Russell Twiss examines what exactly does a smart factory look like and how will they change the way manufacturers operate in an ever-evolving global digital economy.
While digitalisation and Industry 4.0 are still the hot topics for much discussion throughout the manufacturing sector, for many manufacturers, the actual day-to-day reality and ultimate end point of these concepts will be the advent of smart factories. And, with a recent report by Capgemini predicting that smart factories will contribute up to a staggering £1.13 trillion to the global economy, it’s not an exaggeration to say that smart factories are set to revolutionise manufacturing as we know it.
Manufacturers are obviously well aware of the potential impact of smart factories as 76% of them have smart factory initiatives in place. However, only 14% of these are satisfied. So, while it’s all well and good to talk about smart factories transforming manufacturing, how many manufacturers actually know what a smart factory looks like? What shape does it take? Which technologies does involve? And, how will it change the way manufacturers operate in our global economy?
The basic premise of a smart factory is a physical manufacturing entity whose systems are all connected by way of Artificial Intelligence (AI) and the Internet of Things. At the heart of all smart factories lies data, and a lot of it. It’s by making full use of the data that’s generated by the different technologies within the factory that the ‘smart’ comes into play, with equipment not only carrying out automated actions but also using the data to learn to work by themselves, making required changes and improvements with minimal human intervention.
To be truly smart, the factory must have a network of machines, devices, sensors and people that communicate freely with each other, providing the very data that underpins the ongoing operation of the smart factory. This interoperability is key but goes hand-in-hand with transparency of information. The swathes of data that are generated by the factory are contextualised by making use of virtual copies or digital twins of the physical world, making sense of the data and putting it to good use in the actual physical version of the factory. And, when you think that GE recently estimated that there will be over 50 billion connected devices by 2020, that’s an awful lot of data to make sense of.
When it comes to AI, rather than the AI of Hollywood, where humans are totally replaced by technology, the smart factory sees AI technology being used to support humans and augment their activities. So, this might be helping to make difficult decision by providing previously unknown levels of insight into production efficiency, or solving problems by quickly and effectively proffering a whole host of new solutions, or simply helping with tasks that are too difficult or unsafe for people to carry out. However, the ultimate must-have for smart factories to be truly smart is systems that are able to make simple decisions, making full use of machine learning capabilities and abilities to become as autonomous as possible.
We can see what a smart factory should look like, but why are they so important, particularly for manufacturers? Well, while smart technologies are making differences to how we heat our homes and play our music, to name but two examples, the area where smart technologies will make the biggest difference economically is in factories and production in general. Ultimately, with smart factories, manufacturers will be able to produce more, for less, with GE predicting that the IoT alone could add $15 trillion to global GDP in productivity gains over the next two decades.
Through improvements in productivity, reductions in labour costs, increased quality of products and less waste, the potential benefits of smart factories are immense. There’s the predicted thirteen-fold increase of the on-time delivery of products, not to mention the vast improvements in capex and inventory costs, as well as the greatly reduced logistics and transport costs, all of which come about because of increased efficiency across the board. In short, Industry 4.0 and the very smart factories which are a direct result of the concept are set to make manufacturing less wasteful, more productive, more efficient and ultimately, more profitable.
Going back to the earlier statistic that highlighted 76% of manufacturers who have smart factory initiatives in place, they’re definitely right to put plans in place now, but how they proceed is vital. To succeed as a smart factory, manufacturers need to transform digitally first, putting in place the right systems and solutions to facilitate their transition to becoming a smart factory. By adopting and implementing digital technology across all aspects of the business, from finance through to despatch, manufacturing businesses are putting in place the very foundations of smart operations. By starting with what already exists, optimising processes and procedures through the use of digital technology, manufacturers can ensure that the path to establishing smart factories runs smoothly. So great are the potential benefits that smart factories can bring, manufacturers would be wise to start preparations now, with any delay putting them at risk of falling too far behind the competition.
For more information on how Sapphire could help your manufacturing business grow its smart operations, contact us now.