The pressure is intensifying on industry to address its carbon footprint, a movement driven by consumers, suppliers, and increasingly stringent legislation such as the European Green Deal, the Paris Agreement, and UN SDG's. Adding to this challenge, manufacturing is still reeling from the impacts of the COVID-19 pandemic, which exposed weaknesses in industrial supply chains. The vulnerability that the pandemic highlighted increased the concept of resilience and accelerated the digital transformation already in progress.
These were the concepts under discussion in last week's PTC Talk with the guest speaker, Arpita Chari, from the sustainable and virtual production group in the division of production systems at Chalmers University in Gothenburg, Sweden. Chari is in the middle of a six-year Ph.D. study researching the relationship between resilience and sustainability in the Industry 4.0 era. The goal is to gain a greater understanding of leveraging digitalization to improve industry's ability to respond to disruptions and become more resilient. This objective is to understand the different risks that manufacturing industries face today, the corresponding disruptions that take place, and how implementing industry 4.0 technologies can help build specific capabilities that positively impact sustainability.
We live in the Anthropocene epoch, where humans are responsible for grand sustainability challenges such as climate change and resource scarcity. We are consuming resources faster than they can be replenished by nature. As a result, we see today that we are destroying the balance in nature. What is happening in manufacturing industries plays a significant role in this, with production contributing almost a fifth of global carbon emissions.
A crucial strategy to help restore that balance is the circular economy. This is rooted in industrial ecology and grounded in a closed-loop model. It steers away from the traditional linear model of take-make-dispose, where raw materials are collected, then transformed into products that are used until they are finally discarded as waste. Instead, circular systems help minimize waste, keep resources in service longer and help retain their value.
For the research, Chari collected data from surveys, workshops, panel discussions, interviews, and an analysis of published material. The study identified four key technologies driving Industry 4.0 adoption in big data, the Internet of Things (IoT), cloud computing, and simulations. Big data helps address the barrier created by a lack of data regarding waste streams, IoT helps monitor processes to support circular practices, cloud manufacturing creates a shared network of resources and capabilities, and simulations help improve confidence in synergy efforts.
The study also increased the understanding of how Industry 4.0 technologies can provide opportunities to build resilience factors or strategies and positively impact sustainability. Five factors were identified, the first of which was that there were more efficient operations regarding resources, time, energy, and operational efficiency; this is called robustness. Secondly, new agile data collection forms were possible with the implementation of Industry 4.0, which resulted in reduced waste and scrap in production. Thirdly because of this improved data availability, there was increased visibility in production logistics. Next was business model innovation driven by simulation models and virtual prototypes that replaced physical tests at the production site. Finally, IoT and cyber-physical systems (CPS) enhanced manufacturing operations' flexibility, allowing for better machine set-ups and seamless adaptation.
From her research to date, Chari delivered four takeaways that she wanted industry to be aware of. That starts with the systemic challenges enterprises need to be aware of before implementing Industry 4.0 technologies to build resilience or sustainability, which are myriad. For example, funding was found to be a significant bottleneck with a need for more support from top-level management to invest. Add to that regulations and policies, and dynamic customer demands, which also challenge industries. Then there were the organization's internal challenges of digital maturity and the quality of available data.
The second and crucial aspect is understanding what Industry 4.0 means and particularly its relevance to sustainability and resilience because it is apparent that there is a general misconception. Is it IoT or CPS? These terms are interchangeable, although comprehension is improving. The understanding of Industry 4.0 and the circular economy need clarification for effective implementation. When it comes to resilience, it was discovered that many companies have inbuilt resilience. Still, it needs to be recognized as a core strategy, more a by-product of agility or process optimization. Understanding the importance of resilience or building it into business strategy by implementing Industry 4.0 is still challenging. Analyzing what resilience is and its impact still needs to be clarified for many organizations.
The plan for the project is to build a resilience model to deliver a holistic understanding of the different types of risks that impact different types of organizations. What are their corresponding disruptions? Do industries have specific resilience capabilities or strategies that they need to develop? How does this relate to sustainability?
Over the past years, industry has witnessed several disruptive events that have forced organizations to consider building resilience and sustainability in their supply chains and operations. Preparing and investing for future hypotheticals can pay off. Over time, this long-term thinking is crucial because it can help minimize losses, improve digital capabilities, and strengthen industrial ecosystems. So rather than thinking of it as trade-offs between resilience, sustainability, and operations, there needs to be a rebalancing that produces a win-win situation for all.
Listen to the complete webinar above and gain a deeper insight into the research and the results to date.
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