Industry 4.0 is bringing new technologies, innovations and opportunities to industries around the world. So what can enterprises in the Middle East and Africa do to accelerate digitalisation? How can tools like digital twins set the stage for the next step in industrial evolution?
Kamal Ballout, Head of Nokia Enterprise, China, India, Middle East and Africa, shares his thoughts on how companies can benefit from digitalisation today and tomorrow.
You recently returned to the Middle East after spending 30 years studying and working in North America. Can you describe that transition?
It felt like coming back home. While my experience in North America was profound in shaping my personality — living in the land of innovation and technological disruption — I have deeply enjoyed reconnecting with the culture and traditions of the Middle East. It was a challenging transition, but ultimately rewarding to re-integrate into the history, culture and values I was raised in.
Professionally, there are clear differences between North America and the Middle East: which industries drive the economy, how business is conducted, the top priorities for enterprises. Also, my portfolio covers 75 countries and they’re all so diverse.
I like to think I’m bringing my own perspective and experience to the business culture here — a direct and transparent way of doing business, combined with a passion for change and positive disruption — while still understanding and respecting cultural differences. I’m excited to see this region grow and embrace digitalisation as we partner with our customers to make Industry 4.0 a reality together.
Are the key industries in this region ready to digitally transform? Do they have strategies in place?
Historically, the region has lagged North America in digital transformation, but it’s seeing an unprecedented wave of technological evolution. Industries and enterprises aren’t just planning to evolve, they’re actually implementing cutting-edge technologies.
Heavy industries such as oil and gas, mining and maritime ports are the fastest when it comes to adopting these technologies. The mining industry has been under tremendous pressure to boost productivity while keeping workers safe.
Thanks to 5G, I have seen mining operation availability increase by an average of two hours per day, which has a huge impact on productivity and revenues. Plus, miners can use autonomous fleets to reduce accidents, lower emissions and improve asset lifetime.
In oil and gas, the industry is actively pursuing the “killer use case” of remote well head connectivity. 5G is making that a reality by bringing pervasive, reliable coverage to remote and offshore rigs, enabling new levels of automation that can improve productivity by 10 percent, reduce emissions by 20 percent and, according to PwC, boost global GDP by $1.3 trillion by 2030.
And for port operators, 5G is bringing an average improvement of 25,000 more terminal berth moves per year, with a boost in TEU throughput by 10 percent. And it’s not just 5G. Technologies like digital twins are proving to be equally revolutionary.
What is a digital twin?
Industries are embracing digitalisation with urgency because of the immediate benefits it can bring. But they also need to ensure they’re minimising disruption on existing operations as they do so. That’s where the digital twin comes into play. It’s a virtual replica of a specific machine, product or process, such as a crane in a port or drilling equipment in a mine, or an enterprise’s entire operating environment.
By testing changes to configurations and procedures on the digital twin, enterprises can see what will work, without costly prototyping or real-world experimentation that can impact the operation. Digital twins are a growing market, especially in the Middle East and Africa. MarketsandMarkets expects the digital twin market to grow from $1.3bn in 2020 to $3.4bn in 2025 — a 20 percent growth rate.
From a CEO’s perspective, how will digital twins change their business?
Lower costs, improved productivity, safer workplaces, and deeper operational intelligence — almost every aspect of a CEO’s business can be improved by digital twins. One of our customers in the energy industry has seen a productivity boost of about 30 percent and expects to see a reduction in carbon emissions of up to 40 percent. In an industry that is striving to reach net-zero, that’s huge. The productivity boost is also likely to increase GDP by nearly 3 percent, which is a significant return on investment.
Digital twins can also help create a more empowered workforce. As digital twins become supported by even more data and smarter analytics, enterprises can make better decisions that lead to faster response times and improved workplace safety, especially in more dangerous industries like mining and manufacturing where accidents are not uncommon.
Looking at the big picture, technologies like digital twins are serving as the first building blocks toward the industrial metaverse: That is, where enterprises will be able to fuse their physical and digital assets to greatly augment the capabilities of their employees, creating immersive views of their operations in real-time.
We’ve talked about the benefits of transformation. But what are the costs of late adoption?
As the Covid-19 pandemic has shown, delaying digital transformation is a huge risk. Going forward, the more manual operation your business requires, the more limited your productivity will be. According to McKinsey, enterprises that don’t digitally transform could reduce their margins by as much as 50 percent.
Even when companies do transform, they have to do it the right way and at the right speed. A Harvard Business Review study found that 87.5 percent of digital transformation projects fail because of unrealistic expectations, poor execution or the wrong pace of change. In other words, transforming without a roadmap can be a risk as well.
Companies that don’t transform will not only miss out on an economic opportunity, they will
also lag behind the competition, lacking the agility needed to respond to market demands and fluctuations.
Being viewed as behind the market could also damage their brand, making them vulnerable to workforce shortages and lessening their ability to attract the new digital-native workforce. Even existing employees may be elect to pursue other opportunities where they can grow their skills and opportunity through new technologies.
How much does experience matter when addressing digital transformation?
Experience really matters. Nokia has long been a trusted technology partner not only for communication service providers but also enterprises and government agencies running mission-critical networks.
We work with more than 2,600 customers around the world, in industries that include public safety, defence, utilities, energy, mining, railways, airports, manufacturing and more. Every project is unique, so diversity of experience really makes a difference in the outcome of a transformation project.
We work with our customers to find a solution for their specific business challenges and goals. All our solutions are pre-tested against OEM (original equipment manufacturer) equipment and pre-integrated for our customers’ industrial ecosystems, ensuring a “right first time” deployment with end-to-end interoperability and minimal disruptions to their business.
Perhaps most importantly, we’re experienced in building successful transformation roadmaps. Usually, we’ll advise our partners with global insights based on industry best practices to not only maximise their digitalisation investment, but also protect their investment for the future.
The Middle East and Africa is a long-time key region for our business.
We’ve worked with multiple partners to transform their organisations today, while also enabling the use cases and innovations of tomorrow. We’re currently working with Dubai’s only public safety operator — which serves multiple mission-critical customers like the Dubai Police, Dubai Electricity and Water Authority (DEWA) and Roads and Transport Authority (RTA) — to provide best-in-class, end-to-end public safety wireless networks.
We’re the partner of choice to Bahrain’s electricity and water utility, providing a mission-critical network that automates distribution substations — the first of its kind in the region. We’re also working with several mining operators in Africa to offer ubiquitous 4G/5G coverage of remote sites. And we’ve been chosen by port operators throughout the region to help automate terminal operations using 5G, including one of the busiest ports connecting the Mediterranean and Red seas.
What’s coming next in digitalisation?
The digitalisation journey requires a secure and reliable network. While 5G is bringing new levels of productivity and efficiency to enterprises across all industries, will it have the flexibility to keep up with the requirements of the new services that will emerge with the industrial metaverse? That’s why we at Nokia are already looking ahead to future 6G technologies, which will be key to unlocking the full potential of the metaverse by making it fully customisable to the operational nature and needs of each specific industry.
What’s the first step in making digital transformation a reality?
It’s important to realise that digitalisation offers benefits for every industry and that the technology to realise those benefits is already here, from digital twins to 5G. But digital transformation has to be built on a fundamental first step of developing a strategic roadmap that focuses not just on technology but also on people and processes, along with other factors such as cybersecurity and sustainability.
At Nokia, we’re passionate about digital transformation and the benefits it brings to enterprises – and economies. Companies in every industry seek to improve efficiency, flexibility and productivity in a sustainable way, and digital transformation has a key role to play.
We believe Nokia has much to offer to power the successful digital transformation of industries, and we have very recently refreshed our company and technology strategy to reflect who we are today: A B2B technology innovation leader. We look forward to working with more enterprises throughout this region to design the roadmaps they need to make the most of the digitalisation opportunity.