By Mayank Jain (LMB)
Connectivity within the manufacturing process is not new. Yet recent trends such as the rise of the fourth industrial revolution, Industry 4.0 and the convergence of the digital and physical worlds, including Information Technology (IT) and Operations Technology (OT) have made the transformation of the supply chain increasingly possible. Shifting from linear, sequential supply chain operations to an interconnected, open system of supply operations, known as the “Digital Supply Network” could lay the foundation for how companies compete in the future. To fully realize the digital supply network, however, manufacturers likely need to unlock several capabilities:
- horizontal integration through the myriad operational systems that power the organization,
- vertical integration through connected manufacturing systems, and
- end-to-end, holistic integration through the entire value chain
This integration is colloquially known as the smart factory, and signifies the opportunity to drive greater value both within the four walls of the factory and across the supply network.
THE SMART FACTORY REPRESENTS A LEAP FORWARD FROM MORE TRADITIONAL AUTOMATION TO A FULLY CONNECTED AND FLEXIBLE SYSTEM
The smart factory represents a leap forward from more traditional automation to a fully connected and flexible system – one that can use a constant stream of data from connected operations and production systems to learn and adapt to new demands. A true smart factory can integrate data from system wide physical, operational, and human assets to drive manufacturing, maintenance, inventory tracking, digitization of operations through digital twin, and other types of activities across the entire manufacturing network. The result can be a more efficient and agile system, less production downtime, and a greater ability to predict & adjust to changes in the facility or broader network, possibly leading to better positioning in the competitive marketplace.
Many manufacturers are already leveraging components of a smart factory in such areas as advanced planning and scheduling using real-time production and inventory data, or augmented reality for maintenance. But a true smart factory is a more holistic endeavour, moving beyond the shop floor toward influencing the enterprise and broader ecosystem. The smart factory is integral to the broader digital supply network and has multiple facets that manufacturers can leverage to adapt to the changing marketplace more effectively.
A BRIEF LOOK AT THE DIGITAL SUPPLY NETWORK
Supply chains traditionally are linear in nature, with a discrete progression of design, plan, source, make, and deliver. Today, however, many supply chains are transforming from a static sequence to a dynamic, interconnected system—the digital supply network—that can more readily incorporate ecosystem partners and evolve to a more optimal state over time. Digital supply networks integrate information from many different sources and locations to drive the physical act of production and distribution.
In figure 1, the interconnected lattice of the new digital supply network model is visible, with digital at the core. There is potential for interactions from each node to every other point of the network, allowing for greater connectivity among areas that previously did not exist. In this model, communications are multi-directional, creating connectivity among traditionally unconnected links in the supply chain.
DEFINING THE SMART FACTORY
Automation has always been a part of the factory to some degree, and even high levels of automation are nothing new. However, the term “automation” suggests the performance of a single, discrete task or process. Historically, situations in which machines have made “decisions” have been automation based and linear, such as opening a valve or turning a pump on and off based on a defined set of rules. Through the application of Artificial Intelligence (AI) and increasing sophistication of cyber-physical systems that can combine physical machines and business processes, automation increasingly includes complex optimization decisions that humans typically make. Finally and perhaps most crucially, the term “smart factory” also suggests an integration of shop floor decisions and insights with the rest of the supply chain and broader enterprise through an interconnected IT/ OT landscape. This can fundamentally change production processes and enhance relationships with suppliers and customers.
THE SMART FACTORY IS A FLEXIBLE SYSTEM THAT CAN SELF-OPTIMIZE PERFORMANCE ACROSS A BROADER NETWORK, SELF ADAPT TO AND LEARN FROM NEW CONDITIONS IN REAL OR NEAR-REAL TIME, AND AUTONOMOUSLY RUN ENTIRE PRODUCTION PROCESSES.
FEATURES OF THE SMART FACTORY: WHAT MAKES IT DIFFERENT?
Each of these features can play a role in enabling more informed decisions and can help organizations improve the production process.
Figure-2 briefly explains each feature of the smart factory. Fig.2
THE SMART FACTORY: WHY NOW?
While automation and controls have existed for decades, the fully smart factory has only recently gained traction as a viable pursuit for manufacturers. Five overarching trends seem to be accelerating the drive toward smart factories which are –
- Rapidly evolving technological capabilities
- Increased supply chain complexity and global fragmentation of production and demand
- Growing competitive pressures from unexpected sources
- Organizational realignments resulting from the marriage of IT and OT
- Ongoing talent challenges
BENEFITS OF THE SMART FACTORY
The decision on how to embark on or expand a smart factory initiative should align with the specific needs of an organization. The reasons that companies embark or expand on the smart factory journey are often varied and cannot be easily generalized.
However, undertaking a smart factory journey generally addresses such broad categories as
- asset efficiency,
- safety, and
These categories, among others, may yield benefits that ultimately result in –
- increased speed to market;
- improved ability to capture market share; and `
- better profitability, product quality, and labor force stability
Regardless of the business drivers, the ability to demonstrate how the investment in a smart factory provides value is important to the adoption and incremental investment required to sustain the smart factory journey.
IMPACTS OF THE SMART FACTORY ON MANUFACTURING PROCESSES
Manufacturers can implement the smart factory in many different ways—both inside and outside the four walls of the factory—and reconfigure it to adjust as existing priorities change or new ones emerge. In fact, one of the most important features of the smart factory, agility, also presents manufacturers with multiple options to leverage digital and physical technologies depending on their specific needs. The specific impacts of the smart factory on manufacturing processes will likely be different for each organization.
Table 1 depicts a series of core smart factory production processes along with a series of sample opportunities for digitization enabled by various digital and physical technologies.