Digital Transformation – Are You Ready?

We have heard this for several years now – “The fourth industrial revolution is upon us!”  In the last two years in the OpExChange, plant visits and presentations showcased successful implementation of some of the industry 4.0 tools achieving great success. Shaw Industries showed how they are using virtual reality to save millions per year. Stanley Black & Decker in Fort Mill demonstrated how they used automation and machine connectivity to justify onshoring and creating over 700 SC jobs. Rolls Royce presented how they utilize machine learning and predictive analytics to improve reliability of diesel engines with a ten times return on investment.

But not all industry 4.0 endeavors are successful. In fact, according to a recent McKinsey report, a large majority remain stuck in “pilot purgatory” struggling to capture the full potential of their transformation efforts or to deliver a satisfactory return on investment.

In an OpExChange virtual event in September, Dr. Mo Abuali, managing partner of IoTco, spoke with the OpExChange about Industry 4.0 – the business case behind it, and which elements should be assessed before implementation. He also introduced the concept of an industry 4.0 assessment which he is recommending before embarking on a digital transformation journey.

In this meeting, Mo also invited Isaac Bennett, VP of IT and Digital Transformation of SAF-Holland, to share his industry experience and lessons learned on implementing and scaling Industry 4.0 technology. A theme that they both shared in implementation is to “Think Big, Start Small, and Scale Fast.”

Think Big, Start Small, Scale Fast
A mistake some companies make in their digital transformation strategy is to focus on a specific technology and then do a deep dive to make that technology create a return on investment in their business. IoTco, however, is guiding their clients differently. “We are advising organizations to start with the business case and return on investment first,” Mo stated, “and understanding which parts of their business may actually need Industry 4.0 Solutions.”  An organization needs to “think big” about which changes would make a large, scalable impact.

When identifying a pilot project, a proven technology should be chosen that directly aligns with the business case that also demonstrates proof of value. Mo recommends starting small in a relatively mature area of the business. Once proven, that best practice template should be replicated and scaled to other processes and plants. He emphasized that this is exactly what Trane Technologies in Columbia did when implementing predictive analytics. They dramatically increased machine uptime in their factory by using the “Think Big, Start Small, Scale Fast” approach. They presented their results in a report-out to the OpExChange in January.

Roadmap Elements – People Process Technology
There are fundamentally three arenas that must be addressed and aligned for a successful transformation – People, Process, and Technology. The people do the work, processes organize the work to effect efficiency, and technology automates tasks, reducing cycle times and reducing waste. Managing these arenas is analogous to a three-legged stool – if one of the legs is out of sync with the other two, the stool will be off-kilter and could topple.

Several barriers exist that could thwart a successful transition to Industry 4.0. These include IT systems, workforce challenges, legacy equipment, new processes, and capital funding. Unless a company recognizes and assesses the potential obstacles, they could become one of those that become stuck in “pilot purgatory.” This is where a proper industry 4.0 assessment is invaluable in improving the success factor of industry 4.0 implementations.

Isaac added that the industry 4.0 revolution adds a high level of complexity to this balance. Technology advancement is changing exponentially, while people and organizations are changing logarithmically, creating a “change management conundrum.”

The Industry 4.0 Assessment
Both Mo and Isaac encourage OpExChange companies to conduct an industry 4.0 assessment whether you choose IoTco, another third party, or even a self-assessment. Isaac shared first-hand experience in both developing and utilizing digital assessments while in a leadership role at a Tier 1 automotive company. His assessment tool included all the various functions and departments of the entire plant. These assessments enabled them to identify very specific, small pilot projects that targeted true return on investment. He added that although it may seem overwhelming to look at the entire picture of Industry 4.0, the assessments enable breaking it down and establishing a time-scaled, manageable strategy.

In the IoTco assessment, the evaluation consists of a detailed analysis that rates the company’s digital maturity on a five-point scale with regards to people, process, and technology. For instance, from a technology standpoint, the assessment will look at the type of equipment, vision systems, connectivity, etc. On the process layer, it will include evaluating whether processes are more reactive, predictive, or perspective. On the people side, it will evaluate the level of operator interaction, training, and decision making. The assessment will then identify digital tools of the trade which will help advance a company’s digital maturity. A typical assessment takes about three days to complete.

Start Small but Start Now!
As seen from some of the OpExChange plant visits in the past two years, there can be substantial benefits from implementing Industry 4.0 tools. The risk of delaying can be equally huge as competitors may already be realizing those benefits. Regardless of the size of an organization, a detailed assessment can begin the journey.

Mo summarized that, “long story short, it is all about people, process, and technology. It is about assessing those three Venn diagrams that are deeply intersecting, and by doing this assessment you can have a very profitable and efficient Industry 4.0 journey.”

Interactive Workshop in November
If you would like to learn more about assessing your company’s digital maturity, there is a hands-on, half-day workshop offered at the South Carolina Manufacturing Conference and Expo. Join SCMEP and IoTco for an interactive deep dive into “digital tools of the trade” needed to develop a systematic and successful approach toward achieving Zero-Downtime, Zero-Defects manufacturing.

About IoTco
IoTco’s mission is to help clients create a competitive advantage through digital transformation. We achieve this by using Industrial Internet of Things (IIoT) and predictive analytics tools to connect and analyze complex manufacturing processes, systems, and machines to identify opportunities to reduce costs, increase efficiencies, eliminate waste and enhance productivity. https://www.iotco.com/

About OpExChange
The OpExChange, sponsored by the South Carolina Manufacturing Extension Partnership, is a network of manufacturers and distributors in South Carolina known for generating success for members through benchmarking and best practices sharing. Companies host events and share practical examples of industrial automation, lean manufacturing improvements, and leadership development. It is an invaluable resource to South Carolina companies that provides access to others who are on similar improvement journeys. If you are interested in joining, contact Mike Demos (Mike@OpExChange.com) or visit the OpExChange website www.OpExChange.com