The last decade saw a boom in manufacturing that coincided with the growth of consumption. Production floors were busy keeping up with customer demand, and supply chains seemed to be flowing smoothly across borders. But when the coronavirus hit, component supplies tightened, operations halted, and factory floors emptied due to illness and government-imposed social distancing measures. It was not the end of the story for manufacturers, only a temporary hiccup as companies evolved to adapt to new realities by speeding up the adoption of automation, Industrial Internet of Things (IIoT), and advanced digital technologies — and moving away from “just in time” supply chain practices.
The COVID-19 pandemic has changed the global economy and people’s social interactions. It has also affected consumer behavior and consumption. And it leaves manufacturers searching for new approaches to production to meet changing customer demands, forcing a drastic evolution through the pursuit of agility both in assets and operations.
And all of this is happening in an environment of increasingly complex economic, geopolitical, cultural, workforce, and environmental changes. This new reality necessitates rapid digital transformation founded on access to real-time data, flexibility, and operational efficiency. It calls for an embrace of the new industrial revolution.
Industry 4.0 and connectivity
Digital transformation does not necessarily mean replacing old equipment on the shop floor — which can be costly — but augmenting industrial facilities and connecting them through reliable networks, such as Ethernet and 5G. Wireless and sensor-driven communication networks for real-time monitoring of equipment and machinery on the production floor extend a machine’s lifespan, increase throughput, and save on downtime costs.
Computing and communications technology are ushering in a fourth industrial revolution, or Industry 4.0, which leverages connectivity, real-time data analytics, artificial intelligence (AI), machine learning (ML), virtual reality, and other digital technologies to monitor equipment and productivity on the shop floor.
Although industrial data generated through sensing technology and digital systems provide flexibility to production operations, that data requires reliable connectivity. Industry 4.0 is driven by interoperability, allowing real-time data communication across IIoT devices and equipment. Insights from industrial data generated at the edge must be transmitted and communicated in real time to minimize downtime costs, so data management, analytics and cutting-edge networking become critical skill sets.
Advanced computing helps companies localize supply chains, access reliable data in real time, decentralize production facilities, and set up customizable systems that are easy to reconfigure, reducing the time needed for production and product delivery and managing costly interruptions.
IIoT part of digital transformation
This new industrial connectivity demands reliability and security. To create a flexible, agile, and efficient production environment, turning massive industrial data into actionable insights for better decision-making is the first and necessary step. But it entails connecting assets and technologies.
Chipmaker Analog Devices commissioned Forrester Consulting to conduct a survey of 300 senior industry leaders across the United States, Europe, and the Asia Pacific region. The firms the respondents represent are grouped into three levels — low, medium, and high — of maturity in their digital transformation.
The study reveals some interesting findings. Eighty-five percent of high maturity firms take advantage of IIoT technologies, while only 66 percent of medium maturity firms and 17 percent of low maturity firms do the same. But whether low or high maturity, both consider IIoT as a top investment priority, expecting that a hybrid of wired and wireless connectivity are critical on the factory floor.
Low maturity firms seek to leverage insights from industrial data, but most of them still use legacy equipment unconnected to other assets on the shop floor. They tend to focus on the improvement of customer outcomes for their technology investments. Operational efficiency and cost-cutting might only be a result rather than a top priority. These firms seek to increase their productivity and reduce downtime, but the lack of reliable network connectivity poses a challenge.
Companies with medium maturity show reliance on connectivity and industrial data, but they’re still struggling to be digital-first. They prioritize efficiency and improvement of their operational control, regarding technology investments as a key for their long-term business strategies. As customer demands evolve, companies need operational and digital agility. But integrating data analytics and digital technologies with their legacy systems seems to be the hurdle.
High maturity firms embrace flexibility and agility, seeing investing in reliable networks and digital technologies as critical in leveraging the potential of IIoT, industrial Ethernet, and 5G network reliability. These firms seek to turn data into actionable insights for better decision-making. But they face security challenges, struggling to protect customer data, employee information, and company intellectual property.
The quest to be digital-first
Turning data into real-time actionable insights is critical, but skills shortages and interoperability due to legacy equipment used in factories can be obstacles. Companies that adopt digital transformation and invest in security, network reliability, and industrial connectivity gain a competitive advantage into the future.
While connectivity spurs innovation — serving as a foundation for data-driven manufacturing and production operations — it demands improvements to existing networks and technologies and augmentation of factory equipment.
As manufacturing is asset-intensive, it takes time to become digital-first. A company must invest in reliable networks and connectivity to link all physical and digital assets on the factory floor. The payoff is that transforming industrial data into real-time insights puts a firm at an advantage. It allows businesses to innovate faster, respond to the growing customer needs, and stay ahead of the competition.
Taking advantage of the insights from connected assets and investing in real-time equipment and productivity monitoring will speed up a company’s digital transformation.
Connectivity and productivity
Digital transformation depends on reliable, secure, and seamless connectivity.
Turning to 5G to improve wireless connectivity — and Ethernet for wired network reliability — should be high on everyone’s priority list. A private 5G network promises reliable, low latency connectivity with better performance, privacy, and levels of security, and is a critical enabler of IIoT technologies.
Technologies for manufacturing — smart automation, sensing, wireless network, Ethernet, and even edge computing — can be valuable additions if they address your business goals. The goal is to implement automation wherever possible — and a big part of that is having the data to make supply chains run as smoothly as possible.