Building manufacturing resilience through digitalisation

  • 21/07/2020
  • 06:30
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Have you heard of ‘lights-out manufacturing’? This refers to a factory that operates autonomously and requires no human workers. The name comes from the fact they don’t require lighting – or in most cases heating or air conditioning – and can function in the dark.

These types of factories have been in action for over 15 years. E-commerce giant, JD.com, shows us a lights out factory in action. Launched in 2018, the storage and shipping facility has twenty robots that can do all the work humans would do without any human supervision. It would take as many as 500 staff to do the same amount of work in the 40,000 square foot building. This is a pinnacle of the Fourth Industrial Revolution, and it provides insight into today’s – not tomorrow’s – manufacturing evolution. The Fourth Industrial Revolution, also known as Industry 4.0, is the ongoing transformation of traditional manufacturing and industrial practices combined with the latest smart technology.

There is a wide gap between awareness and adoption of the newest digital approaches across the wider industry the reasons are complex, so let’s break it down.

Smarter factories

Like the above example, smart factories are highly digitalised environments where machinery and equipment can optimise processes through automation. This is the concept, but in current practice, 25% of manufacturers are lacking a specific digital strategy (according to the Annual Manufacturing Report 2019). Plus, a further 26% can envision the updates they require, but are uncertain of how to implement them.

Overcoming barriers

Digital Transformation (DT) is having a massive impact on all areas of society, so knowing how to overcome barriers is essential. A recent study presented at the International Conference on System Sciences (2019) summarised the barriers:

  • Missing skills – IT knowledge, information about decisions on technologies, process knowledge
  • Technical barriers – Dependency on new technologies, data security, current infrastructure
  • Individual barriers – Fear of loss of control, fear of transparency, fear of job loss
  • Organisational and cultural barriers – Keeping traditional roles, no clear vision, resistance to cultural change, risk aversion, lack of financing, lack of time
  • Environmental barriers – Lack of standards, lack of laws

The no. 1 barrier is the skills gap. Over the next decade, the shortage of skills is expected to create around 2.2 million unfilled positions worldwide (Deloitte, 2018). In the U.S. economy alone, this shortfall could cost $2.5 trillion over the same period. The good news is that solutions to the barriers outlined above are the exact steps required to create a dynamic digital transformation or DT strategy.

Structuring assessment

The first step in creating a digital transformation strategy is to form a smart factory innovation team. This team is made up of departmental leaders and manufacturing-specific consultants. Not all organisations have digital transformation experts in place, so the Spring team is always here to provide support.

Smart factory innovation teams should start with the challenge-mapping method. Essentially, a challenge map is a matrix of questions. Each team member needs to identify what their challenges are, so they can be added to the map. These challenges can then be gaged using a scale of 0-100 to create more quantifiable data. This data will then help to create a transformational roadmap.

Implementing transformation

Every digital transformation in manufacturing is unique to the organisation in question. We work with both world-leading manufacturing companies and digital specialists daily, so the only question is: what are your specific needs?

Positive examples of manufacturing companies that have transformed provide useful insight. Here is a range of approaches that have led to successful transformations:

  • The utilisation of machine learning can help to improve end-to-end processes and monitor production activity in real-time at a higher level of efficiency than human processing alone.
  • The integration of augmented reality can help to improve factory operations. BAE equips line workers with augmented reality glasses that project 3D models along with real-time instructions which help workers to carry out complex tasks as well as improve their technical ability. This has led to a decrease in assembly and training time of more than 40%.
  • In 2018, ThyssenKrupp Materials Services (TKMS) created an in-house AI program to help optimise transportation costs without sacrificing service standards. The program was updated with the domain knowledge necessary to improve TKMS target areas and led to an accelerated decision-making process.
  • Saltworks, the world’s largest salt manufacturer, improved both their B2B and B2C capabilities by implementing OroCommerce, a world-leading eCommerce platform. This eliminated the need to use costly plugins to their previous platforms, which also led to increased data integrity and synchronisation of their CRM and ERP systems.

Embracing digitalisation

Digital transformation isn’t just about improving efficiency, it’s about embracing the future-proof mindset of the 4th Industrial Revolution.

Of course, there is also the possibility of digital fatigue if companies don’t have a clear roadmap. Our consultants are here to make sure that you have the best talent available to help your organisation progress. Reach out to our team to make your organisation stand out from the competition.