How Manufacturing Should Leverage Industry 4.0
The 4th Industrial Revolution is here & it is the biggest highlight of the Digital Transformation journey for enterprises across the world.
So, What Is Industry 4.0?
Industry 4.0 creates what has been called a “smart factory”. It transforms physical processes of manufacturing by driving end-to-end digitization & automation, essentially putting to use technologies like IoT, Cloud Computing & Cognitive Computing.
What Has Industry 4.0 Brought With Itself?
In a survey conducted by PwC covering about 2000+ companies across the world, only 33% rate their company as digitized in terms of horizontal & vertical value chains. But what stands out is, this number will reach 70% by 2020! Industry 4.0 solves some of the major challenges faced by manufacturers
- Uncertain eco-system of macro-economy & geo-political context
- A complex & connected supply chain for better efficiency
- Bridging the gap between understanding the need for digital disruption, an approach which many still find a big challenge.
- Following a more customer-centric & customer-adaptive holistic approach
- Sustaining in a highly competitive landscape
- The need & vision to diversify & tap into new markets & revenue sources
- Changing the face of work, by addressing talent & skills gap.
Industry 4.0 would shorten cycle times, improve product quality, and implement efficiency across value chains in manufacturing. In fast-growing economies & ever increasing demand graphs, Industry 4.0 is the edge manufacturing has been waiting for. Through digital transformation at an eco-system level in manufacturing, the industry is slowly evolving towards the ‘as-a-service’ economy.
What benefits can manufacturing leverage by embracing Industry 4.0?
Technology: A competitive advantage
Industry 4.0 talks about ‘connected things’, ‘advanced analytics’, ‘one-size fits all’ customization & ‘intelligent communication & coordination’ platforms. To reap the fruits of success, harnessing technology is essential. But not everything can be used & found useful. Prioritizing & investing in the right technology is the key.
Agile processes: More automation less human error
In manufacturing, producing in terms of demands, changing needs & technical advancements, the production, operation & supply chain cycles must never fall back. With the Fourth Industrial Revolution, these physical processes are given the highest importance. Automation for efficiency & agility would enhance customization & in-time delivery of products to the market.
Innovation: Deriving insights to deliver customer success
What gives manufacturing industry an edge above everything else in this revolution is the ability to derive intelligent insights- a powerful boon turning tables around! Earlier there were very limited ways to connect with customers/markets & receive reviews of products that are already in the market & possibly in the various cycles of manufacturing. But with the advent of Industry 4.0, huge volumes of data can be churned to extract insightful data, which can be used in product innovation, & deliver customer delight! Find out more about the monetization of data in the manufacturing industry.
Initial investment? Yes. Advantage? Higher Revenue
Every change on a larger level will require ample investment. Industry 4.0 is a change which cannot be implemented on a single plant or single machine & lo behold! We succeed! It is no fairytale. But not investing now, and missing out on opportunities for producing better quality products, lower costs later & the ability to stay ahead in the game, is it worth the bargain? PwC survey derives, 35% of the companies surveyed expect revenue gains over 20% in the next 5 years. CIOs, CTOs & CDOs, need to give this a long hard thought.
An interesting example that comes to my mind is that of Vopak; leading independent tank storage provider for the oil and chemical industries, achieved 25% cost savings by leveraging technology & innovation read the case study here to understand the complete technology stack – Liquid Bulk Terminalling
What lies ahead
Humans are complicated, more so than machines & technology. Information & data that we exude is far more than any number of machines or sensors have produced. A bridge between humans & technology seems to be the next industrial revolution, we can call it the Internet Of Humans!