Industry 4.0 - futureproofing manufacturing
In 2020 there will be more data than sand on Earth. The speed of change occurring in the factory ecosystem is unprecedented. Industry 4.0 is not in the future - it is happening now. Companies include investments for digitization in their budgets, but often have no idea what or where to be digitized. With organizations facing so many opportunities and challenges, identifying where and how to begin is the biggest obstacle. This means that many companies are aware of the fact that there is a movement, but are stuck in a situation, you can call: “no longer and not yet."
New business trends and operational parameters in manufacturing
The industry is facing a revolution of the same caliber as the birth of the Internet. This will change business models and the way we currently operate in manufacturing companies.
Digital will be highly disruptive to most industries, affecting not only revenue and cost structures but also shaking up the core business and operating models. Interaction between machines, products, people, processes and enterprises triggers opportunity for competitiveness and growth.
Today’s factories must enable the manufacturer to deliver in a world where radically shortening production cycles and a high degree of product variation and personalization are fast becoming prerequisites. Like the previous industrial revolutions have done it, the fourth of its kind changes the world and gets in-depth impact on the socio-economic conditions across Europe.
This places great demands on European countries, and it is the digital transformation that will drive the future growth and prosperity.
Moving from single, siloed systems and organizations to an industrial network of capabilities
The First Industrial Revolution used water and steam power to mechanize production. The Second used electric power to create mass production. The Third used electronics and information technology to automate production. Now a Fourth Industrial Revolution is building on the Third, the digital revolution that has been occurring since the middle of the last century. It is characterized by a fusion of technologies that is blurring the lines between the physical, digital, and biological spheres.
In other words - We are moving towards a world where IT solutions and computers do not just do what we tell them, but even begin to understand the contexts of large amounts of data, and how the physical world automatically communicates with advanced IT systems in intelligent and self-learning factories.
New operational parameters in a smart factory
To achieve their potential to meet customer and market needs and compete in today’s global, dynamic landscape, manufacturers need new operational scenarios to be considered, modeled and put in place. In a "smart" self-learning factory everything communicates with everything and everything needs to communicate with everything. Manufacturing machines and equipment will be connected, and able to talk to each other and share information in real time, ensuring that each can access all necessary data to be prepared for what’s coming next.
The next generation, smart factory will automatically re-route work, pre-empting bottlenecks and identifying areas of underused capacity, customize production, enable predictive maintenance, and operate continuously and at unprecedented levels of efficiency.
The autonomous and independent behavior of manufacturing units leveraging the use of relevant information is a cornerstone of the smart factory. A central feature is here to have real-time data available to connect the virtual world with the real world, the opportunity to permanently create a virtual image of reality updated by real time data.
As stated in many reports data is the new oil. Manufacturers are now looking at making better and faster informed decisions and feedback loops driven by data evidence. Data Analytics goes far beyond the mere aggregation, processing and reporting of large volumes of data. It identifies underlying structures and hidden meanings across diverse and disparate data sources. New visualization techniques bring clarity to underlying complexity, enabling the insights revealed to be more readily interpretable and actionable.
From vision to reality
To achieve digital transformation in the single manufaction company it requires a clear roadmapping of the journey, from where they are now to where they need to be. This is vital if successful transformation is to be achieved. But also political initiatives are required to enable industry 4.0 such as networking and cooperation between digital competence centers and cluster partnerships and support for cross-border cooperation between innovative experimental activities. Both the EU and many European countries’ government have presented plans for digitization of the industrial sector, which includes the above. It is essential that this becomes a reality and not just vision.
The countries whose manufacturing sector master the technological developments will win. If companies miss digital opportunities, this is a serious growth retardant.
For some companies it will be a matter of survival - the companies that do not get started in time, will find it difficult to catch the leaders. If we take Denmark as an example the manufacturing sector is a cornerstone in Denmark's economy and the manufacturing sector has over 100.000 employees. At the same time, the sector only covers 16 percent of total Danish exports. A report from BCG shows that only 24% of Danish companies have a vision for digitization and four out of ten manufacturing companies fail to exploit their data. Only five percent of the Danish manufacturing companies are so-called “digital champions”, meaning that they have data systems that extend from stock to production, sale and the finished product. The rest have only parts of the value chain digitalized.
If Danish companies miss digital opportunities, this is a serious growth retardant. Thus future welfare requires that Danish manufacturing companies are successful, which presupposes that the Danish manufacturing companies master the digital transformation becoming a smart factory.
Future prosperity requires that manufacturing companies are successful. Denmark as well as other countries should not just be spectators to the digital transformation, which is happening now in one of the largest export economies in the world, Germany. We need to be front runners to improve manufacturing competitiveness.
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