Wednesday, 28 November 2018

Blockchain technology as enabler to industry 4.0 implementation

In the new age of big data and cloud computing, the narrative for data management is rapidly changing – demanding a higher degree of transparency, independence and security. The age-old norms in regulating data transactions are continuously being challenged, as the world moves towards innovation in economic thinking and approaches.

At the same time, we hear different forms of the word “social” attached to many aspects of our daily lives.

Not to be confused with socialism, the most common is social media – however, terms such as social enterprise, social learning and crowdfunding have begun to dominate the landscape as new innovations in the way business models are structured to deliver better products and services to the consumer.

The very essence of these new models is the increased participation of stakeholders throughout the process of governance of information, perception and deliverable standards of our daily activities, ranging from purchase decisions to financial transactions.

This means that the governance of data, as massive as the scale can be, is starting to lean towards a high degree of social participation and administration. Once such technology that has been heavily discussed today is blockchain technology.

In a nutshell, blockchain technology is a digital ledger (called blocks) which is shared through peer-to-peer networks over the cloud. Using cryptography technology, these “blocks” cannot be contaminated, and users are able to update or store records of any value along the peer-to-peer network chain.

The key feature in blockchain technology is the “decentralisation” of ownership, which differentiates blockchains from common data systems. This means that there is no central authority owning these blocks of data, but rather is maintained by a community of peers to preserve the value and integrity of the said data.

Perhaps the most sensational and often controversial product based on blockchain technology is Bitcoin.

However, while governments and financial institutions familiarise themselves with cryptocurrencies and decide a trustworthy solution to the Bitcoin mystery, the potentials offered by blockchain technology should not be ignored.

Naturally, the decentralisation of data is highly dependent on trustworthiness within the system. While we work forward towards reducing risks associated with blockchain technology, it remains highly strategic to take first mover advantage in blockchain technology, particularly in areas within the automotive industry in which the rewards and benefits of blockchain technology outweigh the associated risks.

This week, the Malaysia Automotive Institute (MAI) signed a memorandum of agreement (MoA) with Cryptovalley Malaysia, an independent organization located in Cyberjaya aiming to build Asia’s leading ecosystem for blockchain and cryptographic technologies in the country and the region.

This alignment of will begin with the development of four immediate initiatives to benefit the consumers, entrepreneurs and the environment.

The first initiative would be the creation of digital identities to ensure genuine spare parts are properly circulated within the market, and conform to proper standards - ensuring safety and protection of consumer interests.

Secondly, blockchain technology will be used to benefit taxi and ride-sharing markets in the area of security, transparency and dispute resolutions. Consumers stand to benefit through the wider driver networks, receive tokens through consumer-based recommendations.

Thirdly, the technology aims to create an aftersales ecosystem based on decentralized online ratings by end users. These ratings enhance the customer experience through better quality comparisons and rankings, through a user-driven database structure.

Fourthly, is the creation of unique carbon digital profiling for vehicles, allowing enhanced carbon footprint calculations through the application of blockchain technology to allow for accurate environmental policies, regulations and solutions.

These programmes will enable real-time monitoring, auditability and scalability for the aforementioned sectors in applications such as connected vehicles, cybersecurity, smart manufacturing and autonomous driving.

Most importantly, the above initiatives are designed to increase participation of Malaysians in the new age of Reputation Economics – spurring the development of social enterprises and a critical mass of cryptography experts within the Malaysian industry in line with the Industry 4.0 implementation.

The writer is the chief executive officer of Malaysia Automotive Institute.

Thursday, 22 November 2018

New technology governance vital for cross-sector benefits

The increasing speed of the connectivity, growing intelligence of computer hardware and increased efficiency of manufacturing processes is beneficial for the consumer and manufacturer.
It means the lives of the human race are further enriched by new technologies that provide new dimensions of products and services which were not possible before.
The advent of such technology should not be feared or rejected – however, the structured development and governance of such technologies are key to spur a transition from a labour intensive economy, to an economy that is based on a critical mass of talent that is well versed in technology.
Within the automotive industry, MAI has executed Industry 4.0 programs since 2014, through the MAI Intelligent Technology Systems (MITS) initiative.
MITS provides the local industry with the necessary infrastructure and technology foundations in ensuring timely developmental goals in line with Industry 4.0. It is housed in MAI’s headquarters as well as centres of excellence – the MAI Design Center (MAIDC), the MAI Resource Centre (MAIRC) and National Emissions Test Centre (NETC).
With more than 500 companies utilising and benefiting from the MITS initiative, we have learned that the development of smart mobility applications should start with a strong foundation in the areas of Advanced Manufacturing and Advanced IT.
The two areas above manifest through deployment of Robotics and utilisation of the Internet of Things (IoT).
They are integrated to create a manufacturing and service ecosystem that allows mass customisation, and also has the wisdom to gather data and information in order to operate autonomously.
The mastery of the disciplines above form a holistic system – which is an intelligent, data driven, accurate and cost effective solution to fulfil customer demands, and to ensure that businesses can adapt to future technology.
Furthermore, technology investments are long term investments. In order to ensure investor  confidence in maintaining long term commitment to industry development,  it must be smartly procured through sound business models and talent development.
The International Federation of Robotics forecasts a USD70b market size for the robotics sector by the year 2025. McKinsey Global Institute forecasts a global IoT value between USD3.9 to USD11.1 trillion within the same timeframe.
These trends demonstrate the importance of Industry 4.0 readiness – competitiveness of businesses will depend highly on new industrial technologies and data driven product strategies.
For example – in today’s vehicles, sensors in a car’s engine system are already logging engine operating conditions, vehicle usage and driver input through the vehicle’s Electronic Control Unit (ECU).
A simple device, connected to the cloud, would allow data from millions of vehicles on the road to be used by car manufacturers, government regulators, safety engineers, or even environmental conservation experts to create safer and more efficient engines.
Each car can now be customised at the factory, using smart autonomous robots that produce customised engines, each tuned to the needs of the specific customer. This means each product on the road is optimised for performance, fuel efficiency and safety of individual drivers, and not based on blanket specifications at a macro level.
If such intelligence can be expanded to each component of the vehicle, the potential benefits of mass customisation will be limitless.
More importantly, the application of robotics and IoT is not limited to smart mobility and manufacturing only.
They are applicable in many other industries, including aerospace, agriculture, healthcare, oil & gas, and defence.
The recent announcement of Industry4WRD is an important step in ensuring the alignment between industry, government and academia takes place – to ensure the necessary regulations, business structure, talent pool and eco-systemic mindset moves beyond Industry 4.0 compliance, and allows the nation to thrive within it.
A cross-sectoral alignment to the above is key to maximise the benefits of smart mobility, robotics, IoT and the full breadth and depth of Industry 4.0 elements. Each industry provides its own angle to the business and talent development within the transition to an advanced, technology based economy.
With co-ordinated governance and business strategy development, perhaps the massive challenges we face in order to move to the next phase, will not be as burdensome after all.
The writer is the chief executive officer of Malaysia Automotive Institute

Wednesday, 14 November 2018

‘Challenge’ of redefining liberalisation

NOT too long ago, the two of the largest economies in the world voted, either through elections or referendum, for a different kind of administration. It was a vote that was apparently based on the sentiment that capitalism had displaced many.

The average man, perhaps trapped in the middle-class in­come, felt that social upward mo­bility had reached its glass ceil­ing, and the system of "fair com­p et it ion" was marred with inequality.

At the end of the day, a sig­nificant population of two of the most advanced economies de­manded change in the way cap­italist governments did business.

This article aims to address the question - does liberalisation truly equate to economic free­dom? Does the capitalistic game require a relook and re-analyse to determine its fairness?

Principally, liberalisation is meant to create more opportu­niti es - with negotiating economies deciding the point of equilibrium in which the policies are fair to all stakeholders.

This is done through the rigours of many rounds of dis­cussion, taking into account all economic factors, advantages and disadvantages on all sides - with the negotiator relying on in­puts f om a diverse pool of cross­sectoral experts, based on quan­tifiable parameters.

However, the complication may arise when analysing non-quan­tifiable factors. These factors may be lost in translation, with respect to cultural and socio-eco­nomic peculiarities.

These complications have the tendency to de-contextualise the situational outlook leading to in­accurate representations during the negotiation phase.

Therefore, it is crucial that we quickly learn as a nation to look at such localised peculiarities in the process of gaining market ac­cess. This is because there are obvious inroads to globalised trade when barriers are removed between negotiating markets, but we must recognise all our dis­advantages as they often seem rosier than meets the eye.

At the same time, we must also learn the localised cultural nu­ances of the markets in which we want to penetrate, which may render us at a disadvantage, de­spite our competitiveness in our quality, cost or delivery.

For example, local sentiment is a cultural nuance that may often be overlooked. Many economies, despite their seemingly open markets, place a higher regard for the support of local products, and willing to pay higher if it is made locally while some economies are the complete op­posite. Others may opt for eco­friendly or localised "ethical" sources as products of choice, changing the usual science of de­mand and supply.

An unmistakable fact is that a civilisational advantage of an en­tire century or two is a massive obstacle for developing nations to keep up with. While the world moves towards a globalised, bor­derless world, trade can only be free when the "equal" playing field is fair for all.

Furthermore, exposure plays an important role in the devel­opment of talent within society. For instance, those within devel­oped nations have the advantage of working on highly advanced projects, rubbing shoulders with a large pool of experts - a tech­nical, psychological and cultural experience, which is not as ac­cessible to those in developing nations.

Therefore, the challenge of cre­ating critical mass of talent in itself is a disadvantage for de­veloping nations, in playing the field on equal grounds as their developed counterparts.

To be fair, the "challenge" of redefining liberalisation is not something unique to our country alone. With the advent of the fourth industrial revolution, the norms of doing business and cre­ating job opportunities are changing constantly.

In fact, the dynamic global shifts of industry 4.0 are creating new comparative advantages within the global economy.

While it is indeed important to look at our comparative disad­vantages, it is not meant as a jus­tification of our position, but rather a means of alleviating our shortfalls.

The National Policy on Industry 4.0 (Industry4WRD) is Malaysia's call for digital transformation of the manufacturing sector and its related services. With that, the government has created a clear path towards ensuring that Malaysian businesses have the leverage in equalising our com­parative advantages.

Most importantly, the unquan­tifiable disadvantages mentioned in this article must come about through a complete societal transformation - one that moves parallel with industry develop­ment and seeping into primary education, social engineering and cultural development.

As a nation at the edge of its last step of advanced nation sta­tus, we must not just practise - but instil in others - the moti­vation to continuously improve.

Let us eliminate wasted mo­tion, pool our experience and turn our shortfalls into advan­tages. The world may challenge liberal economics, but it should not stop us from liberalising our­selves from disadvantage.

The writer is the chief executive officer of Malaysia Automotive institute.

Thursday, 8 November 2018

Technological solutions key to implementation

The 2019 Budget has introduced a sound framework in building the foundation for the economy. From my experience, working with the country’s technological frontline, the overall transportation industry stakeholders – a key principle that stood out throughout the budget was how technology can be applied within the industry and would trickle down to all levels within society.
The budget solidifies the foundation needed for social upward mobility by firstly addressing fundamental issues such as transportation, home ownership, entrepreneurship, broadband access, etc.
With this, it then addresses the adoption of advanced technology within businesses, for example, through the RM210 million allocation from next year to 2021 to support the transition and migration to Industry 4.0.
Strengthening the technological upstream within the Malaysian economy will naturally trigger a stronger supply chain from within the SME ecosystem and this is how the trickle-down effect takes place.
Through the recent announcement of the National Policy Framework for Industry 4.0 (Industry4WRD), the country will map its strategic implementation towards Industry 4.0 compliance. The announcement is timely, as the expansion of Industry 4.0 elements at a national level will further enhance technology penetration within all sectors of the Malaysian industrial landscape.
The implementation of Industry 4.0 is perhaps new to many industry players, especially Small and Medium Enterprises (SMEs). However, the government is committed towards ensuring that Industry 4.0 compliance is an accessible opportunity for all businesses across all sectors.
Apart from the Industry 4.0 implementation mentioned in the budget, an issue that was highly debated (at least on social media and personal messaging groups) was the implementation of targeted subsidy for RON95 petrol.
While the mechanism in determining eligibility and subsidy value has yet to be announced by the government, netizens quickly pointed out the potential abuse that could take place with such a policy.
First and foremost, potential abuse or mismatching of eligibility is not an excuse to not implement something that, in principle, is beneficial. With an ever-growing population and ever diminishing resources, this column has been consistent in its support for subsidy rationalisation, help should be given to those who need it.
Next, I believe that the issue of subsidy “pretenders” can be addressed with the appropriate adoption of technology. While the policy itself is subject to debate, the implementation mechanism can be made more efficient through the utilisation of big data management, cloud computing and the numerous cyber physical technology that has become very affordable.
Let’s say, for example, that the policy takes into account the vehicle make, engine capacity, monthly fuel consumption requirements (which varies depending on work nature), and income levels. Let’s also assume the fuel price would need to be calculated in-situ, during the petrol pump transaction.
The hardware and software to calculate the eligibility as above would rely on several technologies.
Income level data are readily available through numerous government functions such as inland revenue, employee retirement schemes, etc. Monthly fuel consumption requirements can be readily extrapolated based on average route data obtained through GPS driven software.
Vehicle make and registration identification can be performed using readily available government databases, combined with live optical recognition using cameras that are usually already present in most petrol stations.
It will of course take innovation, talent and cost to implement. However, if we look to the future, the long-term big picture can come to fruition if the necessary technological foundations and frameworks are consistently enshrined in future budgets, both within government and private sector expenditures.
Overall, the central proposition of this piece is that, I believe the 2019 Budget has included the right steps in creating a “developmental budget”, not just in the sense of allocation, but principally has potential to realign the country towards a more technological and industrial future.
We all know the saying, “Give a man a fish, you feed him for a day. Teach a man to fish, you feed him for a lifetime”.
I think the saying needs to be updated – it is much easier to implement if he can learn to fish online, and fish using more efficient yet environmentally friendly techniques!

The writer is the chief executive officer of Malaysia Automotive Insititute.