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High-tech investments may ensure the growth of digital manufacturing — but may not be enough to ensure the success of manufacturers.

Managing the Inevitability of Digital Manufacturing

May 14, 2017
New technologies for automation, simulation, and collaboration arrive constantly, but there is a human dimension to understanding, optimizing, and applying these new capabilities. Relying on IT to power growth Automation via digital planning Developing skilled workers

There is a sense of inevitability about “digitalization” in manufacturing: new technologies arrive in waves, to automate production sequences or processes, to coordinate planning with production, and to link processes with databases, and all these strategies are focused within individual workplaces. Connectivity between locations or across enterprises represents another, equally inevitable dimension of manufacturing.

Manufacturers know, and apparently accept, this inevitability. Epicor Software Corp., one of the primary developers of enterprise systems for manufacturers, earlier this year released a study to demonstrate how manufacturers’ growth strategies are rooted in information technology. Especially in emerging manufacturing markets (e.g., China, 74%; India, 73%, and Mexico, 54%), businesses are relying on IT to power their growth.

Epicor calls this a "grow getter" approach by businesses that take advantage of macro-economic factors (low-cost skilled labor, strong GDP) so that their investments in new technology help them to expand into new markets and locations quickly. This reduces the burden of labor costs and allows the businesses to adapt their product lines to consumer demand.

“Business leaders around the world can learn from the experience of ‘grow getter’ businesses in emerging economies such as India and Mexico,” according to Kathy Crusco, Epicor COO and CFO. “These ‘grow getter’ companies have invested in technology to empower their workforces, drive efficiencies, increase agility, and increase their profit margins, as a result. They use technology to adapt quickly to change and demand, allowing them to drive expansion into new markets, and establish processes to adapt their product ranges to match consumer demand.”

So, high-tech investments are an apparent boost to geographic expansion, but many domestic manufacturers are challenged to increase their existing marketshare. Often, “growing” as a business means a manufacturer must identify and highlight product distinctions with its competitors’ products. In the age of digitalization, this demands research, process planning, and process optimization, all functions of simulation technologies like CENIT North America’s FastSuite Edition 2.

The FastSuite platform supports manufacturers by depicting a parallel “digital manufacturing” approach to their production process, from engineering to the virtual start of production. Users can create, program, and operate robots, machines, and production systems for specific technologies, accurately projecting high-performance simulations.

“Our ambition is to assist systems integrators and manufacturers with automation tasks, from planning to ongoing operation for all the production technologies,” explained Helmut Ziewers, v.p. - Digital Factory Solutions for CENIT.

All of the simulated technologies and functions interact and complement each other in a single user interface with a standardized data model. This ensures the program operator has an efficient workflow with full process control, without data redundancy or loss of information. FastSuite’s functions include process-driven technology and control, to provide offline programming even for sophisticated applications. The basic features allow users to start simulating manufacturing quickly, and reach conclusive results conveniently. CAD data is imported via standard interfaces (e.g., STEP or JT) or direct interfaces to NX, CATIA, SolidWorks, etc.

So, the simulation program is simple and flexible for any data format, and adaptable to specific technologies. The modularity of FastSuite Edition 2 allows the user to expand and customize functions as project requirements change.

FastSuite Edition 2 covers the entire range of process steps between classical product design and real production. Due to its functional modularity, small companies programming a single robot can adopt it successfully, and larger enterprises that want to support an entire digital factory. The scalability of FastSuite allows users to start small and expand simulation as project requirements grow.

While IT, automation, and simulation offer strategies for entering a market, digitalization continues to be a formidable challenge in manufacturing, and it’s a cultural shift for businesses seeking to remain competitive in their established sectors. In fact, even though the digitalization trend is forecast to spur more than 3 million new manufacturing jobs over the next 10 years, the current, aging workforce and the well-documented skills gap indicate that up to 2 million of these jobs may not be filled. In other words, digitalization may succeed but manufacturers may fail as a result.

Alisa Coffey, a Siemens Industry Inc. marketing communications manager attended a recent automotive manufacturing forum, and among the discussions there she identified three barriers to developing skilled manufacturing workers: employee pay, historic industry instability and workplace environment. “We're not paying them enough to get them excited,” according to one industry contractor. “Kids could go to college for three to four years and spend upward of $80,000. And then we're going to offer them a job in the industry that's well under $40,000 a year to start? They're not interested.”

An automation technology expert added that the skills gap and pay issue emerged during the Great Recession (2008-09), and the automotive industry downturn that followed. “There are a lot of kids who are old enough to remember their dads being laid off or deciding to get out of the industry. They were not encouraged to get in.” Another participant noted workers left manufacturing regions during the Recession to find opportunities elsewhere, including the Silicon Valley.

Coffey detailed that millennials view the Silicon Valley workforce model as the model for the future, with distinctive amenities as well as financial compensation. They want to have a social impact, and they expect unique perks and flexibility in their work schedule. Competitive salaries are not enough to draw top talent to manufacturing.

“There is no pay ceiling in the automotive business,” said an industry supplier. “I interview five to six people a week. We have to start thinking like the software companies; that's whom we're competing against. We're not competing against other automotive suppliers. The investment in the workplace is really lacking.”

Education for manufacturing skills is essential, too, Coffey noted. To prepare the future workforce, academia, business, and business organizations like SME are collaborating to create programs and find other solutions to address the skills gap. Academic internships that evolve into summer employment, or more, are a viable model.

Finally, while attracting new talent is a high priority for manufacturers approaching digitalization, they also must realize that their best assets are the skilled and experienced people they currently employ. They need to maximize the value of that knowledge base, and as such a number of manufacturers are increasing their investment in lifelong learning development and looking for new ways to ensure knowledge transfer.

Coffey reported the case of Ben Kisley, a recent college graduate who is enrolled in the Siemens Engineering Leadership Development Program. “Every six months I move to a different location around the nation,” Kisley said. “I get experience from different parts of the organization and learn from different people. I think that is a good idea for enticing new grads.”

Siemens also offers a Workforce Performance Improvement program (WPI) — a six-stage program offering a look into employees’ job skills. The program begins by aligning a worker’s current competency to business targets and approaches the learning process from the customers’ perspective. It incorporates various online and face-to-face learning methods, individually tailored to improve job performance and meet specific performance needs.

One automobile transmission manufacturing plant provided an example of the WPI initiative. Engineers watched a “how-to” video showing how to manage a potential factory outage. They made the adjustment that kept the line running and prevented any downtime. “A manager told us that the video subscription more than paid for itself at that moment,” according to Siemens’ Rick McNamara.

Using digital tools to gather information and pass it to new workers can reduce training time, improve collaboration and communication, and help companies get new products to market faster. John Billings, Siemens Industry U.S. automotive segment vice president, added that that sharing innovation with other companies is another important method for closing the skills gap.

“It takes a community that is collaborating to drive innovation,” Billings says. “Innovation is critical if we want to continue to manufacture in the U.S. private-sector funding of manufacturing R&D accounts for almost 70% of the total R&D spent. If we lose manufacturing, we will lose innovation. This is how we continue to drive for strong American manufacturing.”