SIAA Columnist Part 8: Setting Up an Industry 4.0 Practice

There are several myths about Industry 4.0 that can make the most forward-looking manufacturer think twice about adopting its methods and technologies. Unfortunately, you might have encountered them amongst all the hype and enthusiasm that’s floating in the media and trade press. Putting these myths to rest is an integral part of understanding the benefits and requirements of adoption. Despite what you might have heard, successful Industry 4.0 projects can be:

Completed gradually in stages — There’s no need for a Big Bang deployment. Manufacturers often assume that they must replace entire, existing systems. On the contrary, legacy systems can upgrade to provide Smart Manufacturing capabilities. Therefore, a complete system overhaul is not necessary.

Developed quickly as a series of agile projects — Adding Industry 4.0 capabilities can get tricky, but it doesn’t have to be a lengthy process. The idea is to chop the entire modernisation process into manageable pieces. Then it’s a matter of developing, testing, retesting, and launching the improved process quickly. This agile approach to modernisation is sometimes known as “fail quickly process development”. If the development step fails, you don’t risk much in time and treasure to try again.

Implemented in phases to control costs — An incremental approach is not only practical. In many cases, it’s advisable. No rule requires that everything on a production line change at once. Project engineers control which infrastructure, equipment, and processes change in Industry 4.0 modernisation. Improvement projects can be any size that technical specialists think are appropriate.

Engaged successfully at companies of all sizes — At this very early stage of digital manufacturing development, there are relatively few reports of Industry 4.0 adoption in SMEs. Perhaps, only larger enterprises get the lion’s share of press coverage. Whether or not that’s true, SMEs can adopt and benefit from digital manufacturing improvements.

A Modest Plan, Executed Time & Again

You could summarise our modular approach to Industry 4.0 practice as Optimise — Augment — Test — Launch — Repeat

The general idea of this approach is to start with existing assets, machines and humans. Then, optimise their performance; add new equipment or processes as needed. Finally, quickly and often test, retest, and launch the improvements. Then, find the next improvement and repeat the entire process.

Much of the transformation in digital manufacturing improvement projects involve changes in the attitude, approach, and focus of early adopters themselves. As a result, industry 4.0 modernisation practices can become an opportunity to view and carry out process improvements in a new way. The trick is to find opportunities to practice, optimise, augment, and rapid test-and-launch approach to improving small parts of a facility’s capabilities. For example, by connecting all your production, product, and customer data sources and feeding information onto a big data analytics platform, you can avoid data silos and make your supply chain visible from end to end. There’s a lot of ground to cover in your search for improvement opportunities. The first and essential is that the RAMI 4.0 model expands the traditional concept of manufacturing into value chain steps that occur before and after the shop floor.

It is all too common for Industry 4.0 early adopters to drown in an ocean of vision statements and good intentions with little down-to-earth “how-to” support to guide them. However, using a gradual, modular approach to Industry 4.0 adoption makes it possible to achieve economic benefits quickly, even on a modest budget.

Identify an opportunity to improve operations — We’re looking for ways to achieve economic benefits quickly. So, we’re concentrating on short-term operational improvements rather than new products or business models. Finding a potential process improvement can involve production stage processes or ones that come before it (design/prototyping) or after it (distribution, after-sales services). Just make sure that the improvement reflects a high-priority business goal.


Identify the change story — What’s the story of the changes you want to make? Use 25 words or less to describe what you want to happen. Here are a few examples taken from a recent research paper:

• A highly advanced factory with lean processes uses digital manufacturing to reach the next level of operations performance.

• Fourth Industrial Revolution technology use cases target quality improvement and cost reduction to meet customer expectations.

• The staff of 50-year old plant recognises that they must use digital tools to stay price-competitive for the next 50 years.

• Use big data from connected machines to improve operations and use agile proof-of-concept to support rapid deployment of new use cases. These stories describe high-level intentions.

Next, it’s time to specify the situations that help define the nature and scope of your process improvement.


Identify use cases — List the situations or process functions that are most likely to deliver the results that you want - such as digital inventory management, for example. Also, don’t forget to use cases that enable scaling. Use cases are the bridge between your intentions and implementation.


Establish an Information Technology/Operational Technology (IT/OT) infrastructure — Even if you’re engaging in a modest pilot, it’s part of a step-change transformation. Before you can start the transformation, you must prepare your IT/OT infrastructure in several critical areas:

• Scalable, reliable connectivity

• Intelligent, end-to-end cybersecurity

• An Industrial Internet of Things (IIoT) platform

These tasks involve a lot of infrastructure setup and decision making. You’ll be connecting sensors, actuators, equipment, machines, business applications, and data stores throughout the system used in your experiment. The RAMI 4.0 model can help you define the scope of the connections. Consider whether you want to set up your cybersecurity network or engage a cybersecurity prevention and mitigation service. Then decide whether to manage your data onsite or in the cloud. Industry 4.0 principles assume that your data will reside in the cloud. Nevertheless, some manufacturers report that they don’t need off-premises storage, at least not in the early stages of adoption.


Acquire Industry 4.0 products and services — This step involves choosing and deploying emerging technology-related products and services, which enable process improvements. Specific choices will depend on company- and user-specific criteria. However, this is the step in which standards can play an important role in eventual success. Standards for smart factory equipment and services continue to evolve—very slowly. What should users do if standards conflicts haven’t been resolved when you want to start process improvements? It might take years before relevant stakeholders agree about interoperability standards. Consider partnering up with solution and technology providers — make them prove their value. Expect them to provide relevant use-case proof points at critical stages in testing and solution decision making processes. Expect platform and application providers to offer integrated and interoperable solutions that fit your system’s requirements. Ensure that IT enterprise platforms and applications emphasise flexible operation and use ERP entry points to expand quickly into your Operation Technology(OT) system.


Don’t forget the big picture — Pursuing modest successes is an excellent way to begin your digital manufacturing journey, but remember that you deliberately chose these early ventures as low-hanging fruit. Successful scale-up of Industry 4.0 processes should adopt a two-tier approach, which blends short-term use-cases and a longer-term road map. This approach solves problems at specific pain points and pays attention to clear definitions of performance targets and developing a strong system of vendors, suppliers, and partners.


About the Columnist

Industry veteran Colin Koh is our monthly columnist to share with SIAA community the essence of ASEAN manufacturing and pragmatic tips on how to approach and navigate the fourth industrial revolution for their businesses. Stay tune to Colin's regular segment all about Smart Manufacturing 4.0 in ASEAN! Please visit more resource.