Raimund Klein reveals the future path for digitalisation and how it will impact on industry
Digitalisation is said to be a major turning point in the history of how businesses are run. It has expanded in significance, from existing as bytes and bits to representing an entire way of connecting the physical realm and the digital realm to create even more competitive business models. In recent years, it has become relevant not only to consumer businesses such as telecommunications and media, but also the industrial landscape.
Digitalisation has been hailed a buzzword for its ability to create new business and growth opportunities for companies. However, at this point in time, the trend is still a relatively new concept for manufacturers. The digital transformation of factories marries the virtual and real world, enabling businesses to achieve the next level of manufacturing. Digital and networking capabilities go hand in hand in tightening the integration of operations, with an industrial Ethernet as the backbone of these processes.
Manufacturers are beginning to realise that leveraging data is key to improving factory processes and gaining a competitive edge. A report by a 2014 Economist Intelligence Study found that every single manufacturer surveyed acknowledged that data collection to be a priority concern for their business. Production inefficiencies, under-utilised resources and long time-to-market can be attributed to a lack of insight into manufacturing data. A digital platform can help factories capture and leverage this vital information by migrating processes to a digital interface, enabling the planning and designing of products and production lines using digital models, methods and applications.
The advent of these digital solutions will help factories with high levels of automation and complexity, in particular, to overcome production challenges. Process industries, for example, usually involve highly complex manufacturing activities, and struggle to integrate their facility design and production operations. Digitalisation will be able to enable process industries to eliminate potential issues in the pre-production phase and achieve optimised operations through highly integrated engineering and operations.
Having an integrated landscape across the entire production lifecycle, including engineering and commissioning, is a pre-requisite for digitalisation. The various sizes of factories and level of automation and integration they have achieved will determine how to best set up a digital operating process model. Depending on the results of the plant’s maturity assessment and the prioritisation of digital initiatives, various strategies can be taken. For example, advanced automation technologies such as a control systems upgrade can be first incorporated to the existing operations for improved integration.
Although it would be ideal for manufacturers to digitally transform their workflows as a whole, financial constraints and unfamiliarity with a new system are likely to be contributing factors in their decision to adopt a step-by-step approach instead. Businesses that eventually reach their full digital potential will enjoy the benefits that come with virtual production simulation and watertight integrated system. These operations will enable digital factories to reduce time to market and improve both production flexibility and efficiency.
Digitalised factories will run on a standardised, integrated operating system based on a common data model and uniform hardware and software interfaces. This will allow automation components such as controllers and motor management to function seamlessly in a single engineering environment. This also means problems occurring in any stage of the production line can be detected and resolved quickly as the entire operating process is monitored in real-time. Production efficiency is not only optimised but time-to-market is also shortened in the long run.
A digitally transformed factory also enables the simulation of a virtual production line, where various types, volumes and placements of machines for new production processes can be tested out. These virtual simulations are built upon real-time data to resemble the physical conditions in the factories. When the simulation predicts a high success rate, the particular production design would have a potentially higher chance of implementation with minimal downtime. Production becomes more flexible as production lines can be easily tweaked with lowered risks. Throughout these planning processes for the modifications of production lines, time-to-market remains unaffected as ongoing production processes need not be stopped.
In a challenging landscape
Competitive pressures such as a crowded global export market and shortening product life cycles are likely to drive the uptake of digital manufacturing solutions among companies looking to stay ahead. Global export competition is growing increasingly stiff with the recent formation of major trade agreements such as the ASEAN Economic Community and the recent Trans-Pacific Partnership. These bilateral and multilateral free trade agreements exacerbate competition between countries, companies and brands. Remaining competitive in such a volatile economic landscape will be challenging for manufacturers. Additionally, with the business model evolving towards one shaped by consumers, being able to keep up with trends will be demanding on manufacturers.
Online shopping has profoundly impacted the traditional business model in the last few years, shaping it to one that is consumer-centric. Consumers these days expect to be heard, and have a say in the look and feel of the product or they may take their business elsewhere. Already, consumer preferences have begun influencing manufacturing decisions, extending beyond consumer-related merchandise to include goods involved in business-to-business (B2B) trading.
The consumerisation of manufacturing will likely give rise to shortening product life cycles to keep up with ever-changing consumer demands and personalisation options. End users such as engineers can have very detailed specifications for manufacturers where complex products like industrial pumps or generators are concerned. Being able to respond quickly to customer preferences will increasingly determine whether manufacturers can retain their businesses in the long run.
The future of manufacturing
As manufacturers face stiffer competition and more challenges along the way, the benefits of digital technologies in being able to optimise factory productivity, efficiency and flexibility will become more apparent. Digital data contains enormous potential for manufacturers who choose to invest in digitalisation to leverage on it. Having greater visibility and control over operations and processes will go a long way in contributing to the overall success of the company.
Raimund Klein is executive vice president, Digital Factory and Process Industries & Drives, Siemens.