With full speed into the digital transformation

Upper Austria is making huge investments to ensure the province retains its reputation as a top Central European business location.

The digital transformation has an impact on nearly all areas of life. It forms the basis for the further development of the latest technologies and is thus setting the course for the Upper Austrian economy and industry. Upper Austria’s business and research strategy #upperVISION2030 focuses on the creation of knowledge and added value using data as well as using the innovation potential of new technologies. Within the framework of this programme, around 4.8 million euros will be allocated to the “Digital Transformation” funding call. Research & development projects that support the advancement of digital solutions in companies as well as the transfer of innovation from science to industry are also being funded.

The Covid pandemic as a digitisation accelerator

“The pandemic has accelerated digital transformation. Now we must strengthen the digital know-how of domestic companies to make them fit for the future and also further strengthen their competitiveness. A recent location study by Teodoro Cocca (Professor for Asset Management at the Johannes Kepler University in Linz, Austria) has shown among other things that as a reaction to the Covid pandemic Europe’s leading industrial regions are placing specific emphasis and efforts on the area of digitisation. Pushing forward with the digitisation of domestic businesses, particularly SMEs, is also a clear mandate for Upper Austria. After all, we have a clear goal, we want to position ourselves amongst the top regions in Europe,” explains Upper Austria’s Regional Councillor for Economic Affairs and Research, Markus Achleitner.

“With our current funding call ‘Digital Transformation’ we want to give an additional boost to the digitisation of Upper Austrian companies. In order to achieve this, we are investing around 4.8 million euros of state funding,” Achleitner announces.

Increasing the level of digitisation

“In order to secure Upper Austria as a business, industrial and research location and to maintain its international competitiveness, we have to continue to drive innovation in the development of products, processes, services and technologies,” he says. Digitisation has a special role to play: “One thing we have witnessed during the pandemic in particular is that companies with an advanced level of digitisation have a better resilience to crises, achieve higher revenue, employee and productivity growth, and make more investments”, Achleitner emphasises. The core competences and key technologies at the business and research loca-

Gerhard Dimmler, Research and Development Manager at Engel Austria and Advisory Board spokesman of the Mechatronics Cluster, FFG Managing Director Henrietta Egerth, Upper Austria‘s Regional Councillor for Economic Affairs and Research Markus Achleitner and Günther Schallmeiner, head of the Upper Austria branch of Siemens AG Austria

tion Upper Austria, especially in the fields of information and communications technology, are to be further developed and expanded upon with the current Upper Austrian business and research strategy #upperVISION2030.

In addition, there will be a stronger focus on ensuring a more rapid implementation of research results into real-life applications. Information and communication technology is of central importance in a digital world and especially in a data-driven economy. “We want to generate knowledge and value from data. The knowhow development is to be driven forward, especially in new technologies such as artificial intelligence, data-driven modelling and simulation etc., in order to exploit their potentials for existing applications, processes and products in various areas of the economy,” explains Achleitner.

Funding call ‘Digital Transformation’

By 2030, Upper Austria is set to become a model region for the implementation of the digital transformation, with people at its heart. Particularly in the areas of machine learning / artificial intelligence, the benefits and positive effects for people and society should be clearly in the fore. For this reason, the Province of Upper Austria is making concerted investments in the following topics for the future: After the two funding calls ‘Circular Economy’ and

The focus of the strategy

The Upper Austrian business and research strategy #upperVISION2030 defines numerous specific implementation projects. Among other things, this involves the sustainable integration the results from the activities of the Flagship Initiative Digitisation.

Here are a few examples: c The development of appropriate formats/instruments for the digital transformation of SMEs c Focus on data centres when settling companies c Expansion of the research focus on secure systems c Establishment of a multidisciplinary research focus in the field of data-based modelling c Establishment of a software competence centre in Hagenberg with the focus on software development, IT security and prescriptive analytics c Creation of a (scientific) platform for human-centered AI c Establishment of an AI quality test & certification centre c Support programmes to increase the level of digitisation among SMEs

‘Digital Health’, the Province of Upper Austria is providing a further 4.76 million euros for the funding call ‘Digital Transformation’ within the business and research strategy #upperVISION2030. This will – in continuation of an already tried and tested cooperation – be carried out jointly with the Austrian Research Promotion Agency (FFG).

‘The Covid-Pandemic has accelerated digitisation’ is currently perhaps one of the most-cited findings by business researchers. It is true that the crisis has indeed created more awareness for the potential of the digital transformation. Many companies have massively upgraded in this area and have done so much quicker than planned. “Recent studies show that these investments are worthwhile. Digitisation leads to both a direct and measurable business success. We want to make this successful formula even more accessible to local companies together with the Province of Upper Austria with the funding call ‘Digital Transformation’, stressed FFG Managing Director Henrietta Egerth.

Strategic goals and the focus of the funding call

Through digitisation business models are being adapted, new distribution channels are being explored and existing value chains are being rethought. Data-based decisions have an increasingly higher importance in companies and the use of new technologies has, in addition, an influence on existing organisational forms. A prerequisite for the networking of machines and processes is the user acceptance of new technologies. Topics such as data security and control over data are therefore becoming increasingly relevant.

That is the reason why the focus is particularly on the following strategic goals: The generation of knowledge and value through the use of data, exploiting the innovation potential of new technologies such as big data or artificial intelligence, as well as striving to achieve a pioneering position in the field of human-centred artificial intelligence and setting quality standards for AI systems in terms of security and reliability. In addition, the projects must meet one of these technology priorities: “Pervasiveness of data and supporting software tools”, “the digitisation of business processes”, “new business models” and “machine learning / artificial intelligence”.

Siemens as a driver of digitisation

“With around around 8,000 employees and a turnover of around 2.6 billion euros in the 2020 business year in Austria, Siemens is a significant player in the establishment of industrial digitisation and automation solutions. Research and innovation are the central focus here. The industrial sector in particular is currently experiencing rapid development. The demands on companies, especially those that are in international competition, are increasing. The aim is not only to increase the productivity and efficiency of production, and to bring the issue of sustainability more to the foreground, there is also a greater need today for individual products and solutions while the quality requirements remain the same, or are even increasing,” says Günther Schallmeiner, head of the Upper Austrian branch of Siemens AG Austria and adds: “New products and models are being brought onto the market quicker than they were a few years ago. The reason for this is the use of modern technologies – from Edge and cloud computing to artificial intelligence (AI) and digital twins. They create intelligent value chains and new business models. The use of and the networking of intelligent technologies saves costs, energy and time. This means that from the initial idea through to the development, sales, production, logistics, service and recycling, the individual process steps can be networked with one another, and capacities can be fully utilised. Today’s digital transformation is the future of tomorrow. However, it requires continuous innovation and constant learning.”

© Stadt Linz

In addition to its optimised digital processes, Spitz GmbH has now also switched its entire PET beverage range to 100 percent recycled PET.

Sustainability through digitisation using the example of Spitz

Automation and digitisation processes in the industry are no longer just about pure efficiency gains but also about the question of ecology and sustainability. Digitisation can also make a significant contribution there. One example of this is the Upper Austrian food producer Spitz, which relies heavily on digitisation. The fully automated production in small batches is already ensuring high flexibility, efficiency and quality. The consistent, integrated solution not only increases process stability and product quality, but also minimises potential sources of error at the same time. Spitz uses the Manufacturing Execution System (MES) solutions with the Simatic IT Production Suite. This enables production and manufacturing systems to be controlled, manufacturing processes to be coordinated with the supply chain, and the gap between business management systems and process control systems to be closed. Materials management is integrated into the automation, as is the collection of operating data, which is also used for energy management.

The digital transformation from a business perspective

“The challenges have become considerably more complex over the past few years, as the different technological fields are becoming increasingly intertwined. At the same time mechatronics is helping us to solve these challenges. The comprehensive understanding of systems in combination with powerful calculation capabilities makes optimisations and further developments possible both in the engineering of our machines as well as in industrial implementation, which were unthinkable years ago. The new solution possibilities go far beyond those based on many years of experience. That is why mechatronics can be described as an enabler of digitisation,” explains Gerhard Dimmler, Research and Development Manager at Engel Austria and Advisory Board spokesman of the Mechatronics Cluster. Dimmler sees the greatest potential for the next few years in digitisation and digital transformation. “To put it simply, I see digitisation as a modular system of methods full of new technologies that we can consistently develop and use.” However, it also requires a change of mindset both within a company as well as in the collaboration between industries and companies. “My belief is that we can both foresee and estimate technologies, but the associated application possibilities far exceed our horizon. We will also need this when it comes to the topics of sustainability and the carbon footprint due to increasing environmental political pressure,” says Dimmler.

Different levels and invisible elements

It is very important to differentiate between the different levels of digitisation. On the one hand, we distinguish between digital technologies as visible products or services. It is precisely the mechatronic approach that makes it possible to use the technologies of digitisation on an industrial scale, and to implement them successfully in development, production and manufacturing in order to create added value. Whether it be through more intelligent products or services or the concerted use of AI in conjunction with domain-specific knowledge. ”In this area we are already of-

fering products on the market with great success. But when it comes to service in combination with digitisation solutions we are only at the beginning,” explains Dimmler. “On the other hand, we can see the compelling need to address the issue of software systems as invisible elements of digitisation, even if this is often not so exciting. Among other things, we understand this to mean data consistency, digital twins, a coordinated ERP system, security and much more. These are topics that occupy us within our company, which take up a lot of time and resources and are not really visible when they work. In addition to the companies themselves, the providers of software solutions are also in demand. It will become an interplay between requirements and implementation possibilities in the conflict area between profitability and necessity. Here, we are still in the concept phases,” says Dimmler. The next level describes the medium-term and future foundations of the digital transformation that will solve the challenges that we do not even know about today. Here, science is concerned with questions about cyber-physical systems, miniaturisation as well as the decentralisation of AI and much more. Upper Austria as a business location has been and will be particularly shaped by the scientific orientation in this field, and as a result the innovative output of its businesses will be influenced in the future. That is why it is also a matter of proactively shaping the measures and activities as well as about incorporating future needs in the context of digitisation. ◆

© Engel Austria

Gerhard Dimmler, Research and Development Manager at Engel Austria and Advisory Board spokesman of the Mechatronics Cluster.

Objectives of the funding call “Digital Transformation”

In order to make Upper Austria’s companies fit for digitisation, the submitted projects should fulfill the following objectives and thus become a driver for the future competitiveness of Upper Austria as a business location:

c Objective 1: The project must make a concrete contribution to rapidly transferring research results into commercial application, thereby further strengthening and expanding Upper Austria’s position in the field of digital transformation. c Objective 2: The project must sustainably strengthen the value creation of companies and institutions, and close the gap between developers and users/implementers of digital solutions. c Objective 3: The project result or the solutions envisaged must have an impact on the following aspects: • It must contribute to maintaining and increasing the competitiveness of the participating companies and institutions. • There should be potential for cross-industry or cross-sector solutions, the development of new business models or the developing of new markets. • Development of future-oriented products, services, tools and processes through rapid transfer to commercial application. • Significance for the environment of a company (customers, suppliers, cooperation partners, etc.) c Objective 4: The effects of the project results must subsequently be evaluated in the participating companies and institutions for example through: • internal training and further education of employees • Change in organisational structure, long-term implementation etc. • Änderung der Organisationsstruktur, usw. nachhaltig verankert werden.