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June 24, 2016
Digital Industry 4.0 - Part III
By: Aidan Quilligan

In parts I and II of this series we looked at the characteristics of Digital Industry 4.0, and how they applied in the context of the Digital Plant. Here, in our penultimate article, we explain how the automotive industry is getting the most from existing operations.

The connected vehicle market is an area in which the digital revolution is taking hold. The development of personal communication and the growth of the Industrial Internet of Things have accelerated the rate at which in-car technology has been implemented. And with those exciting developments a number of challenges and therefore priorities arise.

Whilst coping with surging demand, senior manufacturing executives are addressing six key areas of their existing operations. The first of those is automation, on which automotive companies have typically relied to improve output and efficiency. In a survey of global senior manufacturing executives by Accenture, more than half of respondents indicated their intention to make capital investment into manufacturing technology while almost three-quarters will invest to strengthen IT applications. The data generated from automation will help companies to maximise operational efficiency for example by pinpointing line slowdowns, downtime and quality issues.

Second on the list of priorities is improving network-wide flexibility. Responding to shifts in demand, 72 percent are prioritising improvements to their operating models, while a similar number suggest that the ability to dynamically move production across facilities or change the product mix at an existing facility is critical to the achievement of their goals. To enable that flexibility, manufacturers are embedding standardisation across all dimensions of the operating model.

Third, operational excellence is imperative as companies seek to squeeze the most from what they have. Around three in four plan to extend the life and the contributions of existing assets, rather than investing in new machinery, in a bid to improve profitability. Fourthly, visibility is also an area of focus, and automakers are planning initiatives to improve visibility: for example, optimisation of spare parts systems across the manufacturing network.

Fifth, automakers are looking to increase the use of contracted manufacturing as a means of adding flexibility and capacity without adding new facilities. Sixty-seven percent suggested they were building use of the service to overcome short-term capacity demands. Lastly, flux in the automotive sector requires new skills and an overwhelming 85 percent of automakers are increasing their manufacturing workforce and training workers with new skill sets. These new staff will in part be required to oversee cultural changes related to the growth of digital industry.

Changes in demand, skills requirements and the very nature of the digital enterprise are forcing automakers to address fresh challenges. As the Digital Revolution gathers momentum, these responses from senior manufacturing executives give a sense of how the industry will react. By using new digital tools to focus on six core areas of the business, they are hoping to stay ahead of the curve.

Find out more about Digital Industry 4.0.

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