4 Excuses Mid-Size Manufacturers Need To Overcome To Successfully Deploy Industry 4.0
Manufacturers need to make a difference.
Why should any company consider deploying Industry 4.0? Because it can revolutionize how manufacturers do their business. SAP Insights explains the concept of Industry 4.0 well:
Since the 1800s, we have experienced three industrial revolutions. Each was powered by a disruptive new technology: the mechanics of the steam engine, the innovation of the assembly line, and the speed of the computer.
The reason they were called industrial “revolutions” was because the innovation that drove them didn’t just improve productivity and efficiency a little bit – it completely revolutionized how goods were produced and how work was done.
We are now in the Fourth Industrial Revolution, aka Industry 4.0, which takes the automation and computerization we saw in the Third Industrial Revolution into the future. Industry 4.0 is powered by the Industrial Internet of Things (IIoT) and cyber-physical systems – smart, autonomous systems that use computer-based algorithms to monitor and control physical things like machinery, robots, and vehicles.
Industry 4.0 makes everything in your supply chain “smart” – from smart manufacturing and factories to smart warehousing and logistics.
If it is obvious that the Fourth Industrial Revolution should be embraced and implemented to stay competitive, why are small to mid-size manufacturers slow to do so? The answer typically lies in one of the four main categories of excuses: time, team, money, or strategy.
Examples of Time Excuses:
- “We don’t have enough time to change things.”
- “We are running at full capacity and cannot afford to shut down to make the necessary changes.”
- “We can consider this again next quarter.”
These objections are frequently used when it comes to updating a business, but it is a matter of prioritization.
Time in a day or a week is finite. What’s important is what you choose to do with that time. A manufacturer that procrastinates advancements until the “time is right” will always find something else that is deemed to be more important in next quarter as well.
Examples of Team Excuses:
- “We just hired several new associates, and they are still learning their jobs.”
- “The associates that are not new to the company won’t be able to learn how to use the new technology.”
Managers often underestimate the capabilities of their teams. The best way to address this challenge is by engaging the teams themselves in developing the plans and the solutions. Bring the team together and share the direction. Follow this by asking, “How would you go about making this happen?” The answers are normally straight forward and the ownership for the implementation is now with the team.
Examples of Money Excuses:
- “New technology is too expensive.”
- Our margins are already razor-thin as it is.”
As with any project, a cost-benefit analysis should be required for an Industry 4.0 project. Ideally, a one-year simple payback or at most a two-year payback from the project, given the speed of technological advancement.
Quick installation of the project maximizes the return on investment. In addition, Industry 4.0 hardware and equipment has been dramatically dropping in price as more and more suppliers get into the market. Manufacturers have noticed this evolution in material costs enhances a project’s payback.
Examples of Strategy Excuses:
- “I don’t know where to start or how much to plan for.”
- “The deployment seems extremely complicated.”
Developing a strategy is important to know where to start and where the greatest opportunity for success will be. The first step is to assess your organization’s challenges. One favored approach is to identify a “quick-win” that will create excitement and buy-in.
If upgrading the facility’s IT infrastructure is required, consider a few pilots before broad implementation. Also do not forget about developing the skills of the people using the technology and the need for a change management strategy. All of these elements are part of constructing an Industry 4.0 strategy.
Each of these four categories of excuses can feel like large obstacles. In fact, they are not nearly as large as they are perceived to be. The first step is to decide to start and establish Industry 4.0 as a priority.
The second step for a small to mid-size manufacturer is to identify an experienced partner that can help to address any or all of these four areas.
The right partner will bring significant Industry 4.0 experience and support to any manufacturer. Any change can seem daunting before one starts. Having a reliable partner who not only understands the technology, but also the issues around change management will be key to successful Industry 4.0 deployment.