The World Economic Forum announces the addition of seven new factories to its network of “Manufacturing Lighthouses”, state-of-the-art facilities that serve as world leaders in how to successfully adopt and integrate the cutting-edge technologies of the Fourth Industrial Revolution.
The Lighthouses join a group of nine others, which were unveiled in 2018
All were selected from an initial list of 1,000 manufacturers based on their successful implementation of Fourth Industrial Revolution technologies in ways that have driven financial and operational impact.
The wider purpose of the community is to help overcome the practical challenges being experienced by industries in advanced and emerging economies when upgrading technology.
Earlier work by the Forum identified that more than 70% of businesses investing in technologies, such as big data analytics, artificial intelligence (AI) or 3D printing, fail to move beyond the pilot phase.
In response to this, all Lighthouses in the network have agreed to open their doors and share their knowledge with other manufacturing businesses.
The new Lighthouses represent a range of industries and geographical locations, with four factories located in Europe, two in China and one in the Middle East.
Importantly, the list also contains a medium-sized business, the Italian-based Rold.
One frequent challenge highlighted by businesses is that they lack the scale and resources to implement advanced technologies cost effectively.
The new Lighthouses are:
BMW Group (Regensburg Plant, Germany): This car plant manufactured approximately 320,000 vehicles in 2018. By using the custom BMW internet of things platform, it incurred time and cost, but the result has been cut the time to deploy all new applications by 80% leading to, among other things, a significant reduction in logistics costs and 5% reduction in quality issues.
Danfoss, Commercial Compressors (Tianjin, China): This factory makes compressors for refrigerators, air conditioning units and other products. By using its full digital traceability system and digital tools such as smart sensors, visual inspection, auto monitoring system etc. to improve quality control, it has improved labour productivity by 30% and decreased customer complaints by 57% within two years.
Foxconn (Shenzhen, China): “Lights off factory” – This factory, which specializes in components for smartphones and other electrical equipment, boasts a fully automated manufacturing process with machine learning and AI driving auto optimization of equipment, smart self-maintenance and real-time status monitoring in smart production. Its Fourth Industrial Revolution-first approach has resulted in efficiency gains of 30% and lowered its stock cycle by 15%.
Rold (Cerro Maggiore, Italy): This 240-employee business makes locking mechanisms for washing machines and dishwashers. As the only SME in the Lighthouse network, its use of Fourth Industrial Revolution technologies such as smart watches, rapid prototyping and digital dashboards has helped improve turnover by between 7% and 8%.
Sandvik Coromant (Gimo, Sweden): This producer of cutting tools and solutions has created a digital thread through its production processes that has significantly raised labour productivity. One example is its ‘touchless changeover’ which allows design patterns to be changed automatically, even during unmanned shifts.
Saudi Aramco Uthmaniyah Gas Plant (Uthmaniyah, Saudi Arabia): The giant’s gas processing plant has become a leader in a number of Fourth Industrial Revolution technologies including the use of Advanced Analytics and Artificial Intelligence solutions via Saudi Aramco Fourth Industrial Revolution Center, the use of drones to inspect pipelines and machinery (cutting inspection times by 90%) and wearable technologies such as digital helmets that help workers cut the time it takes to make inspections and repairs.
Tata Steel (IJmuiden, The Netherlands): This plant of 9,000 employees is putting its people first, creating an Advanced Analytics Academy to help workers come up with solutions to reduce waste, and improve the quality and reliability of production processes. This work has resulted in a significant improvement in financial results.
Transforming work processes
The Lighthouse programme has been conducted in collaboration with McKinsey. In conjunction with the expansion of the network, the Forum also publishes a white paper, Fourth Industrial Revolution: Beacons of Technology and Innovation in Manufacturing, which showcases findings from the project to date.
Helena Leurent, Head of the Shaping the Future of Production System Initiative at the World Economic Forum, said: “Lighthouse factories are found in companies large and small, in all industries and regions.
“Rather than replacing operators with machines, lighthouse factories are transforming work to make it less repetitive, more interesting, diversified and productive. Rather than staying within the factory walls, Lighthouses build a broad innovation system with business, government and civil society.
“Beyond local pilots, Lighthouses create value and resilience through the supply chain, and agility and responsiveness for customers.
“Technology, deployed wisely in our manufacturing and production system, can create a better, cleaner world.
“We hope this network can be a source of inspiration to help break out of productivity stagnation and deliver the maximum positive benefit for society.”
A turning point
“These 16 Lighthouses represent a turning point. We are now seeing the start of the second phase, as Fourth Industrial Revolution technologies are penetrating the core of all industries, and our platform of 16 Lighthouses is the clearest sign we have,” said Enno de Boer, Partner and Head of McKinsey’s Global Manufacturing Practice, which collaborated with the Forum on the project.
“However, these leaders have a two-year head start ahead of companies that are still sorting out how to scale. We are running the risk that the value creation will be centered around a few ecosystems, rather than disseminated across entire industries. The race has clearly started.”
The extended network of “Manufacturing Lighthouses” will be officially presented at the World Economic Forum’s Annual Meeting 2019, taking place on 22-25 January 2019 in Davos-Klosters, Switzerland, and convening under the theme, Globalization 4.0: Shaping a Global Architecture in the Age of the Fourth Industrial Revolution
For more information on the nine Lighthouses announced in September, click here