DISTRIBUTION FEATURE
INDUSTRY 4.0: IS IT WORTH THE COST?
The technological basis for Industry 4.0 has long been available. Promise of efficiency increases, even with smaller quantities and custom production of single products, are linked to costs and security risks. But for most companies, there is no alternative. Andreas Mangler, Director Strategic Marketing and Communications at Rutronik explores how to get the most out of this infrastructure
T
he drive to increase efficiency is ever present. What's new in this area is the trend towards individualisation. Take for example an application where a well known drugstore chain has taken a connected approach, whereby, through an app or software, customers can create their own customised photo album, poster, canvas picture, cellphone case or shower gel with their own photos. The data is uploaded via the Internet and a few days later, the finished product arrives on the customer's doorstep. "That's Industry 4.0 down to a T", said Andreas Mangler, Director Strategic Marketing and Communications at Rutronik Many other businesses have also perfectly adapted to the trend towards individualisation –but the scalability of their processes has suffered as a result. Industry 4.0 promises to solve this dilemma by producing customer- specific solutions under mass production conditions, but many businesses still hesitate to establish the smart factory as a core
Figure 1:
Industry 4.0 is a strategy of long-term investment delivering streamlined efficiency and cost and time saving benefits
element of Industry 4.0. There are two main reasons for this: firstly, the costs, and secondly, the fear of exposing intellectual property (IP), thereby making it vulnerable to loss.
A DIFFERENT COST PERSPECTIVE Implementing Industry 4.0 requires investment – there's no doubt about that. But in return, it generates long-term savings through increased efficiency. Such savings are generated at other levels though, which is why they are frequently overseen. The current profit centre-based approach
to company management only considers specific unit or personnel costs in quarterly time blocks, meaning that a perspective of the overall costs, in which all processes are included, is missing. In an example – a developer designs a mature, forward-looking technology, but it is not approved by the purchasing division due to excessive unit costs. However, the cheaper components are manually taken, recorded and moved several
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times during the route from the receipt of the goods to production. The process costs incurred here consume the previously generated savings back or even exceed them – even though the purchasing division is unaware of this. This means that expensive manual processes remain in place, as they ostensibly cause lower costs than automation of the process. "This approach prevents both cost savings and innovation", summarises Mangler. Examining the situation from a total cost of ownership perspective on the other hand accounts for the actual total costs incurred throughout the entire process chain, from development to purchasing and logistics. This enables each business to determine for themselves whether it would be worth implementing Industry 4.0, in which divisions and to which extent. "Not every business can become a full smart factory. The trick is to find the right balance between the technology and investment on the one hand, and the purchasing division with the purchase price and the costs of the automated processes within the logistics chain on the other. “So businesses will not always incur an enormous outlay in one fell swoop. Taking the first step by establishing an EDI connection with the distributor or supplier is usually sufficient – a very well-established technology", explained Mangler. "This does mean though that Industry 4.0 needs to prove cost of ownership for the relevant sub-processes in order to demonstrate their benefit." Aside from the investments in necessary systems, there are also other costs required for necessary safety measures. The fear of loss of data, IP and control is which makes data security an extremely important – if not the most important – aspect. "Big data" – the collection, analysis, storage, processing and management of huge amounts of data – is an enormous challenge. "The winner will be whoever can successfully and securely collect data and ensure its security to the greatest extent possible", said Mangler. Technologies for this are already available
at different levels, for hardware, software developed "close to the metal", firmware, and all other software systems based on high-level languages. "These aspects must be accommodated when selecting components, because Industry 4.0 is dependent on robust systems through hardware in particular", explained Mangler. Rutronik started to lay the foundations years ago to enable it to offer its customers everything now that they need for Industry 4.0. These are mainly those components that are now bundled under Rutronik Embedded, as well as appropriate supply chain solutions, for a fully connected industrial infrastructure.
Rutronik
www.rutronik.co.uk 01204 602210
Enter 200 ELECTRONICS | DECEMBER/JANUARY 2015 9
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