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Robots are coming: How can you use them?

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Even though the uptake of robots in South Africa has been slow, they are already being used to or the likes of combatting rhino poaching, showing that we are recognising their advantages, writes HANS KUIPERS, Partner & MD at BCG South Africa.

The global market for robotics—the use of computer-controlled robots to do manual tasks—is growing far faster than expected. In 2014, BCG projected that the market would reach $67 billion by 2025. In 2017, we increased that estimate to $87 billion. Much of the accelerated growth will come from the consumer market because of applications such as self-­driving cars and devices for the home.

Although uptake of robotics in South Africa has been slower than in developed markets – there is no generally accepted valuation of what the market is worth in the country, for instance – there is growing recognition of the opportunities the field provides and the massive potential for growth moving forward. Already there are examples of South African-produced robotics that are assisting in combatting rhino poaching, as well as in dangerous industrial applications such as in mines or on oil rigs. This indicates that South Africa is increasingly adopting robotics as its value is recognised.

Today’s robots have voice and language recognition, access to large amounts of data, algorithms to process information independently, learning capability, greater mobility and dexterity, advanced sensors, and the ability to interact with their environment. They have gained flexibility, speed, and finesse, clearing the way for a generation of precision robots that can make a difference in diverse industries such as retail, health care, food processing, mining, transportation, and agriculture —far more quickly and accurately than human hands can.

As people become more accepting of robots in their everyday lives, this will attract more investment capital and drive further advances in robotic capabilities.

The impact of these changes will be profound. Differences in labour costs between developed countries and emerging economies will cease to be a critical factor for companies deciding where to set up operations, and new factors will come to the fore.

As falling prices, faster CPUs, improved safety, and easier programming continue to place robots within reach of virtually every sector, and their ability to work side by side with humans opens up an array of new applications, the challenge for forward-looking companies is going to be to figure out how to use robotics to gain a competitive edge.

How to gain a robotics advantage

Gaining robotics advantage involves finding innovative, unexpected ways to leverage technology to differentiate a company from the competition and gain a sustainable edge. This may mean identifying the sweet spot where a hybrid mix of human worker and machine delivers the biggest payback, or it may involve creating an entirely new business model. On the basis of BCG’s experience in a variety of industries, we’ve developed a framework to help companies move forward:

 – Identify potential leverage points

Companies should look for areas of the business where robotics might be able to add value by cutting costs, enhancing productivity, improving performance, reducing risk, and addressing skill shortages or workforce variability. Cost savings are likely to be greatest in parts of the world where wages are high and robots could replace labour outright. Areas with highly repetitive or dangerous tasks, or jobs that require flexibility, speed, or precision are also natural fits for robotics. In mining, for example, automated drilling and haulage can reduce the need for workers in remote locations, increase safety, and improve asset utilisation – an area that is already being explored by companies such as Ryonic Robotics in South Africa.

Robots can also be used to take on repetitive, low-skill tasks. Collaborative robots or ‘cobots’ can do heavy lifting and perform precision activities more quickly than human workers can. By liberating workers from tedious, tiresome, or repetitive tasks, robots can improve not only the workers’ productivity but also their job satisfaction. An example of this in South Africa was the introduction of a robot to help sort and collect antiretroviral medication quickly and accurately to dispense to HIV-positive patients at the Helen Joseph hospital HIV clinic in Johannesburg.

– Integrate robotics into strategic decision making

Adding robotics to a business is a strategic decision, not just a capital investment. It requires rethinking and fundamentally altering staffing levels, product mix, manufacturing footprint, and other aspects of the business model. Management must also consider how robotics will affect the company’s brand, operations, and sales. For instance, building robot-enhanced plants closer to local markets may make sense as a way to accelerate response times and to fine-tune products to local tastes – or splitting production into two shifts—a day shift for humans and a night shift for robots—may help to reduce overtime, super­vision, and energy costs.

– Think and act now

Where new technologies are concerned, timing is critical to market leadership. When robotics and automation cross certain price, performance, and adoption thresholds, a tipping point may be near. First movers capture a disproportionate share of the high margins that accrue to successful early adopters. That benefit decreases as adoption becomes more widespread. And because it can take a long time to integrate automation into operations, management needs to act now to develop a point of view, test and pilot robotic applications, and invest in infrastructure—including laying the foundation for a digital supply chain on the factory floor. All the while, the company must closely monitor the industry sector it competes in and move decisively when the time is right.

–  Analyse whether to buy or to build

Proven, off-the-shelf robotics applications can be put to work quickly, but they’re available to everyone, including the competition. An alternative is to invest in a robotics solution tailored to a company’s particular operations. A customised solution could result in fundamental disruption of an industry’s dynamics and provide a long-term source of differentiation.

The decision about which direction to take may come down to sourcing options. Most companies will need to look beyond traditional equipment suppliers for their robotics needs. But even robotics suppliers may not have solutions on hand that meet the specific needs of individual companies or segments, necessitating a customized solution.

–  Develop the workforce

To fully unlock the potential of robotics, countries must retrain or increase the skills of their workforce. Today’s workers generally lack training in robotics installation, programming, operations and maintenance. Few governments, universities, vocational schools, tech leaders and manufacturers around the world are adequately addressing the problem. Despite some progress in early education through STEM initiatives—courses in science, technology, engineering, and mathematics—and in universities with specific degrees related to robotics, an ability gap remains.

Without a pool of qualified applicants to choose from, companies will need to train their own people to install, program, operate and maintain robotics applications. Retaining these people once they have acquired high-demand, high-value skills will be another challenge. As robots take over lower-value and repetitive tasks, the work that remains will be more complex and less structured—and workers will need new skills to perform these tasks successfully.

–  Shape public policy

Companies that make or use robotics should work with communities, educators, local governments and policymakers on issues related to safety, liability, social impact and funding for education and training. By gaining a seat at the table, companies at the forefront of robotics can help define the rules, ensure progress and become advocates for the needs of industry and society alike.

Beyond helping to craft policy for robots that operate in public spaces, companies should participate in setting safety requirements at work, especially as cobots become more prevalent. As robots become safer, the certi­fication process ­should become quicker and less onerous, encouraging further development in the field of automation.

Collectively, the guidelines outlined above can help companies approach robotics in a strategic, disciplined, and pragmatic way—and improve their odds of achieving long-term, sustainable robotics advantage.

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Money talks and electronic gaming evolves

Computer gaming has evolved dramatically in the last two years, as it follows the money, writes ARTHUR GOLDSTUCK in the second of a two-part series.

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The clue that gaming has become big business in South Africa was delivered by a non-gaming brand. When Comic Con, an American popular culture convention that has become a mecca for comics enthusiasts, was hosted in South Arica for the first time last month, it used gaming as the major drawcard. More than 45 000 people attended.

The event and its attendance was expected to be a major dampener for the annual rAge gaming expo, which took place just weeks later. Instead, rAge saw only a marginal fall in visitor numbers. No less than 34 000 people descended on the Ticketpro Dome for the chaos of cosplay, LAN gaming, virtual reality, board gaming and new video games. 

It proved not only that there was room for more than one major gaming event, but also that a massive market exists for the sector in South Africa. And with a large market, one also found numerous gaming niches that either emerged afresh or will keep going over the years. One of these, LAN (for Local Area Network) gaming, which sees hordes of players camping out at the venue for three days to play each other on elaborate computer rigs, was back as strong as ever at rAge.

MWeb provided an 8Gbps line to the expo, to connect all these gamers, and recorded 120TB in downloads and 15Tb in uploads – a total that would have used up the entire country’s bandwidth a few years ago.

“LANs are supposed to be a thing of the past, yet we buck the trend each year,” says Michael James, senior project manager and owner of rAge. “It is more of a spectacle than a simple LAN, so I can understand.”

New phenomena, often associated with the flavour of the moment, also emerge every year.

“Fortnite is a good example this year of how we evolve,” says James. “It’s a crazy huge phenomenon and nobody was servicing the demand from a tournament point of view. So rAge and Xbox created a casual LAN tournament that anyone could enter and win a prize. I think the top 10 people got something each round.”

Read on to see how esports is starting to make an impact in gaming.

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Blockchain unpacked

Blockchain is generally associated with Bitcoin and other cryptocurrencies, but these are just the tip of the iceberg, says ESET Southern Africa.

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This technology was originally conceived in 1991, when Stuart Haber and W. Scott Stornetta described their first work on a chain of cryptographically secured blocks, but only gained notoriety in 2008, when it became popular with the arrival of Bitcoin. It is currently gaining demand in other commercial applications and its annual growth is expected to reach 51% by 2022 in numerous markets, such as those of financial institutions and the Internet of Things (IoT), according to MarketWatch.

What is blockchain?

A blockchain is a unique, consensual record that is distributed over multiple network nodes. In the case of cryptocurrencies, think of it as the accounting ledger where each transaction is recorded.

A blockchain transaction is complex and can be difficult to understand if you delve into the inner details of how it works, but the basic idea is simple to follow.

Each block stores:

–           A number of valid records or transactions.
–           Information referring to that block.
–           A link to the previous block and next block through the hash of each block—a unique code that can be thought of as the block’s fingerprint.

Accordingly, each block has a specific and immovable place within the chain, since each block contains information from the hash of the previous block. The entire chain is stored in each network node that makes up the blockchain, so an exact copy of the chain is stored in all network participants.

As new records are created, they are first verified and validated by the network nodes and then added to a new block that is linked to the chain.

How is blockchain so secure?

Being a distributed technology in which each network node stores an exact copy of the chain, the availability of the information is guaranteed at all times. So if an attacker wanted to cause a denial-of-service attack, they would have to annul all network nodes since it only takes one node to be operative for the information to be available.

Besides that, since each record is consensual, and all nodes contain the same information, it is almost impossible to alter it, ensuring its integrity. If an attacker wanted to modify the information in a blockchain, they would have to modify the entire chain in at least 51% of the nodes.

In blockchain, data is distributed across all network nodes. With no central node, all participate equally, storing, and validating all information. It is a very powerful tool for transmitting and storing information in a reliable way; a decentralised model in which the information belongs to us, since we do not need a company to provide the service.

What else can blockchain be used for?

Essentially, blockchain can be used to store any type of information that must be kept intact and remain available in a secure, decentralised and cheaper way than through intermediaries. Moreover, since the information stored is encrypted, its confidentiality can be guaranteed, as only those who have the encryption key can access it.

Use of blockchain in healthcare

Health records could be consolidated and stored in blockchain, for instance. This would mean that the medical history of each patient would be safe and, at the same time, available to each doctor authorised, regardless of the health centre where the patient was treated. Even the pharmaceutical industry could use this technology to verify medicines and prevent counterfeiting.

Use of blockchain for documents

Blockchain would also be very useful for managing digital assets and documentation. Up to now, the problem with digital is that everything is easy to copy, but Blockchain allows you to record purchases, deeds, documents, or any other type of online asset without them being falsified.

Other blockchain uses

This technology could also revolutionise the Internet of Things  (IoT) market where the challenge lies in the millions of devices connected to the internet that must be managed by the supplier companies. In a few years’ time, the centralised model won’t be able to support so many devices, not to mention the fact that many of these are not secure enough. With blockchain, devices can communicate through the network directly, safely, and reliably with no need for intermediaries.

Blockchain allows you to verify, validate, track, and store all types of information, from digital certificates, democratic voting systems, logistics and messaging services, to intelligent contracts and, of course, money and financial transactions.

Without doubt, blockchain has turned the immutable and decentralized layer the internet has always dreamed about into a reality. This technology takes reliance out of the equation and replaces it with mathematical fact.

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