Industry 4.Now: Agile Production in Uncertain Times

Cycling, climbing, sailing, and other hobbies that one can enjoy solo, away from the crowds, have surged in popularity in the past 12 months. People, it seems, have (re)discovered their love for outdoor sports in these socially distanced times.

In fact, the pandemic has generated an enormous demand for sports equipment of all kinds, from mountain bikes to sports boats, stretching vital international supply chains to the limit in the process.

“Since the spring of 2020, we’ve received an increasing number of messages from manufacturers reporting that, despite full order books, they can’t deliver their goods,” reports Ralf Lehmann, senior director of Solution Management Digital Manufacturing and Industry 4.0 at SAP.

COVID-19 Challenges the Supply Chain

New bicycles, for example, were in danger of becoming scarce because a saddle post and a bottom bracket used by nearly all bicycle manufacturers could not be shipped out of China. Similarly, while demand for sports boats surged last year, production lagged due to missing parts that had to be sourced externally, such as specially curved windshields.

“One of the few manufacturers of these windshields is situated in Italy,” explains Lehmann. “When the entire country was forced to shut down due to the pandemic, that put an end to windshield supply for a while.” Brexit resulted in similar issues where product availability changed practically overnight.

According to Lehmann, “That’s the lack-of-agility dilemma: You are dependent on the manufacturer of a certain part and cannot sell your product even though it’s 98% finished and could be shipped out to the customer.”

In a global economy, companies have to be able to rely on certain production steps being carried out in other countries. But the pandemic has completely changed the rules of the game here, “which, in the worst case, can result in a shortage of certain goods on the market,” notes Lehmann.

From Industry 4.0 to Industry 4.Now

“So the question a lot of SAP customers in the process industry are asking right now is, how can I adapt my manufacturing processes today to be able to produce small lots of different types of products and navigate the company through this crisis?” Lehmann and his team want to help SAP customers with answers tailored to their specific situation.

In the summer of 2020, SAP launched the Industry 4.Now program. Lehmann explains: “The problem many customers currently have is adapting their manufacturing processes to the market and reacting dynamically to situations that change at short notice. That’s a typical Industry 4.0 use case that we run through with the customer in our Industry 4.Now showcase in Walldorf and then explore possible solutions for together.

Design-to-Operate Process as Digital Twin

Originally built for the Hannover Messe for discrete industries, this showcase can be configured for individual customers and their specific problem. Since the fair could not take place in 2020, the showcase was set up in Walldorf instead and made available to SAP customers to visit in-person.

“The showcase contains numerous industry components – equipment that was provided by SAP partners – and thus required technical expertise and service for its correct installation onsite. SAP quickly came to realize just how challenging a physical installation can be in times of a pandemic,” recalls Karol Kalisz, SAP’s project lead for the showcase. “Some of the key experts we needed were not able to travel, and we also had to substitute construction components with viable alternatives. Thanks to SAP’s long-standing and trusted collaboration with the partners, however, SAP was able to get the job done on time.”

Following the successful installation of the physical equipment, SAP turned its attention to creating the showcase’s digital twin. In response to the pandemic safety measures, customers can now sign up for a virtual tour of the physical showcase – from the comfort of their own home. In addition, SAP offers an online version of the showcase that explores Industry 4.0 themes, as well as integrated value streams for discrete and process industries in digital form.

“It is a complete, virtual reproduction of the physical showcase,” explains Lehmann. “That is why we call it a digital twin, which maps the entire design-to-operate process, or, in other words, design, planning, production, implementation, operations, and maintenance.”

Imagine, for example, a company produces valves but the caps for them cannot be delivered from its supplier in Asia. What options does this company have when its supply chain breaks down? Using the showcase, the company can test different strategic approaches to mitigate the impact of this disruption – a missing part – at different points along the manufacturing chain.

Should the company change the design of the final product? Should it change its planning process? Should it change its manufacturing workflows? “The showcase uses examples to illustrate and answer all kinds of questions like these,” notes Kalisz. “As such, you can evaluate different approaches based on your situation to make the best decision for your company.”

For example, if a part is missing, the company has the option of modifying its existing machines to allow it to diversify and manufacture other related products. “Obviously, switching from machine construction to, say, glass casting isn’t possible,” notes Lehmann. “But a production line in the machinery industry is capable of producing more than just engine blocks, for example. It can also build similar parts.” By changing the parameters of a component coming off the production line – such as a milling cutter – it can build a different part.

“Industry 4.0 makes this possible,” he says. “It was possible to do this before the pandemic, too, but the topic has become increasingly relevant lately.” It increases a company’s core competencies and allows it to adapt their industry components dynamically to the current market situation.

Lehmann is convinced that, “Companies that succeed in this will come out as winners in these challenging times. And that is exactly what we at SAP want for our customers, so we’ll support them as best we can in this endeavor.”