Estonian industry on a data gold rush

Estonian industry on a data gold rush. 13.05.2025. “We have large top companies, the leaders in digitalization, but at the same time, there are also smaller and medium-sized companies that are still learning how to make their devices communicate with each other,” said Haran. “We have large top companies, the leaders in digitalization, but at the same time, there are also smaller and medium-sized companies that are still learning how to make their devices communicate with each other” Haran emphasized that the greatest untapped potential of smart industry lies in data collection and its targeted use. “Data is the new gold – companies collect it in massive amounts, but many do not use it for decision-making. What sets successful companies apart is their ability to make practical decisions based on data,” he explained. The hidden potential of smart manufacturing Andri Haran Although companies often make significant investments in machinery and data systems, the collected data often remains passively unused because they lack the skills and awareness to analyze and apply it in practice. This means that while the necessary information exists, it does not reach management decisions, nor does it help increase productivity or improve product quality. “Data collection is just the first step. The real value emerges when data is used for decisions and actions. The fastest progress is made by those companies that understand that digitalization also means rethinking management processes and work organization,” Haran noted. In his view, data utilization does not have to be complicated or expensive – even smaller companies can benefit from it. The key is to focus on specific areas where data can provide clear insights and support management decisions. For example, data can be used to monitor raw material consumption, predict equipment maintenance costs, or improve product quality. “Data collection is just the first step. The real value emerges when data is used for decisions and actions. The fastest progress is made by those companies that understand that digitalization also means rethinking management processes and work organization.” Leaders and laggards According to Haran, some sectors in Estonia are significantly more successful in digitalization and automation than others. He highlighted the wood and food industries as positive examples. Success in these sectors is driven by internal competition, which forces companies to continuously improve their production processes and optimize costs to stay competitive and outperform their rivals. However, success is not solely determined by the specifics of the sector – in every field, there are companies that have managed to get ahead in digitalization and automation. Yet, these companies typically make up only 5–10% of the entire sector, while the rest are still exploring ways and solutions to make their production smarter. Haran acknowledged that smaller and medium-sized companies often fall behind in digitalization because their resources are limited, making large investments risky. In such cases, the most beneficial approach is to take small, well-thought-out steps. Digitalization and automation should primarily be applied in areas where these changes have a direct positive impact on productivity and efficiency. Education and skills – the foundation of smart industry The development of smart industry largely depends on the availability of competent specialists. According to Haran, Estonia’s education system is on the right track, but changes must happen faster and more purposefully. Young people should be offered practical skills and opportunities to engage with real production processes during their studies. This would ensure that new specialists can quickly adapt to industry needs and start contributing to companies’ growth immediately. Haran suggested that Estonia could implement an apprenticeship system similar to the one in England, where young people gain practical experience early on, guided by industry specialists. “It shouldn’t be just theoretical education but a practical and modern approach, where young people can use cutting-edge technology,” he explained. “It shouldn’t be just theoretical education but a practical and modern approach, where young people can use cutting-edge technology.” The development of smart industry also depends on close cooperation with research institutions. According to Haran, companies should view universities as strategic partners capable of providing new solutions and innovation. Research institutions can help companies solve complex technical problems, test new technologies, and develop solutions that would otherwise be out of reach. Such cooperation allows companies to develop faster and remain competitive. Haran noted that while the importance of cooperation with research institutions in developing smart industry cannot be overstated, there is still room for improvement in Estonia. Companies may often fear that the pace of universities and research institutions is too slow, or that research projects are too complex and costly. However, he emphasized that cooperation does not always have to start with large and complex projects – even small and focused initiatives can lead to successful results, as long as both parties clearly understand their roles and expectations. As a positive example of successful collaboration, Haran highlighted AIRE (Artificial Intelligence and Robotics Competence Center), which has delivered excellent results in bringing companies and research institutions together. “It’s precisely this kind of cooperation that helps create something new and competitive,” he said. The future won’t wait – Estonian industry must dare to dream big Haran believes that Estonian industry could reach a global level in the next decade – if it can successfully combine the strengths of the ICT sector with traditional industry. “If we can leverage our data analytics and software development skills in the industrial sector, Estonian industry can become globally competitive,” Haran emphasized. “If we can leverage our data analytics and software development skills in the industrial sector, Estonian industry can become globally competitive.” However, the success of smart industry will not come by itself – it requires courage from company leaders to invest and develop, and a willingness from employees to learn and acquire new skills. According to Haran, the future of Estonian industry depends on how well it can integrate into the global value chain and offer something unique to the world. This means creating innovative products and technologies while also smartly applying existing solutions.