The future of Scandinavian manufacturing: Industry 4.0 perspective

YASH Blog

Last updated on July 6, 2020

Bjorn Janson

Bjorn Janson Head Europe

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Ubiquitous automation. Robots are taking over manufacturing, healthcare, vehicle driving, and communication. Industrial revolutions liberated mankind and industry 3.0 brought digital exposure to billions of individuals. The fourth industrial revolution, driven by the internet of things, is, however, completely different as it integrates the digital, physical, and biological world.

Industry 4.0 is the enabler empowering manufacturers to fuse products, machines, and services to a single centralized wireless network. It will create smart factories where machines will interact, and products will share information. These cost-effective and efficient factories are capable of manufacturing personalized items for every customer. Smart factories are strongly influencing companies worldwide. A PwC report cited that more than 860 billion EUR will be invested in the Internet of Things by organizations globally in the next two years .The great potential of smart factories is also influencing major economies, and Sweden is the frontrunner.

How Scandinavia is leading with Industry 4.0 successes

Manufacturers and the Nordic governments both have recognized the power of smart factories and thereby working hard to embrace disruptive technology. Sweden is one of the top five nations that have smart factory initiatives ready in hand today, reveals the latest study by Capgemini’s Digital Transformation Institute[1]. The industrial sector and services unitedly contribute to 77% of the total Swedish exports value[2]. Therefore, the Swedish government prioritized the implementation of innovative digital technologies to transform its industrial sectors. Smart factories are strongly influencing companies worldwide.

Industry 4.0 – Reinventing businesses across the industries

There are obvious reasons for nations to gain interest in investing in digital technologies such as AI, IoT, 5G, big data, and robotics. The fourth industrial revolution is capable of reshaping all the industries, from logistics to food production, mining, automobile, and manufacturing, of course.

Case in point: Bosch is a leading auto and electrical components manufacturers globally. One of its, factories, reinvented their manufacturing structure by deploying advanced technologies including radio-frequency identification-based tool management, real-time data analytics capabilities, and embedding sensors to machines. The renovated infrastructure enabled the manufacturer to understand and avoid productivity losses. It also helped predict machine interruptions well in advance.

Harnessing lean manufacturing principles and data-led practices offer a competitive edge to manufacturing and improve its efficiency. However, alongside myriads of advantages of the digital revolution, several challenges lay down in bringing this transformation.

Environmental and socio-economic challenges – potential hurdles

Natural Resources

The scarcity of natural resources and their ever increasing demand is one of the major concerns. For example, skyrocketing oil consumption due to the economic boom in countries, including India, China, and Brazil, and the protection of clean water supply are some of the critical factors. Water consumption has already reached an alarming rate. While it is the basic necessity for living beings; the availability of water is extremely crucial for industrial activities.

Demography

The dearth right skilled labor is an alarming issue. Also, the younger population in the US, especially Millennials, are not interested in labor work, including working in manufacturing and production factories. The steady decline in the birth rate in Europe will add to the lack of availability of workforce. Europe is vulnerable to massive socio-economic disruption due to decreasing demographic power. As a significant majority of Europe’s population consists of retired people, decreasing workforce and tax realization with increasing support cost makes for a troublesome equation.

Regulatory support

Adhering to regulations is as important as developing strong corporate leadership and strategic business plans to sustain the competitive advantage. European Union constantly monitors the impact of old and modern technologies in influencing trade agreements, society, economy, and globalization. It is equipped with techniques to benefit its industries by stipulating and enforcing standardization. However, European companies are subject to stricter regulations as compared to their competitors in many developing markets. This approach sometimes affects many sectors across industries negatively. While these regulations will bring a positive impact in the long run, what is required now is support for SMEs.

Management culture paradigm shift

According to experts, history has countless examples of successful businesses with a low adoption rate for innovative technologies. This mindset needs to be changed for companies to survive in today’s market. Companies need to lay down a roadmap for adopting emerging technologies while restructuring their executive management and operational leadership. The European industry needs to be adaptive enough to address every market scenario while being battle ready for changes that are yet to come. The control and adoption of agile IT systems and taking advantage of data and sensor-based technologies will certainly help.

All of the above impact the 4.0 journey of organizations in terms of making sense of disparate data sources, tracking materials and products, utilizing workforce and assets, keeping up with quality and compliance, and getting a realistic picture of their live shop floor analytics. On the other hand, sustainable solutions to these challenges have also shown success through key tenets of IT/OT convergence, which aims at the integration of these information systems towards managing the business successfully. It is interesting to know technologies such as PLC and SCADA controls, PCo (Plant Connectivity) and MII (Manufacturing Integration and Intelligence) are already in wide use among industrial plants .

Way forward for the Scandinavian Industry 4.0

Countries and companies can attain sustainable growth by embracing Industry 4.0 technologies. The capabilities of the fourth industrial revolution will drive faster designing, innovative manufacturing, enhanced processing, reduced risks, and minimum wastage of resources. Disruptive technologies, including supercomputing and AI, help people work more efficiently and accurately by eliminating the risk of errors. These emerging technologies will be the key contributors to the economic success of businesses.

Moreover, these technologies will also uplift the standard of living for humans, thus, serving the social purpose as well. The industry 4.0 lead Digital revolution is the initiator of a better and successful future for the world.

YASH and C5MI as your partner in Industry 4.0 journey

YASH’s C5MI Live Factory® Digital Manufacturing solution is equipped with the latest and invest-worthy frameworks and accelerators that can drive your Industry 4.0 transformation journey. With end-to-end experience in the Information & Operational technologies, emerging manufacturing technologies, and Industry 4.0 domain, the rich pool of skilled consultants at YASH can help you future-proof your factories.

[1] Capgemini’s Digital Transformation Institute

[2] Swedish Government Report

[3] PwC Report, Michael Page

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