Several emerging digital technologies are converging to thrust manufacturing and services into the next orbit. The excitement about digital transformation comes from the new opportunities it is opening up in combining powerful and large amounts of data from multifarious sources in a manufacturing plant and from operating processes with data analytics. This provides valuable information and insights – which were not possible to extract earlier – enabling online optimisation of plant and process, including proactive maintenance of plant & equipment, well in advance, avoiding breakdowns. It is helping in unlocking higher levels of plant performances.
Many who thought that plant optimisation and profitability had peaked are now realising that using such digital technologies, Artificial Intelligence & Machine Learning, productivities & profitabilities can be driven higher, much more than before. These technologies apply across functional areas, allow far better & quicker analyses and hence enable better decision making.
It is also making work more exciting and interesting for plant people, taking the drudgery out of work.
However, digitalisation is not just about novel technologies. It needs decision making at the highest levels. It is important to prepare the organisational infrastructure – IT systems, plant & equipment to incorporate Industry 4.0 and importantly, reskilling the human resources. It needs specific focus, objectives and targets with a roadmap for implementation, which is what counts in effect.
To understand the implications of how Industry 4.0 is unfolding, Chemical Industry Digest sought the views to a few questions from industry leaders whose views are presented below.
Chemical Industry Digest Questions:
Q1. As you know Industry 4.0 constitutes a suite of advanced digital technologies which include: artificial intelligence (AI), industrial internet of things (IIoT), data analytics, virtual reality, machine learning, advanced robotics, blockchain. Many leading experts opine that the advent and convergence of these technologies and their applications in industry and elsewhere will herald the next paradigm shift in manufacturing, which could be a disruptive shift rather than incremental.
How do you view the emergence of Industry 4.0 and what do you feel will be its impact on industry? In what all areas of manufacturing or engineering services would it contribute? Would existing business models need to be re-examined?
Q2. What is your company’s strategy for the digital transformation of your company using these technologies? To what extent has your company seized the potential of Industry 4.0, from top management to the rest of the workforce? How are you preparing your organization for the adoption of such technologies?
Q3. What do you feel are the challenges to its implementation in industry? What about the availability of adequate trained human resources for this? Would it need large scale re-skilling of the workforce?
Rajesh Joshi, Vice President of Sales, India, Aker Solutions
A1. Digitalization, which is a part of Industry 4.0, represents an incredible opportunity. New technologies that combine the physical, digital and biological worlds will impact all disciplines, economies and industries.
A combination of cyber-physical systems, the Internet of Things and the Internet of Systems makes Industry 4.0 possible and the smart factory a reality. Connected machines collect a tremendous volume of data that can inform maintenance, performance and other issues and also analyze that data to identify patterns and insights. Using these technologies, facilities will become more efficient and productive and less wasteful.
Industry 4.0, particularly robotics and additive manufacturing, will also have a disruptive impact on mechanical engineering design. Digital engineering simulation tools create realistic, perfectly scaled, three-dimensional images that speed up product design, reduce iterations and shorten time to market. Processes and operations will have to be redesigned to accommodate these new advances. It will also impact the design of products for increasingly smart manufacturing facilities.
In project management, data from current and past projects tends to be scattered among different sources. Digitalization could assist to capture and analyze the data. It can also assist in developing repeatable, standardized designs and significantly drive efficiencies on design timelines and efforts.
At Aker Solutions, we develop products that use digital technologies to allow our customers to move toward more complex condition monitoring and predictive and preventive maintenance. For example, we have been appointed by Wintershall AS to build a complete digital replica of the Nova subsea production system and undertake a study to enable live data streaming and monitoring of the subsea equipment. The digital twin will become an advanced replacement to traditional documentation, ensuring that all relevant engineering data is held centrally in a single, interactive and searchable solution.
Whereas short-term successes can be realized via process optimization, a long-term strategy requires the development of new products and services as well as new business models which utilize the potential of new technologies and add value in the process. Business models based on digitalization could support long-term advantages such as interoperability, virtualization, modularity and the decentralization of decision-making.
A2. Digitalization is high on Aker Solutions’ agenda, with digital technologies transforming how we live and work. Increasing the use of these technologies has the potential to improve internal flow efficiency significantly. To support this, we moved a number of our business-critical internal systems to the SAP cloud last year.
We believe that the industry needs standardization to reduce capex, improve quality and shorten lead time. With this in mind, we have been working towards increasing the automation of engineering design through standardized, rule-based flexible building blocks. These are being developed using a combination of industry best practices and lessons learnt from past projects.
We’re also working on more hands-on applications for new technologies. For example, we recently installed an automated warehouse storage system at our operation in Brunei. It reduces the material footprint, increases the speed of work and ensures safe operation. It’s also fully integrated with our digital work management system.
More than half of all our R&D investments were allocated to digital initiatives last year, and we expect this share to increase going forward. We have also established a “Software House” to act as a hub for innovation and accelerate and commercialize our own software solutions. Additionally, we are collaborating with other organizations for the collection and analysis of data and the development of new digital offerings.
With these and other initiatives, we are executing on our plan to connect our products, assets and people to the digital ecosystem.
A3. Organizations need to establish an operating model that supports digitalization and innovation. Digital initiatives need to be integrated into the core strategy and work processes. Organizational structures need to be updated for digitalized environments.
Over the next few years, we can expect major shifts in three areas: organizational structure, talent management and corporate culture.
Talented individuals with a passion for technology will be needed to fill new roles and help staff members in traditional roles develop their digital skills. Companies that want to enable innovation must ensure that all employees in traditional roles start developing digital capabilities that complement their existing skills. A long-term plan to recruit, develop, and retain people with very specific capabilities is essential to address any gaps.
Most successful digital teams focus on three priorities. First, they perform analytics to assess operations and performance, and then they take action based on the insights. They also rapidly test and deploy new hardware and software – for instance, an innovative project production system software or a new autonomous piece of site equipment – following agile principles.
The changes described won’t come easily or quickly, but the companies that resolve to address them first will likely emerge as digital leaders.
Ajay Durrani, Managing Director, Covestro (India) Pvt. Ltd.
A1. Industry 4.0 is a fresh intake of current and innovative technologies. If you look at the past years of development in the ways of working, we have come a long way by shifting from traditional and conventional processes to adapting the new age technology. Digitalization has already made its mark in bringing excellence in multiple areas of manufacturing and other related industries already. Industry 4.0 will take the digitalisation to next level with support of technologies like Artificial Intelligence, Internet of Things (IOT), Data Analytics.
Industry 4.0 will truly rely on data and trend analysis as that is going to be the king maker in future and I would say it has already started showing results in the consumer industries specially in FMCG sector with so many customised product variants even for example for a small category like the bakery industry. Today, thanks to AI and Data Analytics, organisations have detailed likings and buying patterns of each customer. Multiple levels of customisation are possible. This has also compelled the related manufacturing industries to embrace the industry 4.0 concepts to cater to rising consumer needs for customised products. Looking ahead of the negligible disruptiveness at the beginning, the trend will bring about more benefits in the industry by contributing to areas like productivity, cost, product quality, operations etc. Although the effect of the Industry 4.0 will be widespread, the areas of production and supply chain will witness the most competitive advantages. All the players in the industry have a huge scope on optimizing on this,as in the future entire factory setup can be digitalised and connected to entire value chain which will give leverage to all the players to optimise as well as enhance their forecasting abilities.
A2. Digital solutions have long been standard in everyday life. And they also facilitate work in the chemical industry and offer great economic opportunities, which Covestro is seizing with a comprehensive transformation program. The focus is on further digitalization of operations, points of contact with customers and new digital business models.
Digitalization is becoming part of our lives – both professionally and privately. This change is being further accelerated by the fast-paced nature of technological developments and the omnipresence of digital technologies. This progress holds enormous potential for Covestro in many areas. The comprehensive “Digital@Covestro” strategic program is designed to make use of this. It comprises three dimensions: “Digital Operations”, “Digital Customer and Supplier Experience” and “Digital Business Models”. Each individual dimension opens up new possibilities for the optimization of production processes and workflows. As a result, added value can be created in many business areas, but it is above all the people who benefit from the digitalization of work processes at Covestro. This transformation needs to be well accompanied: For example, new processes must be internalized, new customer needs to be identified and an adapted working environment created.
Industry 4.0 will be a next formative step in establishing collaborative ways of working across entire value chain and concepts like ‘no-touch orders’ will be reality. At Covestro India we already have progressed well in this area with help of multiple digital inclusion programs.
A3. As the Industry 4.0 is upon us, the impact of it on each industry or company will be different globally, as well as locally. It has become vital for an organisation to retune their current setup to the advanced way of working. This will have some temporary effect but is the need of the hour for most of the organisations. While we will be busy modifying our business models and our operations, one of the essential elements that we cannot leave out is our people. Be it any automation or advanced technology, you will still need a human resource to oversee the effectiveness.
India has the advantage to skill as well as reskill people in this new age technology easily, being one of the software superpowers. However we need to enhance our education system to be more vocational and move towards exploratory learning system. Industry and Academia need to work together in developing curriculum relevant for the change being envisaged by the industry and for the future expertise required.
As the world becomes smart in manufacturing and related processes, there will be equally huge demand for techno-savvy workforce. Such smart work force need to understand not only traditional engineering concepts but are also absolutely hands-on to use multiple softwares and data analysis tools. There is a considerable opportunity for India to create talent pool for the world that is Industry 4.0 ready and will help the world drive this change.
Sudhir Shenoy, CEO, Dow India
Chemical Industry Digest (CID): How is Industry 4.0 advantageous for India? What should India be doing to capitalize on this opportunity? What is the role of private players and government to drive this transformation?
Sudhir Shenoy (SS): As the 6th largest economy in the world, India is focussed on increasing its manufacturing footprint and the manufacturing GDP from 16% to 25% by 2025 – while creating 10 crore new jobs. Adoption of Industry 4.0 will bring significant strategic advantage and boom to the manufacturing industry with smart, flexible supply chains, factories and distribution models where machines capture and convey more data, via machine-to-machine communications and to human operators and others, enhancing the pace of much needed growth. It will also aid product innovation, faster time-to-market, cost optimisation through procurement/supply chain analytics, revenue maximisation through better demand forecasting, and better understanding of customer needs. Industry 4.0 works across all sizes of companies – for example- in the small industries, adoption of technology aids cost optimization, consistency in product quality and better control on product design. For the larger industries, reduction of lead time, flexibility in production, agility to market, optimization of resources, are some of the obvious benefits.
However, with Industry 4.0, one cannot expect a one-size-fits-all solution. On one hand, Industry 4.0 offers India the opportunity to create its own smart-manufacturing ecosystem, custom configured to each enterprise and industry based on the opportunities, challenges and priorities. On the other hand it can become a platform facilitating a level playing field for large, medium and small companies through regulation, policy, sustainability, creating value that makes India a competitive market for the world.
Digital Transformation is and will continue to bring significant reduction in monotonous and ergonomically challenging jobs, giving significance to cognitive abilities and system skills over physical abilities. It allows the manufacturing industry to institutionalize intellectual property, attract young and high skilled talent. Technology aids in building bridges and breaking barriers of who we hire and what we hire them for – providing an unprecedented opportunity for inclusion across gender, disability and others.
Another key element, in the Industry 4.0 discussion is sustainability. The two are closely interlinked and calls for a think now as we plan for Industry 4.0. The play of society, business, and governments to the new paradigm will be critical in directing the impact.
CID: How is Dow India adopting digital transformation?
SS: As a company, we have been early to join the bandwagon of the Fourth Industrial Revolution (FIR) – investing in organizational information systems, cyber security and risk management, reporting and advanced analytics, and facilities management. Our company has collected process control data from all its operations, over the last 20 years – over the last five years, this information has been fed into a ‘data-lake’ and is now being updated in real-time. We have also added sensors on existing equipment to monitor and run analytics. Here are some examples:
1. Predictive Maintenance: On an average, unplanned maintenance costs business between USD 300 – 500 Mn every year – directly impacting the bottom-line. Integration of traditional business with digital transformation has enabled new disciplines like ‘predictive-maintenance’ within our company. When we started this initiative and looked at robots and drones to do the turnarounds, we realized that many confined space entries require maintenance several times during the year. In the past we used to send a human inside a vessel to check, sometimes of hydrocarbons, putting people in a risky environment, when you can substitute machine for the same work. A combination of IIoT, robotics and machine learning, predictive maintenance helps us carry out periodic audits and repairs of our manufacturing sites seamlessly creating real savings. Hosted at our excellence centre in Chennai, this technology helps us monitor facilities all over the world.
2. High-throughput research: In combination with digital simulation, we are using AI to aid high-throughput research which decreases the time and effort required to create and test formulations. By using artificial intelligence we are making our engineers and scientists more productive – taking an idea to commercialization, almost two to three times more effectively.
3. Sustainability in the context of Industry 4.0 has been key enabler for us at Dow India, by helping us accelerate the creation of a safer and more sustainable ecosystem. One of the examples that comes to mind is Nicer Globe – an Indian chemical industry initiative along with Indian Chemical Council. The software used in the model, helps tracking, monitoring and quick emergency response, along with using the data from the driving on particular lanes to determine potential hotspots for accidents, using camera functionality on trucks to track the drivers alertness and to prevent driving under fatigued conditions and more.
