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Transformation 4.0 — Beyond the Hype

by Otto Schell | SAPinsider, Volume 15, Issue 2

April 1, 2014

Explore the potential of Transformation 4.0, also known as “the Internet of Things.” Transformation 4.0 raises significant challenges around security, the handling of big data, privacy, and the safeguarding of intellectual property — but it also creates opportunities for collecting better data, redefining job descriptions, and focusing on predictive maintenance.


Trends come and go, some more quickly than others. Sometimes, however, it is possible to spot a trend that will go beyond the short-term hype and actually become part of everyday culture. In this case, I’m speaking of Transformation 4.0. Whether you call it Industry 4.0, the Internet of Things, or machine-to-machine communication, one thing is clear — this idea has the potential to fundamentally change the way we do business and even the way we live our personal lives.

Examples of progress are shown in the automotive sector — the networking of vehicles and customer relationship activities in consumer markets, for instance. While this is a smart place to start with Transformation 4.0, it is only a stepping stone toward the real objective: the holistic consideration of all conceivable sub-areas and processes in highly automated companies. Organizations can reach this objective by taking two principles into consideration: Stringent security measures have to be in place and the right people with the right skills must be prepared for the transformation.

Integrating Security into Innovation

The challenge of Transformation 4.0 is security. With everything being connected and automated, the dangers go beyond simple information breaches. It is also about data privacy, data protection, and safeguarding of intellectual property. Putting the right concepts in place to allow business transactions in cloud environments and effective handling of big data will be key.

Another area where security is paramount is in the mobile space. Even though everyone is aware of advancing mobile abilities, like GPS location functionality, people still want the right to be informed about the risks involved. Clustering security items such as information severity, information privacy, or service agreements is a first step. But gaining opportunities by working in open environments and then asking for more and more compliance will not foster transformation. We need to think in appropriate levels.

Redefining Job Descriptions

While it is necessary to focus on the technology, processes, and security for Transformation 4.0, one cannot forget one of the most important components: the people. With this great transformation, we need to start redefining job profiles. Job descriptions such as data engineer or business process designer are not yet familiar. But as Transformation 4.0 continues to be accepted into the mainstream, these qualifications will be in big demand.

Considering machine-to-machine communication and the new roles of engineers, predictive maintenance is becoming an area of focus for end-to-end process efficiency.

How DSAG Can Help

One of the most important ways to prepare for Transformation 4.0 is to have all of the information needed to make smart, secure decisions. DSAG is tasked with driving discussions and, through the process and IT expertise of its member companies, contribute to the debates on Transformation 4.0 across various industrial sectors. DSAG’s main goal, as always, is to ensure that the voices of DSAG members are heard and stay at the edge of this transformation by balancing the speed of technology and enabling business integration.

An email has been sent to:


Otto Schell
Otto Schell

Board of Directors — Industry Solutions, Business Processes and Digital Transformation

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