Industry 4.0 developments in Denmark and opportunities in Estonia

16.09.2019

Several Industry 4.0 events will soon take place in both Estonia and Denmark, and Peder Degnbol Pedersen, Enterprise Estonia Export Adviser, Denmark, wrote about the challenges Danish industry is facing in the areas of digitalization and automation, and also refers to several business opportunities for Estonian enterprises.

TechBBQ, 18-19 September Embassy in Copenhagen and Enterprise Estonia in cooperation with Start-up Estonia search for start-ups (9-12) involved with government technology
Hi-Tech expo 1-3 October Big Industry 4.0 trade fair in Denmark, register by contacting Peder.Degnbol@eas.ee (a few places left)

Danish small and medium-sized enterprises (SMEs) need to accelerate digitalisation as SMEs make up the majority of Danish companies and are not as digital as the larger enterprises. That is why the Danish government, like Estonia, has set up a programme to help enterprises get started with digitalisation and e-commerce. Enterprises in Denmark are offered, among other things, grants for private consulting, participation in innovation courses, and opportunities to strengthen digital management skills Here, Danish enterprises are looking for the kind of competence that the Estonian digitalization business can offer them.

The Danish government aims to provide more support to enterprises investing in digital switchover and e-commerce. The digitization rate in the labour force must increase and the goal is for 2,000 enterprises to benefit from the opportunities created by the Danish government in 2018-2021. So far, demand has been high, indicating that many SMEs are keen to start the digital conversion of their enterprises, but need more help. This, however, represents a business opportunity for Estonian enterprises engaged in digitalization, machine learning and artificial intelligence. Estonian enterprises could offer competencies, services, and solutions alongside these public programmes.

One example of the implementation of new technology is the use of blockchain technology in the Danish shipping sector

International shipping is an advanced field involving many people and documents. At the same time, it is crucial that these numerous documents are properly managed, as required by both clients and authorities. One way to manage these documents is via blockchain – a technology that enables secure data sharing on a digital network. Blockchain is best known as the technology related to the digital cryptocurrency Bitcoin, but it could be used for so much more. Therefore, we are currently developing a blockchain based solution that can potentially and in a single move significantly increase the efficiency of international document management without compromising security requirements.

Automation - a tool for simplifying and expanding the production process

Danish industry has consistently automated and delegated work in recent decades and this is one of the most productive aspects of Danish economy today. The potential for automation (~60% of hours worked) indicates that technology can drive productivity growth as well as replace labour in the coming decades.

The extent to which Danish enterprises make use of new technologies such as collaborative robots, 3D printing and the Internet of Things will determine the competitiveness of Danish industrial enterprises. Competitiveness is further enhanced by faster and cheaper customer-centred production opportunities and the development may contribute to a return of production activities in Denmark. Automation technology thus helps to maintain rather than reduce employment.

However, the transition requires the retraining of industrial workers. Operators, metalworkers and others, who make up one third of the industrial labour force today, will need to be retrained in the future, with more time being spent on problem solving and the use of expertise (up to 25% of working time) than on manual tasks.
Restrictions on this transition may be linked to the level of education as many industrial workers may find it difficult to move to other parts of the labour market.

Commenting on the above, it is clear that both Denmark and Estonia are facing the same constraints in the development of Industry 4.0, which are related to labour in both the industrial and manufacturing sector. However, there is one point that represents an opportunity for Estonia. Due to the nature of the technological transition, the return to production does not have to take place in Denmark. This opportunity could be used by Estonian enterprises that are rapidly adapting their automation capabilities and are able to serve Danish enterprises facing major changes regarding the retraining of their labour force.

In addition, Denmark has technology-based opportunities in the areas of health, energy and utilities, agriculture and transport. In addition, the high demand for expertise in e-commerce and e-export by SMEs offers opportunities for e-commerce optimization enterprises in Estonia.

Certain activities also require reorganization and collaboration robots/robots and specific labour force. This is an excellent opportunity for Estonian enterprises working on collaborative robots/robots, automation and labour force training or labour force related solutions.

Denmark and Estonia are already cooperating on artificial intelligence and digital transformation https://futureoflife.org/ai-policy-nordic-baltic-region/ - the time has come for Estonian enterprises to actively seek cooperation opportunities in Denmark.

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