Senior figures from across the UK manufacturing landscape discussed the trends, technologies and influences that are transforming the future of industry during the UK’s largest event of its kind, The Manufacturer's Annual Leaders Conference 2016.
This year, the focus of The Manufacturer’s Annual Leaders Conference was on Industry 4.0, more specifically the digitisation of manufacturing and how UK industry can leverage connected technology to drive business growth.
Entrepreneurial manufacturing leaders and senior decision-makers imparted their knowledge and provided a unique insight into how they had gained from adopting and embracing this new paradigm, supported by leading academics and qualified solution providers for a truly rounded conversation.
TMALC 2016 gathered many of the biggest names and most well respected thought-leaders in industry to discuss and debate a wide range of topics, which included demystifying Industry 4.0; creating your own road map to digital manufacturing; adding value through service provision, delivering the smart supply chain, and digital disruption in practice, to name bit a few.
Your innovation road map
Felicity Burch – head of innovation and digital, CBI
The manufacturing sector is, and has always been, very adept at responding to global change and innovation is a key component of that. Manufacturers are the drivers of innovation in the UK economy, with a reputation for adapting to survive and thrive.
CBI has just completed its first round of economic forecasts since the referendum vote to leave the European Union, and though the value of the pound has dipped, other signs – such as the strength of the FTSE and the labour market for example – are more positive.
In terms of economic growth, we are looking at 1.3% in 2017, and 1..1% in 2018.
Uncertainty is a challenge for manufacturers, with expectations for manufacturing growth remaining subdued and the chance that investment will probably be the first casualty of this uncertainty.
However, this uncertainty is nothing new. The post-financial crash has been characterised by uncertainty for manufacturing.
According to our members, many of them feel that the decline of the pound is negatively affecting their business, rather than acting as a positive.
Innovation is – part of – the answer, helping companies deliver improved outcomes for their customers; attract new customers; develop new and existing markets; reduce the cost of production; raise the quality and speed of production; and increase sales volumes, turnover and profitability.
UK manufacturing accounts for almost two-thirds of total UK R&D investment, with studies showing that during times of uncertainty, business’ investment in R&D actually increases, rather than falls. However, there is one area where UK industry is lagging behind and that’s in regards to digital adoption. Without investing in digital technologies, Industry 4.0 won’t become a reality for UK manufacturing.
For the Autumn Statement, CBI is calling for government to adopt an ambitious target of 3% of GDP to be spent on R&D, with funding for science and innovation crucial.
There is a role for business’, who must engage with the support available, such as Innovate UK, the Catapult network and the R&D tax credit; collaborate with customers and suppliers, and know your strengths.
Manufacturing in a cognitive era
Charles Joel – industrial lead for Industry 4.0 & IoT, IBM
How are cognitive systems different? Understand (they can understand imagery, language, and other data), Reason (grasp underlying concepts and form hypotheses), Learn (develop and sharpen expertise) and Interact (with humans in a natural way).
How do you invoke insights from all data (that which you possess, that which is outside your firewall and that which is coming) will determine your digital intelligence.
Data you possess includes customer records, operational systems and transactional systems. Data outside your firewall which has value to your business includes news, event, social media, etc. Data that’s coming into your business is the Internet of Things (IoT), sensory data and that which comes from cognitive cyberphysical systems.
What are some of the problems that a cognitive manufacturer is ideally suited to solve? Data, how to keep up with the mountains of contextual data available; Complexity, how to overcome and solve for great complexity by giving the skill and knowledge of the informed few to the empowered many; Security, how to stay secure in the ever-changing technology race and connectivity on shop floors.
Demystifying Industry 4.0
Phill Cartwright – CTO, High Value Manufacturing Catapult
Industry 4.0 essentially boils down to four key things: providing and enabling companies to increase productivity; reduce waste; become more agile in a competitive world, and generate high-value, long-term, highly skilled manufacturing careers.
Companies can utilise existing technologies, not just developing new technologies, in their own businesses today. And what’s most important is that utilising these technologies doesn’t need the huge amount of investment everyone assumes.
There are currently 1,700 SMEs engaging with and being supported by the High Value Manufacturing Catapult centre.
Working in these Catapult centres, I’m pleased to say that we’ve taken the design CAD-CAM ‘clash’ principles developed by the automotive sector 20 years and helped apply them to other sectors, such as nuclear and rail. A feat which has achieved considerable savings versus was originally budgeted for projects.
Taking Industry 4.0 technologies and processes onto the factory floor is what the Catapult centres are busy working on at the moment.
Industry 4.0 is not just about design, technologies and the manufacturing process, it’s about flipping business models. Everyone knows the story of Rolls-Royce and its ‘power by the hour’ model, offering a capability rather than just a standalone product.
Supporting your digital transformation – who’s going to eat your lunch?
Mark Elbourne – CEO & president, GE UK & I
If you don’t transform your business by understanding and embracing what digitisation means, you’re at a real risk of being intermediated by someone else – you will be ‘Uber-ed’. Our believe at GE is that every business in every sector is at risk of being ‘Uber-ed’.
Those that might ‘Uber’ you may have a good grasp of data and analytics, but they don’t understand the physics and engineering behind your product. You understand your products better than anyone else to deliver a better customer outcome.
To GE, Industry 4.0 means one thing – productivity, productivity both in your factories and productivity in your customers, and in turn their customers.
Four steps to get you started and learn from GE’s digital transformation: baseline current digital industrial capabilities; build out vision and road map with milestones; generate quick wins to drive momentum, and don’t be scared to partner with other organisations.
If you want your business to both understand and leverage data and analytics, my advice to you is to to do it today, don’t wait.
Your road map to digital transformation
Keith Jackson – CTO, Meggitt
Industry 4.0 is about quality data and analytics, but my advice to you is to be careful. There are plenty of opportunities to get it wrong and set up data gathering systems and fail to extract meaningful, valuable data.
Industry 4.0 is not just about optimising your factory, it’s about optimising your people and allowing them to become the best they possibly can be. That’s an absolute focus for Meggitt.
Just randomly taking data and combining it won’t work. Be careful about how you start your digital transformation journey, ensure that the data you gather or are looking to gather is information, something you can make decisions from and won’t just be additional noise.
The future backbone of manufacturing is built around data, communication and connectivity – the core pillars of Industry 4.0.
Delivering the smart supply chain
Richard Wilding OBE – Professor of supply chain strategy, Cranfield University
Our first major challenge is to recognise that volatility is causing supply chains to change. The fact is, the way we used to work is no longer a viable method today.
To design a smart supply chain, you have to have a very clear focus on what on you want to achieve within your business, enabling you to choose the technologies within Industry 4.0 which are aligned to your business and its strategy.
Your supply chain strategy must encompass: supply chain process design; supply chain infrastructure design; supply chain information system design, and supply chain organisation (‘society’) design.
Social media tools are enabling businesses to perform differently, allowing greater transparency, collaboration and innovation. Companies adopting social collaboration tools achieve a 15% increase in productivity, according to a 2014 study by The Financial Times.
Data driven continuous improvement
Jim Newton – market development director, McLaren Applied Technology
Formula 1 is as much a race to innovation as it is a race to the finish line. It is a data-led business, but every sensor we place on a car adds weight and therefore affects performance, so it’s a real balancing act and requires careful consideration.
There are around 150 data streams coming off each of our current Formula 1 cars when racing. All of that data comes back to mission control in Woking, UK, where we look to make strategy decisions to boost performance during that race.
We run around 3,000 simulations of race outcomes every second, so our strategists can make better, smarter decisions during the race operations, but also symbiotically in our design office. It’s as much about people and leadership, as it is about technology and data.