Although Generative AI had its origins several decades back, it is only in the last couple of years that this machine learning technology has seen explosive growth. GenAI allows computers to generate new content, create new product designs, and optimise business processes. Companies are using GenAI to develop and test products in a virtual immersive environment.
Another recent development allied with GenAI is the emergence of Causal AI. The key idea behind this technology is to learn cause and effect relationships within data and use this to inform the output of AI models. A report by the World Economic Forum offered this as a type of question that Causal AI models are well placed to answer: "What caused this issue in my manufacturing plant and what actions can I take to prevent future issues?"
"Australian companies are already embracing GenAI and Causal AI with even wider adoption expected," said Anthony Wong, regional director, South Pacific, Rockwell Automation. The company's 2024 State of Smart Manufacturing Report (SoSM) surveyed more than 1,500 manufacturers across 17 manufacturing countries including 88 businesses in Australia and New Zealand.
Of the manufacturers in Australia and New Zealand in the SoSM survey, 45% reported the wide adoption of GenAI and Causal AI with another 34% planning to invest in the next 23 months. It is interesting that with 45 percent, GenAI and Causal AI implementation in Australia and New Zealand is already higher than in Canada (37 percent), UK (41 percent), and the US (43 percent).
It is imperative for Australia to embrace technologies like GenAI and Causal AI as the country is getting older, faster. A recent University of Sydney study found that by 2026, more than 22% of Australians will be aged over 65 – up from 16 percent in 2020, which was already double the 8.3 percent at the start of the 1970s. A recent McKinsey study found that GenAI has the potential to increase Australian labour productivity by 0.1 to 1.1 percentage points a year through 2030.
Tech Council of Australia (TCA) has predicted GenAI could deliver between $45 billion and $115 billion in value to the Australian economy by 2030, depending on the pace of implementation. A medium-paced implementation could contribute $45 million to the economy by 2030, with most value coming from improvements to existing industries. TCA estimates that 70% would come from enhanced labour productivity, 20% from improved quality of outputs, and new products and services delivering the remaining 10% of value.
The Industrial Metaverse
The term Metaverse was first popularised by a social media platform. Industry has embraced the concept and incorporated the principles to benefit manufacturing and allied sectors. According to MIT Sloan School, the Industrial Metaverse is being constructed with existing tools, including digital twins, artificial intelligence, high-fidelity simulations, extended reality, blockchain, 5G connectivity, and cloud and edge computing. This will lead to manufacturing being localised and more resilient supply chains.
"In the Industrial Metaverse, machines, factories, grids, and systems are mirrored in the virtual world. This enables teams to collaborate in real time regardless of distance," said Wong. "Taking this to the next level will need cloud technology, AR, and VR systems, blockchain, AI, and other technologies to come together," he added.
This sector is set for phenomenal growth. In the next 12 months, 50% of the Australian and New Zealand companies in the SoSM survey, plan to invest in the Industrial Metaverse. Australia is bullish about this technology and ahead of other countries where planned investment levels are significantly lower – Canada (30%), Germany (34%) and the US (42%).
Digital threads connect the physical and virtual worlds and 41% of the Australian and New Zealand companies in the SoSM Report have already invested in this technology with 39% planning to invest in the next 12 months. A digital thread is a data-driven communication framework that connects traditionally siloed elements in manufacturing processes. Australian and New Zealand are well ahead of the pack compared with digital thread investment in Canada (24%) and Japan (27%).
