Ready for Industry 4.0? Evaluate people, processes, and then technology.
Academic research expresses readiness as the state of being psychologically and behaviorally prepared. By extension, smart manufacturing industry readiness is how businesses can leverage Industry 4.0 technologies and be psychologically and behaviorally prepared as an organization.
Although different organizations may be similar by having products in a vertical industry, each is unique with its own culture, size, management team, and other traits. Moreover, each organization will have a unique ability to adapt Industry 4.0 principles and practices. Specialized companies now provide a level of uniformity and guidance, but also customizable features, to aid organizations in what has become known as the “digital transformation” toward the adoption of Industry 4.0, with a goal of organizational transformation in efficiencies and effectiveness.
Industry 4.0 readiness models are mostly designed with two unique angles, one of finding practice applicability and the other of finding users for the respective readiness definitions. Recent studies of literature related to small to medium-sized enterprises (SMEs) found they have some weaknesses and gaps in the maturity models identified. The areas identified showed that the models are technology focused and, therefore, can overlook management or cultural dimensions. They also may not consider company size, vertical industry, or the complexity of the product being made.
Several other models have been published by both industrial and academic organizations to help guide companies starting the digital journey and transforming their businesses to adopt Industry 4.0 technologies and practices. One of the studies summarized a company’s readiness into three high-level silos: smart process planning, infrastructure, and organization and human resources.
Why digital transformation is important now
Between the pandemic, the supply chain shortage, the workforce shortage, and the related skills gap, it is becoming increasingly essential for organizations to begin a digital transformation to stay competitive on the world stage. The digital transformation, part of which is the implementation of Industry 4.0 practices, encompasses the entire enterprise, including the upstream and downstream connections in the value chain. Because the transformation is all encompassing, it requires commitment, organizational maturity, and a company with the physical, structural, and cultural resources to adopt digital technologies.
A company’s ability to implement new technologies takes a commitment from the entire enterprise. Without the support of the company’s management and ownership, consisting of financial and organizational commitment, the effort to implement any significant initiative is doomed to fail. The same is also true when implementing Industry 4.0, smart factory, and Industrial Internet of Things principles and practices. Recent studies have identified what management is looking for from the adoption of Industry 4.0. The top two motivations are expected increases in productivity and product quality; one of the top five goals is a return on investment.
Industry 4.0 readiness needs to be viewed from wall to wall within an organization. Because all the aspects of implementing a smart manufacturing program can be overwhelming, having an organized methodology and strategy to assist in planning is paramount to success.
Adherence to such a plan can help keep the program aligned with industry best practices and prevent a company from going down a path that is not desired or that will not yield a positive outcome.
Models, maps, and other trends
Maturity and readiness models for industrial transformation existed as early as 2006, but most were published within the last three to four years. Most of the readiness models listed in the literature are academia based, with only 30 percent being industry-driven models.
One of the more prominent industry models was created by the Singapore Economic Development Board in conjunction with many leading technology companies and industry experts worldwide. The Smart Industry Readiness Index (SIRI) comprises a suite of frameworks and assessment tools meant to provide the initial, scaling, and sustaining guidance companies need for digital transformation.
Figure 1 depicts the 16 elements considered within a SIRI assessment. Like what is described in the academic research, the SIRI index is similarly based on the three pillars of process, technology, and organization, while also considering an organization’s current capabilities from infrastructure, technology, culture, and management perspectives.
The assessment and adoption processes are iterative within the SIRI, as well as within many other academic and industrial-driven assessments and frameworks. Companies need to anticipate an ongoing and evolving process, much like any continuous improvement or Lean initiative. Like any Deming-related cycle of plan-do-check-act, the assessment frameworks consider learning, evaluation, planning, and implementation stages. The assessment methodology associated with the German National Academy of Science and Engineering (acatech) Industrie 4.0 Maturity Index demonstrates a cycle of development and testing along the path of readiness and maturity discovery (figure 2).
A recent augmentation of the readiness infrastructure is the introduction and inclusion of a three-dimensional map named the Reference Architecture Model for Industrie 4.0 (RAMI 4.0), which depicts an industry 4.0 implementation that incorporates all aspects of a company (figure 3). This map integrates the life cycle value stream described in the IEC 62890 standard with the hierarchical levels described in the IEC 62264 and IEC 61512 standards.
In the RAMI 4.0 model, the hierarchy level axis accounts for the information technology and control systems. The life cycle value stream accounts for the life cycle of the organization’s products and manufacturing facilities, and the layers show the makeup of a machine into its component structures.
How this topic supports a smart factory
The goal of the complete digital transformation and deployment of Industry 4.0 is an integrated smart factory. A smart factory exists when the organization has a sufficiently high level of integration to allow the production processes to be better organized and optimized to achieve a higher level of automatic sustainability. Connecting the production indicators with the results of a maturity index, such as what is accomplished with the acatech Industrie 4.0 Maturity Index, generates outcomes of assessment versus implementation, which can be cast with actual and definitive outcomes and figures.
Based on these fundamentals, it should be strongly noted that the digital transformation journey to Industry 4.0 readiness is not simply a technology application. Although many of the pillars of Industry 4.0 are technology-laden, a company’s maturity and readiness for implementation do not and cannot rest solely on the technology that will be applied.
As depicted in the three high-level silos mentioned previously, it is the culmination of the organizational planning, the technology infrastructure, and the human resources both within the organization and throughout the entire value chain that comprise readiness and maturity.
The technology aspect is used to expose and collect the information that is then also used for analysis, which provides a means for understanding that information. The final results from the collected and evaluated data are then left as an element of how the organization will use the information and analysis.
For a company considering an Industry 4.0 implementation that is willing to start digital transformation, it is paramount to assess readiness and maturity. With the large undertaking and commitment that such a journey will require, assessing a company’s infrastructure, culture, and commitment is a needed first step.
The following resources and links will help anyone looking to make the first steps down the Industry 4.0 and digital transformation pathway.
The SIRI Framework
Industry 4.0 Readiness Online Self-Check for Businesses
Using the Industrie 4.0 Maturity Index in Industry
The Smart Industry Readiness Index: Catalysing the transformation of manufacturing
“RAMI 4.0 Reference Architectural Model for Industrie 4.0”