Industry 4.0 for Operations Management

Industry 4.0 isn’t just about technology. It’s also about the people on the shop floor, and job descriptions in manufacturing are changing daily.

At Tulip, we’re interested in how Industry 4.0 affects the people who make our world. Today, we’ll look at how digital transformation can help operations managers improve their operations in tangible ways.

Operations managers rely on data to run their operations. Information gathered about human and machine performance informs everything from inventory schedules to hiring and training to long-term strategic initiatives. Without data, improvement initiatives fall flat.

Several Industry 4.0 technologies promise to give operations managers the holy grail of manufacturing data: continuous, real-time visibility into every process and system in a factory.

We’re not talking about the future. For early adopters, this level of data granularity is already a reality. Internet of Things-enabled devices communicate detailed performance data as they run. Cloud infrastructure stores that data in centralized, easily accessible locations. And AI and machine learning give engineers powerful tools to make sense of their data.

But here’s the caveat: the best data in the world won’t be any help unless you understand how to use it to drive insights. Mountains of data are useless unless they’re structured in a way that facilitates use and access.

For operations managers in Industry 4.0, here’s the biggest takeaway:

The better you connect your factory to produce the data you need, the sharper your insights will be. The better you learn to work with large data sets, the more impactful your initiatives will be.

From here, let’s look at some specific ways Industry 4.0 can help operations managers locate new areas for improvement and visual processes in real-time.

1.) Employee Training

Operations managers are responsible for ensuring their operation has the right people with the right skills for a job. This is far from trivial. In Industry 4.0, high-mix assemblies, rapid new product introduction cycles, and employee churn are increasingly common. operations managers need new strategies for training, reskilling, and upskilling their employees to prevent disruptions and keep their operations profitable.

Luckily, one of the major use cases for Industry 4.0 technology is employee training. Dynamic, interactive work instructions replace static paper forms, decreasing training times, and improving information retention. At Tulip, we’ve seen process engineers design applications that cut training times by 75%. Looking forward, wearables and augmented reality have the potential to create an immersive, hands-free training experience.

At this stage, operations managers should assess how Industry 4.0 solutions will keep their workforce flexible and up-to-date throughout the digital transformation.

2.) Quality Assurance

As the leader of the factory, quality assurance can ultimately rest with the operations manager. Working with quality engineers, operations managers own their operation’s products. They’re responsible for ensuring every item meets customer specs and regulations.

To date, QA has been a high-touch, manual process. Even with extensive in-line documentation, root-cause analysis of quality issues can be a time-consuming and inaccurate.

Industry 4.0 reduces the burden of QA and gives operations managers the information they need to perform root cause analysis. IoT connected devices log an asset’s path through the line. Computer vision can track a worker’s progress through an assembly and identify errors as they happen. And audit logs can track a defect to a specific operator at a specific step. For a factory with sufficient visibility, improved data streams can help engineers predict root causes.

3.) Planning and Logistics

In an assembly process, inventory goes in and products come out. The operations manager is at the center of this cycle. Naturally a jack of all trades, operations managers are responsible for knowing their machines in and out–capacity, throughput, changeover schedules, maintenance schedules, and more.

This is one area where data has the potential to make an operations manager’s efforts significantly more effective. With continuous, real-time data, operations managers will be able to set targets for productivity, plan inventory, and optimize workflows. Operations managers can use this data to test and iterate in service of achieving a truly lean operation. With better data, you can move beyond partial understandings like OEE and toward holistic measurements like OPE.

4.) Building Layers of Communication

As any operations manager knows, many aspects of manufacturing can’t be reduced to machine performance. In many cases, human-centric tasks, such as good communication up and down the factory hierarchy is a crucial part of an operations manager’s job.

Industry 4.0 helps operations managers create transparent communications. If a plant manager needs to explain a delay to a director, data will help render problems–as well as their solutions–evident. If a plant manager needs to convince a superior that new technologies will help her operation, data from pilot projects can be key to supporting expansion initiatives.

Contrary to eliminating workers, the transparency created by Industry 4.0 helps operations managers create a worker-first / human-centered culture.

5.) Integrating Systems

One former manufacturing manager told me that Industry 4.0 will require managers to think in terms of systems. If departments of factories have previously functioned in isolation, the Industry 4.0 factory will connect each of these systems into an integrated whole.

This manager’s advice is supported by some of the largest research firms. PricewaterhouseCoopers has suggested that the most successful digital transformations are those that proceed holistically. They think in terms of technological ecosystems, not individual technologies.

During Industry 4.0, operations managers will need to use their knowledge of a factory’s operations to integrate previously isolated systems. By using their perspective to create connections, they can turn tribal knowledge into organizational knowledge, create areas of communication, and integrate data silos.

6.) Empowering Operators

People are, and will remain, central to manufacturing. The best operations managers know how to empower their operators to get the job done right.

The factory visibility created by Industry 4.0 isn’t a bad thing for workers. At Tulip, we’ve found that worker performance dashboards empower workers to be their best. For some, the real-time performance read-outs help work feel like a game. For others, it creates a sense of healthy competition. Still, others like to know when they’re not performing as well as they could, and data makes that observation easy.

Operations managers can help their people succeed by organizing digital transformations that put their workers first.

Industry 4.0 may be creating a lot of uncertainty in manufacturing, but most of the changes will be positive for operations managers. Using the benefits of Industry 4.0 data, operations managers can revolutionize their lean initiatives while empowering their workers.

Curious how Tulip can help you bring new insights to your operations? Get in touch for a free demo today.