As they look to ensure smooth functioning of their operations while migrating many of their processes from manual to automation and enabling employees to work remotely, the key is to carefully draw digital roadmaps and strategies that not only address the current challenges at hand but also better prepare them for any future eventualities.
“While different firms face differing challenges and hence their responses vary, but we continue to see a fast-tracking of automation and digital integration,” said Sameer Gandhi, MD, OMRON Automation, India.
He said manufacturing firms want to reduce the risks wherever possible to try and be better prepared for the varied disruptions that they continue to face.
While some disruptions are difficult to overcome by digital transformation (such as chip shortage), but, Gandhi says, there are still many that can be overcome.
For example, he says, the second COVID wave has once again brought a sharp realisation that labour and market disruptions can occur anytime and hence manufacturing operations must remain flexible and this is spurring an increased investment in automation.
Arvind Kakru, Country Head End User & EPC Business, Rockwell Automation India, says the COVID-19 has given a new dimension to the global supply chain, toppling the long-established business models of corporations and governments across the globe that took decades to develop.
He insists businesses focus on reinventing their models, be more agile and digital and use remote technologies more rigorously. “That will bring in a new focus on cyber security as well and those investments need to be tied out too,” he said.
Digital integration and automation are critical in a crisis, acknowledge experts at Continental Automotive India, pointing out that COVID-19 has had an intense impact on the automotive industry globally.
With disruption in imports and exports of automotive parts, it posed a huge challenge in meeting supply chain demands.
According to Continental Automotive India’s Bangalore plant head Phanindra Karody, the major challenges were in operations – both production and supply chain. “But we quickly reacted to the situation and took the necessary steps following the government protocols for safe production. Our Industry 4.0 practices and lean processes have helped us in keeping our machinery running with limited resources.”
Citing a McKinsey survey published earlier this year, he said 56 per cent of respondents that hadn’t implemented Industry 4.0 before COVID-19 found themselves constrained in their ability to respond to the pandemic.
“Industry 4.0 technologies are no longer being measured for their ability to add value during the usual business; instead, they are also expected to prove valuable during difficult times such as the pandemic crisis,” added Karody.
Industry players acknowledge that the COVID-19 crisis was a wake-up call for all the manufacturing companies that were yet to embark on the Industry 4.0 journey, and, for companies that already started the Industry 4.0 transformation, it was about scaling up.
With technology is rapidly evolving, Ninad Deshpande, Head, Marketing and Corporate Communication at B&R Industrial Automation, says, advanced concepts and digital manufacturing are no longer suitable to have, but “a must-have”. “Most of the manufacturing firms have understood the importance of adopting these latest solutions.”
However, he points out that the adoption rate is still not too high, but as compared to pre-pandemic times, “the intent is evident”.
“Moreover, most manufacturing firms evaluate available advancements and plan their roadmap for embarking on their implementation journey,” added Deshpande.
According to another Industry 4.0 survey by L&T and HFS Research, ‘The Future is Now’, around half of the manufacturing executives expect COVID-19 to have a bigger impact than the 2008 financial crisis, and a similar number feel that their organisational survival or their current scale are on the line, said Dhruv Kapoor, Co-founder and Chief Technology & Product Officer at Zilingo.
He said COVID-19 has had the effect of dramatically accelerating prior trends towards greater digitization, both in terms of the need for greater agility in response to volatile consumer demand, as well as the push towards higher efficiency and lower waste.
“We are seeing manufacturers increasingly becoming more keen than earlier to digitize shop-floor production and quality tracking using MES software such as Zilingo Factory,” said Kapoor.
DIGITAL INTEGRATION STRATEGY
While companies understand the benefits of digital integration, the initial challenge they face is to decide how to go about the whole process, especially, at a time when ROI is all the more important aspect to look at.
For MSMEs, suggests Gandhi, there is a step-by-step approach that should be followed while climbing the ladder of automation. “It is not required to make a big one-time investment. However, what is required s to have a vision and a proper design in place before embarking on this step by step approach,” he said, adding that tying up with a reliable automation partner who has the capability to provide complete solutions comes helpful for the MSMEs in this.
Given that the technology is evolving rapidly, Gandhi says it is also turning out to be a great leveller that can actually help the MSMEs leapfrog and take on the larger and more established manufacturing setups with minimal investments.
For example, quality control by experienced operators (difficult for an MSME to retain) may be replaced more effectively by an investment in a vision system. “Automation can also allow the MSMEs to produce in small batches but with high productivity allowing them to develop local niches for themselves,” he says.
Deshpande of B&R Industrial Automation describes ‘digital transformation’ as a journey, and, insists that it should not be mistaken for a plug-and-play kind of implementation. “A good strategy and a roadmap with milestones are vital factors enabling industries to achieve success.”
He lists down some basic steps that need to be followed by companies wanting to embark on their digital transformation journey.
Organizations should identify gaps in their existing processes and operations and areas that could be digitized. “Evaluate various technologies and understand what each next-generation technology of solutions offers and what kind of problems it will solve. Make feasibility studies and map these technologies against the identified gaps,” said Deshpande.
He says it’s important to prioritize technologies for implementation, which will be done with a prerequisite understanding of investment needed and what would be the perceived benefits, RoI, and the estimated timelines for achieving returns—choosing the right automation and digitization partner guaranteeing your success.
FACTORING THE ROI
Return on investment seems to be the key factor that influences the decisions of companies who do not want to spend time and resources upfront on digital integration.
However, now thanks to digital, AI and ML’s innovative abilities, says Kakru of Rockwell Automation, the scenario is rapidly changing for the better. “When it comes to manufacturing, AI can be implemented for higher productivity, improved efficiency, and faster production.”
He says AI can be used to manage and improve all aspects of the manufacturing process, including quality control, predictive maintenance, waste reduction, design optimization, process automation.
Kakru points out that these solutions can help in reducing the ROI and giving larger benefits that are much larger in the overall context. “The scalability of these solutions nowadays means the deployment and cost dynamics are more in control of the buyer.”
Industry experts say cost is something that continues to be one of the biggest concerns and challenges (followed by the availability of skilled manpower).
Looking at the whole picture created post-COVID and the way the dynamics are changing, Gandhi of OMRON Automation says, organisations have to move towards the ‘Glocal’ phenomenon swiftly, and so it becomes imperative for them to give serious thought towards adopting and embracing the right elements of digital manufacturing if they wish to stay relevant in the industry in the long run.
And now, he says there are a whole lot of in tangibles that must also be considered in any ROI calculation.
For example, what is the cost of production or quality disruption from a market or brand point of view?
“Earlier, these factors or risks were not considered significant, but Covid has upturned all that and these risks must now also be factored into any ROI.”
THE COMPLEXITY OF DIGITAL INTEGRATION
While there are complexities associated with executing and integrating automation and digital solutions, Kakru says this can be offset by the ability to operate 24×7 and scale up or down with demand while forecasting the critical levers and increasing efficiency and productivity of a given enterprise or plant.
“From spot-checking to quality control through greater traceability and labour savings, these technologies offer tremendous benefits to small users as well.”
With the manufacturing environment fast changing, the focus of the industry is not only on capacity building but also on the ability to respond to changing market conditions. It’s critical for companies to achieve this responsiveness while maintaining cost and quality.
“Change is the only constant”, says Deshpande of B&R Industrial Automation, with this manufacturing landscape continues to evolve and will continue to do so.
He says manufacturing organizations need to look at scalable, flexible solutions to be responsive and be ready for the future. “This helps them reduce considerable capital expense and work on existing architecture and systems and yet be able to meet new requirements.”
Deshpande says India is a land of opportunity, with the convergence of government policies with global trends making it extremely attractive for investments.
“We are already witnessing a good impact on the manufacturing industries. The best manufacturing practices, next-generation automation solutions, and the ease of doing business is paving the way for Indian industries and manufacturers to leapfrog in industrial development and achieve global leadership,” he says.
As the industry is moving towards intelligent manufacturing, this is encouraging maximum use of automation, robotics, and digitization to lower production costs while enhancing efficiency, productivity, and OEE.