Global consultancy and outsourcing company Capgemini has today released the findings from its Smart Factories Report.
The survey of 1,000 executives across six sectors, completed by Capgemini’s Digital Transformation Institute, has found that money is pouring into the creation of smart factories. Fifty-six percent of respondents say they have invested $100 million or more in smart factory initiatives over the past five years, while 20 percent claim to have invested $500 million or more.
Smart factories make use of digital technologies, such as IoT, big data analytics, artificial intelligence, and advanced collaborative robotics to improve the efficiency and productivity of a factory. Such facilities are becoming increasingly necessary with the advent of Industrie 4.0 and the shift towards automation of factory operations.
Of those who responded to Capgemini’s survey, 84 percent say they have a smart factory initiative in place, or plans to implement one. However, Capgemini currently estimates that just six percent of those companies are at an advanced stage of digitizing production.
Rapid progress expected
However, progress is expected to happen quickly, as the Digital Transformation Institute also forecasts that as many as half of all factories could be smart by the end of 2022, with the increased productivity gains adding up to $1,500 billion to the global economy.
Leading the pack are the early-adopters in the US and Western Europe, with half of respondents in the US, France, Germany, and the UK claiming to have already implemented smart factories, as opposed to just 28 percent in India and 25 percent in China.
A divide is seen across sectors as well. 67 percent of industrial manufacturing and 62 percent of aerospace and defense organizations say they have smart factory initiatives. Yet, just 37 percent of life science and pharma companies are leveraging digital technologies.
The growth of smart factories is inevitably causing change in the global labor market, too. Capgemini says that while previous waves of automation have reduced low-skill jobs, organizations now recognize the skills imperative and are acting on it.
The company says respondents see automation as a means to remove inefficiencies and overheads, rather than jobs. Consequently, 54 percent of respondents are providing digital skills training to their employees and 44 percent are investing in digital talent acquisition to bridge the skill gap.
Faurecia looks to ‘intelligent tech’
An example of one company already benefitting from such change is Faurecia, a Capgemini client. Grégoire Ferré, the company’s chief digital officer, said “At Faurecia, we are seeing the greatest success in our employees working alongside intelligent tech. For example, we use smart robots in our business where there are ergonomic issues, ultimately creating a safer environment for workers and it gives them time back to focus on other, more-important tasks.”
On Faurecia’s smart factory plans, he added: “Launching greenfield smart factories as well as digitizing Faurecia’s more than 300 plants is a key building block of our digital transformation program. We are also seeing success in ‘revamping’ old processes to be more efficient, for example making our shop floor paperless, or using technology as part of our predictive maintenance scheme – all of which save our employees time.”
The research, which was conducted from February to March 2017, interviewed 1,000 executives holding director or above rank in manufacturing companies with a reported revenue of more than $1 billion each. The research was conducted across six sectors; industrial manufacturing, automotive & transportation, energy & utilities, aerospace & defense, life science & pharmaceuticals and consumer goods. Directors from the US, UK, France, Germany, Sweden, Italy, India and China were interviewed in both qualitative and quantitative interviews.