Smart manufacturing: the benefits of digitalising the shop floor
4 min

Smart manufacturing: how digitalising production pays off

Digitalisation is the key to smart manufacturing. But while it has long since been established in many areas of companies, the production environment is often a blank spot on the roadmap. However, the concept of smart manufacturing thrives on the continuous networking of people and machines, products and processes. Digitalising the shop floor and intelligently linking production with operational information systems should therefore be high on the management agenda.

Smart manufacturing can be defined as a specific corporate goal. It stands for data-driven business processes, significant efficiency improvement measures and responsible handling of finite and valuable resources such as energy, staff and capital. In addition, smart manufacturing forms the basis of new offerings, financing models and business models for the era of IoT, and can help overcome current challenges such as the shortage of skilled workers, rising energy costs and an increasingly complex supply chain. In other words, smart manufacturing ensures competitiveness and future viability in a dynamic economic and social environment, not only, but above all, in a high-income country like Switzerland.

But just digitalising a machine doesn’t mean you’ve got smart manufacturing. This may be a good start, but it does not replace a holistic strategy. Only when all information systems and data suppliers are integrated into an overall system that selective digital processes can be transformed into holistic smart manufacturing. It is only at this stage of ‘Industry 4.0’ that production processes, flows of goods and customer relationships can truly be automated, paperless or perfected from end to end using data from a wide variety of sources.

From the shop floor to the top floor

Smart manufacturing affects all areas of the company, from manufacturing and logistics to commercial tasks and, of course, IT. But it is precisely this that is struggling with the digitalisation of production processes. The shop floor, the manufacturing level, is generally less digitalised than the management process level, even though it is at the heart of the operational processes for manufacturing companies.

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The use of CRM systems for a ‘smart customer experience’ is now a matter of course, as is the use of ERP systems for planning and controlling business processes in the supply chain and in finance and accounting. But for most people, ‘smart’ production is still a dream. Most companies are still a long way from having a self-organised production environment.

The role of IT in digitalising production

When it comes to established processes that can be easily scaled, IT is responsible. Of course, the introduction of company software is also a powerful feat, but at the same time, in some respects, it’s less complex than digitalisation projects on the shop floor. This is because the processes there are less standardised and therefore not easily manageable for the common IT platforms. The resulting decoupling of OT and IT forms a dam that inhibits the data flow essential for smart manufacturing.

However, this also means that digitalising machines, conveying equipment and processes is a first step, but only the foundation. On the other hand, the seamless integration from the shop floor to the top floor – and vice versa – is the freestyle. It brings transparency within and outside the company – a completely digital chain from raw material suppliers to the shop floor and logistics to the customer or their customers is possible. This integration then creates the general conditions for employees and machines to work more efficiently.

Vertical and horizontal integration requires perseverance and experts who do not approach automation projects in isolation, but bring them into the corporate context. When hierarchies and architectures change fundamentally – in the digital world, ERP and production software, tracking systems and sensors all provide data for the entire system – there is no room for a silo mentality and isolated solutions. It must be possible to make all relevant data centrally available and usable.

If this succeeds, a whole host of new opportunities will open up. For example, the prompt exchange of machine and other data between the shop floor and the top floor enables optimised production and fault management. The deployment of materials and machines can be planned more easily and downtimes shortened. Paper forms and Excel spreadsheets are eliminated and human errors are reduced.

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Digitalising the shop floor: a question of technology?

Technically, this is possible, for example, by extending the ERP system, introducing an MES (manufacturing execution system) or using new, intuitive tools such as low-code. The right path depends not only on the existing system environment, but also on the individual requirements, products or targets and the machinery that is decisive for the scalability of a solution.

The choice of technology and software has to fit with the company’s goals, not vice versa. This is why shop-floor digitalisation and integration is not an IT project, but a management task, just like choosing an independent implementation partner who can provide objective advice on software, systems and platforms. However, not everything that is technically possible always makes sense. But what makes sense should be made technically possible in order to actually exploit the potential of shop-floor digitalisation and smart manufacturing.

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