Industry 4.0 transformation in practice
The compelling need for most manufacturers to digitalize and automate their operations is now very widely recognized2 by the leading manufacturers and specialist management consultants interviewed for this study.
Ultimately, an ideal digitalized and automated Industry 4.0 world is one in which people, machinery and systems are all digitally linked. It is a world where technology automatically adjusts or recalibrates itself for greater efficiency, quality or customization. It creates capabilities for preemptive maintenance to improve uptime. It is an environment where powerful digital data flows seamlessly within and between organizations. And it creates a culture where collaborative groups work together up and down the supply chain to build better, more productive, industrial ecosystems.
Getting to the summit of full Industry 4.0 transformation, however, is likely to be reached in a series of steps, rather than a wholesale and sudden change. Even though the pace of product and market development in digitalized manufacturing has been breathtaking,4 experienced managers know that they risk dangerous business disruption if they move too far, too fast, without quality controls and return-on-investment measures firmly in place.
The debate has moved, therefore, from discussing the simple need to digitalize and automate to understanding how organizations create a practical path to Industry 4.0. 5 In an attempt to uncover this path, Siemens Financial Services interviewed manufacturers and expert management consultants in eleven countries around the world 6 about the hurdles manufacturers face in the process of moving to an Industry 4.0 model: What are their main challenges to digitalization and automation in practice? What are the interrelationships between those challenges? Are they technical or cultural? How is a successful strategy developed? What skills are needed at each stage of development? And, crucially, how is that transition financed, and what are the implications for return-on-investment?
The following section of this report outlines the top six challenges, as ranked by research respondents. It then moves on to examine interviewees’ opinion on best practices in creating a practical path to overcome those challenges: What information and insight needs to be gathered to create a viable strategy and plan? What are the questions manufacturers should ask themselves when managing digital transformation in practice? What are the key areas of objective self-examination for the organization?
What business processes, management attitudes, financing strategies and cultural factors need to change?
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