INDUSTRY SPECIAL .....The Problem with Industrie 4.0

The Problem with Industrie 4.0

Industrie 4.0 has been put forth as the ‘next big thing’ for manufacturers of all sizes in all industries. However, is it delivering on its promises? Peter Guilfoyle, Vice President – Marketing at Northwest Analytics, explains the importance of thinking intelligently about intelligent systems, ahead of his presentation on the topic at this year’s ChemSpec Europe.

Promises abound from all corners – from consultants and government agencies to vendors. There almost appears to be a one-upmanship happening across the manufacturing ecosystem as the term becomes more and more visible. As a result, there’s no better time to be a new technology and no more confusing time to be a manufacturer. 

Industrie 4.0 defined…sort of 

A quick online search delivers a wide variety of descriptions and definitions such as:

·         Enables manufacturers to unlock value from the physical-digital convergence and transform their operational systems

·         Captures plant data in real time enabling personnel to intervene at an early stage

·         Guarantees better products, more efficient product methods and bespoke industrial services

·         Nothing more than a fully integrated, value creation system.

That last one is quite the claim. Unfortunately, it was packaged with little actual detail of how and what is required to make that happen.

Then there’s the respected industry source who included no fewer than the following five definitions of Industrie 4.0… in one paragraph!

·         Introduces cyberphysical systems into factories

·         Seeks to learn about the new, collective processes for design and manufacturing by conducting collective experiments

·         Relational competitiveness in new forms of interaction between suppliers and customers

·         Defines new business models linked to platforms offering industrial services

·         The response to the threatening wave of digitalization unfurling against the value chain in manufacturing.

And my favourite, “Industrie 4.0 connects embedded systems and smart production facilities to generate digital convergence between industry, business and internal functions and processes”. I’m not sure what it means, but is has all the right buzz words.

And if that wasn’t bad enough, the term Industrie 4.0 is starting to be used interchangeably with other terms like Digital Factory, IIoT, Factory of the Future, and Connected Factory, to name a few. But are all these things equal? Maybe, maybe not. But this approach certainly does not bring more clarity to the conversation. It delivers more confusion instead.

It’s all about the technology…except it isn’t

Shiny object syndrome (a.k.a, SOS) seems to run rampant when it comes to discussions of Industrie 4.0. Who among us hasn’t heard a vendor pitch or read headlines touting the glory of cloud computing, IoT, machine learning, advanced analytics, digital twin, 3-D printing, AR, VR…? And the list goes on.

For too many, it’s always about the next great thing or the next cool technology instead of how a tool can be applied in a new and inventive way to solve an existing problem. Thus, a technology-centric project gains footing and funding, but then time quickly goes by and money goes out the door as the new technology goes in search of a problem instead of figuring out what problem they want to solve and looking for the best technologies to do so.

And there seems to be less tolerance on the side of the business that makes things for technology projects that end up being one-and-done failures. That side of the business expects more… from industry analysts, technology vendors and consultants… and needs more before they spend time, money and resources so a technology’s results match its promise.

Companies have plenty of examples of what happens when they jump on a technology band wagon before they know where it is really going or the problems it’s going to solve. Remember when business intelligence and business analytics was the ‘next shiny new thing’? BA/BI was going to revolutionize how companies operate and lead to dreamy dollar days by its very existence. Everyone made big BA/BI plays and, more often than not, ended up with really expensive reporting tools. Before, the reporting was ugly and text-based. Now with the BA/BI investment, there are lots more reports that look really cool. Just don't ask for an ROI. A lot of promise and hype with limited value returned to organizations in spite of the mega-investments because they were focused on the wrong thing.

The problem is the (lack of) problem

Each discussion and each cool new technology seems to start and center on the thought that the technologies will somehow just deliver huge benefits to manufactures if they are simply implemented. The very simple equation being proffered across the industry related to the promise of Industrie 4.0 seems to be ‘New technology = Incredible Benefits’.

But as a marketer who focuses on how products solve problems for users, I see the key missing piece of the equation is the problem itself. The Industrie 4.0 equation should read “Problem-to-be-solved + Right-mix-of-technologies + (People + Creativity) = True Innovation”.

And every manufacturer has problems and can express them if they work at it. It could be stubborn yields that defy improvement in a company pushing for higher profits, pressure from key customers that are demanding better and more consistent product, time/money lost to unscheduled downtime, downgraded/recycled product, higher cost materials that require more efficiency just to break even – all things that can be reduced to a defined cost (or don't need to be, like losing your best customer). Problems cost money or they aren't really problems.

By starting with the problem, solutions move from novel, one-time applications of a technology to sustainable, internalized tools that drive competitive advantage

Now to be clear, not everyone has left the problems out of their Industrie 4.0 pitches. Seimens and Cisco among others have started with the problem and worked out to how their particular technologies or services might be applied to solve them. ARC Advisory Group tends to take the problem-centric approach as well.

And to be doubly clear, I think Industrie 4.0 holds promise and is absolutely worthy of resource investment. But the investments need to be made and the approach to the application of new technologies must be targeted to addressing the real, everyday issues that prevent manufacturers from achieving their goals – production, quality, revenue and profitability.

Filtering the noise

Unfortunately, the vast majority of the noise in the market related to Industrie 4.0 is just that – noise. The premise that all these new technologies can be applied in creative ways to deliver real value makes intuitive sense especially when it starts with what problems manufacturers need to solve – e.g. utilizing cloud technologies to improve visibility into a supplier’s process capabilities, utilizing real-time analytics to improve control of internal production processes to address rework or downgrading issues, or better meeting customer through self-organizing logistics.

But what are you trying to achieve is a better place to start than how can I ride the Industry 4.0 wave. As the hype of Industrie 4.0 continues to build, it’s important for each manufacturer to start their Industrie 4.0 conversation with the problems they have and how new technologies might be applied to solve them in such a way that delivers some combination of benefits being proffered – higher product quality, improved customer interactions, better workplace safety and ultimately superior bottom-line results.

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