Capitalising on the benefits of

Research & Innovation Projects for Policy

THE 4TH INDUSTRIAL REVOLUTION

Research andInnovation

CAPITALISING ON THE BENEFITS OF THE 4TH INDUSTRIAL REVOLUTION

European CommissionDirectorate-General for Research and InnovationDirectorate D — Industrial TechnologiesUnit D.1 — Strategy

Contacts Doris SCHROECKER, Yanaris ORTEGA GARCIA, Lukas BORUNSKYE-mails Doris.SCHROECKER@ec.europa.eu,Yanaris.ORTEGA-GARCIA@ec.europa.eu,

Lukas.BORUNSKY@ec.europa.eu RTD-PUBLICATIONS@ec.europa.eu

European CommissionB-1049 Brussels

Manuscript completed in February 2018.

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The report was established based on the project analysis by an independent expert, Lucia Paris Bajos.

More information on the European Union is available on the internet (http://europa.eu).

Luxembourg: Publications Office of the European Union, 2018

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Directorate-General for Research and InnovationIndustrial Technologies

European Commission

Research & Innovation Projects for Policy

2018

Capitalising on the benefits of

THE 4TH INDUSTRIAL REVOLUTION

3Capitalising on the benefits of THE 4TH INDUSTRIAL REVOLUTION

TABLE OF CONTENTS

EXECUTIVE SUMMARY 5

POLICY CHALLENGES RELATED TO THE 4TH INDUSTRIAL REVOLUTION 71. The human dimension: skills, jobs and work organisation 92. The business dimension: new businesses through manufacturing as a service 10

PORTFOLIO OF RECENT EU-FUNDED R&I PROJECTS 111. FP7 and Horizon 2020 areas with contributions to this theme 122. Portfolio of projects and topics covered 123. Portfolio of beneficiaries 13

RESULTS AND IMPACTS OF EU FUNDING 151. Added value of EU R&I investment 162. R&I achievements supporting policy challenges 163. Impacts for society and industry 21

POLICY RECOMMENDATIONS 251. Raise awareness and deepen the understanding of the potentials

and risks related to the 4th Industrial Revolution 262. Promote lifelong learning in factories and new learning methods 263. Set up a European Manufacturing Skills Council 274. Foster links and synergies between relevant policy actions such as

the European Sectoral Blueprint Initiative on Skills 275. Develop guidance and practical examples to address regulatory barriers 27

ANNEXES 29Annex 1 List of projects 30Annex 2 List of acronyms 31

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5Capitalising on the benefits of THE 4TH INDUSTRIAL REVOLUTION

The projects analysed focus on skilled employees in industry and develop new high-skilled job profiles either during project execution or plan to do it after the end of project during commercialisation. Particularly interesting are also projects developing new forms of work organ-isation and showing how technology can be adapted to the worker, as it is the capacity, constraint and skills of the worker which are the driver for designing the work-place and allocating the workload.

Based on a picture of the technologies on the way to change manufacturing, jobs, skills needs and business models, this report suggests the skills to be prioritised and the following policy recommendations:

> to raise awareness and deepen the understanding of the potentials and risks related to the 4th Industrial Revolution;

> to promote lifelong learning in factories and new learning methods;

> to set up a European Manufacturing Skills Council; > to foster links and synergies between relevant policy

acions such as European Sectoral Blueprint Initiative on Skills;

> to develop guidance and practical examples to address regulatory barriers.

Europe is moving toward a more digitised society and economy. In this context, the 4th Industrial Revolution changes the way we live and do business. It can be defined as a range of new technologies combining the physical, digital and biological worlds. It brings with it higher levels of automation and data exchange in man-ufacturing where it lifts production processes to a new level of capability.

Rapid transformations in the design, manufacture, operation and service of manufacturing systems and products have a huge potential to drastically improve the flexibility and productivity of business and organisations.

This report looks at how higher levels of autonomous processes and machinery will impact skills and jobs, and how higher flexibility in the integration of supply, pro-duction and delivery processes, could be used for new business opportunities.

30 EU funded research and innovation projects imple-mented since 2009 have been analysed. These projects have developed industrial and advanced manufacturing technologies related to the 4th Industrial Revolution. The project analysis confirms the transformative nature of the 4th Industrial Revolution. This is in line with the anal-ysis in the Commission Communication on a renewed EU Industrial Policy Strategy. It points to a new indus-trial age which is transforming traditional manufactur-ing processes and the nature of work. This is also the context for the European Skills Agenda and digital skills policy, countering that many people remain without the skills needed for the industry of the future, including basic digital skills.

EXECUTIVE SUMMARY

6 Research & Innovation Projects for Policy

POLICY CHALLENGES RELATED TO THE 4TH INDUSTRIAL REVOLUTION

8 Research & Innovation Projects for Policy

Manufacturing is considered the backbone of European economy. It provides 32 million jobs in more than 2 mil-lion enterprises, including around 13 million jobs in a growing high-tech manufacturing sector,1 and around 60 million additional jobs related to associate services.2

The share of manufacturing in the EU-28 was 16.1 % of GDP in 2016.3

Manufacturing is currently facing the 4th Industrial Rev-olution (4IR), which can be defined as a range of new technologies combining the physical, digital and biolog-ical worlds. It brings higher levels of automation, auton-omous processes and machinery, and data exchange in manufacturing where it lifts production processes to a new level of capability and demand driven customi-sation. Rapid transformations in the design, manufac-ture, operation and service of manufacturing systems and products promise a huge potential to drastically increase the flexibility in the way that supply, production and delivery processes can be integrated, offering new business and growth opportunities.

The EU’s Industrial Policy Strategy is set to strengthen industry’s ability to continuously adapt and innovate by facilitating investment in new technologies and embrac-ing changes brought on by increased digitisation and the transition to a low-carbon and more circular economy. It highlights also that companies on their side must do their part by upgrading the technology base, future-proofing business models, internalising sustainable development principles and embracing innovation. It recalls that the industrial transformation provides enormous opportuni-ties, but reaping them will require substantial investment in advanced manufacturing, people’s skills and talents, as well as intangible assets like research and innovation (R&I).4

The New Skills Agenda for Europe5 addresses skills as a pathway to employability and prosperity. 10 actions respond notably to the need for the right skills for the technological change and to master the digital compo-nents in practically every job. Following the Communi-cation in 2016, the Digital Skills and Jobs Coalition was launched under the Digital Single Market initiative,6 and in January 2018 the update of the European Qualifica-tion Framework was adopted. Also the Digitising Euro-pean Industry initiative under the Digital Single Market priority addresses skills as a priority.

This report focuses therefore on two important policy questions. One is about the human dimension of the 4IR and its impact on skills and jobs, which is also addressed in the European Skills Agenda and the digital skills policy. Secondly, the question is what forms of business innovation and new business models are under preparation, stimulated by advanced digital, machinery and cyber-physical technologies.

This report synthesises what EU funded R&I projects on industrial and digital technologies found in relation to these questions and the policy recommendations derived from the projects’ results. The aim is to contrib-ute to the European skills policies and to flash out the aspects and recommendations where policy and frame-work conditions have a direct impact on the appetite in industry for innovation and change.

More information on the evidence and concrete results underlying the recommendations can be found on the project websites. The projects are listed in Annex I in this report.

1 Eurostat. Employment by industry breakdowns. 10.1. 2018. 2 Jovane, F. et al., 2009. The ManuFuture Road. Towards competitive and sustainable high-adding-value manufacturing. Springer.3 Eurostat. GDP percentage of total, industry breakdowns. 10.1.2018.4 Communication “Investing in a smart, innovative and sustainable European Industry - a renewed EU Industrial Policy strategy” COM(2017) 479 of

13.9.2017 - http://eur-lex.europa.eu/legal-content/EN/TXT/?uri=CELEX:52017DC0479 5 Communication “A new Skills Agenda for Europe - Working together to strengthen human capital, employability and competitiveness”, COM(2016)

381 of 10.6.2016 - http://eur-lex.europa.eu/legal-content/EN/TXT/?uri=CELEX:52016DC0381. 6 European Commission. Digital Skills at the core of new Skills Agenda for Europe. 10. 6. 2016 https://ec.europa.eu/digital-single-market/en/news/

digital-skills-core-new-skills-agenda-europe

9Capitalising on the benefits of THE 4TH INDUSTRIAL REVOLUTION

Current estimations point to a significantly higher demand for highly skilled employees compared to low skills in the timeframe to 2025, while there are indica-tions that, relevant for the 4IR, in the manufacturing and Information and Communication Technologies (ICT) sec-tors, and for skilled trades workers, engineers and ICT professionals this demand is not always satisfied,7 due to shortages and a mismatch between the type of workers employers are looking for and the skills of the current workforce.

There are different ways to capture mismatches with concrete figures.8 All in all though, there is a common understanding on the need for action for a fundamental update of education and training in Europe to be fully prepared to satisfy the demands of new job profiles and to provide the right skillsets or competences. To illus-trate this with an often quoted outlook: 65 % of children now in primary school are estimated to be employed in jobs that do not exist today.9

But there are also concerns about lifelong learning and education and training of grown-ups. In 2016, only around 11 % of adults (age 25-64) participated in edu-cation and training programmes.10 Manufacturing, com-puter use and computer science accounted for less than 10 %.11 Around 27 % of Europeans adults have basic or low digital skills.12 In 2016, 37 % of the EU labour force had an insufficient level of digital skills.13 Apart from formal education and training programmes, in the order of 30 % of employers provided non-formal education and training.14

Employees with insufficient levels of training or flexibility to (re)train face a higher risk of unemployment and subse-quently, higher incidence of poverty and social exclusion.

Economic research is testing different approaches to capturing vice versa the impact of skills mismatches and shortages on industrial productivity.15

The 4IR is thus not only expected to change future job profiles, but will also affect the way work on the shop-floor can be organised and how “human centred manu-facturing” could empower workers.16

The change from a mass production model to a mass customisation model implies also challenges to the way the work and resources are organised within a factory. New ways of working using new tools, processes and approaches will be needed in factories of the future (FoF) in order to better assess the machinery, skills and workforce resources to increase flexibility, agility and competitiveness. The question is also, how the flexibility and performance offered by new technologies could be used to support workers and integrate for example safe human-robot collaboration within on demand produc-tion and delivery requirements.17

With regard to the human dimension of the 4IR, this report focusses on the following questions:

> What is the impact of the 4IR on skills needs and future job profiles?

> How is “education and training 4.0” characterised?> How can new forms of work organisation look like?

1. THE HUMAN DIMENSION: SKILLS, JOBS AND WORK ORGANISATION

7 Cedefop, 2015. Skill shortages in the EU. http://www.cedefop.europa.eu/fr/publications-and-resources/statistics-and-indicators/statistics-and-graphs/esjsurvey-insights-no-1

8 Commission Staff Working Document accompanying the Communication “A new Skills Agenda for Europe” SWD(2016) 195 final of 10.6.2016; For more details, see Kiss, A., Vandeplas, A. (2016) Measuring skills mismatch. DG EMPL Analytical Web Note 7/2015.

9 World Economic Forum. “The Future of Jobs” http://reports.weforum.org/future-of-jobs-2016/chapter-1-the-future-of-jobs-and-skills/#view/fn-110 Eurostat. Adult learning statistics, Table 1 and Table 3 http://ec.europa.eu/eurostat/statistics-explained/index.php/Adult_learning_statistics11 Eurostat. Adult learning statistics, Table 2 http://ec.europa.eu/eurostat/statistics-explained/index.php/Adult_learning_statistics12 Digital Scoreboard: Indicator group (Digital skills)>Indicator (Digital skills indicator)>Breakdown (basic and low).13 Europe’s Digital Progress Report 2017 https://ec.europa.eu/digital-single-market/en/human-capital14 This figure is from 2011, more updated survey is being analysed and will be published in forthcoming months. Eurostat. Adult learning statistics,

Table 4 http://ec.europa.eu/eurostat/statistics-explained/index.php/Adult_learning_statistics15 For example OECD 2015. The future of productivity: main background papers – Labour market mismatch and labour productivity: evidence from

PIAAC data, Müge Adalet McGowan & Dan Andrews.16 EFFRA. Factories of the Future roadmap of the Public Private Partnership - http://www.effra.eu/factories-future-roadmap 17 Factories of the Future – Multi-annual roadmap for the contractual PPP, 2013 –Research priorities: Domain 5 Human-centred manufactuiring –

http://www.effra.eu/factories-future-roadmap

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2. THE BUSINESS DIMENSION: NEW BUSINESSES THROUGH MANUFACTURING AS A SERVICE

Prospects of new business models arise when smart manufacturing technologies and connected factories and supply chains create more flexibility in production. The Organisation for Economic Cooperation and Devel-opment (OECD) expects an increase in customisable goods and services via new production processes and new business models, mainly in industrial sectors.18 The transition from the mass production model towards “mass customisation” manufacturing with competitive development, production and delivery costs implies much more shared, flexible but also more integrated value chain approaches. Uptake of new technologies which allow for co-design and co-creation could bring businesses closer to customers, directly addressing user needs and shortening product development time. New opportunities will arise from customer driven design, partnering for co-development, shared manufacturing, cloud computing, 3D printing or platforms to connect suppliers and customers. Reduced costs of launching new products and services could mean new business opportunities, and increased productivity levels.19

Manufacturing in advanced economies is increasingly interlinked with services for value creation, and the dif-ferences between manufacturing and services have become increasingly blurred.20 This servitisation of man-ufacturing alters the traditional industry business approaches and calls for new and innovative business models. The new service-focused business model is a competitive approach to seeking added value, with the potential of also being more ressource efficient.21

Distributed manufacturing, virtual factoris and embed-ding services in new product-service combinations offer new opportunities with lower market access barriers for SMEs (small and medium enterprises) and start-ups,

which usually have neither the capabilities to control the whole manufacturing lifecycle nor the market power to enforce their own interfaces and standards. Decen-tralised, clean, flexible and also smaller “factories of the future” promise new opportunities for manufacturing close to customers and in cities.

As a large part of future growth in production is expected from these developments, the growing and complex interactions between manufacturing and ser-vices deserve a more integrated view on manufacturing and services at policy level.

The speed of development of new technologies can be overwhelming for manufacturers and there are gaps among businesses across Europe.22 The fast develop-ments are especially relevant for the digital technolo-gies, where the speed of adoption is linked to competi-tive advantages. Slow adopters can face more complex competitive landscape with new competitors providing different business models. Therefore, adjustments in businesses models may become one of key precondi-tions for competitiveness in the long run.

A wider diffusion of advanced production technologies notably to SMEs is an important policy challenge in the transformation of industrial production. Many busi-nesses lag behind in adopting the latest technologies due to cost of these technologies, limited resources or other barriers to innovation such as lack or uncertainties about data security.

This report addresses the specific question on how the challenges of the 4IR can be turned into business opportunities.

18 OECD, 2017. The Next Production Revolution.19 OECD, 2015. The next production revolution, in the conference “Shaping the Strategy for Tomorrow’s Production”, Copenhagen.20 The OECD is referring to “manu-services”, which involve combining advanced manufacturing with a range of different services, OECD Science,

Technology and Innovation Outlook 2016. 21 Dimache A., Roche Th., 2013. A decision methodology to support servitisation of manufacturing. International Journal of Operations & Production

Management, Vol 33.22 While in 2016 59 % of Finnish and 46 % of Swedish manufacturing entreprises use cloud services, it is only 7 % in Latvia and Poland. Source: OECD,

2016. Uptake of cloud services in industries.

PORTFOLIO OF RECENT EU-FUNDED R&I PROJECTS

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Because of its complexity and the fact that the 4IR is affecting every sector of the economy, relevant R&I activities were included in several programme parts across FP7 and Horizon 2020 (H2020). Most of them were though funded by in the programme parts on industrial technologies (“NMP” and “NMBP”)23 and “Infor-mation and Communication Technologies” (ICT), espe-cially under the FoF calls.

In FP7, 19 projects were funded with EUR 64 million. The majority was part of the thematic areas “Nano-sciences, nanotechnologies, materials and new produc-tion technologies” (FP7 NMP). In Horizon 2020, 11 pro-jects were financed with EUR 47 million under the NMBP and ICT programmes. As it is expected, most of the projects belong to the FoF contractual-Public Private Partnership calls for proposals.

1. FP7 AND HORIZON 2020 AREAS WITH CONTRIBUTIONS TO THIS THEME

2. PORTFOLIO OF PROJECTS AND TOPICS COVERED

The main topics adressed were advanced manufacturing process (3 projects); adaptive and smart manufacturing systems (5 projects); digital, virtual and resource-efficient factories (1 projects); collaborative and mobile enterprises (2 projects); human-centred manufacturing (11 projects); customer-focused manufacturing (5 projects); and cross- cutting issues (3 projects).

The main type of actions within the projects portfolio is collaborative projects, with 22 out of 30 projects and 93 % of total budget.

23 “Nanosciences, nanotechnologies, materials and new production technologies” (NMP) in FP7 and “Nanotechnologies, advanced materials, Biotechnology and Advanced Manufacturing and Processing” (NMBP) in Horizon 2020.

30 projects funded under FP7 and Horizon 2020 were found to address technologies of the 4IR and at least one of the selected policy challenges. The chapter on achievements summarises the results/findings of these 30 projects, implemented since 2009. The analysis includes projects under calls for proposals up to 2015. It is based on actual results and therefore does not include the most recent projects under the 2016 and 2017 calls for proposals.

13Capitalising on the benefits of THE 4TH INDUSTRIAL REVOLUTION

3. PORTFOLIO OF BENEFICIARIES

The largest number of participations (54 %) comes from the private sector, which has received EUR 49 million (44 % of the total portfolio budget). This shows the importance of the 4IR for the private sector and is in line with the overall participation of industry e.g. in the “industrial pillar”24 of Horizon 2020. The second largest number of participations is found in the higher or sec-ondary education and research organisations (20 % and 23 % of total participations, respectively), which repre-sent 22 % and 32 % of the total budget.

SMEs, representing 32 % of all participations were funded with EUR 31 million – 28 % of the total budget. This is higher than the average for Horizon 2020 which itself has exceeded the 20 % goal for the first three years of implementation. This confirms the important

role of SMEs in the European economy and in manufac-turing. Furthermore, their participation could assure commercial exploitation of project results and faster technology takeup.

The most involved countries in these projects have been Germany (EUR 19 million, 51 participations), Italy (EUR 14 million, 47 participations) and Spain (EUR 11 million, 41 participations), as it is shown in Figure 1. This reflects the importance of manufacturing, their size, links with other countries and efforts for modernising and digitising the manufacturing sector at the time. For instance, the German government has pioneered a 10- to 15-year plan for applying digital technologies to the industrial sector.25

EU Financial Contribution

EUR 19 m

EUR 0.1 m

FIGURE 1 EU contribution (EUR) to Member States involved in the 30 projects analysed (FP7 and Horizon 2020 combined)

24 “Industrial Leadership”, including “Leadership in Enabling and Industrial Technologies” (LEIT).25 Plattform Industrie 4.0 http://www.plattform-i40.de/I40/Navigation/DE/Home/home.html

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RESULTS AND IMPACTS OF EU FUNDING

16 Research & Innovation Projects for Policy

EU funded projects addressing the 4IR focus on priori-ties where the development and mastering of science and research-driven technologies underpins the global competitiveness of European industries and research. These R&I challenges are cross-sectoral and based on stakeholder input, with industry in a driving role and with special attention to ensuring the take-up of successful results and further industrial investments. For a large part of the Horizon 2020 programme, this process is formalised through contractual Public-Private Partner-ships (PPP), such as FoF and Sustainable Process Industries.

The greatest EU added value stems from the synergies and critical mass of transnational collaborations across Europe and beyond, required to tackle challenges of such a scale and complexity that no sector or single Member State can tackle alone.

Collaborative projects also provide a context for vertical integration. They bring together many different types of organisations, ranging from materials developers, at the very front of the chain, to manufacturers or building contractors/construction companies at the end.

Framework programme funding also helps to mitigate the considerable technological and financial risks in the development of “intelligent” and “smart” technologies, products and processes. Notably Horizon 2020 puts emphasis on helping to cross the “valley of death” for the upscaling of technologies or SMEs which involves still considerable risks. This is done through demonstra-tion projects and pilot lines at higher technology readi-ness levels relevant to industry and financial instruments.

The exploitation of (R&I) results would further benefit from faster implementation of the Single Market in the EU. In 2015, 30 years after the Single European Act and 10 years after the adoption of the Directive on services in the internal market, only 20 % of goods and 6 % of services were traded cross-border within the Single Mar-ket. Recent trends such as increasing digitisation of per-formance-enhancing services are likely to increase the tradability of services in the future. This in turn affects the policy intervention needed to support them.

1. ADDED VALUE OF EU R&I INVESTMENT

2. R&I ACHIEVEMENTS SUPPORTING POLICY CHALLENGES

2.1. R&I achievements in relation to the human dimension: skills, jobs, work organisation

Skills – how to reinforce education and trainingThe most significant skill shortages are in basic techni-cal training, ICT literacy, science, technology, engineer-ing, and mathematics (STEM), problem solving skills, self-directed learning, communication, teamwork and time management for the three main groups of industry workers: engineers, researchers / scientists and produc-tion workers.

The FoF will be increasingly digitised. Besides digital skills, other general skills and abilities are required in order to prepare future workers for a short and long

term learning: there is a need for new attitudes to work, as workers move from being assigned a job or task, to selecting it themselves; for autonomy and more flexible organisational structures; for a more positive attitude to failure; for multidisciplinarity, involving less repetitive tasks at the shop-floor; for playfulness or learning by doing.

The EU R&I projects underlined that lifelong learning is particularly important. The disruptive nature of the 4IR technologies and their fast innovation cycles make life-long learning programmes necessary for the optimum performance of the workforce and other stakeholders.

They also showed that identifying training needs is an issue in itself, at strategic level as well as for individuals and companies.

17Capitalising on the benefits of THE 4TH INDUSTRIAL REVOLUTION

Education and training systems should cultivate, besides the key skills and competences, the capability of extending and applying the knowledge in an interdisci-plinary and evolving field. The rapid evolution of the new technologies will require a continuous update of skills and knowledge, and by extension of educational systems.

Project consortia stress the importance of starting the manufacturing education early in the students’ lifetime, so that the labour force has already acquired some key competences when entering the manufacturing world, which will facilitate life-long training in the long run.

New technologies to facilitate learning: Some projects have developed methodologies and tools based on state-of-the-art augmented reality, wearable and ubiq-uitous computing or gamification technologies, adapted to each target group and sector needs. These contribute to facilitating learning and motivating the trainee. This has been tested by the same projects.

For instance, the project ActionPlanT organised a sum-mer school in order to assess the effectiveness of the learning methodology and the knowledge delivery mechanisms. The methodology developed is an effi-cient and innovative “mechanism” for competence development allowing trainees to face real life-like use

case and it could potentially help bridging the gap between new ICT knowledge and product / process inno-vation. Other projects have also analysed the potential of using digital manufacturing technologies for educa-tion and training, concluding that it can reduce the cost of producing new knowledge. For example, 3D printers make it easier for students to produce prototypes that help them to better understand the subject under study.

Projects have stressed the need of a stronger collaboration between industry and education and research.26

In order to strengthen this synergy, several projects have developed learning programmes that satisfacto-rily use the manufacturing plant as faculties (“teaching factories”).

Projects have emphasised the impor-tance of not only training workers, but of also extending training programmes to end-users, decision-makers in industry, management and public administration. This would allow them to understand technology possibilities and also limitations, and consequently their responsibilities concerning risks and threats, and how to better support the development and deployment of new technologies.

26 See also the study by the Joint Research Centre, 2017. Innovation and Industry: Policy for the Next Decade. https://ec.europa.eu/jrc/sites/jrcsh/files/jrc109610.pdf

The MAN-MADE project developed a “Training Needs Detector” software which provides worker-specific training hints based on workers’ knowledge and skills, factory demands, job content and job allocation statistics. It compares workers’ knowledge, skills and needs with required competence of jobs and tasks, providing inputs for training programmes triggering workers’ lifelong learning.

Collaboration between industry and education/research is perceived as a critical element for the success of the 4IR learning methodologies. The “teaching factory” is an example of how to implement this collaboration.

The SatisFactory project developed a training and collaborative platform where workers can exchange work knowledge, experiences and practices, while team interactions are stimulated to capitalise on the more experienced workers’ skills and knowledge.

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Jobs There is a focus on skilled employees in industry and projects continue to develop new high-skilled job pro-files either during project execution or plan to do it after the end of project during commercialisation. In order to capture the great variety of types of developed future high skilled jobs, relevant PPP set-up new job profiles as a Key Performance Indicator.

From projects in the FoF PPP a first list includes: robotics programmer, machine designer, skilled maintenance

technician, virtual reality manager and programmer, advanced operator with data processing knowledge, skilled technician in data science, process designer, energy and resource efficiency manager, supplier net-work design expert, design synthesis based facility plan-ner, design synthesis based supply chain manager, remanufacturing engineer, cockpit supply chain strate-gist, artificial intelligence educator/supervisor, manager, smart robot operators, smart robot cell developer.

This in return allows drawing conclusions and refining the needs for some specific technical skills and compe-tences: knowledge of mechanical and electrical engi-neering processes; ability to work with computerised systems, to read and write machine programming code, to read manufacturing blueprints and to operate auto-mated manufacturing systems; knowledge of aug-mented reality and artificial intelligence.

Furthermore, this allows the conclusion that workers of the future should have a combination of technical and non-technical skills that allow them to acquire a com-petence set rather than specialisation in a single one; they will need to be adaptable, with the capacity to learn and to think critically. Know-how rather than phys-ical labour will be needed. This continuous adaption must be ensured at all levels, from the top level man-agers, to engineers and operators of machines. This will result in longer working life and ability to work in an ageing population in Europe.

New forms of work organisation As manufacturing processes are becoming more and more flexible, both in terms of their activities and in terms of their physical spaces, different forms of work organisa-tion are emerging, which can affect worker-enterprise relationships.

Projects focused on this aspect have notably developed new forms of work organisation in which the human dimension gains importance (“human centred manufacturing”),

notably for jobs where human work cannot (easily) be replaced by automated systems in the near future. It means that the technology is adapting to the worker, as it is the capacity, constraint and skills of the worker which are the driver for designing the workplace and allocating the workload. These worker-centred models are meant to increase the worker’s satisfaction (see projects Satisfactory, Manuwork and Factory2Fit), as well as to make the workplace healthier, safer and more attractive professionally. In some cases, results cover methodologies and tools redesigning the workplaces and adapting work allocation to the evolving profile of the worker and skills. The take-up of such technologies will need agreed approacheds for privacy as well.

The SatisFactory project developed a toolkit that allows supervisors to manage machinery and human resources in real-time. It takes into account the workers’ skills, in order to match each task to the suitable/required expertise of worker and experience. It also provides statistics that help evaluating the workload, the workers’ experience, and the condition of assets.

19Capitalising on the benefits of THE 4TH INDUSTRIAL REVOLUTION

2.2. R&I achievements in relation to the business dimension: manufacturing as a service

Identification of new business modelsProjects have developed new business models, by approaching the concept of manufacturing as a service from different angles:

> Demand-driven and local manufacturing: projects developed tools such as product configurators, co-de-sign platforms and supply chain management frame-works. These would support the process of local product designed manufacturing for the client or by the client, while guaranteeing environmental sustain-ability and the compliance of EU product safety regu-lations in sensitive sectors. Projects28 have worked on customer-focused manufacturing models resulting in frameworks and tools for the acquisition of customer demand data, user feedback and data from product embedded information devices (big data approaches). Besides, they have contributed with knowledge-based business models, where the end-user collaborates in different phases of the manufacturing value chain.

> Projects developed the concept of virtual factories, which combines the manufacturing assets of several independent factories to achieve complex manufac-

turing processes, and ICT platforms and tools for plug-and-play and pay-per-use manufacturing assets.

> Other projects addressed the value chain integration, in which new business models and tools for the man-agement of the manufacturing supply chain were developed.

Technologies accelerating business innovationsDigital fabrication technologies, which allow digital designs to be transformed directly into physical prod-ucts, are identified as key technologies emerging from the 4IR.

The most promising application domains of these tech-nologies, according to the Diginova project, are: digital printing (digitisation of the traditional printing industry,

27 The FACTS4WORKERS project (636778) was funded under Horizon 2020. 28 Some examples of projects are ADDFACTOR, ADVENTURE, Diginova, FALCON, iBUS and TRANSPARENCY.

FIGURE 2 Human-machine interface. Technology develop by the FACTS4WORKERS project.27

The project ManSYS developed a set of e-supply chain tools for metal additive manufacturing, which help overcoming communication problems with external suppliers, supply chain visibility and coordination.

©FACTS4WORKERS

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decoration of products and surfaces, packaging, textile printing and display graphics), additive manufacturing (for durable goods, integrated electronics, sensing, power generation and transmission and energy storage), printed electronics (OLED lighting and displays, smart windows, printed sensors, thin heating elements and smart textiles) and personalised medical and healthcare applications (medical micro-factories, personalised diagnostics and drug delivery, tissue engineering scaf-folds, treatment planning tools such as organ-on-a-chip and digitally fabricated garments). The Diginova project also analysed the expected timeline to reach the market for these types of products. In the short term, it is expected that, for instance, applications of textile print-ing, printer sensors and OLED lighting and displays will be available on the market, while at mid-term (around 2025), smart textiles, personalised diagnostics and drug delivery, and smart windows will be on the market. Finally, it is expected that tissue engineering scaffolds and medical micro factories will be mature enough to be commercialised from 2025.

Focusing further on additive manufacturing technolo-gies (AM), the FoFAM project developed a roadmap for building the fundamental knowledge and defining actions necessary to accelerate the design, application and implementation in the market of AM technologies. The sectors fastest deploying AM technologies, accord-ing to the European Additive Manufacturing Strategic Research Agenda are medical and dental, aerospace, automotive, and consumer and electronics goods.

Digital industrial platforms integrate the different digital technologies into real-world applications, processes, products and services, while enabling interactions between two or more customer groups.29 They support the creation of ecosystems, in which any company can add specialised and innovative features through com-plementary innovations. The FALCON project, for exam-ple, has developed a platform to connect information on product and service usage; this will facilitate the gath-ering of customer feedback through social media, the

collection of usage information through information devices embedded in products, the comprehensive pro-cessing of the collected data and customer feedback and, finally, the deployment of the identified informa-tion in the product-service development phase.

Blockchain and other distributed ledger technologies are currently being used in the financial sector mostly. Other fields, such as B2C and B2B,30 are realising the potential of radical organisational shifts towards more collabora-tive and automated processes. However, they seem to be relevant for industrial fields, but their deployment is hampered by issues ranging from interoperability, standards, intellectual property (IP) to liability and data protection. It would be interesting to assess technology potentials and up-take constraints.

BarriersDigital Fabrication still needs to overcome technological barriers primarily related to:

> Speed;> Reliability, stability and robustness; > A limited range of materials (composite materials and

embedding electronics or sensor capacities are still a challenge, also the replacement of fossil based, rare earth materials or metals).

Additionally, the uptake of technologies as well as of new business approaches in the 4IR is facing non-tech-nological barriers. The projects raise the following issues related to EU policies:

> Cyber-security: the servitisation of manufacturing is based on the use of digital tools and the sharing of digital data. New Commission initiatives in the area of data protection (Building the European Data Economy Communication31) and cybersecurity (Cybersecurity package32), are designed to raise awareness of the issues and propose ways to address them. With regards to ICT products and services, the aim is to increase overall transparency of cybersecurity assur-

29 Every platform consists of at least two stakeholders. Platforms can be horizontal (the range of users is connected among multiple sectors) or vertical (users within a single sector (sector specific). Vertical platforms are associated with manufacturing, supply chain optimisation and lifecycle and value streams.

30 B2B=business to business; B2C=business to consumer.31 COM (2017) 9 final of 10.1.2017. Communication on Building a European Data Economy. https://ec.europa.eu/digital-single-market/en/news/

communication-building-european-data-economy32 COM (2017) 477 final of 13.9.2017. Proposal for a Regulation of the European Parliament and of the Council on ENISA, the “EU Cybersecurity

Agency”, and repealing Regulation (EU) 526/2013, and on Information and Communication Technology Cybersecurity.

21Capitalising on the benefits of THE 4TH INDUSTRIAL REVOLUTION

EEC is fit for purpose vis-à-vis new technological developments (i.e. software, Cloud, Internet of Things, advanced robots and automated systems), and whether it covers cases of malfunctioning apps and non-embedded software.

> Intellectual property issues: there is a need for a bal-ance of open-source model and protection of IP, in a manner which allows the development of digital manufacturing. AM technologies will enable reproduc-tion of any existing product design, manufacture the product, and potentially distribute it (as 3D CAD-STL file). Concerns with regard to IP are mainly based on the ease of digital file sharing and increased access to 3D scanning and printing technologies. However, the success of the free software movement, the emphasis on open innovation and its many ramifica-tions into other fields of knowledge show that crea-tivity can thrive with little need for exclusive protection of ideas, industrial designs and creative work. Copy-right-based free licenses allow authors to share their work granting users all basic rights (“the four free-doms”) to enable them full autonomy in their work, thereby allowing the emergence of thriving innovative ecosystems. Having started in the domain of soft-ware, the question is how far this could be a model also in the field of hardware designs where patenting seems to be still predominant.

ance to address vulnerabilities and strengthen trust in the digital single market and in digital innovation.33

> Privacy issues related to wearable technologies and the Internet of Things in factories: the digitised work environment of the 4IR enables companies to collect a vast amount of information from the workplace that could be used for monitoring employees’ work and activities, in a way that damages the worker’s dignity. Furthermore, the combination of data pertaining the behaviour of employees at work with external infor-mation, publicly available on the internet, may affect recruitment processes.34 It is therefore essential that these data are used by industries only for legitimate purposes, and always respecting the privacy and dig-nity of the worker.

> Product responsibility or liability: there is a need of clarity which party has legal responsibility for the quality assurance of products. In simple terms, when products are sold, the so-called strict liability doctrine holds the seller or manufacturer responsible for lia-bility claims. In a distributed manufacturing model, there is a need to define the liability of each party. Liability issues have recently been investigated within the framework of several Digital Single Market initia-tives, for example the Building European data Economy Communication (adopted January 2017) and upcoming intiatives on Artificial Intelligence, one of the issues is to reflect whether Directive 85/374/

3. IMPACTS FOR SOCIETY AND INDUSTRY

3.1. Impacts in relation to the human dimension: skills, jobs and work organisation

Skills – how to reinforce education and trainingProjects have contributed to technology development for the 4IR, the identification of skills needed in the manufacturing field and new learning technologies and training methods. The goal of funding these projects is to enable stakeholders, notably industry and workforce,

to benefit from the results, with impact on tackling skills deficiencies and mismatches between the demand and supply of skills. They are important as already, industry cannot find all the skills needed for new job profiles and further improvements in their competitiveness.

A better understanding of the needs with regard to skills and core competences will also help policy makers to respond to better address the current social, economic and technological challenges in Europe.

33 Transparency of cybersecurity assurance means providing users with sufficient information on cybersecurity properties which enables users to objectively determine the level of security of a given ICT product, service or process. Source: COM (2017) 477 final of 13.9.2017. Proposal for regulation of the European Parliament and of the Council on ENISA, the “EU Cybersecurity Agency”, and repealing Regulation (EU) 526/2013, and on Information and Communication Technology cybersecurity certification (‘’Cybersecurity Act’’).

34 Seidel et al., 2017. Robotics, Autonomics, and the Law, vol 14. Nomos, Germany.

22 Research & Innovation Projects for Policy

systems including the skills dimension and training, with the aim of increasing the awareness of the benefits of the 4IR and speeding up the adoption of emerging advanced manufacturing technologies.38

The Horizon 2020 Work Programme 2018 in the area of industrial technologies calls for activities on “Skills needed for new Manufacturing Jobs”.39 This coordination and support action is expected to develop strategies to bridge the skills gaps through upskilling of the existing workforce, to analyse new job profiles, leading to a longer working life for jobholders; and to help engage different stakeholders within the manufacturing sector. This topic is complementary to the activities launched under the Blueprint for Sectorial Cooperation on skills in AM. The Blueprint for Sectoral Cooperation on skills will build a partnership with key stakeholders from industry, research, universities, vocational education and training (VET) organisations and qualification organisations from different geographical areas. This action will support manufacturers to be better involved in assessing the skills gaps and in drafting of AM-related curricula at VET and higher educational level.40

The project analysis and recommendations in this report could also contribute to the different European Commis-sion’s initiatives on education and training such as Euro-pean Alliance for Apprenticeship, European Framework for Quality and Effective Apprenticeship, ErasmusPro, Blueprint for Sectoral Cooperation, etc. First experience with this interaction exists: the evidence found in the analysed projects contributed to the redefinition of the key competences for a lifelong learning set up within the European Reference Framework in late 2017.41

New forms of work organisationThe projects have developed new work organisation models, which take into consideration the constraints of the workforce (e.g. older workers), and reflect the increasing flexibility of manufacturing processes and

The collaboration between academia and industry is a key factor in the modernisation of the current educa-tion and training programmes, which seem unable to meet the future challenges in the manufacturing sector.

Projects have contributed to promoting education in manufacturing at an early stage in life, that is, children, teenagers and university students. Such approaches help the workforce to acquire some of the key compe-tences of the manufacturing world. A widespread intro-duction of the approaches developed by R&I projects will enhance current systems and will tackle, at least partly, the skills deficiencies in Europe. Supporting measures for the integration of young people, low-er-skilled and older workers in the labour market, will adap the training in academia to the new paradigms.

Projects have pointed to the importance of a lifelong learning strategy. The methodologies and tools devel-oped, based on state-of-art augmented reality, weara-ble and ubiquitous computing or gamification technol-ogies, contribute to modernising the training system in industry and in education and training centres. They help to accelerate learning and enhance the motivation of the trainee, while increasing their capability to keep up with the pace of new technological advances. An appro-priate company strategy for marketing and recruitment should also be pursued at the same time, in order to increase added value for the company and making the industrial employment more attractive to potential younger applicants.

Around 60 % of large industries and more than 90 % of SMEs consider themselves lagging behind in digital innovation, in addition to strong digitalisation discrepan-cies which exist between industrial sectors.35 Industry and SME oriented infrastructures such as Digital Inno-vation Hubs36 and Open Innovation Test Beds37 could be further developed as catalysts for the creation of eco-

35 European Commission. Pan-European network of Digital Innovation Hubs. 9. 1. 2018 https://ec.europa.eu/digital-single-market/en/digital-innovation-hubs

36 Digital Innovation Hubs Catalogue available at http://s3platform.jrc.ec.europa.eu/digital-innovation-hubs-tool 37 Horizon 2020 LEIT-NMBP Work Programme 2018-2020 http://ec.europa.eu/research/participants/data/ref/h2020/wp/2018-2020/main/h2020-

wp1820-leit-nmp_en.pdf38 Sensors, CPS, Internet of Things, robotics, lasers and cloud-based HPC simulation.39 DT-FOF-01-2018: Skills needed for new Manufacturing jobs (CSA) – http://ec.europa.eu/research/participants/portal/desktop/en/opportunities/

h2020/topics/dt-fof-01-2018.html 40 Also a new study is just starting to develop pan-European curriculum guidelines for KET and Advanced Manufacturing Technologies under the COSME

programme – http://ted.europa.eu/udl?uri=TED:NOTICE:133854-2017:TEXT:EN:HTML41 https://ec.europa.eu/education/news/european-commission-adopts-key-education-initiatives-for-inclusive-cohesive-societies_en and http://europa.

eu/rapid/press-release_IP-18-102_en.htm

23Capitalising on the benefits of THE 4TH INDUSTRIAL REVOLUTION

3.2. Impacts in relation to the business dimension: manufacturing as a service

Rise of new business modelsIn order to enable the higher impact of new technolo-gies on products, services and business innovation, inno-vative business models should be adopted. Projects have contributed to the definition of a new set of busi-ness models supporting and increasing customisation in industry, based on several key concepts:

> Demand-driven and local manufacturing (or mini-fac-tories): this allows the integration of customer prefer-ences in development and production processes, leading to decentralised production networks with local manufacturing capacities, reaching higher envi-ronmental sustainability levels, while complying with EU product safety regulations;

> Virtual factories can primarily benefit SMEs, by building up new capabilities to control wider manufac-turing lifecycles and enforcing their own interfaces and standards;

> Value chain integration: in this regard, projects have contributed to promoting the evolution of the produc-tion value chain from a ‘push’ to a ‘pull/on-demand’ model. This implies that products can be supplied with short lead times, at high speed, at any place or time, inventories optimised and production adapted to immediate market condition changes.

Offering products as services has the potential of open-ing up new market segments, generating revenue opportunities and creating competitive advantage. Sev-eral studies claim that the development of cross-sector ecosystems of services, with upstream and downstream integration, will be developed by 2030.47

their physical spaces. These models provide significant benefits in terms of reducing costs due to better data and prediction tools, and tools evaluating the workload and the available machinery capacities, skills and work-force resources, and matching each task to the expertise of a worker.

Growth and jobs through industrial investmentsThe selected projects address innovation which is expected to have a noticeable impact on growth and jobs. They are a specific sample of projects addressing the higher degree of flexibility brought by the 4IR.

From a broader perspective42 EU investment in research and innovation, a direct leverage effect43 of the EU investment for the private and public sectors of 0.85 and 0.28, respectively can be estimated.

Taking into account the average share of private sector participation in EU projects related to the 4IR (44 %)44, the estimated direct leverage effect of the EU contribu-tions is overall above 50 %. In other words, for every euro of EU contribution, there is an additional investment of 0.5 euro. Adding the indirect leverage effect, which occurs mostly after project finalisation and through accompany-ing projects, for example the estimations of the EFFRA association indicate a leverage factor of approximately 5 for the Factories of the Future PPP.45

Further, it is estimated46 that the selected projects will create over 1 900 research jobs per year (over a period of 10 years) and over 2 300 additional jobs indirectly per year (over a period of 25 years).

These achievements are likely to have a positive impact on the manufacturing sector and therefore the econ-omy, by boosting productivity and decreasing unemploy-ment and skill shortages.

42 Leverage effect figures from the Ex-Post Evaluation of the Seventh Framework Programme. {COM(2016) 5 final}- Annex 23.43 Additional direct and indirect expenditure per EUR 1 funding.44 Beyond the 30 projects analysed in this report.45 This estimation takes into account all activities starting in the year 2010 up until 2015/2016.46 In FP7, a EU contribution of EUR 45,335 billion generated 130 000 research jobs over 10 years and 160 000 additional jobs over 25 years, according

to the Ex-Post Evaluation of the Seventh Framework Programme. {COM(2016) 5 final}. This same ration has been used for the estimations on jobs generated by our sample, with a total EU contribution of EUR 667 million.

47 Global e-Sustainability Initiative, 2015. ICT Solutions for 21st Century Challenges. Stehrer, R., Baker, P., 2014. Study on the relation between industry and services in terms of productivity and value creation (Final report of the ECSIP consortium). Institut für Arbeitsmarkt und Berufsforschung, 2015. Industrie 4.0 und die Folgen für Arbeitsmarkt und Wirtschaft.

24 Research & Innovation Projects for Policy

Impact on SMEsSpecialisation and differentiation of products and ser-vices are among the most significant success factors for SMEs. This specialisation and development of more niche market demand have enabled SMEs to strengthen their comparative advantages and to reduce the struc-tural disadvantage stemming from resource constraints and limited ability to reap economies of scale.51 In fact, most manufacturing SMEs operate in such niche mar-kets and hold potential to gain a larger share of the overall market. However, the specialisation and differ-entiation can be hindered by several technological bar-riers, such as demanding manufacturing processes or special tooling. A smooth adaptation of the technolo-gies, together with an identification of market opportu-nities with clear business potential, would give SMEs the opportunity to both reduce costs and increase target markets, particularly within global value chains.52 The productivity of SMEs could increase by 30 to 75 % by using modern automation in production, digital tools in product design, and an effective production and resource planning.53

SMEs and start-ups need help for lowering obstacles and for the introduction of digital tools, allowing them to develop new innovative products and enable new knowledge-intensive services for customers.52 The most common obstacles are lack of access to finance, to new business models, and the use of traditional product development methods and production processes. The challenges are to bring new innovative products to the market at a faster pace, to overcome bottlenecks in the design process, to reduce waste in production, and to keep the product price at a competitive level. In this, SMEs are particularly depending also on the innovation and economic eco-system surrounding them, and related policies.

Technologies accelerating business innovationsIndustrial platforms and AM are two of the emerging technologies expected to have a higher impact on the higher demand of customised items and servitisation, by enhancing the physical capacities of companies in product development. It promises to profoundly change economies of scale and related cost advantages for small and large manufacturers.

Digital industrial platforms are operating systems inte-grating different technologies and various applications and services. They support customer demands for mass customisation, adaptation to dynamic markets and innovation. These platforms may be vital in the creation of ecosystems of market players in a multi-sided mar-ketplace, enabling the creation of new innovative prod-ucts and services, and helping providers to optimise their business models. A recent outlook48 estimates that by 2019 50 % of manufacturers will be collaborating directly with customers and consumers, on new and improved product designs, through cloud-based crowd-sourcing, virtual reality, and product virtualisation. This might result in an up to 25 % improvement in product success rates. 60 % of the top worldwide manufacturers are expected to deploy digital platforms. This is consid-ered able to trigger up to 23 %-30 % increases in reve-nues and 26 % in productivity in the coming years.49

Despite several drawbacks (high resource- and invest-ment-intensive), AM will have a tremendous impact on industrial and consumer areas in the coming years.50 AM can increase localised production, with more goods manufactured close to their points of consumption, which in turn can strengthen regional economies and entrepreneurship. It can also foster innovative manufac-turing in Europe, bringing outsourced jobs back, and open up new business opportunities for SMEs.

48 IDC FutureScape: Worldwide Manufacturing 2018 Predictions.49 Figures from McKinsey&Company, 2015. How to navigate digitization of the manufacturing sector. and OECD - Meeting of the OECD Council at

Ministerial Level Enhancing the contributions of SMEs in a global and digitalised economy, Paris, 7-8 June 2017.50 The project FoFAM has identified already existing tools and initiatives supporting additive manufacturing businesses: Enterprise Network Europe

(ENE), Invest Europe, InnovFin – EU Finance for innovators, European Business Network (EBN), Business Innovation Centres- BICs, Startup Europe. This project has also highlighted the important role of European regions with initiatives such as the Smart Specialisation Strategy (S3) or the Living Labs.

51 OECD - Meeting of the OECD Council at Ministerial Level Enhancing the contributions of SMEs in a global and digitalised economy, Paris, 7-8 June 2017.52 Lloyds Banking Group, Accenture, 2016. Financing Growth; SMEs in Global Value Chains, SME Finance Forum.53 It has been shown that Finnish SMEs providing their own products tend to be innovative and well aware of the competition and emerging

technologies. Source: Project I4MS.

POLICY RECOMMENDATIONS

26 Research & Innovation Projects for Policy

There is a need to raise awareness of the potential, as well as the risks, of the 4th Industrial Revolution in the manufacturing sector. While larger manufacturers are already embracing new technologies emerging from 4th Industrial Revolution and re-adapting their business models, small companies are not always familiar with these. Moreover, technical staff in industry and SMEs as well as managers and policy makers need to be trained in order to understand the implications and opportunities.

In order to enhance the engagement of SMEs, the launch of specific actions is recommended, such as R&I topics conducive to SME participation and digital inno-vation hubs and test beds. The Horizon 2020 projects show already the interest of SMEs to engage in collab-

orative projects. Synergies between actions at EU, national and regional level should be sought and monitored.

Further to available work on impact aspects,54 dedi-cated studies and bringing together knowledge and “communities of practice” would enhance the basis for addressing the non-technical aspects of both the human and business dimensions of the 4th Industrial Revolution. Studies should engage with all relevant stakeholders (industry, academia, research centres, pub-lic institutions, regions and trade unions). They should inform EU, national and regional policies with regard to funding, training and regulation, and make the link to monitoring mechanismsk observatories and indicators.

This section sets out the main policy recommendations for addressing needs related to the human and business dimensions of 4IR, derived from the results of recent R&I projects funded under Euro-pean Framework Programmes.

1. RAISE AWARENESS AND DEEPEN THE UNDERSTANDING OF THE POTENTIALS AND RISKS RELATED TO THE 4TH INDUSTRIAL REVOLUTION

2. PROMOTE LIFELONG LEARNING IN FACTORIES AND NEW LEARNING METHODS

An inventory of training needs, guidelines and tools, as these arise from relevant projects (starting with the pro-jects considered in this report), and making all relevant results available to potential users in the manufacturing sector could help to create awareness of the need for new skills in the existing workforce and also to act as a catalyser to spread this across sectors and inform stakeholders in industry, the education and training world, research and policy makers. Further steps would

be to identify potential users, to communicate the best practices identified, and ultimately to promote lifelong learning within factories, aiming also to attract young people, and to encourage research organisations, inno-vation hubs and Open Innovation Test Beds to include training aspects in their offers (“learning factories”).

54 SASAM (FP7), AM-motion (Horizon 2020), Impact Coordination and Support actions of the Factories of the Future and SPIRE by PPPs.

27Capitalising on the benefits of THE 4TH INDUSTRIAL REVOLUTION

3. SET UP A EUROPEAN MANUFACTURING SKILLS COUNCIL

4. FOSTER LINKS AND SYNERGIES BETWEEN RELEVANT POLICY ACTIONS SUCH AS THE EUROPEAN SECTORAL BLUEPRINT INITIATIVE ON SKILLS

5. DEVELOP GUIDANCE AND PRACTICAL EXAMPLES TO ADDRESS REGULATORY BARRIERS

In order to maximise the achievements and impact of EU-funded projects, it is recommended to set up a Euro-pean Manufacturing Skills Council. This council would assemble the relevant stakeholders, bring together knowledge and initiatives from different policies and programmes and offer a European platform to:

> better anticipate the current and future skills needs at manufacturing workplaces in Europe;

Relevant knowledge and results should be better dis-seminated across different policies and programmes.

The Blueprint for Sectoral Cooperation on Skills, launched in June 2016, is one of the 10 actions of the Skills Agenda. The Blueprint is developing sector-spe-cific approaches by providing a clear skills strategy for each sector, and new instruments to address the issues of skilling and reskilling, to better prepare individuals for the jobs of the future. It mobilises industry and educa-tion and training centres, aiming to attract private investment and ensure a better use of EU and national and regional funding programmes.

New technological opportunities and business models involve also new ways of acting in the legal framework. All actors and notably SMEs will benefit from clear legal guidance, adaptation as necessary and practical exam-ples to address cyber-security, liability, privacy and the protection of intellectual property.

> tackle skills shortages and mismatches, through retraining;

> develop harmonised qualification and certification systems for appropriate job profiles;

> develop and manage quality assurance rules of the training and qualification system;

> improve cooperation to enhance links between com-panies and education and training centres, regarding new education and training models.

A new initiative, closely related to the 4th Industrial Rev-olution, on AM has just been launched. The results of the analysed projects should feed into the first phase of the Blueprint, which is about collecting evidence of skills gaps and their potential impact on growth, innovation and competitiveness. Beyond the specific action on AM, all sectoral blueprints should be encouraged to pay spe-cial attention to the relevance of 4th Industrial Revolu-tion aspects in their sectors.

Another example for links is the Future of Manufactur-ing in Europe55 action, and the new study on a pan-Eu-ropean curriculum for Key Enabling Technologies and Advanced Manufacturing Technologies.56

Cyber-threats and cyber-security are seen as major issues, which must be addressed to ensure trust in advanced digital systems. The Commission Communi-cation on Cyber Resilience Systems of 2016 already acknowledged the problem and proposed concrete actions. In September 2017 the Commission proposed a European Union Cybersecurity Agency and the estab-

55 Future of Manufacturing in Europe. 15. 1. 2018. https://www.eurofound.europa.eu/observatories/emcc/fome 56 See Call for tender under the COSME programme http://ted.europa.eu/udl?uri=TED:NOTICE:133854-2017:TEXT:EN:HTML

28 Research & Innovation Projects for Policy

lishment of a European cyber-security certification framework.57 It will be important that the results and impact of these activities will reach all players including SMEs and entrepreneurs.

Defining who has legal responsibility for the quality and safety of digitally fabricated products will be a key step in developing a mass-market for digital manufacturing. In the context of the Communication on “Building a European Data Economy”, a key issue is to assess whether the current EU legal rules for product liability are fit for purpose, when damages occur in the context of the use of new technological developments, such as Internet of Things, advanced robots, 3D printing files with personal data in the cloud, autonomous systems etc., and in particular taking into consideration their spe-cific characteristics of autonomy, self-learning and data-based nature, ecosystem complexity etc. The existence of quick and cost-effective qualification and certification methodologies is particularly important for SMEs.

Privacy issues related to the Internet of Things technol-ogies, in general, have also been identified as barriers for the implementation of flexible manufacturing pro-cesses. Indeed, the sensors included in these devices will have the capacity of capturing information related to personal and non-personal data, which represents a challenge and an opportunity for the industry. The use of personal data is regulated by data protection regula-tions and privacy needs to be assured for personal data in the work environment. As the free flow of non-per-sonal data is a pre-requisite for a competitive data economy within the Digital Single Market, the Commis-sion has proposed a Regulation aimed at removing obstacles to the free movement of non-personal data.

Policies on intellectual property rights should offer pos-sibilities (e.g. incentives and reward schemes, defini-tions of protective areas of public interest) to develop fully the potential of open innovation. Balancing the benefits of open access with benefits of protecting intellectual property could lead to a more open and flexible model. Best practice in intellectual property exploitation should be identified and promoted, in order to stimulate the further development and widespread use of new approaches in manufacturing.

57 European Commission. COM(2016)0410 final of 5. 7. 2016. Communication on Strengthening Europe’s Cyber Resilience System and Fostering a Competitive and Innovative Cybersecurity Industry.

ANNEXES

30 Research & Innovation Projects for Policy

ANNEX 1 LIST OF PROJECTS

No Project Acronym Project ID Project Call Identifier Framework Programme

1 ActionPlanT 258617 FP7-2010-NMP-ICT-FoF FP7

2 ADVENTURE 285220 FP7-2011-NMP-ICT-FoF FP7

3 CREMA 637066 H2020-FoF-2014 Horizon 2020

4 CyPhERS 611430 FP7-ICT-2013-10 FP7

5 DiDIY 644344 H2020-ICT-2014-1 Horizon 2020

6 Diginova 290559 FP7-NMP-2011-CSA-5 FP7

7 FACTS4WORKERS 636778 H2020-FoF-2014 Horizon 2020

8 FALCON 636868 H2020-FoF-2014 Horizon 2020

9 FoFAM 636882 H2020-FoF-2014 Horizon 2020

10 HORSE 680734 H2020-FoF-2015 Horizon 2020

11 iBUS 646167 H2020-NMP-2014-two-stage Horizon 2020

12 IC2 246172 FP7-NMP-2009-SME-3 FP7

13 I-RAMP³ 314329 FP7-2012-NMP-ICT-FoF FP7

14 MAN-MADE 609073 FP7-2013-NMP-ICT-FOF(RTD) FP7

15 ManSYS 609172 FP7-2013-NMP-ICT-FOF(RTD) FP7

16 ManuSkills 609147 FP7-2013-NMP-ICT-FOF FP7

17 ManuVAR 211548 FP7-NMP-2007-LARGE-1 FP7

18 Optician2020 609251 FP7-2013-NMP-ICT-FOF(RTD) FP7

19 REViSITE 248705 FP7-ICT-2009-4 FP7

20 ROBO-PARTNER 608855 FP7-2013-NMP-ICT-FOF(RTD) FP7

21 SatisFactory 636302 H2020-FoF-2014 Horizon 2020

22 Sense and React 314350 FP7-2012-NMP-ICT-FoF FP7

23 SO SMART 608734 FP7-2013-NMP-ICT-FOF(RTD) FP7

24 SO-PC-Pro 609190 FP7-2013-NMP-ICT-FOF(RTD) FP7

25 SYMBIO-TIC 637107 H2020-FoF-2014 Horizon 2020

26 TRANSPARENCY 246273 FP7-NMP-2009-SME-3 FP7

27 TWIN-CONTROL 680725 H2020-FoF-2015 Horizon 2020

28 Use-it-wisely 609027 FP7-2013-NMP-ICT-FOF(RTD) FP7

29 WEKIT 687669 H2020-ICT-2015 Horizon 2020

30 XS2I4MS 678860 H2020-FoF-2015 Horizon 2020

31Capitalising on the benefits of THE 4TH INDUSTRIAL REVOLUTION

ANNEX 2 LIST OF ACRONYMS

4IR 4th industrial revolution

AM Additive manufacturing

EU European Union

FoF Factories of the future

FP7 7th framework programme for research and technological development (2007-2013)

GDP Gross domestic product

ICT Information and communication technologies

IP Intellectual property

LEIT Leadership in enabling and industrial technologies

NMBP Nanotechnologies, advanced materials, advanced manufacturing and processing, and biotechnology

NMP Nanotechnologies, advanced materials, advanced manufacturing and processing

OECD Organisation for Economic Cooperation and Development

OLED Organic Light-Emitting Diode

PPP Public-Private Partnerships

R&I Research and innovation

SME Small and medium-sized enterprise

STEM Science, technology, engineering, and mathematics

VET Vocational education and training

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Research and innovation results generated by EU Framework Programmes play a key role in addressing societal challenges, strengthening sustainable growth and creating new jobs. They can also provide solid evidence and the latest knowledge to inform and improve policymaking. ‘Research and Innovation Projects for Policy’ is a series of reports exploring this opportunity and putting it into practice. Each report focuses on selected issues and challenges in a topical policy area, highlighting the corresponding pertinent results from Framework Programmes and concluding with concrete recommendations for policy actions in Europe and internationally.

Research and Innovation policy

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