Industry 4.0 adoption in manufacturing: Where we are and the road ahead

Digital has become the backbone of manufacturing as every organization, irrespective of the size, is looking to improve productivity. With revenue growth under pressure in the current economy, reducing cost has become a must win battle for every manufacturer. Industry 4.0 is not at all a buzz word now; in fact, it has become a reality for large enterprises and a vision for Small and Medium Enterprises as well. The adoption of digital technologies has seen significant growth in 2019, leading with automation and machines getting augmented with sensors, AI and IoT solutions.

Traditional process improvement initiatives like Lean and Six Sigma have always helped the manufacturing industry to identify ideas that can drive productivity, but with Industry 4.0 those ideas are getting implemented fast and that too at organization level. We are moving beyond digitization to digitalization with the fundamental change of technology redefining business models and providing new value chain opportunities, rather than just automating a single process.

There are lots of success stories already where digital has transformed the operations across industry use cases especially in Assets Management, Predictive Maintenance, Worker Safety, Supply Chain Optimization and Customer Experience. This transformation is happening across both discrete and process manufacturing companies. The Indian Government’s initiatives around “Make in India” and “Digital India” have also proved to be the big catalyst for the digital-led manufacturing transformation.

The year 2020 will see major acceleration happening on Industry 4.0 implementations to optimize the entire organizations' operations. Artificial Intelligence through machine learning models will enable far more accurate predictive machine maintenance. Additive manufacturing can help create highly customized components in much less time. The supply chain is getting moved from forecast driven to data-based and demand-driven. Order cycles are becoming shorter to meet the current level of demand. Logistics processes are also getting efficient with real-time data enabling tracking of trucks and goods leading to just-in-time delivery and optimal inventories.

While so much is happening across different industry use cases, the outcomes will depend a lot upon how effective we are in building an ecosystem that can support this level of growth. This will involve large manufacturing enterprises -  while they continue to build smart factories they also need to come forward and act as big brothers to help the SME sector adopt their success stories. In a similar way, large technology companies and system integrators should look for start-ups as their partners to increase the reach and address the growing demand.

We need both of these sets of technology companies to co-exist as each brings unique value. While large technology companies have the global experience, they have limited bandwidth, on the other hand, start-ups are innovative, agile by design and ready to do POCs. The SME sector is providing enough opportunities but to take them up, we still need a lot more deep-tech start-ups.

Another big challenge in Industry 4.0 adoption is not having clarity on where and how to start. CEOs and functional heads are looking for ROI and that’s where design thinking can play a major role. Every manufacturing company needs to start with a design thinking workshop at the start of the digital journey as it can help in identifying challenges from the user point of view, which means proposed solutions will have user acceptance. Workshops also help in building an overall technology roadmap with a phased implementation plan based on the ease of implementation and expected business outcomes.

By Amit Saluja - Senior Director and Center Head, NASSCOM Center of Excellence, Gandhinagar