11 Aug 2022

Agility in automation adoption is the key to unleashing the potential of manufacturers

Stuart Coulton, Marketing Manager UK & Ireland, OMRON Electronics, takes a look at the importance of agility in automation adoption for manufacturers.

For many years now, automation has been a cornerstone of the UK’s manufacturing sector, helping producers of food, cars and myriad other products to create their wares faster, more efficiently and in greater volumes.  Despite these obvious advantages, the UK has languished behind many of our global competitors in adoption of robotic (and other automated) systems for some time: for context, according to the International Federation of Robotics, the number of industrial robots sold in Germany in 2020 was ten times higher than in the UK.

With the well-publicised labour shortage and long-standing productivity puzzle, the good news for the UK’s manufacturing sector is that there are some significant shoots of positivity arising from the metaphoric soil.  It appears the penny has dropped!

In this article, we will analyse the nemesis that is low productivity growth and how automation can play a significant contributing role in defeating it.  Furthermore, we will look at what OMRON’s view of the future of manufacturing looks like and how agility is the key to unleashing the potential of our sector.

Market dynamics are at an unprecedented level

As time elapses, it seems there is a new external force pushing our market in a slightly different direction. Sustainability and net zero provide a significant guiding light but the continued increase of consumer demands makes it very tricky for manufacturers and logistics operators to manage the tension between the two.  Effectively, we need to provide the best quality product in the shortest possible time with minimal (or zero) impact on the environment.  Sounds simple.  It isn’t.

Contrast this scenario against the backdrop of three huge barriers to adoption, this challenge gets even tougher:

 

  1. Increasing labour shortages (manufacturing vacancies are at an all-time high and nearly 4 times what they were pre-pandemic 1), mean flexing production in line with dynamic consumer demand is practically impossible.
  2. The makeup of production systems has evolved [as shown below]. It is clear the required skillset has altered drastically, and the cold reality is, we cannot meet it in the volume that is required. Skills chart
  3. The local capacity of system integrators is far below the rising demand for automated systems meaning long lead times and extended periods of suboptimal productivity.

Low productivity growth: The problem or the symptom?

Before the financial crash in 2008, the UK was performing well in terms of productivity growth, outperforming many of our global rivals.  Since that point however, productivity growth has slowed to below 1% 2, compared with more than 5% for many other European economies.  There is a direct correlation between rate of adoption of automated production systems and productivity growth so why is the UK lagging so far behind in both?

Following anecdotal discussion with our customers, OMRON has concluded that there are three key shortages that are preventing our sector from elevating productivity in line with its potential: shortage of skills, shortage of capital and shortage of buy-in.  It is vital that we address all three to get our manufacturing economy thriving again.

The skills Struggle

It is commonly accepted that due to our aging workforce, our manufacturing sector as losing many years of skills and experience at an increasing rate.  Compounded by the fact that younger workers entering the workforce have differing skills and, perhaps more pertinently, interests, means there is a huge gap between what currently needs to be done and our capacity to do them.

When we considering digital transformation and Industry 4.0, we often think of a wide variety of technical disciplines: Big Data, the Internet of Things and Cyber Security are three examples of this but there are others.  OMRON found, during discussions with external stakeholders, that almost 90% of IT managers in the manufacturing sector felt that to implement new digital technologies, the vast majority of the implementation would need to be outsourced due to a lack of internal skills.

It is therefore essential that we can facilitate scalable implementation of digital manufacturing concepts without an overreliance on complex skills.  This creates opportunities for us to scale fast and introduce greater agility in our response to consumer demands.

The cash conundrum

As energy prices soar and component shortages continue to bite equipment suppliers, cash flow is a growing concern for most businesses.  As history tells us, when cash flow is tight, investment plummets down the priority list as the businesses go into ‘survival’ mode.  This is the logical choice for most SMEs in UK Manufacturing but is it the only choice?  The fact is, despite the heightening cash flow concerns, the issues around skills and labour availability are not going away and have the potential to make the cash flow scenario even worse.

It is times like these that innovation in the way we finance capital investments is key to driving new developments and then scaling them at enterprise level.  The days of lump sum investments are numbered.  Leasing, hire purchase and government incentives must become a fundamental part of our national manufacturing strategy opening doors to faster deployment, more sustainable revenue and cash flow and, ultimately, much greater agility.

The buy-in battle

“Robots are taking people’s jobs”!!! Whilst this is true, to a degree, it fails to highlight that robots are also creating new, more exciting and better paid jobs for the very same people whose jobs they are replacing.  This must be viewed as a positive.

One of the common themes OMRON sees when reflecting on scaling automated systems is that the technology strategy is very well defined but there is little in a way of people strategy.  How workers will interact with the equipment, how they will service, maintain and develop the equipment and how they feel about the equipment is usually an afterthought, if it is considered at all.  This is perhaps the most substantial change manufacturers can make when implementing automated systems.

More often than not, the race to scale outpaces the move to get the workers on board with the change – resulting in lower than anticipated productivity and longer ROI periods.  However, those installations that have taken a more holistic approach with incremental developments in the early stages until the workers were fully bought in resulted in faster scaling, maximised productivity and shorter ROI periods: put another way, they created agility.

What does agility look like?

When we Re-Think manufacturing, we are trying to push the boundaries of what is possible to provide the necessary agility to enable manufacturing business to thrive in all economic environments.  Agility means being able to flex capacity to dynamic operating environments quickly, easily and without compromising on operational excellence.

agility

High Mix – Low Volume production is a key component when generating greater production flexibility.

There are five key changepoints that are key:

  • Moving from a mass-produced production philosophy to one that promotes high-mix low-volume.
  • Ensure flexibility is designed in from the start as opposed to post-deployment.
  • Taking product off the main line for customisation rather than producing on a completely separate line.
  • Adopting a modular approach to process sequencing as opposed to a rigid, synchronous one.
  • Empowering people to innovate the production process rather than to operate the machine.

It is OMRON’s belief that implementing these 5 changepoints maximises the agility of the entire manufacturing operation creating much less reliance on the skills and availability of human workers whilst creating new and exciting jobs for all factory workers.  The autonomous nature of this approach to manufacturing creates much better harmony between man and machine whilst holistically improving the skills of all workers.  This in turn creates a personalised customer experience for the increasingly discerning consumer base we serve.

Where do we begin?

Embarking on such a journey can seem daunting but there is a plethora of support from a variety of different sources.  Remember, Rome wasn’t built in a day and this is a really important consideration.  It is vital that the right foundations are in place before deploying automated solutions at scale.  The technology strategy combined with the right processes and management systems with create a good amount of operational improvement but to reap the true benefits that an agile manufacturing process can bring, having a clearly defined people strategy is paramount.  IN summary, start small, prove the concept, gain buy-in then scale fast!

1 ONS
2 Make UK

Company info: Omron Automation