Skills Gap Threatens to Stall Industrial Digital Transformation for Nearly Half of Companies, Finds New Study from Hitachi Vantara

Competing priorities and skills shortages in IoT, AI/ML data science and robotics undermine potential progress in IT/OT convergence and security

SANTA CLARA, Calif., Sept. 20, 2022 /PRNewswire/ -- Hitachi Vantara, the digital infrastructure, data management and analytics, and digital solutions subsidiary of Hitachi Ltd. (TSE: 6501), today released the findings from a 451 Research report commissioned by Hitachi Vantara that found a lack of digital skills is jeopardizing industries' digital transformation initiatives. The report "Industry 4.0: Maturity of Adoption and Its Impact on Sustainability and ESG"¹ surveyed more than 600 IT and OT leaders engaged in Industry 4.0 initiatives across the manufacturing, transportation, and energy and utilities sectors.

Download a copy of the commissioned 451 Research Report on Industry 4.0

The report provides a broad view of the confidence, concerns, and next steps regarding enterprises actively engaged in digital transformation. Key findings include:

• While 100% of companies surveyed are engaging in or planning digital transformation projects for their operations or supply chains, more than half of companies said they lacked sufficient skills in key areas. The most critical gaps cited are in data science (42%) defined as artificial intelligence, machine learning and analytics; IoT deployment and development (48%), or robotics deployment and operations (60%).
• Given the technology skills gap, at least 37% of respondents indicated that they had no plans to implement IoT-led initiatives.
• Once viewed as a potential barrier to Industry 4.0 and digital transformation initiatives, IT/OT convergence is happening with 95% of respondents saying the two departments collaborate adequately or better for IoT projects.

"Faced with too many priorities and too few people, companies need a focused, sustained approach that derives outcomes as quickly as possible," said Sid Sharma, IoT Practice Leader at Hitachi Vantara. "At Hitachi Vantara, we focus on an outcome-centric approach enabled by our deep industry expertise and experience. Our ready-to-deploy industry-specific templates, data models and automation libraries help us in scaling and accelerating results."

For more information on Hitachi Vantara's IoT Solutions and Services 

Digital Transformation Drivers Reveal Competing Priorities

The survey also revealed that companies are facing a plethora of competing digital priorities from business optimization to employee retention to ESG (environmental, social and governance). The top driver for digital transformation continues to be optimization of business processes and operations, followed closely by reducing risks, innovation/new revenue streams and increasing revenue/cutting costs.

"Digital transformation and its potential to create value for society, environment and economies will depend on how fast certain industries can adopt and ready their workforce for the cloud, cybersecurity, 5G, AI/ML and IoT. Companies must be selective about their business' most critical outcomes and appropriately align it with the necessary investments in software, automation and services," added Sharma.

Despite ESG finishing eighth as a company driver, more than 80% of respondents see ESG regulatory requirements as having at least a medium impact on their organization and expect the impact to increase significantly in the next two years.

"While regulation will have some impact, companies indicated that the primary drivers to meet ESG goals are coming from other market and social pressures," as stated in the report by Ian Hughes, Senior Research Analyst for Internet of Things at 451 Research, a part of S&P Global Market Intelligence. "Increased efficiency and sustainability are competitive factors for enterprises. Digital transformation helps make these efficiency improvements, and many of the ESG requirements achieved are almost a bonus."

Confidence In Cybersecurity Increases

The August 2022 report also reveals that more than three-quarters of respondents are confident in their company's skills for IT and OT security, operations, and application development. However, that degree of confidence may be overestimated given the findings of a recent cybersecurity study that suggested nearly four of five IT respondents reported a ransomware attack at their company within the last year and that nearly three quarters (73%) were financially or operationally impacted by these attacks.

Breakdown of Survey Respondents

451 Research surveyed 616 respondents across transportation (35%), energy (33%) and manufacturing (32%). Thirty-five percent of respondents are located in the U.S. and the rest across Canada, UK, France, Germany and Japan. Nearly two-thirds of the respondents are from companies with 500 or more employees and represent a 51-49 percent split between IT and OT organizations.

Additional Resources

• Report: Industry 4.0: Maturity of Adoption and Its Impact on Sustainability and ESG
• Blog: Aggregating IT/OT Data Does Not Equal Convergence
• Learn More about Hitachi Vantara's IoT Solutions and Services

Source: 451 Research, part of S&P Global Market Intelligence, Industry 4.0: Maturity of Adoption and Its Impact on Sustainability and ESG, Discover Report, August 2022

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About Hitachi Vantara

Hitachi Vantara, a wholly-owned subsidiary of Hitachi Ltd., delivers the intelligent data platforms, infrastructure systems, and digital expertise that supports more than 80% of the Fortune 100. To learn how Hitachi Vantara turns businesses from data-rich to data-driven through agile digital processes, products, and experiences, visit hitachivantara.com.

About Hitachi, Ltd.
Hitachi drives Social Innovation Business, creating a sustainable society with data and technology. We will solve customers' and society's challenges with Lumada solutions leveraging IT, OT (Operational Technology) and products, under the business structure of Digital Systems & Services, Green Energy & Mobility, Connective Industries and Automotive Systems. Driven by green, digital, and innovation, we aim for growth through collaboration with our customers. The company's consolidated revenues for fiscal year 2021 (ended March 31, 2022) totaled 10,264.6 billion yen ($84,136 million USD), with 853 consolidated subsidiaries and approximately 370,000 employees worldwide. For more information on Hitachi, please visit the company's website at https://www.hitachi.com.

HITACHI is a trademark or registered trademark of Hitachi, Ltd. All other trademarks, service marks, and company names are properties of their respective owners.

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