitalization. But it will also lay the ground for 5G services, virtualization, networks-as-a-service and other super-cool tech at a later date.

That means that starting now, the enterprise will no longer be a place of digital haves and have-nots.

Starting now, we can move away from a world where some professions get connected while others look on.

I am proud that Nokia is facilitating that journey.


Pekka Lundmark

About Pekka Lundmark

Pekka was appointed Nokia’s President and CEO in August 2020. He previously worked for us between 1990 and 2000, before embarking on a 20-year journey through the technology, energy, manufacturing, machinery, retail and finance sectors. This broad experience gives him insight into new technologies and techniques that will be at the heart of the Fourth Industrial Revolution.

Connect with Pekka on LinkedIn and Twitter.

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