Industry 4.0 - the future of automated manufacturing
Industry 4.0: Business Model Engineering and Opportunities for NZ Businesses
Dr Frank Wagner, Head of the German Fraunhofer Institute R&D Management Competence Centre shared insights about international developments in automation and new manufacturing business models.
Dr Wagner led two seminars and workshops on ‘Industry 4.0 - Networked Manufacturing’ focusing on opportunities for NZ manufacturing businesses. Over 50 SMEs met in Auckland and Christchurch to exchange their experiences and think of smarter products, automated or digitalized processes and new business models.
Callaghan Innovation’s international policy and business innovation advisors, Dr Nicole Miller and Nathan Stantiall were part of the audience, and we asked them for their thoughts on where technology is heading, and to give us an Industry 4.0 101 tutorial.
What is Industry 4.0?
Nicole: It’s an overall term for industry initiatives using product and processing information to create customer centric and individualised products and new services. It also applies to the use of technology to create more efficient and flexible processes, for example using VR (virtual reality) or light directing to support workers or automate hazardous or physically demanding work.
Nathan: By definition it is the 4th industrial revolution which is Cyber Physical systems. Steam, Electrical and then Electronics were the previous three revolutions spanning the last 230 years.
How is it manifesting in NZ businesses?
Industry 4.0 is already used by innovative and ambitious businesses for example in the manufacturing, healthtech, or food technology sector (farm to fork or harvesting). Networked and smart manufacturing is an international trend that offers new opportunities, particularly to SMEs, to access global supply chains.
Nathan: We have some great reference sites for Industry 4.0. One is Fisher & Paykel Appliances subsidiary Production Machinery Ltd, who have developed an enterprise solution that networks manufacturing processes. In fact they have an “Industry 4.0 Technology Manager” and could be in a position to help NZ businesses get their manufacturing processes networked. We co-hosted workshops in Auckland and Christchurch which had a good number of businesses keen to join together and build their respective capabilities.
Dr Wagner said Industry 4.0 and The Internet of Things could merge in the future – how do you imagine this looking?
Nicole: We all use connected consumer electronics every day and are familiar with routine data-driven and decentralised decision making - think smart cities. Industry 4.0 is the internet of things for industry.
Nathan: ‘The Internet of Things’ in manufacturing terminology appears to be more American where Industry 4.0 is more European. Either way, smart and interconnected machines are on an exponential trajectory and will be ubiquitous in the future.
What do you see as the benefits of Industry 4.0 for business generally?
Nicole: New Zealand’s most successful businesses and start-ups compete globally with innovative business models and applications of world-class technology. Industry 4.0 provides an opportunity, particularly for SMEs, to develop a structured approach to innovation and to identify new opportunities through smart products, processes and customer focused services. Networked manufacturing makes small batch sizes and individualised products viable. On the shop floor Industry 4.0 principles support design of fast, efficient, effective and flexible business processes and empower the workforce and provide a better workplace.
Nathan: It will enable NZ businesses to be globally competitive with cost effective and specialised manufacturing at very low batch sizes.
In a nutshell - Industry 4.0 principles are designed with the supply chain and customer needs in mind. Implementation of smart business processes and products provide significant real-time quality data, time, resource and cost advantages. SMEs can apply those principles across sectors in energy, health/nutrition, food integrity, mobility, security, communication, logistics and manufacturing to:
- Develop smart connected products and new services (‘solutions’) for global niche market
- Make individualisation and single batch sizes viable
- Provide better customer focus
- Participate in high value global supply chains
- Design fast, efficient, effective and flexible business processes
- Work in the engineering sector from where you want
- Empower your workforce
On the technical side - Industry 4.0 is using standard internet protocols and the global players in the manufacturing and automotive sector develop their own secure cloud spaces and systems. Responding to an audience question Dr Wagner noted we might soon see the merge between Industry 4.0 and the Internet of Things platforms.
Automation and Digitalization in the news:
- Listen: Smart manufacturing, the 4th revolution will be digitised - Dr Frank Wagner (Radio NZ, 30 June 2016)
- Listen: From Farm to Fork - Dr Helen Darling, Exec Director, Asia Pacific Centre of Food Integrity (Radio NZ, 30 June 2016) (NZ Food Integrity Conference 2016, Auckland, July 13-14: www.foodintegrityconference.com)
Other references and information:
- Platform Industry 4.0 (supported by German Federal Ministries for Economic Affairs and Energy & Education and Research) - includes links to other international initiatives
- German Trade and Invest publication: Link to website with videos, link to pdf only
Nathan Stantiall, Business Innovation Advisor, email@example.com
Dr Nicole Miller, Advisor International Policy and Partnerships, firstname.lastname@example.org