Industry 4.0 trends affecting manufacturers

Posted on Nov 13, 2020 :: Insight From
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Posted by W. Kent Lorenz, board member, First Business Financial Services, Inc.

The coronavirus pandemic continues to batter the state, and it’s brought with it challenges for manufacturers ranging from supply chain disruptions to finding ways to implement new safety protocols in their plants. Amidst that adversity, another familiar issue remains: attracting and retaining talent.

WMEP Manufacturing Solutions’ most recent Economic Crisis/COVID-19 Wisconsin Manufacturer Pulse Survey asked respondents to identify their No. 1 concern, and finding and keeping workers trailed only worries about declining sales.

While 2020 has brought much upheaval, it’s important for manufacturers to maintain their focus on the future and to address the inescapable demographic shift taking place. The workforce is aging, with a net loss of 500,000 workers per year projected for the next 10 years.

Industry 4.0, which encompasses areas including big data, Internet of Things, augmented reality (AR), artificial intelligence (AI), robots and additive manufacturing, can help manufacturers address the skills gap and better position themselves in the long term. It’s imperative for manufacturers to begin planning to adopt Industry 4.0 solutions now.

A McKinsey and Company report states that for manufacturers to thrive in the next decade, being a “fast follower” isn’t enough. Rather, it’s vital for companies to become early adopters of Industry 4.0 solutions. Early adopters can reposition themselves competitively in a significant way, not only in terms of cost structure but also customer experience.

To put the issue in stark contrast, consider that Todd McLees, founder of the Pendio Group, predicts that Wisconsin manufacturers could see a 10-year attrition rate of 40 percent, meaning approximately 3,700 manufacturers could cease to exist by 2030. Successfully adopting Industry 4.0 solutions will play a part in manufacturers’ longevity.

Let’s take a closer look at four key areas of Industry 4.0 affecting manufacturers: robots in the factory, digital ecosystems, artificial intelligence and augmented reality.

1. Robots in the factory

People often worry about robots taking their jobs, but the reality is that robots and cobots — collaborative robots that work alongside people — can take over tasks most workers don’t want to do. Letting robots complete the dirty and dangerous jobs allows human workers to do work that’s both more impactful and gratifying.

The United States already lags behind other countries in adopting robots in plants. In 2016, the International Federation of Robotics (IFR) found the United States came in seventh in the world behind Korea, Singapore, Germany, Japan, Sweden and Denmark. Beyond that, the IFR found that China far outpaces the United States in adding industrial robots to plant floors.

To prepare for a future with fewer workers, manufacturers must look at transitioning from human-centric processes to machine-based ones. This could include looking to robots to take on tasks such as loading/unloading, end-of-line palletizing, parts inspection and measurement, welding, painting and sealing.

Around 7,000 robots are in operation in Wisconsin today, and that number is projected to increase to more than 15,000 by 2030. To combat shrinking numbers of available workers, manufacturers will need them.

2. Digital ecosystems

Implementing a digital ecosystem can help prevent disruptive and costly unexpected downtime. Factory floor connectivity can deliver real-time data, allowing for improved traceability and trackability along with the ability to provide data dashboards for customers and vendors. Solutions such as FANUC Corp.’s Zero Down Time system allow manufacturers to analyze and predict issues and maintain and optimize their operations.

Smart devices also will continue to become more prevalent and sophisticated. The rise of 5G means devices can be embedded with intelligence and capabilities such as indexers, bar feeders, gauges and cutting tools.

As manufacturers implement these solutions, it’s important to remain ever vigilant about cybersecurity. At a minimum, companies should comply with NIST SP 800-53, which defines the standards for federal agencies to build and manage their information security systems. Consider implementing a trusted cybersecurity system such as Darktrace or Crowdstrike.

3. Artificial intelligence

AI allows for deep learning that can create real-time operation management and optimization of production and capacity planning, along with improved machinery performance.

No longer the stuff of sci-fi, AI has been used to identify skin cancer. In one test, doctors and AI analyzed 100,000 patient images to detect skin cancer. The doctors’ accuracy rate was 86.6 percent, while AI achieved an accuracy rate of 95 percent. Combining doctors and AI boosts the accuracy rate even further to 98.2 percent.

In applying AI to a simple CNC program for creating a brass part, efficiencies emerge. In an analysis, while the overall cut time didn’t change, using AI created a 65 percent reduction in the non-cut time rate and a cycle time reduction of 50 percent. Results will vary, but the overall reduction of cycle times is significant.

Smart, connected products also will become more prevalent.

For example, sump pumps can be outfitted with alarms and controls for runtime, flow rate and temperature, and water softener systems can alert suppliers when it’s time to deliver a customer more salt.

4. Augmented reality

AR can be put to powerful use in applications like employee training, factory servicing and troubleshooting from afar.

Using AR as an employee training tool provides a cost-effective and powerful means to train and educate workers. Integrating AR into training has been shown to create more effective outcomes as well as leading to productivity improvements and elevated employee retention rates.

When it comes to remote servicing, AR can allow technicians to respond to problems effectively and quickly, all while cutting down on the time and environmental impact of traveling to a location to perform the same task.

Considering implementing Industry 4.0 solutions may seem daunting at first. Creating a five-year strategic plan is a good place to begin. Goals should include gathering real-time data for AI analysis, creating real-time customer and supplier dashboards, and implementing AR tools. By 2030, companies should target a 40 percent increase in productivity per employee using automation and technology.

W. Kent Lorenz is retired chairman and CEO of Acieta LLC, a provider of advanced industrial robotic automation systems for manufacturers. He was honored with a Distinguished Achievement Award from UW-Madison’s College of Engineering for his work in industrial robotics and with high school students. Lorenz serves on the board of directors of First Business Financial Services, Inc. and the advisory boards of OwnersEdge, Essential Industries and Itasca Automation, as well as acting as an adviser to two startup companies.