The State of Augmented Reality, Mixed Reality and Virtual Reality adoption and use in European small and medium-sized manufacturing companies in 2020 : VAM Realities Survey Report

This report provides an overview on Augmented Reality (AR), Mixed Reality (MR), and Virtual Reality (VR) adoption and use in European manufacturing SMEs in 2020. AR is a technology that combines digital objects into the user’s view of the real world with various devices, such as smartphones and head-mounted-displays (HMDs). MR is often used to refer to more advanced AR solutions, although they are also often used interchangeably. VR on the other hand replaces the user’s view of the real environment with a simulated virtual world with the help of VR HMDs. The AR, MR, and VR markets, which together constitute the overall Extended Reality (XR) market, are expected to grow rapidly during the next few years. These technologies became relevant for organizations with the emergence of the new wave of AR and VR hardware in 2016, namely with the commercial release of the Oculus Rift and HTC Vive VR glasses, and the unveiling of the Microsoft HoloLens AR glasses. However, despite the initial excitement provided by these novel technologies, it soon became obvious that the necessary enterprise software and information systems did not yet support these new devices sufficiently to enable efficient and rapid workflows in organizational business processes. For example, digital building information models (BIM) used in the construction industry often took hours or days to export into AR or VR. This process also required manual optimizations and using several different software in order to create usable visual models for AR/VR use. This made using AR/VR time-consuming, costly, and impractical. However, now that AR and VR software have had a few years to catch up, many AR and VR software have been able to develop efficient pipelines between various software and organizational information systems and AR/VR solutions. For example, exporting digital models (such as BIM) into VR can now be done in seconds or minutes by the click of a button. Moreover, it is now even possible to edit CAD models in real-time inside VR, which can enable novel business processes. The release of vastly improved hardware chipsets (such as the Snapdragon XR2) used in the newest AR/VR devices are now also further expanding the possibilities for future software innovations in the AR/VR space, as well as business opportunities for manufacturing SMEs. These developments have made it increasingly possible to adopt these technologies in companies to increase the efficiency of organizational business processes. Accordingly, companies should take a renewed look at how different XR solutions could be implemented in their companies. In addition, the COVID-19 pandemic has also forced many companies to start working remotely which has compelled companies to try to find more effective ways of carrying out their business processes remotely to adapt to this new reality. This situation has accelerated the already existing trend of increasing remote work. AR and VR both present intriguing opportunities for making remote work more engaging, effective, and efficient. For example, reviewing 3D models of new product designs can now be done collaboratively in VR whereas AR can make remote support more intuitive for employees. These types of solutions can help employees stay connected even though they might not physically see each other for extended periods of time. However, small and medium-sized enterprises (SMEs) need to take into account many different factors and requirements if they wish to start using XR technologies in their organizations. The VAM Realities project (co-funded by the Erasmus+ Programme of the European Union) set out to explore these issues at the beginning of 2020. We carried out 46 interviews in nine European countries and collected data from 255 respondents on the use of AR and VR in organizational settings with a survey. This document reports on these findings and results. The majority of the surveyed companies were still not using AR or VR (around 60 %), but a sizable minority (around 25 %) were using them sometimes with a smaller group (around 15 %) using them very often. However, the majority of respondents were aware of the potential that these technologies have in their organizational context but had not actively planned on using AR or VR yet. Nevertheless, a majority of the respondents (65 %) also thought that their company would use AR or VR in the future. Several different adoption barriers were identified in the interviews and via the survey. An innovative organizational culture and support from the top management were found to be necessary for AR/VR adoption. Managers should therefore acquire at least a basic understanding about these technologies, where they can be used, and what limitations they might have in their enterprise context. Employees should also be given time to delve into these technologies to figure out how they could be best used to support or transform their businesses. However, in companies which do not have employees who could be characterized as digital innovators, it is likely that AR/VR solutions will need to be acquired as complete turn-key packages in cooperation with external vendors. Companies will also need to identify the best opportunities for testing AR/VR hardware and software. University cooperation, industry associations, and vendor demonstrations were identified to have the most potential in this regard. Due to the novel nature of XR technologies, first-hand experience with relevant use cases was found to be essential for understanding their potential and limitations. These testing situations should be made to be as engaging and practical as possible in order to mitigate any possible apprehension from the employees towards XR. It is also important for companies to evaluate how well their current software and information systems can be integrated with the currently available solutions because the value of AR and VR comes mainly from presenting existing digital information to users in novel and efficient ways. In this regard, streamlined AR and VR functionalities and plugins have become available for many design software (e.g. in the BIM and CAD context) just in the last few years (2019-2020). Companies should therefore examine whether these new tools could be more easily adopted than in previous years when the first new AR and VR devices became available. Most of the surveyed companies reported that their competitors were still not using AR or VR in a noticeable way to the best of their knowledge. However, due to the COVID-19 pandemic and ever-increasing remote work, exploring how AR and VR can create a competitive advantage in this new situation can be advantageous for companies. In the short-term, AR and VR adoption and use will still most likely focus on internal business processes or facilitated customer-facing activities because customers still largely do not have the necessary AR or VR equipment in use. Acquiring competences with AR and VR will also increase the possibilities for expanding AR and VR use in the future as more powerful solutions become available. Higher-education institutions (HEIs) can also provide important support to SMEs in acquiring these skills and capabilities through consultancy and research project collaboration