Can Lean Management and Industry 4.0 Co-Exist?
Ever since the end of World War II, manufacturers have examined and then adopted the lean management principles that emanated from Toyota Motor Corporation in Japan.
Lean management is the foundation for most manufacturing enterprises because it has proven over the years to reduce waste, save time and money and produce continuous improvement on the factory floor.
So, does the arrival of Industry 4.0 mean there’s a new sheriff in town?
Much Ado About Nothing?
There are those in the lean management camp who believe – and publicly state – that Industry 4.0 is a lot of noise and doesn’t really do what it purports to do.
They maintain that Industry 4.0 is hardware-heavy and software-driven, requiring hordes of IT technicians to keep the digital engine running smoothly.
It’s more bother than it’s worth, they argue, and it’s costly, too.
This, of course, ignores the fact that the hardware in use today with most Industry 4.0 applications often comes in the form of sensors embedded in factory floor machines.
The sensors feed voluminous amounts of data to a central computer whose software analyzes the data and, through AI - artificial intelligence (software programs known as algorithms) - can detect patterns, opportunities, errors and trends in real time that the manufacturer can lever into greater market share, an expanded customer base or new products for existing customers.
The sensors are inexpensive and getting cheaper all the time while computing power is growing exponentially to handle the processing speeds needed for data analysis.
Where Humans Interface With Machines
No human or team of humans practicing continuous improvement or kaizen can achieve this.
What they can do is act on the predictions offered up by AI in their factories, plan marketing and sales strategies around those predictions, test these strategies and then implement them on a wide scale.
In other words, a synergy between the digital and human worlds can produce positive results for manufacturers.
Overall equipment effectiveness, or OEE, is critical to manufacturers. By optimizing OEE, capacity can be increased, costs reduced and product quality enhanced.
When OEE is sacrificed and machines break down, productivity drops and the need to carry high inventory increases.
A digital factory floor employing sensors can detect potential breakdowns before they occur by analyzing data in real time and alerting line workers that a problem is about to cause a disruption to processing operations.
Beyond the factory walls, sensors tell Kone Corporation, for example, when any of its elevators or escalators installed in buildings around the world need servicing. This is not routine maintenance conducted according to a pre-ordained schedule; this is digital technology alerting mobile service crews when and where they need to go.
Kone saves millions of dollars each year in maintenance on its vast fleets of service vehicles around the globe because the service teams venture out only when they need to.
Working Collaboratively With Technology
Efficiencies like this cannot be achieved with humans only, no matter how lean a company’s operations are.
The entire thrust of the digital transformation being ushered in with Industry 4.0 is to enable human workers to produce more efficiency, speed and quality, rather than to render obsolete their lean techniques on the shop floor.
When one considers that the core of lean manufacturing is to empower people to drive improvements, how can you argue with what Industry 4.0’s message is?
Think about the evolution of cellular telephones from the early 80s to today.
There is no comparison between the clunky, walkie-talkie Motorola devices that came with less than an hour of talk time and the capacity to store a paltry 30 phone numbers and today’s smart phones which are effectively palm-sized computers linking us to the world via an internet connection.
Both make phone calls. But only one has the capability to harness the power of an unseen digital world and permit customers to order or purchase product, service teams to conduct remote assessments of equipment or sales teams to obtain a complete 360 degree view of a customer – all by means of a smartphone.
This is the kind of power that Industry 4.0 is delivering and it empowers people to achieve more and go further without forfeiting all that lean management offers.
The Digital Path Explained
Gerent implements this same experience with every project we implement.
Using Salesforce CRM integrated with a manufacturer’s existing ERP, Gerent creates solutions that leverage the best of human intelligence and the best of artificial intelligence to produce results that power up quality, innovation, marketing and sales throughout the manufacturing sector.
Gerent understands how overwhelming digital transformation can be for manufacturers.
So, we have produced a white paper that offers clear advice on how to prepare and begin a journey in the world of Industry 4.0.
It’s available free of charge and numerous manufacturers are already benefitting from the valuable information contained on its pages.