Industry 4.0 May End Outsourcing

Rob Spiegel

June 20, 2014

3 Min Read
Industry 4.0 May End Outsourcing

Advances in technology gathered into a package called Industry 4.0 will revamp and revitalize manufacturing, potentially bringing outsourcing to an end. While it looks looks like the concept of Industry 4.0 has meat on its bones, the full monty of its promises will take about 20 years to roll out. In a presentation at Siemens PLM User Group this week, Zvi Feuer, CEO and GM of Manufacturing Engineering Software Solutions listed the five facets of Industry 4.0 that "keep him up at night." They are:

  • Autonomous robots and advanced robots

  • The Industrial Internet of Things (IIoT)

  • Cloud computing

  • Big data

  • 3D printing

One of the benefits of Industry 4.0 is flow of data that comes with the connectivity. The data will improve processes on the automation system, as well as improve processes in the company's IT backbone. "With the improvement of the bandwidth and the improvement of handheld devices, you will be able transfer huge amounts of information over the Web," Feuer told Design News. "That information will be available on the shop floor, as well as the top floor of industrial companies. This will offer a way to get more organized while creating a more flexible product."

The flood of data will allow the automation system to anticipate potential breakdowns before they happen, whether it's detecting wear in a part or foreseeing bottlenecks. "The combination of the five domains is providing exciting capabilities, starting from the ability of production lines to predict problems in manufacturing to having a solution put in place in advance," said Feuer. "We will be able to realize continuous improvement. That's been discussed for many years, but it has not been executed. Now we can do something. We can collect information, analyze it, and feed it back in to fix problems."

Because of the complexity of deploying all five aspects of Industry 4.0, it will take years before companies see all the benefits. The technology exists now, but the processes to execute the technology have not yet been developed. "There are the major changes that will happen with Industry 4.0, but they're going to take time because it's a combination of several technologies coming together: machines, products, and the designs themselves," Feuer told us.

One of the benefits Feuer sees is the end of outsourcing. "I believe the question of cheap labor will go away. In the past, we outsourced everything. We believed that once we outsourced manufacturing, we would get better results in productivity and cost," he said. "But in the last couple years, the cost of labor has risen significantly. The cost on transportation is higher, and distance has caused inefficiency. Companies, especially in America, are now saying, 'Maybe this isn't so smart.'"

With the use advanced technologies, the cost of producing a product in North America may be equal to the cost of producing it in Asia and shipping it to North America. With cost a wash, the differential may be improved quality in manufacturing as well as design. "Bringing manufacturing back will lead to the same cost per unit, but with a higher quality and a strong link between design and production," said Feuer. "It is important that those who design products work with those who manufacture them. Designing for manufacturability takes weeks. If you have your manufacturing close by, the process is much more efficient."

Related posts:

About the Author(s)

Rob Spiegel

Rob Spiegel serves as a senior editor for Design News. He started with Design News in 2002 as a freelancer and hired on full-time in 2011. He covers automation, manufacturing, 3D printing, robotics, AI, and more.

Prior to Design News, he worked as a senior editor for Electronic News and Ecommerce Business. He has contributed to a wide range of industrial technology publications, including Automation World, Supply Chain Management Review, and Logistics Management. He is the author of six books.

Before covering technology, Rob spent 10 years as publisher and owner of Chile Pepper Magazine, a national consumer food publication.

As well as writing for Design News, Rob also participates in IME shows, webinars, and ebooks.

Sign up for the Design News Daily newsletter.

You May Also Like