February 2020

COMMENT n REPORTS FROM THE DIGITAL FRONTLINE It sometimes feels that when we talk about smart factories, we are envisaging a utopian future that is still several years away. But a new survey of more than 200 manufacturers across Europe suggests that more have already embarked on the“digitalisation journey”than you might think. Commissioned by the industry analyst teknology and the edge computing specialist Stratus Technologies, the survey 1 finds that 63% of those quizzed have already embarked on smart factory initiatives, and that a further 37% are planning them. Drilling down, the figures are not quite so impressive, with only 8% of the projects being at an“advanced”stage, while 36% are still in an early phase. And while more than half (56%) of the projects are too early to have achieved an ROI (return on investment), 45% of the companies that are further down the road are reporting ROIs of less than a year, with a further 52% saying that their smart factory investments are taking one to three years to pay for themselves. Almost two thirds (63%) are planning to increase their spending on smart factory projects over the coming three years, with 35% expecting little change in their spending – and 2% reporting that they will actually be cutting their smart factory budgets. When asked about the biggest challenges to adopting smart factory technologies, more than half (58%) cite the costs of the investment. Just under half (48%) say they struggle to build a business case, while almost as many (47%) say that a lack of skills is holding them back. Other factors cited include: the complexity of the analysing the data (mentioned by 43% of the respondents); the cost of managing smart factories (42%); and the challenges of integrating IT and OT (40%). But if you can overcome these challenges and implement Fourth Industrial Revolution (4IR) technologies, the benefits can be substantial, as the latest report from theWorld Economic Forum on its global network of “Lighthouse”factories makes clear. As we report on page 8, the first British factory has just joined this global list of plants that are intended to act exemplars of what a well-implemented 4IR project can achieve. There are now 44 Lighthouse plants around the world, with high concentrations in Europe and East Asia, and none yet in Australia or Africa. The US has just three plants on the list, while Indonesia and Singapore have two each. Of the 28 new sites added to the list recently, half are examples of how 4IR principles can be extend beyond walls of a factory to encompass the whole end-to-end supply chain. When this is done, the results can be transformational. They can move beyond merely improving operational efficiencies, to reducing waste, resource consumption and emissions, thus boosting an organisation’s environmental sustainability as well. TheWEF report 2 is well worth reading because it shows the concrete results that individual organisations are achieving by adopting smart factory technologies. And seeing the benefits that your rivals are reaping might be the best incentive for companies to embark on their own digital journeys Tony Sacks, Editor 1 The Stratus/teknology report, Smart Factory in Europe: 2019 and Beyond , can be downloaded fromwww.stratus.com/en-uk/lp/edge/smart-factory-transform-business 2 The WEF report, Global Lighthouse Newtwork: Insights from the Forefront of the Fourth Industrial Revolution , can be downloaded from www3.weforum.org/docs/WEF_Global_Lighthouse_Network.pdf “With the right partner, the battle is already won...” The UK’s largest stock of quality electric motors, inverter drives & gearboxes. T o t a l E n g i n e e r i n g C o mm i t m e n t 01299 252990 enquiries@tecmotors.co.uk www.tecmotors.co.uk

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