Industry 4.0 MUST have video … for management

As previous posts have argued, I believe that manufacturing and logistics operations are grossly under-utilizing video technology in their operations. I believe there are many easy wins if you apply standard video surveillance technology to manufacturing and logistics processes. However, as I watch the growing momentum behind Industry 4.0 (and Industrial Internet Consortium, and …), I am convinced that video may be even more critical to success in those ventures

Implementation Challenges for Industry 4.0

I was around in the 1980s when GM bought EDS and introduced early automation efforts like Saginaw Gear and CIM and MAP 1/2/3. I remember the endless discussions about “islands of automation”. I’m confident that the data connectivity problems of that era are well and truly solved. But I also remember the angst that occurred when engineers tried to integrate new technology with legacy production systems. It wasn’t just the data or technology interfaces … there were serious personnel and cultural issues. The computer geeks didn’t communicate well with the assembly plant engineers … or maybe the other way round. It mostly wasn’t personal animosity. It was the fact that neither group understood the other’s tools and technology … to the point they seemed to speak different languages.

Fast forward and Industry 4.0 is proposing tectonic shifts in manufacturing processes and technology. The shift is so big that virtually all consulting documents share two expectations:

Industry 4.0 will demand a new workforce:

The skills needed for Industry 4.0 will be very different from the ones that are successful in conventional manufacturing. Conventional manufacturing is designed to break work down into well-specified processes so that modestly educated and trained workers can execute them consistently and correctly. Implicit in this model is the assumption that most work is managed visually. With Industry 4.0, most of the work will happen inside machines or in algorithms that use data and are hidden from the human eye. Everyone from design engineers to managers, to front-line workers must be able to read and understand the data flowing through the system. That will be the new definition of “sight”.

  • “The critical Industry 4.0 jobs—for example, data managers and scientists, software developers, and analytics experts—require skills that are fundamentally different from those that most industrial workers possess today. – BCG – Inside-OPS-Jul-2016.pdf, p6
  • “Lack of skills or competencies in the company’s workforce is also the biggest challenge survey respondents see when it comes to making use of data analytics.” – PwC – industry-4.0-building-your-digital-enterprise-april-2016.pdf, p17
  • “In the process of trying to integrate IT and OT through the use of Industry 4.0 practices at the organization level, companies often face a shortage of talent to plan, execute, and maintain new systems. The number of engineers trained in handling unstructured data and big data tools—crucial for the type and scale of data generated by connected systems—is gradually increasing, but still falls far short of anticipated demand.” Deloitte University Press – DUP_2898_Industry4.0ManufacturingEcosystems.pdf, p17

Industry 4.0 will be implemented incrementally

Designing new equipment, integrating new systems and training or retraining a new workforce will take time. Probably a long time. Also progress will be made at different rates for different types of manufacturing. Some products may be ready for early Industry 4.0 now. Others will require significant further development. It is highly unlikely that any rational company will leap off a cliff into a wholesale adoption of Industry 4.0. There are too many personnel and management changes to understand and absorb.

  • The shift to Industry 4.0 will not happen suddenly and will not necessarily stick to ideal and typical change management models.” – KPMG – factory-future-industry-4.0.pdf , p31
  • “Replacement of existing tools with machines during the third industrial revolution (automation) is estimated at up to 90 percent. Under Industry 4.0, we believe that the main requirement will be upgrading existing equipment, mainly in the dimensions of sensors and connectivity.” – McKinsey – mck_industry_40_report.pdf, p14
  • “Unlike prior industrial revolutions, Industry 4.0 is not about replacing the existing assets with new ones but about mastering the managerial challenges …” – McKinsey – mck_industry_40_report.pdf, p15

During this transition, key production assets will continue to operate on the old labor-based, eyeball and paper management systems. Gradually, they will switch to the new digital, data-driven system. How will they be coordinated and managed through this transition?