If you are in manufacturing, you probably have heard of Industry 4.0, smart factories, the fourth industrial revolution, and smart manufacturing. But what exactly is the difference between all of these?
The maybe not-so-surprising truth is that they all describe the same thing: the power of data for manufacturing and its incredible availability, thanks to digital technology. A business can now know more about its industrial assets and value chain than ever before, while creating a competitive business model.
So, if you’re interested in leveraging data and digital connectivity to improve your productivity, and competitiveness for the 21st century, here are five things to consider before you make any decisions.
1. Smart manufacturing is (mostly) common sense.
Smart manufacturing uses existing and emerging technologies like smart sensors (IoT), cloud computing, augmented and virtual reality, and artificial intelligence (AI) to improve the manufacturing process, increase product quality, and reduce costs. For the first time, these enabling technologies are affordable to the masses, not just the Fortune 100 companies. They will allow businesses to take action in real time by getting the right information to the right people at the right time to drive breakthroughs in competitiveness and efficiency.
As technologies like AI and cloud computing become more common, prices for solutions have become more affordable for smaller companies and much easier to deploy and maintain. Use common sense when evaluating options and embrace piloting before deciding on a long-term plan or investment. “Try before you buy” options are increasingly the norm, even in a manufacturing environment.
What you need to know:
✔️ Wherever you are in your smart manufacturing journey, focus on making your current manufacturing smarter. Start by evaluating your current processes and systems to identify weak spots, pain points, and the data that you might need or want to know in order to improve. Put a flashlight on your process so that hidden issues aren’t controlling your destiny.
❌ Don’t try to become the smartest manufacturer overnight. Many smart manufacturing projects fail because too much focus is put on “fancy” technology and not enough on the people and processes at the heart of an operation.
2. A smart factory is about more than new technology and tons of data.
Purchasing brand new machinery and cutting-edge technology can be tempting. After all, if the future is all about data, you’re probably ready to start collecting as much of it as possible using the best tools you can find.
But here’s the thing: You could harvest a hundred billion data points and find that only a few hundred of those are actually useful to your business becoming more productive. Wearing an exercise activity tracker is not, by itself, going to make someone healthier. A lifestyle change needs to go along with it to produce real results. Smart manufacturing is no different. It has to start with as clear an idea as possible about what actions need to be taken.
What you need to know:
✔️ Map out your production process and move on from there. Determine what specific data points will help you make smarter decisions before you start collecting any information. The people in your organization most likely know what the issues are—use their insights as guard rails for data.
❌ Don’t hope that having lots of data will, by itself, point out how to achieve productivity gains.
3. Factories are goldmines if you take one data-rich step at a time.
The more efficient a manufacturer is, the less resources it uses to produce increasingly better quality products. The average manufacturer in the United States reports an efficiency rate of 85–90%. That means that there's plenty of room for most businesses to improve and, even better, it’s mostly a matter of capturing low-hanging fruit.
How much do you know about your current operations? If you don’t know how your current processes and machines are doing, you are blind to where efficiencies can be gained. This journey starts by strategically collecting data. Most companies do a good job of managing with what data they have, however they can only improve with they know about and are measuring. Trusted data and information is key to moving an organization from basing decisions on opinion to basing them on facts. This is a culture change that will dramatically accelerate your business.
What you need to know:
✔️ Start where you are today—quantify what a 1% improvement in productivity would look like and how it would benefit the company. Then then set a target for your existing assets or value chain. Leverage continuous improvement methodologies and collect trusted data.
❌ Don’t wipe everything out and start over. Build on what you already have and listen to your people.
4. Human error will happen.
It’s easy to think that automation and artificial intelligence (AI)—two pieces of the Industry 4.0 puzzle—will eradicate human error by taking people out of the equation. But that’s not the case. The algorithms running the automated systems, which are made by people, can make mistakes, too.
Instead of trying to make error impossible, focus on preparing for it through smart manufacturing. After all, volatility, uncertainty, complexity, and ambiguity—what the U.S. military calls “VUCA”—are increasingly the best descriptors of how the world works.
Smart capabilities, like machine learning and AI, enable operators and engineers to not only know more about what is happening, but to manage it better. This includes not only solving an existing problem, but also preventing potential ones.
Remember that a smart system works only with available, historical data. That means if it encounters an issue that has never happened before, it’s unlikely to provide an optimum answer. This is why real people are still such an important part of the equation.
What you need to know:
✔️ Use smart manufacturing to meet volatility and uncertainty with flexibility and resilience so that, if an error happens (and it will), your systems can adjust and improve quickly. Combining the strengths of people, process, and technology will be your best approach.
❌ Don’t expect smart manufacturing to erase the possibility for human error. You must develop a robust plan to mitigate the risk.
5. Take advantage of federal funding and resources.
Most smart manufacturing today happens within corporations with big budgets and deep resources. They can afford to take risks that smaller manufacturers can’t. That matters when you consider that, of the more than 300,000 manufacturers in the United States, 92% of them have 100 employees or less.
A helpful resource for small-to-mid-sized businesses is the Clean Energy Smart Manufacturing Innovation Institute (CESMII). A consortia of manufacturers, academic institutions, and federal government agencies in the U.S., CESMII is dedicated to “democratizing” smart manufacturing technology. The institute aims to develop and release an open-source platform solution for U.S. manufacturers that will help to reduce the costs, complexity, and risks associated with onboarding smart manufacturing technologies and processes. CESMII is part of a larger organization, Manufacturing USA. Manufacturing USA comprises 14 national manufacturing innovation institutes in a public-private partnership.
If you’re just beginning a digitization process, see our post introducing electronic resource planning (ERP) software. It’s a good first step for a smart manufacturing transition.
What you need to know:
✔️ Consider resources like CESMII to access technology, funding, and expertise that is available to U.S. manufacturers.
❌ Don’t assume that you need to take unnecessary risks—like overhauling your assets or investing in costly new technologies all at once—to keep up with larger competitors.
These insights were taken from a presentation by Jim Wetzel at the Golisano Institute for Sustainability at Rochester Institute of Technology on October 31, 2019. Jim is the strategic advisor to the CEO of CESMII. He spent more than 30 years leading General Mills Inc.’s global adoption of smart manufacturing.
About the author
The Center of Excellence in Advanced & Sustainable Manufacturing (COE-ASM) is a partnership between New York state and RIT dedicated to helping state manufacturers develop and apply new technologies that create competitive business advantages. Funding is provided by the New York State Department of Economic Development (DED). Any opinions, findings conclusions or recommendations expressed are those of the author(s) and do not necessarily reflect the views of the DED.
