From artificial intelligence (AI) to green energy, automated vehicles to the internet of things (IoT), innovation is accelerating at a relentless pace, creating huge opportunities for businesses and consumers, but also new risks.
Regulators have been racing to respond and over the last few years an array of regulations and standards have been put in place to ensure products and services enter the market safely.
This has made the job of compliance much harder for innovators, particularly those operating globally, who must navigate different regulatory frameworks in each international market. Yet, it would be a mistake to view regulation primarily as a burden, as some companies do, when in fact it plays a crucial role in driving innovation forwards.
Technology that doesn’t comply with regulatory requirements will not succeed, and for good reason, which means the companies behind it will miss out along with society at large.
To ensure this doesn’t happen companies must embrace regulation as part of the invention process, rather than treating it like a barrier. This is where the testing, inspection and certification (TIC) industry comes in – helping organisations to detect possible regulatory and financial risks, ensuring there are ultimately fewer barriers standing in the way of exciting new developments.
“The TIC sector is a key foundation of safe invention,” says Stan Zurkiewicz, the chief executive of Dekra, one of the world’s leading TIC providers. “When disruptive innovation comes into the world, ensuring it is safe is non-negotiable. If an innovator fails to take this into account, they are bound to fail.”
AI threats and opportunities
Dekra carries out product testing, inspection and certification in 60 countries, supporting around 500,000 business clients across an array of industries, along with millions of individual consumers.
One of its key areas of focus is AI, which could offer huge consumer benefits if implemented properly including safer and cleaner transport, more efficient manufacturing, cheaper and more sustainable energy and also improved and accessible healthcare.
When disruptive innovation
comes into the world, ensuring
it is safe is non-negotiable
Yet fears about the risk of bias and inaccuracy in algorithms and data have led to greater regulatory scrutiny and tough new rules. The European Union (EU) has led the way with its AI Act, which will closely monitor certain types of AI to ensure they are safe, transparent, traceable, non-discriminatory and environmentally friendly.
To support its clients Dekra independently assesses, tests, and certifies AI systems to ensure they meet the new rules.
“If things go wrong with AI the impact can be quite severe and hard to reverse,” says Zurkiewicz. “So, the challenge is ensuring that a positive vision of AI prevails, not a negative one, which is why having a trusted TIC partner is so important.”
Cyber and sustainability
Dekra also plays a vital role in the rapidly evolving world of cybersecurity. As the internet touches more and more aspects of daily life, hackers are finding new opportunities to exploit at the device level.
Everything from connected vehicles and web-enabled consumer electricals to power plants and other critical infrastructure is now a target, which is why thorough testing and inspection is so crucial.
It’s a similar story in the sustainability sector, where wind turbines, solar panels and battery storage units also need conformity assessments and periodic inspections for safety, durability and efficacy.
In addition, companies face growing pressure from regulators and shareholders to demonstrate that they are genuinely progressing towards carbon reduction targets. “It requires a financial audit but also a technical one, which is where we can help,” says Zurkiewicz. “You can no longer make sustainable claims to investors or regulators without credible independent verification.”
Headquartered in Stuttgart, Dekra last year reported revenues of €4.1bn (£3.5bn), making it the world’s fourth largest TIC organisation. It supports a wide range of organisations including public sector agencies and government departments, start-ups and SMEs, and blue-chip giants such as BMW, Apple and Google.
Among its other services, Dekra tests and certifies products for export around the world, provides firms with regulatory guidance, and is the leading provider of testing to the electric vehicle sector. It also provides retail and business customers with mandatory and voluntary periodical vehicle inspection services for all types of vehicles.
Managing risk
While larger companies are better equipped to manage regulatory change, all companies find it a challenge, Zurkiewicz says. “Even when there is no obligation to undergo mandatory third-party checks, firms come to Dekra to help them stay ahead of the curve,” he says. “It’s a crucial part of risk management.”
Last year Dekra partnered with LatticeFlow to complete the first commercial AI assessment for Migros Bank, which is one of Switzerland’s best-known financial institutions with around 1 million customers across the country.
The audit focused on a partnership between the bank and Gowago, Switzerland’s largest online car-leasing provider, for which Migros provided financing services.
Gowago uses an AI model to predict the value of cars at the end of the lease-term to help it provide competitive rates. But Migros’s revenues could have been hugely impacted if the algorithm was faulty, so the model had to be carefully tested.
“Our Dekra expert auditors AI Assessment used the Framework, which focuses on assessing the AI system quality as well as its compliance with upcoming EU regulations,” says Zurkiewicz.
“In addition, LatticeFlow conducted an end-to-end technical assessment of Gowago’s AI lifecycle to ensure safety and trustworthiness in line with the latest ISO standards.
“Overall, we helped Migros to harness the benefits of AI in banking operations by managing the risks.”
‘One-stop shop’
Dekra is also supporting Hylane, a German start-up backed by the German government that operates the largest hydrogen-powered truck fleet in Europe.
The firm rents its trucks to major transportation companies such as DB Schenker and GLS as well as retailers like DM and Rewe. And while users only pay for the kilometres they have driven, they are still entitled to maintenance, repairs, servicing, insurance, and access to hydrogen as part of the package.
Dekra helps Hylane with driver testing and training, statutory vehicle inspections and condition reports. “Dekra is a strategic partner because our organisation is a one-stop shop offering everything Hylane needs,” said Stan Zurkiewicz.
Innovation will accelerate rapidly in the next decade, and there will be a significant amount of new regulation to navigate, particularly if a company operates across borders.
Testing, inspection and certification will play a crucial role in helping firms on this journey, and in many cases will be required by law.
“Regulation should not be seen as a burden but as an indispensable enabler of innovation,” says Zurkiewicz. “Companies must work within the rules to succeed commercially, and rigorous independent testing, inspection and certification is key to helping them do that.”
For more information please visit dekra.com
