For over a decade I4.0 has been trend-setting for the Manufacturing Industry in Germany and also on the other side of this hightech vision the digitalization of the production is a central challenge for all industrial enterprises. The publication that is now available offers an insight into the development of the I4.0-Readiness Germany. To this end, on the basis of the results of the survey German Manufacturing Survey of 2015, 2018 and 2022 were analysed and with the aid of the new ISI-Industry Panel which interlinks these three waves of the survey conclusions were drawn. The Industry Panel shows a rather subdued digital growth in the last decade.

Bridging the digital divide between SME and large enterprises until 2018

First of all, the formerly less digitalized enterprises and sectors had improved above average. The small and medium-sized enterprises (SME) had made large improvements between 2015 und 2018 regarding digitalization and vis á vis large enterprises they had been able to catch up considerably. Using the I4.0-Readiness Index of Fraunhofer ISI, which is based on seven digited production technologies and their division into three separated technology fields, it becomes obvious that in the last few years this trend could not be maintained. The difference between the two respective index values compared to the baseline value of 2015 becomes even more pronounced as a percentage increase: The growth of the SME was in 2018 at 12 percent compared to the baseline year 2015. Since then, their digital progress is, however, clearly declining and most recently was at only 5 percent

“The bridging of the digital divide between the SME and the large enterprises could not continue according to Dr. Christian Lerch, director of the Business Unit Industrial Change and New Business Models.” He explains: “While the gap to large enterprises narrowed until 2018 and they had caught up with the leading group, the pace of this technological development slowed down significantly. In 2022, it was in particular large companies which invested in an expansion of there digital production.”

Stagnation and Trend reversal caused by Covid

The team of the Competence Center Innovation and Knowledge Economy traces this stagnation back to the COVID-19-crisis with its lockdowns and accompanying production restrictions as of spring 2020. Due to weaker turnovers, particularly SME were less inclined to invest which in turn resulted in a lower degree of modernization of the production equipment. Larger companies were able to overcome the consequences of the lockdowns better due to better resources and were able to give more attention to digitalization even during the crisis. 

The new panel analyses of Fraunhofer ISI show that the decline of the dynamics is also justified by the fact that a relevant proportion of SME had not only made no progress in their I4.0-Readiness, but rather some of them experienced a significant decline in digital equipment digital facilities between 2018 and 2022. The analyses point to a special feature of digitalization in production. “More than classic analogue technologies, digital solutions need even after their implementation continual modifications, targeted measures and investments. SME were not able to always achieve this.“ says Christian Lerch.

The publication “(r)Evolution 4.0: auf den Spuren des rückläufigen I4.0-Fortschrtts, Nr. 82 der Mitteilungen aus der ISI-Erhebung Modernisierung der Produktion“ offers further insights based on the index values for example with a view to the sectors of the Manufacturing Industry as well as a detailed explanation of the individual elements and classifications of the I4.0-Readiness-Index.

Since 1993 Fraunhofer ISI has regularly conducted the surveys for the German Manufacturing Survey. Every three years the survey captures a representative sample of 1,600 companies of the entire Manufacturing Industry. Its comprehensive and fact-based concept allows the survey detailed analyses of the modernity and efficiency of the companies of the Manufacturing Industry.