Is it possible for a manufacturer to find secure footing in a world that seems to be shifting daily?

It’s a struggle, and there’s no certainty about the outcome. But advanced conceptual and technical tools are becoming available to help industry succeed in a footloose and fast-changing environment.

Since the start of 2020 and global outbreak of COVID-19, supply chains, delivery systems, production lines and retail outlets have all undergone tremendous disruption. Consumer needs, tastes and buying habits have also experienced rapid shifts. Climate change, extreme weather events, cyberattacks, ballooning debt, sociopolitical polarization and the realignment of alliances, as well as sanctions and financial freezes resulting from Russia’s attack on Ukraine, are all contributing to a volatile world characterized by massive uncertainty. And, at least to most analysts, that isn’t going to change anytime soon.  

The Old Normal

Manufacturing, however, is predicated on long-term investments in product development, capital equipment, employee recruitment, staff training, building out distribution systems and cultivating customers. None of that is easy in the best of times. But when massive disruptions to a company’s supply chain can happen overnight, the situation becomes profoundly unsettling.  

For decades, the world’s commerce and manufacturing were predicated on a smooth-flowing global trade and transport system. It allowed manufacturers to source materials from suppliers anywhere in the world — wherever it was most favorable — even in the face of local turmoil. And, despite occasional mishaps, its functioning was largely predictable. Today, though, that seeming stability, built around the belief that bloodshed and destruction in the industrial world were artifacts of an earlier era, is no longer operative.

At the same time, being able to navigate the turbulence of changing commerce requires timely information — collecting it, analyzing it, and acting on it. That’s not new; information has always been key to successful trade. But today, with changes taking place more abruptly and potentially affecting more tiers of suppliers and modes of transport than ever before, having access to the right information in real time is essential. That’s the idea at the heart of the smart manufacturing philosophy, sometimes known as Industry 4.0. 

The Digital Revolution

A central tenet of Industry 4.0 focuses on the importance of having visibility into every aspect of the company’s business, starting with Tier 2 and 3 suppliers, and continuing on through its own production, distribution, and ultimate product consumption. The importance of visibility relates to the measurement and quantification of those processes, and particularly to the mathematics used in their analysis. You can’t measure what you can’t see, and you can’t manage what you can’t measure.  

The generation of industrial tools now coming onto the factory floor are less mechanical than digital. That means that any measured data relating to production is processed through software employing artificial intelligence, machine learning, advanced analytics and automation. It’s also a pattern of analysis performed continuously and in real time, meaning that decisions regarding process changes, ranging anywhere from small tweaks to major transformations, can be determined far more quickly than before. That, in turn, allows for faster and more decisive responses, enabling manufacturers to mitigate adverse events before their competitors can.

Getting to 4.0

For an established manufacturer, getting to Industry 4.0 isn’t something that can take place overnight. It’s a disruptive transformation which involves multiple steps and corresponding changes in workflow, training and job assignments. The first step (capturing data) is the most fundamental, and even without the subsequent steps (visualization, material-centric insight, transformational intelligence and autonomous production) collected data can begin offering the company options that provide competitive advantages, particularly optimum supply chain management.

Perhaps the best news is that an Industry 4.0 organization is much better positioned to avoid disruptions, with supply chains that are more resilient, agile and visible. Advanced technologies can bring real-time, end-to-end supply chain traceability. That can make it easier to respond quickly to unforeseen supply chain disruptions, market changes and other future challenges. Beyond that, once implemented, Industry 4.0 technology and processes can dramatically reduce product recalls, identify weaknesses in the plant itself, and eliminate related safety concerns.

Regardless of whether or not your facility is organized around Smart Industry principles, unexpected things will continue to happen. But it’s the manufacturer that has achieved Industry 4.0 — the ability to measure, analyze and act quickly when changes do occur — who will be at an advantage in seeing new options and making appropriate responses.

Rob Schoenthaler is senior vice president in the Vision Business Unit of ThinkIQ.