Artificial intelligence

Lukas Dehling,

The potential in the manufacturing industry

A study commissioned by the Federal Ministry for Economic Affairs and Energy demonstrates the high value creation potential of AI in the manufacturing industry. The authors of the study, Dr. Inessa Seifert and Dr. Leo Wangler, provide information on the approach and specific results.

"The study shows potential for all company sizes," says Dr. Inessa Seifert

© Image: Computer&AUTOMATION, Source: iit/Company research PAiCE

"The study shows potential for all company sizes," says Dr. Inessa Seifert.

© iit/accompanying research PAiCE

Dr. Seifert, how great is the potential for AI in the manufacturing industry?
Dr. Inessa Seifert
: In the manufacturing industry alone, artificial intelligence can generate 32 billion euros in additional gross value added over the next five years - that corresponds to a third of the total growth forecast for this sector. This is the conclusion of our study 'Potentials of Artificial Intelligence in the Manufacturing Industry in Germany', which was published as part of the accompanying research for the PAiCE technology program.

Many studies have already examined and confirmed the potential. What distinguishes the PAiCE study from others and what was the focus of the study?
Dr. Inessa Seifert:
A whole series of studies on the topic of artificial intelligence in business have indeed been published recently. However, previous studies have primarily focused on the effects at industry level and concentrated on the potential in various fields of application. None of the studies specifically focused on the potential of AI in the manufacturing industry. This is where the PAiCE study comes in and focuses on the use of AI in manufacturing companies.

How did you approach your study - what methods did you use, who did you interview?
Dr. Inessa Seifert
: Essentially, the aim was to differentiate between the various levels: AI technologies are used in various fields of application, which in turn can be assigned to different stages of the value chain. Using systematic mapping, we were able to capture the use of AI at the various levels. To do this, it was necessary to adopt different perspectives and to record the know-how on the potential of AI use among different experts. Manufacturing companies, technology providers and scientists were involved in the study and asked about their assessments on the basis of the online survey.

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"The use of AI technologies will increase significantly over the next five years," says Dr. Leo Wangler.

© iit/accompanying research PAiCE

Dr. Wangler, to what extent is the manufacturing industry already using artificial intelligence today and are there any differences between medium-sized and large companies?
Dr. Leo Wangler:
In our survey, we came to the conclusion that an average of 25% of large companies, but only 15% of small and medium-sized companies, state that they are already using AI technologies in the respective stages of the value chain. However, the majority of companies in the manufacturing sector expect the use of AI technologies to grow rapidly in all stages of the value chain over the next five years. The most important AI applications for SMEs are knowledge management and quality control. Large companies are focusing somewhat more on logistics and purchasing/procurement.

What requirements do users and providers state for the successful introduction of AI technology? Where do they see the biggest hurdles?
Dr. Leo Wangler
: A key prerequisite is, on the one hand, the skills of employees to deal with AI and, on the other, the openness of established companies to work with external service providers. Companies see the shortage of skilled workers as a significant hurdle when it comes to building up internal expertise. Interestingly, companies in the manufacturing sector consider themselves to be open to cooperation with external service providers - however, this openness has not yet been perceived by ICT companies that develop AI products for the manufacturing sector.
Robust algorithms and data quality are crucial prerequisites for the use of AI in the manufacturing industry. Compared to providers, users emphasize security aspects and interoperability more strongly.

How do German companies assess their competitiveness and what opportunities and risks are there in an international comparison?
Dr. Leo Wangler:
The experts see the USA as the leader in research into AI technologies in almost all areas, with Germany leading the field in natural language processing and cognitive modeling alone. When it comes to the application of AI technologies, the gap to international competitors is narrowing, although here too the USA is in a leading position. This makes the USA the main competitor in terms of the range of AI products and services. However, competition is expected to intensify in the future, mainly from providers from China.

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