Smart Manufacturing Technology: What It Means to the Future of Business By Michael Mantzke, President and CEO Global Data Sciences, Inc. 2112 W Galena Blvd., Suite 8246 Aurora, IL 60506 (630) 299-5196 www.globaldatasciences.com
Introduction Smart Manufacturing technology is more than just a buzz phrase about today s technology and its role in the future of worldwide manufacturing. The term accurately describes the convergence of every component of manufacturing, particularly access and integration of all relevant data. The goal of Smart Manufacturing is to provide internal and external (competitive) intelligence, which is a critical driver of global marketplace success. Ideally, Smart Manufacturing s promise is to deliver innovation that disrupts the marketplace with new insights and actionable steps that will lead to higher and more sustained growth rates, especially for companies that know how to use data to their advantage. Smart Manufacturing is more than efficient production. It represents an evolutionary approach that spells the end of a silo mentality often displayed by plants in the same company that operate independently of each other. Instead, Smart Manufacturing fosters interconnected operations that lead to better run plants and less costly operations. Background To fully understand the implications of the trend toward Smart Manufacturing, first consider the size of the market this approach impacts. A Morgan Stanley analysis of the Internet of Things indicates there will be 75 billion devices using the internet by 2020. 1 The ubiquity of data in the marketplace graphically illustrates the need to effectively and efficiently harness it. More and more, businesses understand the importance of accessing data that is relevant to their operations and competitive standing. That s the easy part. The difficulty lies in separating meaningful data from what is often referred to as background noise. The task becomes even more complicated because the data that may seem to be irrelevant at the moment can turn into critical information later. That s why it is important to have the technology to crunch the endless bits of information so that data can be leveraged to its maximum benefit. Such know-how can spell the difference between being strategic and proactive on one side and reactive on the other. The latter is less likely to produce a competitive edge now or in the future. 2020 75 BILLION
Research shows the importance and value of using data to improve nearly every operational aspect such as product quality, worker and workplace safety, energy efficiency and environmental compliance, all while reducing cost. This is where Smart Manufacturing comes into play. Thanks to technological innovations that have fueled the growth of Smart Manufacturing acceptance, such achievements have become reality something that was anything but the norm less than 20 years ago. Today, advances in technology have produced an extremely sophisticated global marketplace that has forced businesses to radically alter their work processes to successfully compete. Technology can also be attributed to the rise of the start-up businesses that pose a major competitive threat to their larger counterparts because of their concentrated focus on innovation and rapid product development. These new arrivals pride themselves on maintaining a previously unheard of time frame from design to marketplace as little as six months. Larger, established firms that compete with start-ups generally take as long as 18 months for the same process an amount of time that threatens to relegate their new product to instant obsolescence. Their methodology has put them at a competitive disadvantage, which is unacceptable in a global business environment. Smart Manufacturing, Big Data and Information Technology The technology to sort out and leverage the data is certainly available, but many companies choose to focus on the micro (a specific issue or product) instead of the macro (the integrated data process that relates to the entire organization) approach. In some cases, they may possess the technology, but choose to limit its use because they mistakenly focus only on what they presume to be relevant data. That decision ignores the potential impact of other data in the company s possession. Certainly, Big Data needs to be understood at a molecular level for effective analysis, but when technology to analyze it is either not clearly understood or, worstcase, ignored, the company has failed to take advantage of a potential competitive edge waiting to be leveraged. The value of Smart Manufacturing Technology, which some refer to as Industry 4.0, is its very specific goal: innovation. It integrates data and applies it to every aspect of operations including strategic planning, expedited production, economic growth, and environmental compliance to name a few.
Smart Manufacturing has often been compared with the Industrial Internet of Things (IIOT), in which data technology is integrated with machines to supposedly produce more efficiencies, cost savings and business intelligence. However, according to the website TechTarget, a major concern surrounding (IIOT) is interoperability between devices and machines that use different protocols and have different architectures. 2 Integration is, of course, the point of Smart Manufacturing, and its technological integration of every aspect of data has resolved most of these issues. Another function impacted by the rise of Smart Manufacturing is the role of the information technology specialist. For many companies, IT is charged with maintaining infrastructure at the highest level. IT is considered non-revenue producing and an expensive but necessary budgetary expenditure. The evolution of Smart Manufacturing has changed that perception by transitioning the people who keep the information systems running into business partners. Today, it is essential to consider IT as a strategic player in the company s bottom line instead of a utility. How is this possible? The answer is the use of data analysis from Smart Manufacturing combined with a changing role for IT departments. Moving from order takers to strategists, IT professionals have an expanded role that includes designing and building the architectures and their required devices that are consistent with the organization s needs and goals. The new technologies of Smart Manufacturing are integrated into this process a recognition that IT s value for the business goes far beyond that of service provider. Since Smart Manufacturing s focus is innovation, this is the very proficiency and skillset that IT is more than capable of providing. It makes sense in this very competitive, digital and rapid response global economy to harness the expertise IT can provide to ensure that business planning is as strategic as it should be. Perhaps the best explanation of the impact of these approaches from IT to global competition is summarized by Greg Gorbach, an analyst for the ARC Advisory Group: Software, scalability, analytics and the possibility to reinvent business processes are what will really drive the uptake of technology and the coming digital transformation, Gorbach said. 3 Reinvention, a by-product of Smart Manufacturing, is likely to determine the winners and losers in the technology-savvy business world. Software, scalability, analytics and the possibility to reinvent business processes are what will really drive the uptake of technology and the coming digital transformation. Greg Gorbach Analyst ARC Advisory Group
Innovate to Succeed One company that can attest to the value of Smart Manufacturing technology is Continental Tire, Sarreguemines, France. The company sought to improve tire production by eliminating bottlenecks and delays caused by missing material and, at the same time, reduce component waste. Through the combined efforts of Cisco Wi-Fi nodes, Aero Scout s industrial tags and Global Data Sciences, in 2012, Continental was able to increase tire production from 33,000 per day to 38,000. Thanks to the Smart Manufacturing system installed, Continental reported reducing component waste by 20 percent. 4 Pleased with its results in France, Continental also installed the system in its Mount Vernon, IL., plant. Both systems used the Global Data Sciences material inventory tracking system (MITS) software data management. Using Smart Manufacturing technology, Continental Tire Increased tire production from 33,000 per day to 38,000 per day Reduced component waste by 20 percent 4 Smart Manufacturing has proven to be an integral part of a global economy in which the most responsive and innovative solutions are likely to succeed. Manufacturers that implement this technology are likely to see the following results: Improvement of the bottom line by understanding costs thoroughly; Understanding the trends and possibilities of business growth by recognizing immediately the data that exists; Gain the competitive edge essential for success in the global marketplace. Fundamental to all of these outcomes is acceptance of what should be considered an axiom for today s and tomorrow s businesses: systems utilizing intelligent data resources are interdependent on each other. That is the very core of Smart Manufacturing. Nothing in the business environment can be taken for granted. Big Data leverages a comprehensive strategic and tactical execution of a company s operations, and sound data security protocols are integral to the successful use of Smart Manufacturing technology. The future of every business may depend on it.
Company Credentials Global Data Sciences, Inc., Aurora, IL, provides scientific, data-focused approaches to developing and executing sound strategies to increase company value in the global environment. We specialize in identifying hidden opportunities in enterprises through proven techniques that produce tangible and measurable results. Among are many areas of expertise are global operations, process and procedure optimization, systems integration and optimization, and cyber-security and data forensics. Tel: (630) 299-5196. For further information, please visit our website at www.globaldatasciences.com. References 1 Morgan Stanley: 75 Billion Devices Will Be Connected To The Internet Of Things By 2020. Tony Danova, Business Insider. October 2013. 2 Industrial Internet of Things (IIOT). Margaret Rouse. www.techtarget.com. March 2015. 3 New IIOT Technologies, Strategies for a New Year. Bob Vavra. Plant Engineering CFE Media. December 23, 2015. 4 Continental Tire Plant Increases Productivity, Reduce Waste. Claire Swedberg. RFID Journal. April 25, 2012.