Over the past few years, the manufacturing sector has opened its arms to an array of new technologies. One such technology, advanced automation, has enabled significant operational improvements.
In fact, factories that deploy automation, or “smart factories”, could add $1.5 trillion in value to the global economy by 2022. Countries within the Asia-Pacific and Japan (APJ) region have been readying themselves for a wave of smart manufacturing innovations and have invested heavily in automation.
As we look forward, factories of the future will move beyond traditional automation to create a fully intelligent and connected system, driven by a constant stream of data from business, operational and production applications to rapidly learn and adapt to evolving demands.
This evolution can be beneficial. According to Capgemini, these innovations should allow manufacturers to expect the on-time-delivery of finished products to increase 13 fold, while quality indicators to improve at more than 12 times the rate of improvement since 1990. At the same time, overall productivity and labour costs are also expected to improve dramatically, experiencing improvements of 700% and 900% in their rates of growth, respectively.
Despite these benefits, only 16% of regional companies that had launched a “smart factory” project were pleased with their efforts to date.
Why is this so? And what areas can companies focus on to accelerate their journeys toward a truly smart factory?
Place a focus on supply chain digitisation
Many manufacturers in Asia, specifically in Singapore’s energy supply chain, have begun to leverage smart factory components in areas such as planning and maintenance. The factory of the future has to be much more sizable and holistic than just the factory floor. It has to reach beyond the four walls to integrate with customers and suppliers.
The entire supply chain is changing through digitisation from a traditional linear and sequential operation to an interconnected, open and multi-layered ecosystem of trading partners. The integration of smart factories into new digital supply chains takes some working out.
Ensure you are gaining complete insights from your data
Through applied AI and advanced analytics, data will drive processes in the factory of the future. Smarter data and analytics solutions will allow for early – or even predictive – detection operational errors. Moreover, these solutions provide user feedback, enabling factories to improve the volume and quality of production output.
The factory of the future will enable more customisation facilitated by data that identifies demand, minimises the downtime needed for retooling and resetting, and enables greater flexibility in manufacturing processes.
This, in turn, allows manufacturers to look at how they can use the data they have to create new data-driven products and services, such as predictive maintenance capabilities within their own manufactured products. Additionally, the sharing of key insights can have wider societal benefits.
For example, countries like Singapore are making moves towards becoming a lead in data exchanges, through initiating a Data Sandbox Programme to mobilise data-driven sharing and innovation across Singapore.
Consider digital transformation more holistically
Digital transformation is sometimes considered the move from paper-based to digital processes. However, the factory of the future takes this further. It relies on the convergence of operations technology with information technology.
The rapid growth in Internet of Things (IoT) is driving this transformation. It enables factory operations to be connected and monitored. This IoT data can be used to feed operational systems to improve performance or can be combined with data from other enterprise systems to begin to change how the entire factory and supply chain operates.
A report by MIT Technology Review Insights has discovered that digital transformation in Asia-Pacific is already significantly underway in terms of internal systems, services and products. While digitalisation of manufacturing and supply chains is lagging, the future is full of anticipation for new technologies to accelerate it substantially.
Examine every disruptive technology – not just IoT
IoT is only one of the many disruptive digital technologies manufacturers are faced with. Companies also have access to advanced analytics, AI, drones, Blockchain, robotics, 3D printing and wearables. Processes within every company are different so there is no ‘one size fits all’ for the factory of the future.
Each individual company will have to decide which combination of technologies will meet their specific business goals.
Think about the new opportunities for your workforce
Increased digitisation should not be viewed as a means to reduce headcount, but instead to radically change the responsibilities of your people to allow them to focus on higher-value roles. As Forbes points out, people - not technology - are the key to successful digital transformation.
This is especially true in the smart factory- as repetitive and easily automated roles disappear, allowing employees to focus on higher-value tasks.
In Singapore, the digitalisation of manufacturing has encouraged the SkillsFuture Series for Advanced Manufacturing to develop digital confidence in workers. Agile and adaptive change management is required to ensure that employees effectively move between roles and gain access to develop the new skills required.
Involve your governance, risk and compliance requirements
Deloitte points out that the role of technology as the enabler for a Smart Nation is not surprising; harnessing technology to improve on governance is more evolutionary than revolutionary. One of the most valuable features of the smart factory – its ability to self-optimize, self-adapt, and autonomously run– can fundamentally change traditional governance, risk and compliance models.
Automated systems reduce the need for human intervention so there are fewer errors and less risk. However, governance and compliance policies have to establish how one can monitor and audit the machines that now fulfil this aspect of a business.
In addition, the connectivity of the smart factory extends into the supply chain ecosystem. The governance, risk and compliance policies, procedures and technologies that are put in place have to take full account of this new, interconnected and collaborative way of working.
The growth and advantages that come with this progression in manufacturing are too significant to wait for the “future” to arrive. With the intelligence and financial returns that the factory of the future promises, the manufacturing world will see it sooner than we think.