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Article Posted Tuesday September 15, 2020


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Trends

New Factories of the Future Light the Way of ‘Next Normal’ in Manufacturing

Ten new manufacturing sites applying Fourth Industrial Revolution technologies to streamline operations and improve efficiency; A new report, Global Lighthouse Network: Four Durable Shifts for a Great Reset in Manufacturing, reveals how new trends in the manufacturing and supply chain sector are helping to shape the recovery from the COVID-19 crisis

The World Economic Forum announced the addition of 10 new factories to its Global Lighthouse Network, a community of world-leading companies that have succeeded in the adaptation of the Fourth Industrial Revolution at scale. In the face of unprecedented disruption from the COVID-19 pandemic, these manufacturers have found ways to improve sustainability, competitiveness and customer satisfaction.

The network and its 54 factories are a platform to develop, replicate and scale up innovations, creating opportunities for cross-company learning and collaboration and for setting new benchmarks for the global manufacturing community. The goal of this community is to share and learn from best practices, support new partnerships and help other manufacturers deploy technology, adopt sustainable solutions and transform their workforces.

Research based on learnings from the network reveals that four shifts in manufacturing and supply chain have emerged: 1) agility and customer centricity; 2) supply chain resilience; 3) speed and productivity; and 4) eco-efficiency. The new report, Global Lighthouse Network: Four Durable Shifts for a Great Reset in Manufacturing, expands on these new trends and how factories have adapted to the industries and production contexts. They set the benchmark for a “next normal” in manufacturing and highlight how the industry is contributing to the Great Reset and shaping the recovery from the COVID-19 crisis.

The new Lighthouses are:

Asia

Alibaba (Hangzhou): Combining powerful digital technologies with consumer insights, Alibaba’s pilot Xunxi factory brings a fully digitized new manufacturing model to life. It empowers end-to-end, on-demand production based on consumer needs, and enables small businesses to be competitive in the fast-paced fashion and apparel market by shortening delivery time by 75%, reducing the need to hold inventory by 30% and even cutting water consumption by 50%.

Micron Technology (Taichung): To drive the next wave of productivity improvement, Micron’s high-volume advanced semiconductor memory manufacturing facility developed an integrated internet of things and analytics platform, ensuring that manufacturing anomalies can be identified in real time while providing automated root-cause analysis to accelerate new product ramp-up by 20%, reduce unplanned downtime by 30% and improve labour productivity by 20%.

Midea Group (Guangzhou): Faced with intense appliance industry competition and increasing complexity and speed in e-commerce, Midea leveraged Fourth Industrial Revolution technologies to transform from an automated factory to an end-to-end connected value chain, improving labour efficiency by 28%, reducing unit cost by 14% and shortening order lead time by 56%.

Unilever (Hefei): With e-commerce booming in China, Unilever built a pull-production model by deploying Fourth Industrial Revolution solutions such as flexible automation and artificial intelligence at scale across production, warehousing and delivery, reducing order-to-delivery lead time by 50% and e-commerce consumer complaints by 30% while reducing costs by 34%.

Europe

Groupe Renault (Maubeuge): To protect the plant competitiveness (recognized as the best-performing light commercial vehicle plant in the Alliance), Groupe Renault deployed Fourth Industrial Revolution technologies at scale in its 50-year-old plant, reducing warranty incidents by 50%, increasing its flexibility to deal with the many vehicle configurations and reducing manufacturing costs by 16%.

Janssen Large Molecule (Cork): With a fast-changing and increasing demand for biological products, Janssen has digitally connected R&D, its internal and external manufacturing, and deployed advanced process control solutions to drive near real-time visibility of supply chain status, improve reliability by 50%, as well as accelerate technology transfers while reducing costs by 20%.

Novo Nordisk (Hillerød): Facing volume growth and rising complexities, Novo Nordisk has invested in digitalization, automation and advanced analytics, building a robust Industrial Internet of Things operating system to be scaled across their manufacturing footprint, increasing equipment efficiency and productivity by 30%.

Middle East

Saudi Aramco (Khurais): As part of Aramco’s dedication to increase the resiliency of its operations, the Khurais oil field was built as a fully connected and intelligent field, with over 40,000 sensors covering over 500 oil wells spread over 150km x 40km. This enabled autonomous process control, remote operation and monitoring of equipment and pipelines, resulting in maximizing the oil well production with at least 15% attributed to smart well completion technology alone.

North America

DCP Midstream (Denver): Driven by the need to combat market volatility with operational transformation and innovative efficiencies, DCP Midstream leveraged internally developed digital solutions and tech-venture partnerships to integrate the remote control of operations with its planning, logistics and commercial systems, allowing real-time optimization of margins and creating over $50 million in value.

Schneider Electric (Lexington): To maintain a business and technological edge, Schneider Electric’s more than 60-year-old facility has implemented Fourth Industrial Revolution technologies to achieve a complete end-to-end transformation of its operations from supplier to customer. This has improved customer satisfaction by 20%, demand forecast accuracy by 20%, and reduced energy costs by 26%.

“Recent world events have led to unprecedented disruptions, affecting nearly every aspect of global industry. Lighthouses demonstrate how Fourth Industrial Revolution technologies can drive efficiency in operations, enhance supply chain resilience and improve customer experience, while augmenting the workforce and enabling more sustainable production systems. They have the opportunity and responsibility to become the engine of the Great Reset.” Said Francisco Betti, Head of Shaping the Advanced Manufacturing and Production, World Economic Forum.

Enno de Boer, Partner, McKinsey & Company and Global Lead of its manufacturing work, said: “The Global Lighthouse Network organizations have already shown the power of Fourth Industrial Revolution innovation when it moves beyond a pilot phase, delivering new levels of efficiency while keeping people at the center of their strategy. Now that we are entering the next normal, we have an opportunity for these technologies to enable a great reset in manufacturing and supply chain operations, delivering value to a wide range of stakeholders including workers, consumers, and the natural environment in the shape of the four durable shifts identified in our research.”

The extended network of “Manufacturing Lighthouses” will be officially awarded at the Global Lighthouse Network Annual Meeting 2020, on 17-18 September. To better understand and identify solutions for the future, the Global Lighthouse Network, a World Economic Forum project in collaboration with McKinsey & Company, is gathering leaders from its exclusive group of advanced manufacturers. Click here to watch sessions live at the Global Lighthouse Network Annual Meeting 2020.

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