By most accounts, many factory digital transformation efforts have yet to achieve their anticipated benefits. Of the companies promoting the benefits of Industry 4.0, few have the experience as Schneider Electric.

Their Smart Factory programme started in-house by putting theory into practice and delivered tangible productivity benefits. As a result, their Batam “lighthouse factory” in Indonesia reported a 44% reduction in machine downtime over the last year. So, how did they get to that point and how did they start.

In a recent blog, the factory digital transformation officers responsible for spearheading the evolution at Batam shared some of their key discoveries. Lighthouse factories serve as examples of environments that lead the way to a more resilient and inclusive future. They show where technological innovation can benefit private enterprise, the natural environment, and society at large.

Factory digital transformation

The Batam factory deployed a wide range of Industrial Internet of Things (IIoT) technologies including smart sensors, alarm prediction management, site bench marking and augmented reality to empower its workforce. Workers have a new advanced visibility into operations, maintenance, and energy use. As a result, their maintenance costs have fallen while overall equipment efficiency (OEE) has increased. They also reported a 44 percent reduction in machine downtime over the last year. First came the roadmap.

Step 1 – Recognise that transformation starts with people

They began their transformation by identifying their low value-added manual and administrative activities. The goals were to improve work quality by allowing people to execute their work in simpler ways and enable faster and more accurate decision-making.

Digital transformation was not only about technology adoption but the role of people and culture change. Upskilling people and rescaling processes need worker involvement from the start. To foster this, they talked with operators, maintenance technicians and engineers one-on-one. Not only for their inputs on improving workflows, but also to help them see how it can help make their life easier.” Creation of an upskilling program embracing a “this journey is your journey” philosophy, was key to buy-in remaining positive.

 Step 2 – Develop a broad external ecosystem with shared interests

They began their digital transformation journey with an implementation team of only four people. Realising that to make transformation a reality they needed to widen their circle of influence. To develop a broader ecosystem, they identified three outside sources: nearby universities, government, and business associations.

Working with local universities, they recruited twelve students to take part in a digital internship programme. By bringing a digital mindset to others within the organisation, the students were eager to work with augmented and virtual reality tools. This helped to speed up acceptance of digitisation by presenting out-of-the-box ideas of how to apply such technologies to the internal processes.

Their efforts to use digitisation to reduce waste and energy consumption also dovetailed with the Government’s low carbon initiative.

 Step 3 – Apply technology to improve vertical and horizontal integration

Many organisations assume that digital transformation occurs in a vacuum, only benefiting those within a particular building or business organisation. The true benefits come when linking and connecting vertically within the organisation. For example, from machine sensor to the SCADA system, to the ERP. Also, horizontally beyond the organisation to external partners such as upstream suppliers and downstream distribution partners.

To foster horizontal integration, they worked with key component suppliers to establish a list of shared product quality parameters for products that were coming into the factory. This enabled them to avoid duplication of effort in quality control by only having to inspect for quality once instead of twice. They also linked selected systems for the remote tracking of production machines that supplied them with parts. Seeing up-to-the-minute what the supplier had in stock and how that matched up with their need reduced choke points.

In times of economic uncertainty, factory digital transformation is one of the tools to ensure continued prosperity. The COVID 19 pandemic may encourage companies to speed up their plans, and Schneider Electric is ready to share their experiences to support them.