Manufacturing for the Future: Strategy, Leadership and Investment

Richard Hill, Head of Automotive and Manufacturing at the Royal Bank of Scotland, explores how businesses should make the most of technological change.

Next week, I’ll be welcoming people from across the manufacturing sector in Scotland to the Royal Bank of Scotland’s Gogarburn headquarters for the SMAS Future Manufacturing Conference 2017. To me, the key sentiment is the future. Today, Scotland’s manufacturing sector delivers 52% of the country’s exports and accounts for 54% of business expenditure on research and development, according to figures from the Scottish Government. But it’s the prospect of what those numbers could be tomorrow that is the important question.

Businesses from across the sector – whether small-scale or large, automated or labour-driven – will be well used to the technologies mooted for tomorrow. The usual suspects include additive manufacturing, big data, AI, VR, the Internet of Things and, of course, robots. Yes, these are usually mooted in the context of the shop floor, but other parts of the business stand to benefit from them too, including marketing, accounts and customer services. To the cautious mind this presents a problem: the future, it seems, offers a complex choice of possibilities in what to invest in, and why.

I won’t predict what technologies manufacturers will use, or how and where – we have futurologists for that – but I am confident of how businesses need to approach technological change in order to get the most from the opportunities. Learning from the businesses I speak to across Scotland, and the results from the bank’s own Future Fit programme which is propelling British manufacturing, there are three magic elements that manufacturers need in the long term.

The first is strategy. Those cautious minds perplexed by the different technologies to explore will find calm with a sound vision of where they are going, how they fit in to the supply chain and what markets are right for them. This means the usual rigmarole of researching the competition, exploring new markets, taking into account the changing role of regulation. But it also means having a strong sense of tactics – those day-to-day activities that are being used to deliver the wider strategy, and which might benefit from new technologies. Will technological advances present your company with the means to grow the top line, or do they present opportunities to do things more efficiently, and save costs?

Secondly, there is investment. In the UK, the narrative has been one of manufacturers failing to invest in machinery – with falling productivity the inevitable result. At the heart of the solution are the wonderful technologies and machines that change how a company operates. Yes, this will mean smart investment – avoiding the wrong technologies as much as investing in the right – but it also means investing long term in skills and talent. A rise in productivity almost certainly means machines doing some of the tasks that humans currently do, but workers skilled in robot maintenance, programming and STEM subjects will be needed in far higher numbers than in the past.

The third is leadership, and it’s no surprise that quality leadership is a priority in the Scottish government’s Manufacturing Action Plan. At last year’s conference, delegates heard Colin Robertson, CEO of Alexander Dennis, talk about the role this plays within his company, delivering a clear, practical vision that all parts of the organisation can deliver. In future, as much as in the past, strategy and investment will only work with a strong sense of leadership and communication. Given the revolutionary changes presented by innovation and change, being able to take people with you and convince them of the strategy will be key, whether that’s investors, supply chain partners or workers on the shop floor. Thankfully, the robots won’t need any pep talks, yet.

The local picture 

In Scotland, the environment for manufacturers is particularly encouraging, as they receive unrivalled support compared with peers elsewhere in the UK. This incorporates the Manufacturing Action Plan, which is complemented by the UK’s new industrial policy strategy. Lest we forget that England’s Manufacturing Advisory Service closed in 2016, but Scotland’s equivalent – the Scottish Manufacturing Advisory Service – remains vital in the support structure of local businesses. Together with Scottish Enterprise, Highlands and Islands Enterprise, academic institutions and Catapult centres across the UK, manufacturers are enjoying a level of support that they need to exploit.

At RBS, we’re committed to seeing this happen. In hosting this conference at our headquarters, I encourage people to joins us to hear about enduring issues facing our sector, whether that’s new business models, data analytics or, of course, the march of technology.

A Practical View of Industry 4.0 in the Heavy Manufacturing Sector

Alistair Carty, Technical Director at Replicade Ltd, a technology and manufacturing company who will be exhibiting at the 2017 SMAS Future Manufacturing Conference, outlines a practical view of Industry 4.0 in the heavy manufacturing sector.

Over the last 16 years, Replicade Ltd. have been delivering Tool Control solutions into, primarily, the aerospace sector. During that time, we have observed a gradual shift in the usage of technology within that market to address an increasing number of needs and this increase in technology has led to some interesting trends.

There has been significantly increased activity in the gathering of data around the management of assets within manufacturing production lines. Further data acquisition has occurred relating to regulatory reporting requirements. Finally, there has been a general increase in Non-Value Added (NVA) cost, typically due to the difficulty of either locating the assets in the correct area or even locating them at all.

These trends, in themselves, drive up the cost of manufacturing in a tangible way and, unfortunately, the solutions to these issues tend to manifest as localised “sticking plasters”. The trends, when combined, lead to, not only, exponential cost rises but an exponentially more spaghettified technical stack.

The increased complexity, and typically non-integrated, explosion of technology creates an additional knock-on effect in the form of data volumes. In this instance, I purposefully avoid the use of the term “Big Data” and this implies some form of analysable cohesion that is typically absent with non-integrated systems.

So, what can be done? There is a definite need for a more holistic approach that unlocks the full potential of production streamlining and, ultimately, better operations and reduced cost. We believe this is where Industry 4.0 is critical.

In 2014, Replicade Ltd. looked at our primary market offering, the Tool Control foam inlay, and envisioned a new technology stack which would not only address current customer needs but also provide a broad ecosystem in which components could interoperate in a future-proof and scalable way. This resulted in our RAMLoop platform which currently encompasses a number of Industry 4.0 hardware and software products.

Our Tool Control foams are used to ensure that all tools are located within their appropriate toolbox when an aircraft has finished its maintenance cycle. Currently, auditors should inspect all toolkits, note down any audit breaches (usually on paper) then produce a report that enables a “go/no-go” decision to be made.

This system is encouraged (and may be examined at a later date by a regulator) and has a sizeable component of NVA time due to the inefficient data gathering. There is also potential delay in releasing the aircraft due to the time the process takes which may result in fines.

By using our RAMAudit app, NVA time can be substantially reduced by transmitting the audit information in real-time to RAMLoop. Any audit breaches can be handled as they are recorded (“Technical Assistance” in Industry 4.0 terms) and RAMLoop’s blockchain-based tamper-proof audit trail gives you the required regulatory reporting. This production streamlining enables you to release the aircraft faster but without compromising the process.

By using Industry 4.0 principles, the promise of “Big Data” to enable insights into issues at a macro-level, which were previously incapable of being spotted, can now be effectively unlocked. However, on a day-to-day basis, the “Small Data”, which is critical to the success of any manufacturing operation, can also be effectively tapped on a real-time and accessible basis.

The uptake of Industry 4.0 will be successful only where the technological solutions are unified with a clear view of how production processes can be streamlined. In our current experience, there is a considerable amount of will to make this happen but there is also a considerable amount of education required especially around the cost-benefits of such a large and complex transformation. Unfortunately, a fragmented approach that does not adequately address all 4 design principles of Industry 4.0 will fail and has the potential to fail more catastrophically than the “sticking plaster” solutions.

All RAMLoop products share the design principles of Interoperability and Decentralised Decisions and all produce a stream of real-time information including self-monitoring capabilities. RAMLoop currently offers connected products for keyless Access Control systems, sensors (for a number of uses), asset tracking and asset auditing.

We will be demonstrating some of our RAMLoop products in the Technology Zone at the SMAS Future Manufacturing Conference on Tuesday 24 October and will be delighted to talk to you!. Find us in the Atrium on the ground floor.

The Numbers Behind Industry 4.0

Kirsty McIntosh, Commercial Manager for central Scotland based Enterprise & Industrial IT experts Exmos, explores the figures behind the hype that is Industry 4.0 in the manufacturing space and how 4IR can apply to your operation.

If you’re involved in manufacturing in any way whatsoever, you’ll be finding it hard not to be bombarded about Industry 4.0 on a regular basis. The so-called “fourth industrial revolution” is everywhere in industry media, but is there any substance to the hype?

We’ve put together some of the key statistics behind 4IR to help guide your decision making and truly understand the potential in your facilities of embracing Industry 4.0.

 67% of UK Manufacturers recognise Industry 4.0 as an opportunity (The Manufacturer, HSO, The Annual Manufacturing Report)

Industry 4.0 is a huge opportunity for UK manufacturers, and most of them agree. 62% are planning on building towards Industry 4.0, and 23% are already doing so, leaving just 15% believing 4IR is not important to them. However, there still seems to be a lot of uncertainty surrounding the work involved with 4IR.

By 2020, Industry 4.0 is expected to bring an average cost reduction of 3.6% p.a. across process industries globally, totalling $421 billion (PWC Global Industry 4.0 Survey)

Expected cost reductions vary across industries, from 4.2% p.a. in Forest, Paper & Packaging to 3.2% p.a. in Metals and Transport & Logistics. Across industries, however, it is abundantly clear that a significant cost reduction is expected across the board by implementing 4IR practices.

In 2015, only 50% said data had a significant impact on decision making. By 2020 this figure is expected to reach 83%. (PWC Global Industry 4.0 Survey)

Data is, of course, at the heart of Industry 4.0, but it’s surprising to read that only 50% were making data-driven decisions only two years ago. This figure is an average across industries, and some industries are expecting to be more driven by data than others, such as 90% of decision making in Transportation & Logistics compared to only 72% in Engineering & Construction.

Breaking down data silos is a key concept in building on your Industry 4.0 factory. Everyone has their favourite way of collecting and displaying their data, but this results in duplication of work across the board. The first step in any 4IR project is discovering what data you have already, before figuring out if you can automate that data collection.

Regardless of industry, data-driven decision making is the future.

Industry 4.0 could add $14.2 trillion to the global economy by 2030. (Accenture 2015)

We all know that $14.2 trillion is a gigantic number, but it can sometimes be hard to put large numbers like this into perspective. $14.2 trillion is roughly equal to the nominal GDP in 2017 of the United Kingdom, France, Germany, Italy, Spain, Canada, The Netherlands & Belgium combined. This figure is based on the efficiencies that will be gained by organisations implementing 4IR strategies globally, which should be exciting for every manufacturer looking to improve their bottom line.

Of course, this figure is highly dependent on manufacturers globally grasping this opportunity with both hands and running with it, as well as the necessary support from international governments.

73% confess their companies have yet to make any concrete progress creating new revenue streams using IIoT (Accenture 2015)

This statistic comes from a survey of more than 1,400 C-suite decision-makers. 84% of these decision-makers believe that their organisations have the exciting capability to create new revenue streams from IIoT. As Industry 4.0 enablers at Exmos, we see a lot of talk and hype in the media surrounding Industry 4.0, but many are slow to actually take action. We strongly believe that 4IR principles don’t have to be disruptive to your entire operations, and they don’t need to cost an arm and a leg.

Interested? Remember, it’s all about the data

Yes, Industry 4.0 is exciting, but remember that at the end of the day it’s all about data. Figure out what data you have, what data you’re collecting and ways to automate that process before moving onto anything overly complicated. Industry 4.0 is about incremental gains; be patient, and listen to the data. Before long you’ll be making data-driven decisions without having to rely on solely gut feel, and you’ll be raring to do more.

If you’re interested in discussing Industry 4.0 in your organisation, catch me at the SMAS Future Manufacturing Conference next week, or get in touch via email.

An Introduction to STEP Scotland’s Technology Centre

Tina Koenig, Marketing Executive at STEP Scotland gives an introduction to the Step Technology Centre, an innovative lab facility offering SMEs a selection of smart tools to help them prototype, innovate and bring new products to market.

The STEP Technology Centre offers SMEs across Scotland low-cost access to prototyping technology including 3D printers, 3D scanners, laser cutters and engravers, a vinyl cutter and digital embroidery equipment.

Situated in the offices of STEP Scotland, within Stirling Enterprise Park, the Technology Centre opened at the end of 2014. Formerly known as the CREATE:Lab, it was designed to support Scotland’s rural businesses which find ICT to be a key barrier for growth. STEP Scotland members now range from farmers and craft businesses through to innovative research and design firms.

As well as our onsite facility, STEP’s mobile facility can be used to access any location in the country, demonstrating new products, state-of-the-art production technologies and software to SMEs.

How the technology works

Rayjet is a desktop laser engraver system, aimed specifically at small and medium enterprises, that allows you to engrave, mark and cut a variety of materials.

It is characterized by the highly precise cutting edges and the consistent quality of results. You can also achieve advanced visual effects and surface structures when engraving materials.

The Rayjet is suitable for laser engraving and cutting of wood, plastics, leather, paper and many other materials. Typical applications include signage, trophy engraving, stamp engraving, prototype construction and promotional items.

A unique resource for ambitious SMEs

Many SMEs lack the necessary capital to invest in specialist equipment so the Technology Centre offers an affordable alternative for businesses trying to make, create or simply test an idea.

Come and speak to us! 

STEP Scotland’s 3D printer will be switched on and ready to go at the SMAS Future Manufacturing Conference on Tuesday 24 October. You will find the machine, along with the team in the Technology Zone. Our experts will be on hand to guide you and show you how to make the most of the equipment. Come and speak to us!

Big Data Doesn’t Automatically Mean Big Understanding

Michael O’Connell, Director and Co-Founder of Visual Performance Management Ltd, argues that while manufacturers understand the value of big data, they don’t always know how to use  that data to its full potential.  

As the Internet of Things grows ever larger simplicity will still have a vital role to play. And while big data has huge opportunities, it also has some big problems that will need to be overcome.

Boundaries within manufacturing are being eroded as the industry moves more towards an interconnected, digital world that has the potential to break down barriers within supply chains, across organisations and even between humans and machines. Whether you believe that Industry 4.0 is truly an industrial revolution or simply the natural evolution of our technological age this trend is likely to have dramatic and far-reaching consequences throughout the entire manufacturing ecosystem.

The long-term prospect of machine-learning, automation and an uninterrupted Internet of things may ultimately take the human interaction in manufacturing from an active to a much more passive role. This may seem like science fiction but so did the electric car less than a decade ago and, while there are huge challenges in reaching this state, the drivers of economic progress are likely to accelerate it into the near rather than the distant future.

There are many challenges, such as security and over-reliance, but one that is of specific interest is the human-machine interaction during this transition period. Imagine for instance the increased complexity that big data brings to human interpretation of results and how to react appropriately to what this data is telling us.

Whereas computers are ideally designed to handle increasingly large volumes of data, human beings have a limitation in dealing with the interpretation of the results. This is not just because we miss things when data sets become too large and intricate but also, we are so good at seeing patterns and creating stories that we see them where they do not exist. Our tendency towards heuristics that make us so successful in many aspects of life can cause significant problems when interpreting data. Large data sets mean exponential opportunities for false positives because patterns occur just by chance.

For this reason, there will naturally be a limitation and a point at which the insight gained by the person viewing the data becomes saturated, or even diminished, as the complexity of the data increases.

It is therefore vitally important that we collect the most critical data in a robust and meaningful format and display the resulting information clearly and simply. Creating screens showing 17 meaningless 3-D pie charts, mixed in with a handful of fuel gauge graphics, may have appeal to the people in an organisation who do not actually have to act on the data but to those trying to extract some value from the displays and take some action they are little use.

Ultimately the success of big data and Industry 4.0 should not be measured by the quantity of information we collect and display but the understanding it brings and the positive actions we can take as a result.

Future-Proofing Manufacturing with Circular Business Models

Louise McGregor, Head of Circular Economy at Zero Waste Scotland looks at the importance of a circular economy to the future of manufacturing in Scotland, exploring its benefits and business models.

If manufacturing at its very basic definition is the business of making things; what happens when the materials needed to make things become inaccessible, or start to run out and become so expensive that using them is no longer economically viable?

One way to future-proof manufacturing to offset resource scarcity and build business resilience could be to adopt circular business models and approaches.

Circular approaches are recognised as bringing multi-million pound benefits and providing substantial prospects for job creation and sustainable economic development opportunities. Globally, Accenture values the circular economy opportunity as $4.5 trillion.

The Scottish Government has set out their strategy for realising this opportunity for manufacturing in Scotland in three key policy documents: Making Things Last, Scotland’s circular economy strategy; Scotland’s Economic Strategy; and the Scottish Government’s Smart Specialisation Strategy, A Manufacturing Future for Scotland – a programme for Government commitment.

Manufacturing is at the heart of a circular economy – in production processes and their supply chains, and in new circular business models which change consumers’ relationships with products in acquisition, use, and disposal.

  • Design for longevity – changing how products are made (longer-lasting, easier to disassemble and repair, using modular design and regenerative materials) and how they are consumed (leasing or hiring, ‘sharing economy’ models, e.g. tool libraries, replacing a product with a service e.g. Netflix)
  • Re-use, servicing and repair – extending the lifetime of products by maintaining and repairing them, keeping them in their original use for as long as possible
  • Leasing and hiring – retaining ownership of products for long-term income flows
  • Recycling – separating products into component parts and materials, and enabling those to be reutilised in new products, displacing the use of virgin raw materials
  • Remanufacture – continuing the lifetime of products at the end of their ‘first life’ by restoring them to a ‘good as new’ state for their next

At Zero Waste Scotland, we are supporting businesses to deliver circular economy business models that use collaboration and innovation to drive success and growth. Our £18m investment fund and business support service are helping small to medium sized businesses in Scotland pioneer circular ways of doing business.

We have already successfully supported several businesses to develop circular economy business models that are innovative, exciting, and represent some of Scotland’s most traditional industries. Developed by geotechnical engineers at Heriot Watt University, Kenoteq has patented a brick made without raw materials – instead consisting of 90% construction and demolition site waste. Meanwhile kilt-maker Diggory Brown has created a collection of ‘Synergy’ tweeds using cloth woven from wool waste.

We are working with the high-value manufacturing sectors such as aerospace, automotive, electronics, engineering and the medical device industries to truly disrupt the current ‘take, make, dispose’ linear economic model with revolutionary new processes.  Our research in partnership with the Ellen MacArthur Foundation and Scottish Enterprise indicates it’s a trillion-dollar opportunity globally, and action across manufacturing sub-sectors (such as motor vehicles and electronics) could generate up to £1.5 billion in cost savings for Scotland alone.

Manufacturing businesses looking to future-proof their business, should therefore look no further than the circular economy opportunity. “Circular” future-proofing for survival and profitability will mean moving the goalposts, challenging the status quo, stimulating new markets and driving new ideas and it is already here, and happening now.

The £18 million Circular Economy Investment Fund, administered by Zero Waste Scotland, offers investment for SMEs based in Scotland and supports work that will deliver circular economy growth. It’s backed by funds from the Scottish Government and the European Regional Development Fund (ERDF).

What does 4IR Mean in Practice for Manufacturing SMEs?

Malcolm Harold, Knowledge Transfer Manager, Manufacturing at KTN asks ‘”What is 4IR and what will it mean in practice for manufacturing SMEs?”

There’s a lot of hype around the 4th Industrial Revolution (4IR), or Industry 4.0, but do you really know what it is and how it will impact you?

4IR represents a transformative opportunity for industry. It is clear that when implemented well, digitally-based technologies and systems can improve productivity, quality and reduce costs in manufacturing.  The new global transformation and implementation of cyber-physical systems brought to us through 4IR, will enable companies to remain competitive.

With Brexit almost upon us, the UK needs to work harder to remain globally competitive and UK manufacturers need a way to increase their business resilience in these difficult times. SME engagement in 4IR is therefore imperative for the economic prosperity of the UK.

Manufacturers have raised concerns about 4IR in terms of confusion, resource concerns, uncertain benefits and the language of 4IR, all of which create key barriers for SMEs.  A recent study carried out by the Knowledge Transfer Network into 4IR highlighted SMEs concerns around:

  • There is a lack of a common understanding of definitions and standards
  • There is no common glossary of terms readily available
  • “Where do we start?”
  • “Where can I see it?”
  • “What is government doing?”
  • In conjunction with these concerns, the term “Big Data” often used when speaking about 4IR can be viewed very negatively by companies who do not really understand its meaning and benefits

The biggest business concerns facing companies digitising their manufacturing processes include:

  1. Legacy systems and integration – the single biggest digital challenge
  2. Identification of new business models for vendors to make middleware and targeted software more accessible to manufacturing SMEs allowing them to embrace 4IR
  3. Building competence and confidence within the company where there are skills gaps
  4. Fit for Digital.  Companies of any size need to be in a fit state to benefit from adopting new technologies (machines or software).  Failure to do so will compromise predicted benefits and productivity gains, rendering high ROI an almost unachievable ambition
  5. Access to easily accessible specialist, localised programmes to help manufacturers navigate this complicated landscape and find a result that is tailored for them
  6. Support to help manufacturers understand the terminology generated through 4IR
  7. An approach that works for many manufacturers is – led from the top – driven from the factory floor.

The areas manufacturers will gain significant benefit from focusing their resources for digitisation include:

  • Factory floor and production systems
  • Additive manufacturing
  • Industrial internet of things
  • Sensors
  • Systems integration
  • Digitally assisted assembly
  • Robotics and automation
  • Simulation
  • Cyber security
  • Flexible manufacturing
  • 3D Visualisation
  • Digital processes (rather than paper and human time-consuming processes)
  • Predictive maintenance
  • Energy and water efficiency

So the 4th Industrial Revolution can offer many opportunities for companies to improve productivity, quality and reduce costs in manufacturing.  The Knowledge Transfer Network are working on a solution to support companies addressing 4IR. Watch this space to find out more.

Improving Productivity and Value-Add through Digital Technologies

Dr Abigail Hird, Executive Team Member at the Strathclyde Institute for Operations Management (SIOM) at the University of Strathclyde discusses the increasing hype around Industry 4.0 and what it means in practice for SMEs.

A revolution is upon us. Manufacturing is changing. New services are being created. Fresh opportunities, challenges and business models are emerging as a result of the adoption of a range of enabling technologies. How should you embrace these technologies? How will they impact your business and competitive proposition? And what does it all mean for SMEs ?

The Revolution

Enabling technologies such as sensors, data analytics, Internet of Things and Cyber-Physical Systems have provided a platform for industry to innovate with new processes and business models. Sectors and companies that have embraced these changes have enjoyed productivity increases and generated significant added value. At a national level, the UK faces productivity challenges and fierce competition from global markets. We need innovation that propels us beyond ‘catching up’ with others, and novel applications of digital technology could be one way/route to achieving this.

Digital “Noise”

Digital Technologies can impact manufacturing firms beyond the production process: smart products and smart supply chains are other aspects to consider. One thing that gets in the way of having useful conversations about “Digital Manufacturing” is that definitions of ‘Digital Manufacturing’ or Industry 4.0 vary depending upon who you are talking to. People have a tendency to see the world through the lens of their favourite technology or application. How we like to think of it is that it’s not about Amazon drones, smart fridges, or robots taking over, or any single specific technology, but more about  the application of a whole range of technologies for improved decision making – whether that’s at the level of a single manufacturing operation or at a strategic organisational level.

Making Smart Decisions

Digital technologies can enable decision making that has less reliance on human judgement and intervention saving time and money in terms of resource. This could mean automating run-of-the-mill information provision or, developing insights, improving consistency and removing bias in more complex decision making. Whilst managers will still ultimately be the decision maker in a digital context they are empowered by improved information often enabled by sensor-driven data collection, powerful new data analytics and fast communication technologies.

Size Matters

To date, much of the research, policy and uptake in practice has been championed by, and targeted at, large organisations. Operationally, large firms are very different to smaller businesses. Being big has its advantages: resource to invest in new technologies and leverage in well-established markets, for example. There are benefits to being small too: it shouldn’t be as onerous to generate momentum for change and strategy decisions can be rolled out and adapted with better visibility and control. The UK economy is powered by smaller businesses and when it comes to digital strategy it isn’t a case of one size fits all.  Digital strategy must be considered in light of the size, sector, value proposition, and all the wonderful idiosyncrasies of your individual business.

Taking Advantage

New digital technologies enable innovative business models and exciting opportunities to compete in transformative ways. With more natural agility, small firms are best placed to take an opportunistic approach.

For example:

  • SIOM researchers developed and applied exciting AI methods to improve resource forecasting, enabling quick and confident responses to tender and better product development resource planning decisions
  • The Advanced Forming Research Centre (AFRC) are working with augmented and virtual reality technologies to help the construction industry visualise cables and plumbed systems behind walls

SIOM and You 

SIOM provides a forum for industry (businesses of all sizes), academics and policy makers to collaborate with a view to addressing key operations management challenges to deliver real impact, compete nationally and internationally and improve productivity through efficiency gains and increased value-add. We are looking to explore how digital technologies can be applied in a range of contexts with a view to identifying patterns and trends to help your business and passing on the things we’ve learned.

You may still be wondering what Digital Manufacturing means for your business, or maybe you are well down the road to automation, or perhaps you have processes with minimal technology. Either way, we’ll help you reflect on where you are currently, where you need to be and where investment in effort and resources is going to be most beneficial.

To find out more please contact Dr Abigail Hird

Are you Ready for the Next Manufacturing Revolution?

A new manufacturing era is taking shape across the globe but are you ready to take advantage asks Nick Shields, Director, Scottish Manufacturing Advisory Service

History tells us that step changes in economic growth have been driven by manufacturing revolutions. The first industrial revolution was driven from harnessing steam power which started a dramatic rise in productivity and living standards. The next major advance was mass production, pioneered by businessmen such as Henry Ford. In the 1970s, robotics and automation injected large productivity improvements, boosting employment and growth.

The world is now on the cusp of the next fourth revolution and the fuel for this revolution is not coal; it is data. Industry 4.0 will combine manufacturing practices and the power of the internet connecting products with users, producers and service providers. It will transform traditional analogue centralised workflows into digital approaches and de-centralised production processes.  Intelligent factories will allow products to find their way independently through the production process. Machines and products will communicate with each other, co-operatively driving production. Raw material, supply chains and machines will be inter-connected in an ‘internet of things’, meaning highly flexible, individualised and resource friendly mass production.  This new revolution is about producing better, smarter products.

This industrial internet will lead to decreased production costs, be resource efficient and be customer orientated.  New business models, innovative products and new services will evolve. Internal and external data will inform decision making and drive up both innovation and efficiencies.  Machines and products will be equipped with sensors continuously collecting data about status, location and progress.  This will lead to more efficient processes and optimal and preventative maintenance of machinery and equipment to help identify sources of errors and save costs.  It’s a quantum leap in the networking of people, machines and products that will enable businesses to improve the efficiency of a product through its entire lifecycle.  For customers, it will result in a lower cost of use and reduced environmental impact throughout the lifetime of the product.

But how do businesses adapt to this fast-changing and increasingly competitive marketplace as it becomes more important to operate quickly, flexibly and cost effectively? Where do they start to make the investment in time and money to digitise, automate and connect the processes not only within their company but along the entire value chain?  How do they prepare their workforce for the changes in how employees will perform their jobs? How do businesses maximise this opportunity of the lower cost of technology and automation?

To some manufacturers the intelligent factory is a natural next step. For most, however, this all feels quite distant from today’s reality, where many factories have yet to adopt, embed and sustain a culture of business excellence.  Before embracing Industry 4.0, businesses need to pave the way by making incremental improvements to every part of the organisation – introducing visibility and controls and getting the culture right, while at the same time utilising data to make better decisions.  This will allow businesses to be poised and ready to fully embrace Industry 4.0 to improve the organisation as a whole.

The challenges ahead are not insignificant, but the opportunities are huge, particularly as technology becomes an affordable reality.  However, only those companies who transform will be able to seize the growth potential and realise the vision for this fourth industrial revolution. Also, many parts of the world are now embracing this approach and are investing to protect their competitive advantage and to open up these new business opportunities. The latest research shows that through applying this approach, first mover businesses are planning for 30% revenue increases combined with 30% cost reductions and in the next 5 years (Industry 4.0: Building the digital enterprise, PWC, 2016).

We at SMAS are part of the network of support in Scottish Enterprise to help businesses understand, implement and benefit from all that Industry 4.0 has to offer in order to produce better, smarter products and to stay ahead of the competition. We can help design, implement and arrange financial support for the digital manufacturing journey that will develop business products, people and processes.

So whether you’re already quite far down the road, or just starting to think about dipping your toes in the Industry 4.0 pond, this conference has drawn together a wealth of expertise and support under one roof, to help you cut through the hype and navigate solutions to future proof your business.

How can you Join the Fourth Industrial Revolution?

Lynne McGregorInnovation Lead for Manufacturing and Materials at Innovate UK, asks ‘How can we bring UK manufacturers to the forefront of Industry 4.0?

Artificial intelligence. 3D printing. The Internet of Things. Autonomous vehicles. A wave of emerging technologies are transforming our world and the way we operate within it. Everything from watching films to managing money is evolving as the digital revolution picks up pace across the globe. Industry 4.0, or the fourth industrial revolution, describes how digital technologies will change industry, and the way we design, produce, sell, use, maintain and recycle products.  This shift presents UK manufacturers with a wealth of opportunity. A recent study identified that by fully applying these technologies over the next decade, UK industrial production would be up to 30% faster and 25% more efficient.

Industry 4.0 can keep the UK competitive

Vitally, the fourth industrial revolution provides a once-in-a-generation opportunity to return the UK to higher levels of productivity. Manufacturing has been a source of wealth and jobs for our nation since the first industrial revolution, and still is: it currently provides over £162 billion to UK GVA, accounts for 50% of exports, and employs 2.6m people (with a further 2.5m people across the extended supply chain). However, this source of wealth is declining. Since 2004 the UK has fallen from sixth to ninth place in the world rank of manufacturing nations, and its productivity is now the lowest of any G7 country.

Quick and widespread adoption of Industry 4.0 will be key to securing a more competitive global position, increasing productivity and creating highly skilled, multidisciplinary jobs within the UK manufacturing sector. As such, Innovate UK is keen to encourage the successful use of digital technologies in manufacturing.

Partnerships and ‘Hack & Pitch’ events

So how can we bring UK manufacturers to the forefront of Industry 4.0? Collaboration between the manufacturing and digital communities is imperative. This will give manufacturers a clear idea of the potential benefits of digital technologies and how to implement them, while developers of digital technologies will gain insight into industrial use of their products. Innovate UK has been fostering such collaboration through its various networks – the Digital and High Value Manufacturing Catapults, and the Knowledge Transfer Network (KTN).

Sheffield-based AMRC, one of the High Value Manufacturing (HVM) Catapult centres has recently partnered with Sheffield Digital – an organisation helping to grow digital businesses in the area. This new relationship will “feed expertise into the supply chain and increase opportunities for innovation,” says Mel Kanarek, director and co-founder of Sheffield Digital.

AMRC have initiated a Digital Meet Manufacturing (DMM) campaign. Working with the support of the HVM Catapult and partners such as Tech North, Innovate UK, KTN and The Manufacturer, DMM includes a coordinated programme of Meets, Demonstrations and Challenge events between Autumn 2017 and Spring 2018 to promote and intensify collaboration between innovators and entrepreneurs from the two sectors.

Another interesting way of getting the digital and manufacturing communities to work together was developed by the Digital Catapult.  Their  ‘Hack & Pitch’ format involves digital SMEs competing to solve manufacturing challenges identified from industry. Typically, winners receive a prize and go on to develop solutions with the manufacturing companies posting the challenges.

These events are a great way to get the two communities working together to positively disrupt the UK manufacturing industry. Past successes include the Digital Catapult’s Tech Challenge, which ran from January to March 201, where three manufacturers presented challenges, 15 digital SMEs applied to solve them, with seven shortlisted to pitch and one winner.  Innovate UK also ran a Hack & Pitch competition at the Industry 4.0 Summit in Manchester in April, with three industry led manufacturing challenges, 24 companies pitching solutions, three companies winning prizes and one overall winner.  The Digital Catapult are planning another Hack & Pitch event to be held at the Smart Factory Expo in Liverpool in November.

The KTN’s “4Manufacturing” initiative has been helping SMEs to take their first steps into Industry 4.0, develop a plan of action, and find the right partners and funding.  Thus far KTN have helped over 175 SME manufacturers in this way.

Get involved

Innovate UK, the Digital Catapult, the HVM Catapult centres and the Knowledge Transfer Network are working together to grow the use of Industry 4.0 within UK Manufacturing.  New Hack & Pitch competitions and events to bring the digital and manufacturing communities are planned. KTN will feature case studies from its 4Manufacturing initiative at the next Industry 4.0 Summit in February.  KTN is also helping put together two of the sessions on Industry 4.0 at Venturefest Scotland in Glasgow on 20th September. Registration is free and you can book your place here.

To get connected to the right partners and funding get in touch with KTN –  or see the flyer here and watch for news releases from the Digital Catapult