Digital Transformation in Manufacturing Sector
Published on : Monday 04-07-2022
What are the strategies manufacturing industries in India follow to cope with the post pandemic scenario.
Digital transformation is a journey, not a destination, it is said. It is an ever-evolving process that needs organisations to be familiar with the latest trends, with the agility to adopt them. Today, these trends include IoT and real-time data processing, edge computing, data analytics and AI-enabled experiences from this data, use of AR/VR, and the readiness to adopt 5G services that will transform plants and factories as well as remote workplaces. What is the pace of this journey in the Indian industry? How has the pandemic impacted the progress? What are three digitalisation strategies that companies are working on based on lessons of the last two years?
“A shortage of skilled labour during the Covid-19 pandemic and an added drive towards digital transformation have prompted companies to automate the value chain and reduce human intervention,” says G Balaji, SVP, Head – Energy Industries Division, Process Automation, ABB India. “Digitalisation represents a wave of disruption that has the power and potential to transform industrial processes, from controlling inputs from the supply chain to limiting outputs in terms of emissions and energy wastage. By providing a thread that weaves production processes, digitalisation provides the intelligence needed to optimise performance at every stage, ensuring that the result can be efficiently produced and will meet the expected levels of quality and consistency,” he explains.
“The pandemic is one disruption that has hit us; but definitely not the only one. There have been in the recent past also weather related disruptions and more significantly disruptions which have their origin in geo-political events,” opines PV Sivaram, Evangelist for Digital Transformation and Industrial Automation, who believes all of these introduce a high degree of uncertainty in the business environment. “The way to cope with such uncertainty is to become more agile, be more productive and importantly, be more innovative. Perhaps agility and innovation are more appropriate in the scenario of unpredictability. So companies should embrace digitalisation to tackle these issues. Direct access to market data and production data can help to be more agile. So this should be the first strategy and this applies to industry at any scale. Working with data rather than with guesswork and estimates can improve the speed of response which is critical to success,” he suggests.
Dr Pradeep Chatterjee, Head – Digital Transformation, TML Business Services Limited, feels the pandemic definitely has taught us several lessons, which helped in expediting adoption of digital technologies by organisations. According to him organisations are focussing on the following:
(a) Supply and demand forecasting
(b) Adopting collaborative platforms for hybrid form of working, i.e., combination of working from home and office, and
(c) Automating processes with Industry 4.0 and now Industry 5.0 technologies to reduce human dependencies.
For Adnyesh Dalpati, Enterprise Architect, Technologist and IoT Evangelist, the three main digitalisation strategies to follow are:
1. Automation of processes through Robotic Process Automation (RPA) – RPA helps eliminate repetitive tasks that require human intervention and are repetitive; RPA essentially helps in pandemics to get the jobs done in case of fewer resources.
2. Adoption of Productivity & Efficiency Tools for Employees – In a hybrid environment, monitoring employees' efficiency has become difficult, so productivity apps and employee monitoring apps have increased significantly.
3. ERP Systems – Instead of having multiple disconnected systems, companies are building or deploying ERP systems in their organisations, so the information in various departments is properly flowing. This was much-needed post-pandemic since physical communication channels were disrupted, and the need for digital was required.
Hemal Desai, VP Quality & Marketing Communication, Endress+Hauser India, too has three points to consider, the first being the future of sales, the interface to the market and customers. “In this case we have to utilise every available opportunity in the interaction between the analog and digital worlds. Digitalisation and online platforms create additional access to the market and customers. The further we branch out, the better it is for us,” he elaborates. The second is the way in which we work together will nevertheless change. “When people are all physically present in a room, collaboration is different than if they are collaborating in a mixed or fully digital environment.” The third point will be the robustness of supply chains. “With countries closing their borders, supply chains have been interrupted. Endress+Hauser were able to ensure the availability of materials, but many of our customers experienced difficulties. That will lead to new thoughts about how supply chains will be organised,” adds Desai.
The need for digitalisation
The pace of digital transformation is one thing. For many Indian companies, who are not fully into Industrial Revolution 3.0, is there any urgency to move towards digitalisation?
“Yes, definitely,” says Vikas Khanvelkar, Managing Director, DesignTech Systems Pvt Ltd. “The pandemic has shown us that the unanticipated events can come upon us without any forewarning and can literally bring our entire operations to a standstill. So the urgency of going digital has never been greater. With digitalisation, the companies have the means and tools to monitor, measure, and manage their work processes remotely. The access of data and tools allows the team members to carry on the tasks from home or locations other than office. The sooner the companies invest in building their IT and digital infrastructure, the better they will be positioned to carry out the work in challenging situations,” he explains.
For Ninad Deshpande, Associate Director – Research, Quadrant Knowledge Solutions, moving to digitalisation in some form or the other is the need of the hour for every Indian organisation. “It is indeed right to say some Indian companies are not fully leveraging automation and are still focused on semi-automatic, manual operation, or even labour. However, it is not right to say that they are not thinking of digitalisation as an urgent demand and action point,” he says, while maintaining that many organisations have taken steps to embark on their digitalisation journeys. “Moreover, the pandemic fuelled the digitalisation journey with many incorporating predictive maintenance, data acquisition, energy monitoring, remote access, remote monitoring, and digital twin solutions amongst many others. The list is huge with technology and features being a top priority for many Indian organisations,” he points out.
“Digital technologies for industrial use are becoming increasingly available and affordable. Tangible improvements in production efficiency and quality and in areas such as plant safety and energy consumption can be made without huge outlays in expenditure,” says Bob Gill, General Manager, Southeast Asia, ARC Advisory Group. “In addition, the young tech-savvy workforce increasingly expects to see and work with technology such as mobile devices and cloud applications that they are increasingly familiar with in their home and personal lives. They will hence favour companies that are enlightened to want to move towards digitalisation,” adds.
Titash Bhattacharya, Digital Transformation Expert, is of the view that digitalisation is not only about becoming digital but understanding the purpose – what business problem is to be solved, the value we are generating and are we getting any competitor edge. “Companies without being fully into Industry 3.0 still had a competitive edge. But with digitalisation or implementation of Industry 4.0 successfully, the solutions deliver irresistible returns. Digital transformation is revolutionising all aspects of manufacturing, touching not just processes and productivity but also people. The right applications of technology can lead to more empowered decision making,” he opines.
Challenges in moving forward
For many companies, the challenge is in moving from pilots to deployment at scale. What is the way forward?
“There are several factors that can stifle the transition from pilot to deployment, which is why many companies refrain from moving forward,” says G Balaji of ABB. However, according to him, understanding the problem definition clearly, identifying the complexities in integration, retaining a low level of customisation to minimise solution cost, and creating a connected enterprise, as opposed to a siloed approach are few ways for companies to move forward.
PV Sivaram is of the view that technology projects have a kind of glitz and glamour about them. They appear quite attractive to the technical team. Hence many companies rush into these projects to acquire the latest gadgets and implement them in a pilot study. The pilots are even successful at demonstrating the proof of concept. But then they stagnate. “For the project to get into scale across the enterprise, a well thought out strategy is needed. This usually means a different operational procedure. This needs to have a buy-in from all stakeholders. Here the well-known factor of inertia kicks in. People will be comfortable with existing systems and procedures and reluctant to switch to new ways of operation and collaboration. So the way forward is to use the pilot project to remove the apprehensions in the team and make the project owned by the team rather than the management,” he cautions.
“I think the challenge for deployment at scale comes on account of speculations if a particular digital solution will give the desired benefits. Else if it is clear on return on investments within acceptable time limit, there will be no hesitation to implement the same. So choosing the right pilot becomes important and critical to the success. The pilot should be chosen as such which should have clear RoI demonstrable, which is convincing. Then deployment at scale will be smooth flow,” says Dr Pradeep Chatterjee.
According to Adnyesh Dalpati, the fear of losing business makes it difficult to move from pilots to deployment. There are many pilots done, but no new changes have been implemented. “The only way through this is to create buy-in with all the stakeholders. So, post pilots, there is no fear of something going wrong; if the entire business is involved in some capacity with the activity, they all vouch for the success of creating an environment of mutual trust,” he suggests.
Hemal Desai refers to the ‘pilot purgatory’ that many companies are experiencing, when they have significant activity underway, but are not yet seeing meaningful bottom-line benefits from this. “To more fully understand how manufacturers across the globe are approaching their Digital Manufacturing transformation and the challenges they are facing, the move from the ‘current version’ of factory production to Digital Manufacturing holds the promise of significant value, and this shift should be a top strategic priority for manufacturers across the globe,” he emphasises.
Data and analytics
Much depends on the quality of data when it comes to implementation of transformational strategies in the field of manufacturing. There is so much work going on in the area of Data Analytics. What about the effort to get real-time data directly from machines?
“In IIoT or the Industrial Internet-of-Things, the sensors actually get real-time data from the machines directly. The data is gathered and through intelligent sorting, a dashboard can be created to provide the concise synopsis of the machine working information. For example, the machine maintenance, output, can all be monitored. Functioning issues can also be red flagged beforehand such as lesser oil, high temperature, increased vibration, servicing due, etc. This helps in reducing the machine down time and increasing the manufacturing output and productivity, says Vikas Khanvelkar.
“A lot has been spoken about IT and OT convergence with artificial intelligence, machine learning, big data, and data analytics playing a vital role. However, the challenge is to gather real-time data from the field for leveraging data analytics and incorporating business intelligence. IT and OT were two separate worlds with different operating systems, programming languages, and different programmers with varied skill sets. Today, this gap is fast diminishing and operating systems such as Linux are being utilised in automation controllers, which enables easier real-time data exchange for data analytics,” says Ninad Deshpande. “There are many vendors offering such solutions in the market, which make it possible to use Linux and higher-level programming languages for advanced applications consisting of AI and ML,” he points out.
Commenting on the issue of data and analysis, Bob Gill feels a good example here is MTConnect, the open, royalty-free protocol, which delivers plug-and-play connectivity for machine tools by enabling equipment to provide data in structured, contextualised and no longer proprietary. “As such it enables automated, real-time data collection and much greater visibility into machinery operations. The data can then be consumed by a software application for machine monitoring (utilisation, OEE), job scheduling, process analytics, predictive maintenance, etc.,” he says.
“Embedded sensors and interconnected machinery produce a significant amount of big data for manufacturing companies. Data analytics can help manufacturers investigate historical trends, identify patterns and make better decisions,” says Titash Bhattacharya, who is of the opinion that smart factories can also use data from other parts of the organisation and their extended ecosystem of suppliers and distributors to create deeper insights. “By looking at data from human resources, sales or warehousing, manufacturers can make production decisions based on sales margins and personnel. A complete digital representation of operations can be created as a ‘digital twin’,” he states.
“The main factor which compromises data quality is the source of data. If data is not direct from the point of origin, then there are chances of corruption. If there is any human element in the chain of data collection, we can have issues of delay, inaccuracy, bias, etc.,” says PV Sivaram, who believes that to avoid these inaccuracies, there is a need to implement sensor based collection of data. “One obstacle in this strategy is that it is not easy to connect all controllers and sensors to a central data collection agent. There are so many makes and models of devices, and most of them use proprietary communication protocols. This situation is akin to the famous Tower of Babel. Another term here is ‘Islands of Automation’, and data is available in silos,” he explains.
Handling legacy equipment
While it is easy for Greenfield projects to implement the concepts of Industry 4.0 and digitalization, most of the companies have the onerous task to transform their existing plant and machinery. For these and other niche and custom solutions that are being attempted for connecting legacy machines, what about long-term serviceability? What are the options?
“Continuing from earlier, many installations attempt to address the problem using local resources and products tailor-made for their distinct purposes. These solutions do work. But, what happens when a new product enters the factory and needs to be connected as well? What about periodic updates? These are problems lying in wait. So it is better to go for solutions and products, which have a large installation base and there is an agency to look after concerns of product life cycle,” says PV Sivaram, continuing his elaboration on the subject from the data analytics perspective.
Speaking about ABB, G Balaji says the company is committed to the reliability of operations, providing full support to maximise operational uptime – and thereby lowering life cycle costs. “Collaborating with our customers, we understand the challenges faced and can advise and support them in their maintenance and upgrade strategies. Leveraging our network of experts around the globe, the company can respond to customer queries and resolve issues rapidly. But service is not restricted to maintenance and preventing failures. ABB’s service portfolio also encompasses the optimisation of processes and operations. The company can also support customers in their quest for greater energy efficiency, lower operating costs or in protecting systems and equipment from cyber-attacks,” he adds.
Hemal Desai says Endress+Hauser IIoT ecosystem is also set to be ready for the market soon. “An application for asset health monitoring will monitor the status of the installed base, and is set to eventually enable predictive maintenance,” he says. “Endress+Hauser Smart Metrology is going in the same direction: This application, which is still in its conceptual phase, will enable the optimisation of the calibration intervals of pH sensors. Another application for water quality will allow for the simple and cost-effective remote monitoring of water levels.”
According to Dr Pradeep Chatterjee, it will be difficult to find a single solution to connect all legacy machines and hence custom and niche solutions will be required. “However, for long term serviceability each organisation needs to define certain technical standards, which act as guide-rails for development of custom solutions,” he says.
Commenting on the problems faced by dependence on legacy machines, Adnyesh Dalpati, believes it is due to the fear of losing business if a new initiative is taken. “They are not long-term solutions but help bridge the gap till a new app is developed or a new strategy is implemented. We should avoid calling them part of digital transformation since they are not long-term solutions,” he opines.
Standards and regulatory guidelines
A major concern is also related to the data itself – the safety and security aspects. Is it too early to talk about standards and regulatory guidelines for collection, storage and access to data?
“There is never a bad time to start talking about standards. Usually, standards make lives easier not only for vendors but also for users and the earlier there are robust industry-wide standards the lesser the confusion it creates. Without standards, there is chaos as all vendors start creating products and solutions based on their understanding and customer needs,” says Ninad Deshpande. “It is nice that there are already a lot of standards and regulatory guidelines prevalent in the industry for topics such as data access and storage, especially from the security point of view. The IEC 62443 and NIST frameworks and ISO 2700x are some standards that are widely accepted in the field of manufacturing. There are many more industry-specific standards, but it’s important to note that there is already a lot of activity in the standards and regulations area,” he adds.
Titash Bhattacharya agrees that standards and guidelines are required to establish technical specifications that are adhered to, and adopted by a wide range of manufacturers. “The overarching goal is to increase reliability, predictability, inter-compatibility, consistency, and efficiency. Industry standards ensure that different products are compatible with each other and that customers can mix and match products from different vendors. They spearhead innovation, reduce costs, and enable a plethora of cost-effective and holistic solutions,” he explains.
“Several standards and associations have emerged with the shared goal of promoting interoperability, accessibility, and process automation in Industry 4.0. All of them satisfy a certain niche of the industrial production process, such as designing a digital twin of a product or production site, utilising sensors to optimise efficiencies, and various communication and software elements,” says Titash, further elaborating the point.
“Virtually every organisation has enacted some sort of data privacy policies to regulate how information is collected, how data subjects are informed, and what control a data subject has over his information once it is transferred,” says, G Balaji. “Especially during the hybrid work environment that most of the organisations have adopted. Failure to follow applicable data privacy may lead to fines, lawsuits, and even prohibition of a site's use in certain jurisdictions. Manufacturing facilities tend to have a lot of devices generating more data, which leads to another buzzword: Big Data. Putting in place a data infrastructure policy, helps to level the playing field in modern data management making things more equitable,” he adds.
Integrating global supply chains
Digital transformation is deemed to be necessary for companies to become part of the big global supply chains. Are there already such requirements by big buyers as a condition to become their suppliers?
“Yes. Marketplaces like Amazon and Walmart have become 1st party buyers; they have specific protocol EDI for communication of orders, inventory, shipping, etc.,” says Adnyesh Dalpati. Some buyers need standardised protocols for data exchange and network infrastructure also to start with. These enhance the information infrastructure, speed up the transaction processing and reduce operations. “As we are growing in volumes, digital transformation helps bridge this gap as well as build it for the future,” he adds.
“There are mostly guidelines and pre-requisites given by big buyers to get enrolled as suppliers which includes IT platforms and system integration requirements. Some part of the transactions also needs to be performed in the buyers’ system either through manual transactions or through integrations for seamless flow of information,” concurs Dr Pradeep Chatterjee.
According to Hemal Desai, in the next three to five years, we will see an increase in the adoption of digital supply chain technologies, as well as technologies that improve human decision making. In addition to labour availability constraints, rapidly rising labour rates and the residual impacts of Covid-19 will compel most companies to invest more in cyber-physical systems. More and more companies are entering the D2C business through different platforms, which indirectly creates a bigger stress on the supply chains model. “It will then be for the industry to reduce time of delivery through online platform sales and deliveries will be done faster. This will result in the requirement of the supply chain industry to rely heavily on digital platforms to meet the rapid demand from the industry,” he emphasises.
“Companies will certainly favour suppliers that have undergone a sufficient level of digitalisation to be able to share and integrate their data and thus increase the utility of the buyer companies’ own systems and enable business efficiency improvements,” opines Bob Gill.
“Some of the digital solutions are necessary for vendor’s registration and on-boarding as suppliers. It helps the OEMs track the data and processes with better effectiveness. For example, SCM (supply chain management) solutions or ERP (enterprise resource planning) solutions are required to streamline the workflows and processes. OEMs have a lot of suppliers and vendors scattered geographically. The only way they can track the inventory, deliveries, shipments or other back-end processes and documentation is through these solutions,” concludes Vikas Khanvelkar.
(Note: The responses of various experts featured in this story are their personal views and not necessarily of the companies or organisations they represent. The full interviews are hosted online at https://www.iedcommunications.com/interviews)