Digital value generation – the growth potential for European industry, Part 2
The boundaries between the physical, financial and digital value chains of industry are increasingly becoming blurred. Regardless of the many technological issues that are still waiting to be resolved, many experts agree that blockchain technology will bring about lasting change in the value chains of a whole host of sectors of the economy. In what ways will growth potential present itself to industry and what kind of role will digital assets play?
Networking between companies has moved ahead in leaps and bounds in recent years, not just in terms of administrative systems but also in key areas of production. The creative energy that fuelled this new level of interconnectedness – especially in telecommunication and digital technology – came from emerging technology. With new types of sensors on the scene, standardised protocols and the 5G communication network, the stage has been set for completely new kinds of connectivity to enter the limelight. These are forms of technology that are entirely reliable and – crucially – now also affordable.
When companies form networks, they also generate huge volumes of data. If a way can be found to filter this data properly, analyse it and make it available to others, business will ascend to a new level of digital value creation, a world brimming with economic potential.
An entry point to effective monetisation
To find effective ways to make good money out of data, systems have to be re-engineered. This entails much more than digitalising production or injecting IT into logistical systems. It also catapults you way beyond classic ‘condition monitoring’ solutions.
Currently, entire industries – such as IoT platforms, cloud services and banking – are scrambling to gain a footing in this digital world of the future. It’s a bit like the gold rush of the 19th century. The data supremacy race is not just about prospectors making money by finding gold – there is also the modern equivalent of shovel sellers, entrepreneurs who profit indirectly by setting up infrastructure.
What’s interesting is the way US tech companies have managed to squeeze their way into the industrial landscape. Their highly advanced technologies are often used to create the basic architecture of digital value creation, such that they now also occupy a dominant position in the German market, also thanks to a slew of collaboration agreements.
So how will industrial enterprises become a central part of the new data gold rush?
Digital assets – a growth opportunity for industry
Let’s come back to the example of non-fungible tokens (NFTs) looked at in Part 1 of this blog series. With NFT technology, information marked with a date and time stamp can be assigned to its original source without any doubt of authenticity. But it also offers more, because that information can then be sold to third parties at a profit. This process is equally applicable to information regarding materials, production processes, construction and many other areas of data.
Also, data usage rights can be automated through smart contracts and even equipped with time restrictions by defining expiration dates. Selling arrangements can also be tied to specific usage scenarios and made anonymous. Furthermore, NFTs can be programmed to stipulate licence fees. This ensures that the owner receives a certain percentage of revenues and benefits from every sale.
Rethinking business in novel and digital ways
So are there any treasure chests of data out there already? What data could we start collecting in the future? Who should we enter into collaboration agreements with? These are the sorts of questions every company should start looking into. Given the emergence of new digital business models, we all need to change our mindsets and start seeing anything that was created using digitech as a tradable commodity. To do this, it helps to come at your business from a data perspective. Our IT industry in Europe is ideally poised with respect to the kind of software you need to manage stricter data protection requirements, so it comes to the world of digital value creation in the guise of a reliable business partner.
Henry Ford already knew that “you can’t build a reputation on what you are going to do”. So things will become a lot more exciting if we shape the future and rethink business ourselves – because the future is digital.