German industry expert: ‘No one will be bypassed by digitisation’

Tinosch Ganjineh (L) Project Leader AutoNOMOS, and Daniel Goehring, Project Leader Self-Driving Cars Intelligent Systems and Robotics Freie Universitaet Berlin (R) drive in a driverless car, presented by Swiss communication company Swisscom, during a press event in Zurich, Switzerland, 12 May 2015.

Digitisation has become a fix point in the public debate as significant effects on the economy and the working world are expected. Are Germany and the EU well prepared? EURACTIV Germany spoke to Iris Plöger.

Iris Plöger is a member of the executive board of the Federation of German Industries (BDI).

She spoke to EURACTIV Germany’s Steffen Stierle.

Ms. Plöger, according to the EU’s DESI Index, Germany is only in the mid-range of digitalisation. From an industry point of view, where are the top priorities for a leadership role?

In terms of digitisation, even in our latest Innovation Indicator, which we published together with Acatech in the BDI, Germany only plays in the midfield. It looks better in the area of innovation, in international comparison we range on the fourth place. Innovations are not always ready for the market in time.

This is also a big topic in the field of Artificial Intelligence (AI). In our industrial core, however, we continue to be great, which is why we should gear up with a targeted AI strategy. Industry 4.0 has become an export hit similar to Made in Germany. Now the companies urgently need the digital infrastructure to implement the Industry 4.0 applications.

In the German coalition agreement, digitisation takes a lot of space: a lot of money is meant to be spent for digital infrastructure, but also for digitisation of the public administration. Is this the right direction?

There are notable advances, but other world regions continue. A prime example is China, where the government is pursuing strategic industrial policy and now has a planning horizon until 2049. There are clearly formulated claims in which areas you want to be the world market leader by when. Accordingly, high sums are invested. But we live in Europe and not in a planned, but a market economy. The aim is therefore to create the right incentives for the projects to develop themselves, sometimes with government support.

Mentioning e-government: Germany has to catch up in this area. Many assume that digitisation is only working horizontally when there is a digitised public administration. If you ask in Germany what problems start-ups and medium-sized companies have, bureaucratic hurdles play a major role. For example, it is very difficult to employ a non-EU employee here. Time and administrative effort are enormous, that would have to be made much more efficient.

However, one difficulty in the EU is the multi-level system. The responsibilities lie partly at national, partly at European level. What about the latter? There is much talk of making the single market fit for the digital age.

There is no doubt that we need the common European Economic Area. The Digital Single Market has started many consultations and much will be done by the end of the legislative term. But it is true: We should only regulate on European level, what must be really harmonised.

Not everything has to be done Europe-wide. A good example of a meaningful, uniform regulation is the GDPR. But now it is important to ensure that the rules are implemented uniformly in all countries. This is already causing difficulties, because member states interpret and apply the regulation differently. That’s a problem because our businesses need legal certainty and no patchwork.

In the context of the Digital Single Market there is also much talk about the ‘Gigabit society’. What is it all about?

‘Gigabit society’ means that we need a digital infrastructure sufficient to handle all the new technologies in medical, autonomous, industry 4.0 matters and so on. Required are high transmission bandwidths in the networks and real-time transmission. Germany lags behind. That is why it is important to auction off the 5G frequencies quickly, even if it does not provide nationwide coverage by itself.

Should the 5G frequency allocation be coupled with conditions, for example with regard to network coverage in rural areas, so that this coverage can be achieved?

Certain conditions in the context of frequency allocations make sense, as long as they remain feasible for the mobile service providers. A nationwide supply is desirable. However, nationwide coverage is currently not achievable with 5G alone. This is not technologically or economically feasible with the frequencies provided, so a corresponding edition so not effective. But the goal of a nationwide 4G supply can be intensively worked independently.

Because you mentioned AI in the beginning – it is not just about technology, it is also about ethical issues and concerns. People fear self-driving cars that run over children. How can you counter this?

Other parts of the world are more likely to see the opportunities that AI provides, but many people’s concerns are serious. It will certainly take some time before autonomously driving cars are part of the everyday life – so it is good that ethical questions and concerns are already being discussed and possible practical solutions are at stake.

So far, thank God, I do not know any example in which an autonomously driving car ran over a child – it has always been humans…

… but there are cases, where adults have been ran over by autonomously driving cars.

Every traffic victim is a disaster. Accidents can hardly be avoided 100%. Nevertheless, the safety through autonomous driving is overall much higher than it has been the case in previous times.

It is clear that ethical questions must also be answered. For this a number of commissions were launched. I myself am a member of the High Level Expert Group on Artificial Intelligence, in which 52 experts from all over Europe discuss where red lines need to be drawn, what the economy can do through self-regulation and where it needs regulation from the legislative.

This will be necessary, whereby we plead not to regulate everything hectically, but to look in calm: What can AI already do today, what will AI be able to do in a future perspective that we need to settle today? And what are future scenarios of which we do not know if they will ever be realised?

Digitisation is not only taking place at the political level, it is also a major challenge for the economy. What is important for industrial companies? How prepared are you for this?

That cannot be easily answered. There are great medium-sized companies that have a lot of pioneering spirit and are moving much faster and easier than big corporations, where a whole set of equipment has to be changed. Meanwhile, however, all branches of industry have understood that this topic concerns them as well. No one will be bypassed by digitisation without a trace.

Perhaps the smaller companies in the past also felt overwhelmed when they were told that now everyone needs to establish a digital platform and think much more of the customer instead of looking at the production process.

Realistically, not every medium-sized company is going to found a platform. But we are seeing that many interesting platforms are emerging. It is important that they connect with each other. Every medium-sized company should be careful to be connected even in the digital age. As a company, it is important to be involved in every value creation structure.

It is also feared that a large part of jobs will become replaceable in the future. What educational and socio-political action do you see to counter this?

A number of studies actually shows the opposite. According to this, digitisation will actually create more work or more need for work …

… but these will not be the same jobs.

Right. But do we always have to maintain the status quo? In Germany, too,  we often have the perspective: What is there in a particular moment is good and beautiful. That probably expresses how well we feel today, but still is not always the best view of things.

Nevertheless, we have to prepare for the changes. Workers need qualification opportunities.

Absolutely, we have to prepare for the changes. There will be massive changes, that is the challenge we face today. Digitisation must be part of school education.

Politics has been talking about this for many years, nothing has happened yet. Therefore, it is good that there is the Digitalpakt Schule with a volume of €5 billion in the coalition agreement. However, it is not just about equipping the schools, but also about making the teaching staff fit for digitisation. Finally, teachers need to convey a basic understanding of digital processes.

This not only applies to schools, but also to universities and dual training systems: How can I bring a digital component to the individual courses? How can the training professions get this digital component? In this way, job profiles could become more interesting, for which there are too few interested parties today.

The third component is training on the job: How do I convince the workforce, whose field of activity will continue to change? How can employees qualify to take on a new job in the company?

Are the companies doing enough to provide the relevant training opportunities? According to a survey of work councils this is not the case. They complain that digitisation is compressing jobs and increasing control, but that qualification is not enough.

When it comes to digitisation, industry associations and trade unions work well together. The unions have also recognised the need for action at an early stage. Both sides are important: The employer must make sure that the employee can follow the process so far that he knows what he has to do.

But it is also about the self-motivation of the employee, not to be discouraged by the change, but to take on the task. Digitisation succeeds best with initiative.

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