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Who says manufacturing in the United States is dead, shriveled up and blown away toward distant lands where manual labor is plentiful and cheap? Far from it. The country is at the threshold of a new golden age of manufacturing, one in which the physical and virtual words of production are integrated.
This connected ecosystem is called Industry 4.0, although other terms like SMART Manufacturing, Manufacturing 4.0 and The Fourth Industrial Revolution have been used to describe it. By embedding sensors and semiconductors in factory equipment and integrating this data with similar information coming from other activities and sub-systems across the value chain, manufacturers are making more functional products closer to customer demands, resulting in greater productivity, shorter times to market and higher profit margins.
“By capturing and analyzing the large data sets produced by intelligent machines across the supply chain, manufacturing capacity can be deployed more efficiently and cost effectively,” says Gaurav Dhillon, cofounder of data integration powerhouse Informatica, and currently the CEO of SnapLogic, a data integration platform-as-a-service provider. “Sophisticated algorithms can be applied to this wealth of data to glean insights into new production concepts and persistent problems like bottlenecks or product defects, pinpointing areas of improvement.”
Dhillon dubs this modern system of manufacturing “Turbo-Six Sigma,” borrowing the well-known set of management techniques intended to improve business processes. Now with
Internet-enabled sensors and algorithms, manufacturing processes can be improved at light speed, he says.
General Mills: An Early Mover
Large companies in the aerospace, automotive, chemicals, mining, consumer products, pharmaceutical and electronics industries, among others, imagined this future first, making the necessary investments in talent and research to bring it to fruition. A strong case in point is General Mills. “We’ve been on a journey for 25 years to achieve the goals of a connected enterprise,” says Jim Wetzel, director of global reliability at the $16.6 billion consumer foods manufacturer. “It’s not like we flipped a switch and here we are.”
It’s been an expensive trek, given the cost of technology a generation ago. “In 1993, the large TV you can buy today at Costco for $300 cost $4,000,” Wetzel says. “This order of magnitude exists across the spectrum of other technologies. Something that cost $100,000 now costs $10,000. And what used to take a year to develop now takes a month.”
Consequently, “midsize and smaller manufacturers can achieve much of the connectedness, visibility and optimization of the ‘big boys,’ but at less price and greater deployment speed,” he adds. By deploying and connecting smart technologies across its value chain, General Mills reaps value at different points along this spectrum.
As an example, Wetzel cites the impact on the company’s top consumer foods brand, Cheerios. Made from oats, the well-known cereal should have been naturally gluten-free—a plus for many consumers. However, at various points “from field to fork,” Wetzel says, the oats came in contact with grains like wheat and barley that contain gluten.