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Image Credit: Hindustan Unilever
In 2021, Unilever announced it was experimenting with nano-factories. Their engineers managed to streamline and encapsulate an entire production line within a portable shipping container to produce liquid bouillon. Unilever thinks such an approach can help them be more agile and flexible while catering to changing consumer demands. We, however, believe an approach like that of Unilever’s has great promise when examined from the lens of sustainability in the era of Industry 4.0.
For the uninitiated, the term nano-factory popularly refers to a highly compact production facility that operates on a smaller scale, often designed and made with Industry 4.0 technologies. High precision driven by deep rooted digitisation ensures there is little need for manual intervention and monitoring.
Pragmatically speaking, such high-tech miniaturisation often translates to conveniences and efficiencies related to installation and operations. Further, when coupled with local sourcing and distribution, such an approach may prove to be more sustainable in comparison to mass manufacturing models.
But, is the grass really green on the side of nano-factories?
What does the academia know and think?
Later last year, guided by the question above, we set about building a nuanced understanding of the way this area is emerging. Our first stop was IIT Madras wherein we spoke with Prof Pinosh Kumar Hajoary, a scholar with research interests in the areas of Industry 4.0 and circular economy. Prof Hajoary holds an optimistic view and believes that nano-factories can drive local job creation, micro-entrepreneurial innovation, and sustainability by minimizing transport and emissions.
However, he also argues that the development of nano-factories in India depends on incentives, market demand, skilled workforce, infrastructure, collaboration, and innovation. In comparison, on a global level, developmental factors for nano-factories include environmental and social considerations, market dynamics, and regulatory environments.
What is happening in the Indian industrial space?
Armed with insights from the academia, we started looking for applied cases to build a holistic understanding of nano-factories. This pursuit took us to a Bengaluru based startup ‘Leumas’ operating in the nutraceuticals industry space. Leumas offers digital factory solutions with promise of higher efficiency and sustainability focus.
For the uninformed, the term nutraceutical refers to products that promise medicinal and nutritional benefits. Across the globe, demand for nutraceutical products has risen with growing public awareness and rise in disposable incomes. More specifically, the size of the nutraceuticals market was estimated to be around USD 396 billion in 2021 with 5.2% anticipated CAGR between 2022 and 2030.
Here, we note on the side that the segment of choice conscious consumers with high disposable incomes has only risen in the last couple of decades. Such consumers are well known for seeking customised/differentiated products and services.
Naturally, catering to such a consumer segment will become a challenge for mass-manufacturers in the neutraceuticals category since they may not have ample space for heterogeneity in production. Therefore, observing the inherent distributed-ness in the nan-factories model, aspiring business houses may wish to experiment with nano-factories.
Observations and Lessons from Leumas
Leumas has built a distributed manufacturing solution for establishing a network of connected nano-factories through Industry 4.0 technologies. The intent is to assist businesses in being closer to their customers and to be more responsive to differentiated demands in a sustainable and efficient manner.
During our observations, we compared Leumas’ distributed approach to nano-factories with the classical old mass-manufacturing approaches. However, since distributed manufacturing technologies and business models are relatively newer and still evolving, we realised that it may be imprudent to attempt an entirely data-based comparison between the two due to data unavailability.
Therefore, we devised a multidimensional lens with following five dimensions to build a contextually relevant comparative understanding: energy consumption, logistical efficiency, water consumption, wastage, and macroeconomic impact. Our observations are presented below.
Energy Consumption
Leumas is a process nano-factory. Distributed manufacturing equipment designed by Leumas is useful for smaller production batch sizes. When compared with the traditional mass manufacturing equipment, Leumas’ power requirement and equipment load is lower. More specifically, Leumas’ equipment for majority of the process operations (like volumetric dosing, dispensing, pumping and agitating) is DC powered. Nano-factory robotic units use single phase power unlike the traditional industrial equipment that usually requires 3-phase AC power. Further, an entire nanofactory with 10 to 12 production robots requires less than 5KW single phase load, similar to what a micro IT Services office would need for seamless operations! Here, we also note that since mass manufacturing factories are designed for higher throughput, utilities get wasted when the equipment are underutilised or low-loaded. In terms of quantity of energy consumption, pre-production nano-factories consume less energy due to the lack of need for storage and on-demand production delivery.Logistical Efficiency
By design, distributed manufacturing models bring production facilities closer to consumers. This shortens post-production supply chain significantly. Further, such a model favours Just In Time (JIT) production approach, thereby ensuring compact post-production storage footprint. This translates to lesser all-round energy consumption across the storage phase whether normal or coldstorage is employed.
Water Consumption
Typically, mass manufacturers employ the Clean-In-Place (CIP) method for cleaning the equipment. In comparison, since Leumas’ process equipment is smaller and modular, Clean-Out of-Place (COP) approach is possible. This translates to lesser cleaning and lesser water requirement. Similarly, in a mass manufacturing setup, preparation is done through transient storage reservoirs. This translates into significant water requirement for cleaning after production of every batch. In comparison, with
Leumas, it is possible to execute last-mile production in the final use vials for several single-use formats without the need for a final bottling operation thereby reducing the need for water consumption.
Further, since mass manufacturers face a cold start problem that necessitates running of the equipment and the plant before reaching useful yield levels, more water is required than a distributed manufacturing setup. Similarly, while transferring ingredients from one process to another, conventional manufacturing plants use jacketed water heating as transient storage equipment requires continuous heating. However, in the case of Leumas, owing to smaller batch sizes, this may not be required or required for much lower volumes.
Wastage
Since Leumas’ equipments operate small batches of product output, lesser volume of raw material needs to be procured. This saves space, prevents hoarding and lessens wastage. Further, since Leumas uses additive compounding technology (like 3D printing) at the last mile, it is possible to prepare multiple product SKUs using common set of ingredients like functional ingredients, excipients, taste or flavouring agents, and bulk agents. If employed wisely, this can reduce wastage.
For heat and mass transfer, mass manufacturers often use long pipe networks that may even run into kilometres in some cases. Hence, it is likely that every production batch attracts working material wastage while flowing through these pipe networks (also known as the melt issue or melt wastage in process engineering parlance). This issue is almost negligible in the case of Leumas’ equipment.
While storing and supplying finished goods, mass manufacturers face multiple issues like expiry,
damage, theft, and losses. In some cases, up to 25% of the finished goods inventory may be wasted
due to such reasons (see also). Then, there is always the chance of having unsold inventory. In comparison, since Leumas operates using the JIT approach, production follows demand - thereby
requiring near zero inventory of finished goods.
Macroeconomic Impact
A distributed manufacturing model distributes economic and job opportunities since production facilities can be setup almost anywhere. In turn, this facilitates emergence of locally situated micro entrepreneurs at scale, thereby contributing to the local economy and higher sustainability.
Conclusion
In factories' hum, a whisper of care,
Sustainability, our pledge to bear.
In every part, in every plan,
We shape a future hand in hand.
Recycling old, crafting anew,
Greening every process we pursue.
For in manufacturing's vital role,
Sustainability becomes our soul.
Quite evidently, the academia and early adopters appear to be positive regarding the promise of nano-factories. However, it is essential that policymakers, industry players, and innovators unite and support endeavours like that of Leumas to develop and adopt regulations and provisions that encourage innovation for sustainable manufacturing.
By Dr Tanuj Negi, Assistant Professor - HRM, FLAME University and Ms. Shreya Baberwal, Alumna - FLAME University
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