Nick Davis, Deloitte, explains the ‘7 sins’ of the smart factory

On day one of Smart Factory Expo, Deloitte highlighted the common pitfalls encountered on a smart factory journey and how to avoid them through the ‘7 Sins of Smart Factory’, based on the company’s experience of smart factory transformation.

On day two, Deloitte took a deep-dive into the ‘7 sins’, with a specific focus on cyber security and the complexity of data and asset connection. What an effective organisational change in a smart factory journey looks like was also explored.

Nick Davis, Partner and Industry 4.0 Leader at Deloitte, sat down with The Manufacturer to explain more.

What do you think of this year’s Smart Factory Expo?

It’s just phenomenal. Having been the headline sponsor for this incredible event for a few years now, I think there’s an even greater buzz this year. And having the Manufacturing Leaders’ Summit alongside the expo has helped amplify the diversity, seen in all the different types of manufacturers and solutions providers we’ve come across.

The Deloitte stand is acting as something of a launchpad for several smart factories that we have globally, in Kyoto, Dusseldorf and the US. We have an immersive virtual experience where people can see for themselves what some of those environments are like. It’s a collaborative space that we use to help educate executives and others on what a smart factory is, as well as some real world, practical applications to showcase what it could mean for organisations.

How can Deloitte help manufacturers who are embarking on their digital transformation journeys?

The beauty of smart factory for industry is the sheer diversity of what’s involved. At Deloitte, as an independent organisation, we’re not focused on a particular technology, solution or strategy. We help organisations to navigate their smart factory journey from all different facets; it could be looking at HR transformation and the people and cultural aspects of these journeys. Then there’s the technology itself and how to choose the right solutions, as well as how to implement them.

Finally, there’s a broader range of areas to consider – aspects like cyber security, for example, and some really niche benefit areas such as different types of tax regimes or funding routes that are available. My role as the Industry 4.0 Leader for Deloitte is essentially to curate and make sure that the full breadth of our capabilities is available to our clients.

Can you explain the seven sins of the smart factory?

With the seven sins of the smart factory, we wanted to create something that was memorable, and that people could consider while they’re walking around Smart Factory Expo.

Allow me to elaborate on a few of them. Lust; manufacturers often lust after that new piece of technology, simply for the sake of it, which is a sin. We often see organisations making this mistake instead of considering what should really be driving their smart factory journey, as well as the value to be realised and the business challenges that need to be addressed.

Another is wrath. Not incurring the wrath of your people along the way and having consideration around actually solving the challenges that people face on the shop floor. Often, it’s these individuals who have the best view of the pain points they experience every day and, with some awareness around what technologies are out there, they can really help. They can piece those elements together and help facilitate the kind of discussions that can avoid the sin of wrath.

With the seven deadly sins in mind, what best practices should manufacturers be following?

Something that is extremely important in constructing the right teams for a smart factory journey is to recognise all the different stakeholders involved; who’s really going to use it? For example, is it going to benefit your quality, operations, R&D, etc. Then it’s important to bring that all together with IT, OT and external support organisations.

In terms of business case, define the North Star that excites those who are financially minded in the organisation and then consider how that translates into what it’s going to mean for the people on the shop floor.

While productivity boosts are good news for the organisation, the thing that’s probably more exciting for an operator is whether it’s going to make their life easier; how they are going to be able to do a better job using these new tools. Surrounding all of this is effective communication throughout, which is key to ensure everyone buys in to the journey.

How is the digital transformation journey progressing?

Something that has struck me, particularly in the Manufacturing Leaders’ Summit and the roundtables, is how much commonality there is among different businesses. Many organisations are further in the journey than a few years ago and if we look at the technological elements, the maturity of pre-packaged solutions to solve particular challenges in this space has moved on enormously.

One challenge is how to replicate the successes people are seeing in a business unit and scale them up, potentially globally, across a network of factories. We’ve reached a tipping point and it’s something that a lot of manufacturers are now struggling with.

How are recent challenges impacting digital transformation?

Undoubtedly, funding and priorities are big challenges. At the same time, for those involved in this field, there is an opportunity. The impacts for manufacturers involve exactly the same elements that those who want to drive digital transformation need to be thinking about and articulating when it comes to value.

So, even with something like inflation, and what that’s doing in terms of increasing the cost of labour and materials, the resilience challenges we’ve experienced (which has seen organisations hold inventory for longer), can be solved with the help of digital technologies. There’s an element of keeping an eye on what those business challenges are. We as practitioners in digital manufacturing and smart factory need to be attuned to those and help our business stakeholders actively address them.