After hours | April 18, 2017
The Industry 4.0 – New Generation of Smart Factories
In 1990 Detroit, USA, was one of the economic centers of the world. At that time, the value of the top three companies in the automotive sector was estimated at $36 billion. Within a quarter of a century, most of Detroit’s factories had shut down, and the city had lost half its population, gaining only the title of the murder and arson capital of America in return; while the value of the three largest companies from the new center of the global economy, Silicon Valley, exceeded $1 trillion, employing 10 times fewer staff than Detroit’s automotive giants during their own glory days.
The contemporary equivalent to Detroit in the 1990s is the economy of Germany, which is still based on industrial production, despite the digital revolution. Here, however, the similarities end as, unlike their American counterparts, the German economy is in a very good state, with no sign of any change in the near future. No wonder, because it was here that the idea of Industry 4.0, the fourth industrial revolution, was born. It may sound somewhat bombastic, but it is worth taking a closer look at specific projects and solutions, as these are what make the German economy one of the most competitive in the world, notwithstanding the growing demographic problems associated with an aging population and ever fewer people of working age.
The Fourth Industrial Revolution
In brief, the first industrial revolution was based on mechanical production driven by the steam engine; the next revolution was mass production and electrification; while the third was the introduction of integrated circuits that allow automation into factories. As mentioned above, Detroit is the symbol of the exhaustion of the economic model created by these phases of evolution in industry. In the case of the fourth revolution, the driving force is the network, but in a much wider sense than the Internet itself:
- social networks, signifying the development of the network economy, based on a network of partnerships between companies, co-operation, and business networks,
- the Internet of Things – a key element of so-called smart factories, that operate based on a network of interconnected production machines equipped with sensors, readers and recorders that collect data and regulate the production process,
- the Internet of services – on the one hand, this means cloud services; on the other hand, the specialization and outsourcing of services, using a partner network, which is also possible thanks to the use of modern communication technologies, enabling work to be done remotely,
- the Internet of data – the use of both one’s own and external data as a resource to ensure the competitiveness of your enterprise. It also includes phenomena such as mass customization, or mass production including parameters identified by specific customers, as well as fog computing, the transient state between the local server and the cloud, and completely new ways of communicating – both within the company and with customers and business partners.
The Fourth Industrial Revolution has the potential to address some of the most pressing contemporary issues facing industry, and more generally the economy as a whole, such as innovation and productivity problems, demographic problems, and the necessity of developing industries that are ecologically sound, economically efficient, highly innovative, and bring more added value than the service sector, but are also less susceptible to economic crises (reindustrialization).
Paradoxically, Industry 4.0 is also a response to social unrest in highly developed countries caused by relocating production to countries where manufacturing is cheaper. It turns out that this phenomenon, which is typical of globalization, is losing steam. While in the United States this is simply Donald Trump’s unfulfilled campaign promise, many of today’s leading German companies, such as Adidas and Stihl, are bringing production back to Europe. But what has brought this on?
Offshoring production is becoming less and less profitable (due to rising labor costs in Asia, which is also the result of globalization), and does not ensure swift order fulfilment, which is especially important in industries such as fashion. The ever shorter fashion cycles (the days of having two seasons, spring-summer and autumn-winter, are already a thing of the past, as we now have at least eight seasons), as well as mass customization (Adidas has long been offering customers the chance to customize their own shoes online), mean that production is obliged to move closer to the customer. But production is usually much more expensive there. So robotics is the solution, and the German and Swiss markets are leading the way.
Bystronic and smart factory solutions
For many readers, the theory of the fourth industrial revolution may sound naive, like another idealistic economic stimulus project, full of murky definitions and unclear guidelines. Therefore, it is worth giving an example of how it can work in practice. To do this, I will use the example of the Swiss company Bystronic, with whom I have the opportunity to cooperate in person.
Bystronic offers advanced systems and services for industrial processing, including the cutting of various materials by means of laser and water jet, as well as sheet bending (for the automotive and shipbuilding industries). The equipment produced and used by the company requires specialized software that ensures the highly precise processing of materials. To that end, the company decided to establish a partnership with JCommerce, entrusting them with software development.
“The demand by many users for automation and digital process solutions is increasing. This trend is being intensified by impulses from the field of Industry 4.0, which are changing also the world of sheet metal processing. Software plays a key role in this transformation. Software solutions support users in the planning, interlinking, monitoring, and optimizing of all their processes. In cooperation JCommerce and Bystronic are working on new software solutions, in order to support customers within a world of automated and networked manufacturing”, Bystronic says.
JCommerce specialists are currently implementing software projects to support Bystronic by developing new solutions in the field of Industry 4.0.
Clearly, the strategy of Bystronic is the idea of Industry 4.0 in practice, meaning that the company is aware of the potential of information that can be obtained using industrial machines, connected to a common data processing system, in the IoT model. It also takes advantage of the opportunities that a network of trusted business partners brings, carrying out tasks more effectively thanks to its specialized nature. Bystronic remains a company in the industrial sector, it is still a factory above all – although a smart version – because it utilizes advanced IT technologies to a great extent.