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Industry 4.0: The Intelligence of Things

03 Jan 2018
Innovation
Phoebe Harvey
03 Jan 2018

Industry 4.0: The Intelligence of Things

On Wednesday 27th July 2016, Tom Dawes (Valuechain CEO) joined Insider magazine for a special roundtable discussion about the current understanding of Industry 4.0 amongst manufacturers.

Tom was sat alongside some of the key promoters of Industry 4.0 in the North West, including: Liverpool John Moores, Liverpool Local Enterprise Partnership, University of Liverpool, Unilever and several technology businesses

Industry 4.0 For UK Manufacturers

On Wednesday 27th July 2016, Tom Dawes (Valuechain CEO) joined Insider magazine, Liverpool John Moores, Liverpool Local Enterprise Partnership, University of Liverpool, Unilever and several technology businesses, at a special roundtable debate discussing what the current understanding of Industry 4.0 is among digital manufacturers in the Liverpool City Region and where the biggest challenges and opportunities lie.

In order for the UK to compete on a global level and keep up with the rest of the world, manufacturers must grasp the opportunities presented to them by Industry 4.0. Consultants at McKinsey define Industry 4.0 as the “fourth major upheaval in modern manufacturing”. It follows 'lean' in the 1970s, outsourcing in the 1990s and more automation which characterised manufacturing in the 2000s. Industry 4.0 is driven by four disruptions including increased data volumes, emergence of new analytics capabilities, new human-machine interactions and improvements in transferring the digital into the physical world, using technology such as 3D printing.

With increased productivity, better data analysis, increased competitiveness and lower manufacturing costs touted as the top ways in which Industry 4.0 will affect UK manufacturing, the roundtable looked into how the region’s manufacturers take full advantage of the possibilities and what challenges they faced. Better collaboration was key, said Unilever’s vice president of operations & open innovation, Jon Hague: “We’re probably all trying to solve the same challenges but not really talking to each other about it.”

Tom Dawes, Valuechain

For me the definition of Industry 4.0 is about valuechain integration, innovation and intelligence. It depends on what sector and what tier you’re in. If you’re an OEM (Original Equipment Manufacturer) you’re looking at product innovation and some process innovation. If you’re a supplier, it’s all about process innovation as you won’t have much control over product development.

Tom Dawes - Valuechain CEO
Industry 4.0 is also about capturing intelligence – from people, plant, products, processes and partners in the supply chain. It’s about analysing the data and generating intelligence so that businesses make more informed decisions.
The big challenge is people; it’s a new generation of graduates that we need with operations management skills, electronic engineering, software engineering and data science. Getting data is relatively straightforward, being able to interpret it to make valuable, informed decisions, is important. 
There are also cultural issues around supply chain collaboration – customers and suppliers sharing data more openly. There’s no point having a smart factory, if you’re scuppered by your supply chain, and you’ve got no visibility.
What I would like to see next, is more awareness among SMEs. Having evidence to answer questions like “what is it?”, “why should I do it?”, and “what is the return on investment of Industry 4.0?”. I would also like to see some frameworks or standards to help analyse and visualise data more effectively; putting processes in place and preconfigured approaches.
 

Anthony Walker, Liverpool John Moores University

Strategic manager, LCR 4.0 project.

My vision of Industry 4.0 is the impact it will have on productivity by developing smarter products, smarter processes and faster supply chains. That will stimulate economic growth.
One of the pillars of Industry 4.0 is cyber security. So if you’re looking to create more autonomy and digitise the supply chain, your IP (intellectual property) could be held in the cloud. Are you comfortable with that? Cyber security is massive challenge to any process of digitisation.
Anthony Walker - Liverpool John Moores University

SMEs are telling us that they have jobs but they can’t find the right people without having to train them up for a long time. From the university perspective we’re striving to create industry-ready graduates and we’re developing an MSc around digital manufacturing, for example. But we’re just one university, we can’t do it all on our own. We are looking to partner with people who will enhance the curriculum and bring industrial input into the skills side. I’d also like to address the silo mentality culture within companies. Staff are scared of new technologies; people are terrified of Industry 4.0 as they think it will replace all the staff with automatic systems. But it won’t; what it will do is upskill staff. Companies need to change culture and understand the benefits.

 

Simon Reid, Liverpool City Region Local Enterprise Partnership

Sector Manager, Advanced manufacturing

Together with our university colleagues, we see Industry 4.0 as driving innovation, productivity, growth and further jobs and investment. Industry 4.0 is an evolutionary curve for businesses. At a very fundamental level, productivity improvements can be driven through better use of data and analysing process and procedures. At the other side of the scale is full servicisation of that manufacturing business. If I were to distil a definition of Industry to a sentence, it would be where the Venn diagram of the cyber and the physical meet.

 

Simon Reid - Liverpool City Region

We went on an Industry 4.0 fact-finding mission to Germany and visited Siemens’ national training centre in Berlin. They are taking their16 to 18-year-olds through what used to be a mechatronics apprenticeship into what’s now a mechatronics and IT apprenticeship. They are now looking at how mechanical and electrical properties interact with the digital world. I visit colleges and schools in the UK and they are doing some great science projects, but their IT students are doing completely different things. I always ask whether there are any projects where the IT, mechanical and electronic engineers can collaborate.


At the LEP we have to grab the opportunity of Industry 4.0. Using European funding there’s a programme called LCR 4.0 to proactively go out to companies through the Growth Hub and take the Industry 4.0 message to the boardrooms in the Liverpool City Region. We can show them the potential productivity gains, the potential new markets, the export opportunities and new partnerships that could be formed and to help de-risk it for them with European money to pump-prime that sandpit.
The CBI found that if the UK manufacturing supply chains could share data, that’s £149bn worth of efficiencies. It’s a big prize.

 

Gillian Murray, Virtual Engineering Centre

Director

Industry 4.0 is the embodiment of modern manufacturing; you can align a lot of tools, techniques and innovations to it. We help companies become more productive by using advanced modelling, simulation and digital engineering tools and techniques, which is often the first step on the Industry 4.0 journey.
The biggest challenge is the breadth of it and where an organisation starts in order to add value. Another challenge is the pace of change intechnology.
Gillian Myrray - Virtual Engineering Centre
It’s difficult for companies to keep up. So we have a sandpit approach, allowing companies to play with the technology. We take companies on an innovation journey. The Bentley project [which was a winner at Insider’s Made in the North Awards 2016] is a great example. We started helping them to design cars quicker and less expensively. Then we looked at how we manufacture them better. All the partners came together to explore how we can work together and deliver the right tools and toolsets back to the business. These pilot projects, or sandpits as we like to call them, are really important. They allow you to deliver something that’s critical to the business, see the return on investment, and capture it from future budgets in order to invest for the long-term.
 

Peter Salt, Immersive Interactive

General Manager

We’re a company that produces software for interactive sensory room for the education and medical sectors. We’ve got to a point where we’re ahead of the curve in terms of our competition, but we’ve got to make sure we stay ahead and develop. We’ve got to move more into 3D and we’re working with Liverpool John Moores looking into bringing in graduates to go on placement with us for 3D modelling and software development.
Peter Salt - Immersive Interactive

However, we know that if we take a graduate on using a knowledge transfer partnership that the graduate will grow with the company and become very marketable. That could lead to a problem with IP—especially if all the IP is developed by one person.

One of the biggest frustrations I have at the moment is developing our overseas market. We have to supervise the build of our immersive rooms at the moment. We want to try to set up a reseller network that will enable us to focus less on the physical build, and concentrate on the software. If we can do that, we can transform the company quickly. Our tie-up with John Moores is about getting the software content to stay ahead of the game.
 

John Hague, Unilever

Vice President of Operations & Open Innovation

Industry 4.0 is the transformation of manufacturing industries with digital technologies. The important word is transformation, which by definition affects all elements of the product lifecycle. As well as economic productivity, environmental productivity should be a great outcome of Industry 4.0. We should be able to use resources much more effectively.
John Hague - Unilever

At Unilever, want to digitise our research and development and we’d love to be in a position where for the products we make – fast-moving consumer goods – we don’t make anything that we don’t sell.


We want to be able to predict how a product will behave with consumers, what packages are going to do – whether they are going to leak, for example; how will they behave in the supply chain; all in silico rather than the physical prototyping and testing that we have to do now. The most obvious benefit is, and the one we’re interested in, is speed. But you can also see knock-on impacts on quality and manufacturability.


We’ve got more than 250 factories around the world and approximately 400 co-manufacturers. There are all those assets already out there making Unilever products and if we wanted to transform all of our manufacturing capabilities to Industry 4.0, how on earth do we do that? I don’t know if people have really figured out how to retrofit and digitise old assets, but that will be our big challenge. We will build factories of the future, of course, and we have a couple of projects on the go, but that’s just two out of hundreds that are on the ground already manufacturing. We’ve got to look at what we’ve already invested in and how that becomes part of Industry 4.0 as much as what the future is going to be.
Another challenge with bringing more autonomy into a business is ‘idleness’. If you have autonomous factories and autonomous knowledge work, what’s in it for people? Industry 4.0 has to paint a scenario of the future that does generate employment otherwise how does value get created? By 2030, when we’ve gone through the transformation curve, what will the workplace look like?

John Hopkins, MedeTrax

Chief Executive

What does industry 4.0 mean to us? For me it’s about the growth of the business and the area and bringing more employment to Liverpool. Health is a people industry and we produce a product that if implemented has huge return on investment in making clinical staff more efficient.
John Hopkins - Med eTrax

But the pace of change in the NHS and its appetite of perceived risk make it difficult for us. The data we produce from our type of product can start to produce datasets of a predictive nature that will help the diagnostic path. That will see us move towards personalised medicine and delivering care when it’s needed.


As we develop software for the health service, one of the challenges we have, as we explore the sensor technology route to feed into our products, is getting well qualified people who understand the health sector and its challenges and the electronics of sensor technology. We’re working closely with LJMU and Alder Hey, pulling in the sensor knowledge and the clinical knowledge and marrying those two aspects together to deliver benefit. We require a good pool of talent.

Luke Walsh, Brainboxes

Managing Director

Many SMEs are far behind when it comes to technical capabilities. I think the challenge is making SMEs understand they don’t need new machines they can make existing ones more efficient. There’s inertia, people are used to what they’ve got. I’m sure large blue chip companies will embrace Industry 4.0, but the challenge is allowing SMEs to make the transition as well.
Luke Walsh - Brainboxes

When it comes to the internet of things, I would be very careful of what you put on the internet. Initially you may not need that internet connection to benefit from what Industry 4.0 has to offer. There’s very little appreciation for cyber security and what the impact could be if someone got hold of your information. Someone could build a very detailed picture of your organisation, and if they can see things, they may be able to control things too.


The big challenge is people; it’s a new generation of graduates that we need with operations management skills, electronic engineering, software engineering and data science. Getting data is relatively straightforward, being able to interpret it to make valuable, informed decisions, is important.
There are also cultural issues around supply chain collaboration—customers and suppliers sharing data more openly. There’s no point having a smart factory if you’re scuppered by your supply chain and you’ve got no visibility.


What I would like to see next is more awareness among SMEs. Having evidence to answer questions like what is it, why should I do it and what is the return on investment of Industry 4.0. I would also like to see some frameworks or standards to help analyse and visualise data more effectively; putting processes in place and preconfigured approaches.

Learn More about Valuechain's Answer to Industry 4.0

 
 
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