Nokia CEO Sees Tech Spurring ‘Massive’ Global Productivity Gains

(Bloomberg) --

The next industrial revolution will bring about “massive productivity growth” the likes of which hasn’t been seen in decades, according to Nokia Oyj Chief Executive Officer Rajeev Suri.

Productivity should increase by as much as 35% starting in about 2028, he estimated. The gains will be seen first in the U.S. and a few years later in China, India and the European Union, Suri said Tuesday on a panel about manufacturing at the World Economic Forum in Davos, Switzerland.

Suri said the productivity slump of the past decade is due in part to the traditional nature or the manufacturing sector.

Digitization is poised to reverse that trend, as artificial intelligence, machine learning, robotics, the so-called Internet of Things and 5G mobile networks will help turn industrial companies into technology companies, allowing them to better capture and use data in their processes, he said. Suri pointed to “layout-less factories” without assembly lines in the future, featuring more autonomous vehicles.

Nokia, under Suri, is gearing up for fifth-generation mobile technology roll-outs that it expects will play a role in what some have called the fourth industrial revolution. The technology enables connected devices on “ultra-reliable” networks enabling machines to talk to one another, Suri said.

At Nokia’s factory in Oulu, northern Finland, productivity increased 30% year-on-year after being automated with robotics, Suri said. New product ramp-ups increased 60%, accompanied by a drop in quality defects, and reduced lead times, he said.

“We wanted to un-tether” machines at the Oulu plant “so we could reconfigure it in a fluid manner,” he said. “The results were fantastic.”

To contact the reporter on this story: Kati Pohjanpalo in Helsinki at kpohjanpalo@bloomberg.net

To contact the editors responsible for this story: Rebecca Penty at rpenty@bloomberg.net, Jennifer Ryan

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