12 July 2017
Disruptive Technology Set to Transform Asia's Manufacturing Base
The potentially tsunami-like effects of Industry 4.0, the so-called Fourth Industrial Revolution, dominated proceedings at Manufacturing Technology Asia 2017, with businesses warned of the perils of failing to manage the coming change.
Nothing focuses minds like the prospect of a looming disruption. It should come as no surprise, then, that attention at this year's Manufacturing Technology Asia (MTA) event was fairly squarely on Industry 4.0 (also known as The Fourth Industrial Revolution), the long-mooted tidal wave of change that is set to transform the manufacturing sector. In particular, this change is expected to be wrought by five sectors that have grown in significance over recent years – 3D printing, industrial Internet of Things (IoT), automation, augmented reality and robotics.
Heralding this change and calling upon companies in the sector to ready themselves for its impact, Lindy Wee, Chief Executive of UBM SES, the Singapore-based organiser of MTA, said: "Across the world, manufacturing is undergoing a digital transformation. As technological advances bring about greater connectivity and optimisation throughout the value chain, it is important that industry leaders and technology enablers share their knowledge and digital success stories.
"This will be essential when it comes to helping businesses across Asia accelerate their own digital transformation with regard to their processes, business operations and services. Only in this way will such companies become more flexible and agile, while being better-positioned for rapid future growth."
For Martin Högberg, the Asia-Pacific Hub Digital Head for ABB, the Zurich-headquartered robotics and automation giant, this coming disruption is one that should be welcomed and could usher in a new Golden Age for the manufacturing sector. Highlighting the opportunities as he sees them, he said: "Of the top 12 most disruptive technologies, nearly all of them form an integral part of Industry 4.0, most notably IoT, mobile, knowledge work automation and robotics. Collectively, these technologies will generate something like US$4-11 trillion in value terms by 2025.
"Based on our own experience, we see Industry 4.0 as likely to give companies a 200% or more increase in productivity, while also delivering a 30% reduction in overall energy costs. At the same time, it will also deliver products that are likely to last up to 30% longer."
Similarly enthused as to the likely benefits of Industry 4.0 was Dr Daniel Küpper, Managing Director of The Boston Consulting Group, the Massachusetts-headquartered global management consultancy. Singling out the upside for Singapore alone, he said: "By 2024, we estimate that 22,000 new jobs will have been created. On average, the salaries for these new positions will be 50% higher than the jobs displaced, with productivity also enjoying an increase of up to 28%. In total, we are predicting that the overall manufacturing output could be up by as much as US$26 billion in value terms.
"Among the other improvements will be better working conditions and an enhanced facility for real-time production planning, which will result in considerable savings with regard to inventory costs. We can also expect to see smart robots producing goods at a faster pace and with fewer errors. Improved sensor arrays will also help drive Big Data analytics, boosting the possibilities of predictive maintenance as never before. All in all, Industry 4.0 should deliver unprecedented levels of efficiency across the whole of the production cycle."
A more governmental perspective on Industry 4.0 came courtesy of Sim Ann, Singapore's Senior Trade and Industry Minister. Clearly seeing the coming changes as a means of boosting Singapore's competitiveness, she said: "A number of advanced manufacturing technologies, including additive manufacturing, industrial IoT, and robotics, are not only changing the way products are created, but also causing a rethink as to how supply chains should be managed and how value chains are to be defined in global terms. Ultimately, this will enable the vast majority of companies, both large and small, to benefit from significant productivity gains.
"For our part, we are committed to adopting these new technologies as the means to build a globally-competitive manufacturing sector, one that will contribute some 20% of Singapore's GDP. Among the initiatives already under way is US$2.3 billion investment in the manufacturing sector and the setting up of two model factories to help SMEs understand and adapt to these new technologies."
Among the pioneers sharing their direct experience of these disruptive technologies was Roxane Desmicht, a Senior Director with Infineon Technologies, the German semiconductor manufacturer. Looking back on how her own company had embraced the challenge of Industry 4.0, she said: "The process that saw us transform into a smart enterprise began in 2012 when we adopted a number of early automation initiatives, including automatic material handling and automatic store and retrieve systems. This was soon followed by the implementation of a dedicated manufacturing execution system.
"Our more recent initiatives have focussed on a connect-automate-control system and have involved the introduction of automated decision making for scheduling and dispatching. We have also integrated advanced process controls, introduced robotic arms as a means of managing testing boards and switched to automated guided vehicles (AGVs) as the primary means of transporting material from the automatic material handling system to the processing equipment."
According to Desmicht, Infineon will be investing $75 million in the next five years in the development of a smart manufacturing plant in Singapore. Officially referred to as the Smart Enterprise Programme, the plant will have a real-time link to a number of the company's other production sites. Over time, its assembly line will upgraded to make use of a number of still emerging automated technologies.
Overall, the combination of Big Data analytics and IoT inputs is seen as having the potential to deliver huge improvements in operational efficiency, a key part of the Industry 4.0 landscape. A recent report from the McKinsey Global Institute, however, indicated that, at present, almost 70% of the data captured during the manufacturing process goes unused.
Warning that this is a problem that needs to be addressed in the short term, Raimund Klein, Executive Vice-president of Siemens ASEAN's Digital Factory, Process Industries and Drives Division, said: "The amount of data captured is expected to grow exponentially, rising from less than 500 exabytes in 2012 to around 15,000 exabytes by 2020 – roughly equivalent to 15 trillion gigabytes. Manufacturers need to leverage on systems and technologies that can properly analyse such data and turn it into smart data, which can then be used to improve efficiency, increase flexibility and lower production costs – all of which are vital if Industry 4.0 is to become a reality."
Manufacturing Technology Asia (MTA) 2017 took place from 4-7 April at the Singapore EXPO Convention and Exhibition Centre.
Ronald Hee, Special Correspondent, Singapore