Digital transformation in production

With Industry 4.0, the digital age has also found its way into production, and thus the topic of digital transformation has become an issue for managers. With the help of information technology, new possibilities and paths are to be taken on the way to Manufacturing 4.0 (M4.0). In terms of production, the steam engine was at the beginning. This was followed by the assembly line and the first computers. Today, industry and production are on the threshold of a new, digital age. Now companies have the opportunity to use future-oriented technologies to their advantage. These options must be researched, analyzed, and successfully implemented. This raises the question of how digital transformation can succeed.

Four aspects of the digital transformation of manufacturing

Nowadays, the task of companies does not end with the sale of a product. Only where the sale ends, and the service for the customer begins can lasting revenue be generated. Networked products with the corresponding services are the be-all and end-all for companies. It is essential to consider whether this project should be realized by the company alone or with the help of external partners. If the company opts for this strategy, it will have several advantages:
- From the data of the customers’ networked devices, the company can obtain insightful information about the customers’ usage behavior. The company can improve its products and create innovations with the insights gained because it knows what customers want and what is less successful.
- Another advantage is that networked products open up new avenues for selling them. For example, it is possible to launch individual subscription models using the user data obtained from networked devices. In these subscription models, fees are based on how customers use the product. This lowers costs for customers because they only pay for what they use. For the company, a subscription model ensures a permanent source of revenue—a win-win situation for both sides.
For most industrial companies, one of the biggest problems is creating opportunities to improve the user experience for the customer through digitization. When customer service is customized and optimized to meet customer needs, it leads to more satisfied customers. This, in turn, gives the company a competitive advantage. Satisfied customers generate positive word of mouth and become valuable brand ambassadors in the B2B and B2C sectors, the individual needs to be more involved. This results in the so-called business-to-business-to-consumer model, also known as the B2B2C model. In the future, B2B sales must also increasingly take user experience into account. In the e-commerce sector, this issue is well known for private use. Users expect a simple, individual user experience. In the same way, companies must offer these experiences to their employees when it comes to purchases that employees make for themselves via the company at which they work.
The demands placed on employees are also evolving as digitization increases. Companies must ensure that their employees stay updated with technology, software, and workflows through training and education. Modern workplaces are an essential prerequisite for being able to work effectively. This includes, for example, DevOps and agile methods such as Scrum or Kanban. This makes shorter release times possible. This is no longer just a matter for pure software or IT companies but also for the manufacturing industry.
The digital age brings with it many challenges for industrial companies. Likewise, digitalization is creating new opportunities and possibilities that were unthinkable just a few years ago. The number of machines equipped with modern sensors is constantly increasing. The devices are increasingly networked with each other and connected to cloud services. This provides the basis for the collection, analysis, and evaluation of data. The buzzword here is predictive maintenance. This makes it possible, for example, to determine maintenance times that are tailored to the respective machines, depending on the severity of the wear and tear on the components. Today’s modern devices measure the quality of the manufactured workpieces themselves and optimize them as required. The course has thus been set in the direction of the smart factory, where machines make decisions entirely autonomously and are in contact with each other. Companies should, therefore, gradually strive to replace outdated hardware or appliances with modern devices to move competitively into the digital future.

Different strategies to drive digitalization in production.

On the road to digital transformation:

1) Define a clear strategy to discover new opportunities

First, it must be clarified in which direction the digital train should travel for the company in the future. To do this, the decisive course must be set. Everyone involved in this process must understand a digital transformation and be heading in the same direction.

If it is not yet clear which product is to be offered in the future, but it is to bring a concrete benefit to the consumer, it is advisable to apply the design thinking method.

The design thinking method is ideal for a systematic approach to a complex problem. In scientific or technical processes, the focus is on the technical solution. Design Thinking, however, focuses on the user’s wishes and needs. In design thinking, one puts oneself in the role of the user or end-user. Through feedback from the user, a broad spectrum of solutions can thus be quickly found about the original problem.

Design Thinking uses methods such as functional prototypes and creativity techniques for this purpose. With this, immediate feedback from the user flows in. The solutions found here provide information about the digitization strategy.

For example, these solution approaches produce options for gradually digitizing existing processes. It may even happen that an entirely new business model emerges.

2) Define the definition of ready

For gaps to be found and closed, it is necessary to take stock of the current state. To define readiness, the factors of technology, people, and organization must be taken into account. This is the only way to see to what extent the company or organization is fit for digitization.

In the case of the human factor, it is essential to determine how employees have the necessary knowledge and skills to help shape and implement the digital transformation. The tasks involved here must be distributed so that they correspond to the skills and strengths of the respective employee.

The organization must be assessed for its agile capabilities and the associated reactions to change. The basis for this is to look at which technical devices and processes are already networked. It is necessary to look at where production has some catching up in terms of digitization and how the transformation process can be supported in this direction.

3) Where is the journey heading? The roadmap

In the previous two steps, a concrete goal was defined. The roadmap now indicates which primary and sub-tasks need to be completed on the way to the destination. Milestones are also described in the roadmap. This gives the company a concrete roadmap overview of the correct allocation of resources as well as tasks. Like a jigsaw puzzle that is gradually put together, an increasingly concrete picture emerges with the respective fields of action on the path to Manufacturing 4.0.

4) Devices and technology for the Industry 4.0 era

In the first phase, design thinking was used to describe a method that already provides concrete indications of the future direction from the user’s perspective. This means that a large part of the technological orientation towards Manufacturing 4.0 has already been determined. The task now is to select and use the technology on the market that will help the industrial company with the digital transformation. An example of an application is an employee in the assembly area who needs both hands for his work, for example, to complete a job with a conventional hand scanner. With the help of new technology, he can be supported by gesture, voice, and gaze control and thus work more efficiently. One possible solution is a smart glove containing a scanner and smart glasses showing him specific display data.

5) The prototype is ready

The new product for the market is taking on a more and more concrete form. With a prototype of the future development, one has left the planning prototypes from the design thinking and strategy phase behind, at this point with the prototype, of course, has not yet reached the final product. Fine details such as the appearance or design will be completed later. In this phase, the focus is on the functionality of the product. Now the prototype has to be made available to a particular group of people for testing. It is not yet necessary to have a fully developed application for the backend. Here, a small, clear presentation was sufficient to show how the concept has been implemented and where the product is still headed. In this phase, it is essential to get feedback from the testers as early as possible to be gradually incorporated into the product. In this way, the effect slowly develops into a final product suitable for the masses. Another advantage of the prototype is that it shows potential investors that their investment has paid off and that the product is on the right track. State-of-the-art technologies also support progress at this stage.

6) It gets serious – the finished product

Now comes the decisive phase, when the product is launched on the market. Production must decide which technical systems harmonize and communicate best with each other. For a better visual overview, graphical process diagrams that link manufacturing with IT, among other things, can help. Once the required technologies have been determined and integrated, the processes must be aligned with the corresponding project plans and associated milestones. For this purpose, it is advisable to apply an agile method. This ensures that it is possible to intervene and react in good time if changes should occur. In the final step, the new product is launched locally or globally with the newly integrated Manufacturing 4.0 process.