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Industry 4.0: “Get Down to the Practicalities”

Published on 29 April in SAP
Don’t waste another moment! Get going with Industry 4.0! That’s the message from logistics expert Professor Steffen Hütter from Saarland University of Applied Sciences.

His advice to companies is to stop spending time on visions and to get down to implementing Industry 4.0 by starting with some small-scale projects.

SAP News: Professor Hütter, at this year’s CeBIT, you demonstrated how production systems and sensor technology can link up to create a digital factory that also enables automated inventory management. Is that what is meant by “Industry 4.0″?

Hütter: The mission of Industry 4.0 is to connect up machines, sensors, and people in the production process and beyond. Plenty of today’s machines are brimming with sensors, but they often still function autonomously and do not yet collaborate with each other. “Real” Industry 4.0 looks very different. For example, when a machine senses that a drill bit is wearing out, it automatically orders a new one, sends an SMS to the technical service department, and forwards the purchase requisition to the ERP system.

Many companies are worried that their machines are outdated and that their systems are not sufficiently connected. They are afraid of Industry 4.0. Why do you think that is?

Many companies are disconcerted because they assume that embracing Industry 4.0 means discarding everything they’ve built up over recent years ? just at a time when they’re breathing a sigh of relief at having emerged from the latest financial crisis unscathed. But Industry 4.0 does not herald a revolution on the scale we associate with the invention of electricity or the steam engine.

What makes you so sure of that?

Because development cycles are now so short that we can’t even say whether Industry 4.0 will ever actually reach maturity. The transformation to Industry 4.0 is not comparable with implementing a new technology like electricity or the steam engine.

How do you suggest companies overcome their reluctance to tackle this seemingly complex topic?

As CeBIT showed, the period of educating companies about Industry 4.0 is pretty much over. The topic has been discussed at length and everyone knows pretty much what it’s all about. Companies should start their transformation slowly and not try to make the switchover all in one go.

Today’s enterprises spend far too much time talking about strategies and visions. They need to embrace Industry 4.0 on a practical, operational level. What are we aiming for? What will it cost? How long will it take? Those are the basic questions companies should ask before they begin the job of connecting humans, machines, and IT systems.

And, whatever they do, they shouldn’t wait around for a “standard”. It may well emerge at some point and make lots of things easier. But it doesn’t exist yet, so the best approach is to make a start today and avoid losing any more time.

Even if companies “start small”, they will have vast amounts of new data to handle. Are they suitably equipped?

Networking, of whatever sort, always generates more data. If you have three people (or machines) collaborating with each other – instead of two – you’ll see disproportionately more data being created than you had before. That means greater complexity. In the past, we had to think carefully about which data to keep and which to discard, otherwise our hardware would simply have collapsed under the weight. That’s something we don’t have to worry about any more. A scenario that my research group, Qbing, conducted together with IT service provider Orbis on a SAP HANA test system confirms that. I’d go so far as to say that the expression “Data welcome!” fits quite neatly here.

Where do you see Industry 4.0 making a practical difference?

In the electronics industry, for example, a company could embed RFID tags in the machines and tools its uses for its plastics injection molding. Manufacturing personnel could then check the on-screen factory layout to see where the different tools are currently located. In another scenario, when 1,000 power strips reach the end of the production line, an alert could automatically be sent to the forklift driver with instructions to collect the completed products and deliver them to a specified location. Manufacturing and production are not the only areas in which Industry 4.0 has highly practical uses, mind you.

Take the energy sector. If consumers know how much energy their various appliances consume at different times of the day, they can choose to use their washing machine in the evening or at night – instead of during the day – to save money. Of course, many more elements need to be interconnected before scenarios like this become reality. Currently, you can’t even be sure that the digital meters in heating systems are necessarily Internet-enabled.

A host of completely new business models are possible too. Imagine a scenario in which a mechanic from the local car repair shop calls at my home to install a new battery (that my car ordered 48 hours earlier from the cheapest online dealer) three days before my current battery is due to give up the ghost!

You mentioned that Industry 4.0 might never reach maturity. What stage of its development is it at right now?

Well, it still has quite a long way to go. But to put its development in perspective, I’d say it was somewhere between kindergarten and elementary school.

Photo: Saarland University of Applied Sciences, Faculty of Economic Sciences

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