Disruptive Innovation- In Operations Scenario

Introduction
Today Digital technologies are challenging the traditional manufacturing industries they are
changing the way how things are designed, made and serviced across various industries. They
have the potential to create value by integrating individuals and machines across the value
chain making it possible to generate, securely organize, and draw insights from vast new
oceans of data. These technologies challenge the status quo and have huge potential for a
disruptive change, similar to that of rise of Ecommerce Industry. Internet has contributed
nearly $1.7 trillion to global GDP in 2010 when two billion people connected online. Any
guesses what would be scenario when 50 billion smart machinesdeployed across factory
floors, through supply chains, and in consumers handscan connect with one another? Isnt
that exciting, and yes today we are moving towards the 4 th Industrial Revolution i.e.
Industry 4.0
During 1990s the integration of information technology and automation has helped the
manufacturing industry immensely in being organized and profitable. Over the years one of
the main reasons for low cost production can be attributed to automation. However, there was
a delay in decision making whenever there was a disconnect between the data which is
present with the decision maker and happenings on the production floor. This is where
INDUSTRY 4.0 - the 4th Industrial Revolution - comes into the picture. Industry 4.0 is all
about leveraging the technology to its fullest level. Before we delve into what Industry 4.0 is,
let us understand what are the four phases of industrialization that the companies have
undergone?
Four phases of Industrialization

Industry 1.0 which dates back to late 1700s was mainly characterized by development of
water and steam power. Industry 2.0 was revolutionized by electricity. Mass production was
possible due to assembly lines. The third revolution, Industry 3.0 occurred when information
technology made its way in the manufacturing in the latter half of 20th century. Today the

consumers demand for more customized products as result it becomes a challenge for the
manufacturer to bring in produce goods with more efficiency at lower cost.
The Industry 4.0 the 4th Industrial Revolution is a move towards digitization and can be
explained in three parts.
1) Internets of Things and cyber-physical systems such as sensors have the ability to
collect data that can be leveraged by manufacturers and producers.
2) Advancements in big data and powerful analytics help the organizations to trawl
through the huge sets of data and produce insights that can be acted upon quickly.
3) Communications Infrastructure backing this up is secure enough to be used by heavy
Information and communication technology will be taken on board by small factories for an
evolution in supply chain and production. This would bring higher level of digitization and
automation in the process
How does the Industry 4.0 differ from the IoT?
IoT mainly focuses on convenience of individual consumers, where as the Industrial 4.0 is
strongly focused on improving the efficiency, safety, and productivity of operations balancing
return on investment.
There are 9 pillars on which Industry 4.0 rests

Autonomous Robots

Robots are autonomous, flexible and cooperative devices that the organizations are
leveraging to tackle complex assignments. These robots are programmed in a way that they
interact with one another and work safely side by side with humans and learn from them.
They cost less and offer a wide range of capabilities that are needed in manufacturing today.
A classic example of this would be Kuka, a European manufacturer of robotic equipment.
Kuka offers autonomous robots that are interconnected so that they can work together and
automatically adjust their actions to fit the next unfinished product in line. These devices
collaborate with humans with the help of high-end sensors and control units.
Simulation
Today we can clearly see the evolution of 3-D simulations from products, materials, and
production processes to future simulations which can be extensively used in plant operations.
By leveraging real-time data, these simulations mirror the physical world in a virtual model
including machines, products, and humans, thereby allowing the operators to test and
optimize the machine settings for the next product in line in the virtual world before the
physical changeover, which eventually helps in driving down the machine setup times and
increasing quality. For example, a virtual machine was developed by Siemens and a German
a machine-tool company, this virtual machine can simulate the machining of parts using data
from the physical machine. This tool has helped the company in reducing the setup time for
the actual machining process by as much as 80 percent.
Horizontal and Vertical System Integration
Most of todays IT systems are not fully integrated. Companies, suppliers, and customers are
rarely closely linked. Nor are departments such as engineering, production, and service.
Functions from the enterprise to the shop floor level are not fully integrated. Even
engineering itselffrom products to plants to automationlacks complete integration. But
with Industry 4.0, companies, departments, functions, and capabilities will become much
more cohesive, as cross-company, universal data-integration networks evolve and enable
truly automated value chains. For instance, Dassault Systmes and BoostAeroSpace launched
a collaboration platform for the European aerospace and defense industry. The platform,
AirDesign, serves as a common workspace for design and manufacturing collaboration and is
available as a service on a private cloud. It manages the complex task of exchanging product
and production data among multiple partners.
The Industrial Internet of Things
Using IoT technology, organizations are developing smarter infrastructures and building connected
networks across entire manufacturing processes. Internet of things has given voice to lifeless objects
through which they can communicate with each other. IP enabled miniature sensors have made this
inter object communication possible.
Real-time visibility: IOT will provide managers with real-time monitoring that lets them know which
parts
of
their
operation
is
underperforming.
This makes the process much more efficient and error free.
Automation: The objects can signal to warehouse robots to move it to production line without any
human intervention.IOT allows equipments to schedule their maintenance; allows ready goods to

schedule their shipment. This makes the process very smooth and safer without any human
intervention
Data: When objects communicate with each other, lots of data gets generated which needs to be
captured and analyzed for further improvements. This data is the input for the big data analytics.

Cyber security
Today organizations need to protect critical industrial systems and manufacturing lines from
cyber security threats because of increased connectivity and use of standard communications
protocols that come with Industry 4.0. As a result, secure, reliable communications along
with sophisticated identity and access management of machines and users are critical. Over
the years we can clearly see several industrial-equipment vendors acquiring or establishing
partnerships with cyber security companies
Cloud
Companies are already leveraging analytical applications and cloud-based softwares, but
with the advent of Industry 4.0, more production-related undertakings will require increased
data sharing across sites and company boundaries. At the same time, potential improvement
in the performance of cloud technologies will help in achieving reaction times of just several
milliseconds. As a result, machine data and functionality will increasingly be deployed to the
cloud, thereby enabling more data-driven services for production systems
Additive Manufacturing: 3-D printing allows direct printing of objects directly from raw
materials. The object can be of any shape or size. The method which uses addition of multiple layers
of raw materials of desired shaped is known as additive manufacturing. It has applications in almost
every industrial segment, from electronics to medical devices and from clothing to automotive
manufacturing.
This has multiple benefits:

Saves the time needed for sourcing the mold and manufacturing the required part
Cost effective
Customization of products as per customer requirements
It has applications in almost every industrial segment, from electronics to medical devices and
from clothing to automotive manufacturing.

Augmented Reality: It combines the physical world with the digital world. The reality is
combined with the computer data and perception of reality is expended by means of digital
transformation with help of mobile devices such as smartphones and google glasses.
Logistics company Knapp AG developed a picking technology using augmented reality.
Pickers wear a headset that presents vital information on a see-through display, helping them
locate items more quickly and precisely. And with both hands free, they can build stronger
and more efficient pallets, with fragile items safeguarded. An integrated camera captures
serial and lot ID numbers for real-time stock tracking. Error rates are down by 40 percent,
among many other benefits.

Vision Picking: Order picking is the process of collecting items in a specified quantity from
inventory to fill a customer order. The order picker must locate the correct product, scan the
product, and deliver the product to the loading dock. Most traditional order picking processes
involve paper-pen picking or picking through voice-automated systems. However, this
continues to result in inefficiencies. When coupled with augmented reality, orders can be
fulfilled with the help of smart glasses like google glass. Vision picking offers digital
navigation to find the right route and item more efficiently, while reducing training time. All
the information related to location of item is displayed within the visual field. The employee
can move faster, more efficiently and with greater accuracy.
Big Data and Analytics
Big Data and Analytics helps the organizations in saving energy, optimizing production
quality and improving equipment service. In an Industry 4.0 context, the collection and
comprehensive evaluation of data from many different sourcesproduction equipment and
systems as well as enterprise- and customer-management systemswill become standard to
support real-time decision making. For instance, semiconductor manufacturer Infineon
Technologies has decreased product failures by correlating single-chip data captured in the
testing phase at the end of the production process with process data collected in the wafer
status phase earlier in the process. In this way, Infineon can identify patterns that help
discharge faulty chips early in the production process and improve production quality.
Impact of Industry 4.0 on Producers
Industry 4.0 will affect the entire value chain from design to after-sales service

Along the value chain, the integrated IT systems will optimize the production
processes. As a result of this, today we can see integrated production lines replacing
insular manufacturing cells

Physical prototypes will be reduced to an absolute minimum. Through the

Manufacturing processes will increase in flexibility and allow for the economic
production of small lot sizes. Robots, smart machines, and smart products that
communicate with one another and make certain autonomous decisions will provide
this flexibility.

Manufacturing processes will eventually reach to a stage through learning and selfoptimizing pieces of equipment that will, for example, adjust their own parameters by
sensing certain properties of the unfinished product.

Conclusion

We can clearly see that the industries and countries will embrace Industry 4.0 in different
ways at different rates. Industries with a high level of product variants like automotive and
food-and-beverage industries are going to benefit generating productivity gains and on the
other hand the industries that demand high quality, such as semiconductors and
pharmaceuticals, will benefit from data-analytics-driven improvements that reduce error
rates. Industry 4.0 will bring a radical change in the manufacturing industry based on how
producers and suppliers leverage these nine pillars of technological advancements.
References
http://www.mckinsey.com/business-functions/operations/our-insights/manufacturings-nextact
http://www.mckinsey.com/business-functions/operations/our-insights/digitizing-the-valuechain
http://www.in.techradar.com/news/world-of-tech/future-tech/5-things-you-should-knowabout-Industry-4-0/articleshow/46849578.cms?page=6
https://www.bcgperspectives.com/content/articles/engineered_products_project_business_ind
ustry_40_future_productivity_growth_manufacturing_industries/?chapter=4