News In Context

Manufacturing Shifts For The Great Reset

Manufacturing Shifts For The Great Reset

The World Economic Forum this week announced the addition of 10 new factories to its Global Lighthouse Network, a community of companies deemed to have succeeded in the adaptation of the Fourth Industrial Revolution at scale. Despite the disruptions caused by the COVID-19 pandemic, the Forum says these manufacturers have found ways to improve sustainability, competitiveness and customer satisfaction. Among the factories added to the network are plants in Asia run by Alibaba and Unilever, plants in Europe run by Groupe Renault and Novo Nordisk and a plant in the U.S. run by Schneider Electric. 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. A new Forum report, Global Lighthouse Network: Four Durable Shifts For A Great Reset In Manufacturing, details how factories in the network have adapted.

The lighthouses showcase significant, measurable improvements across several key performance indicators (KPIs), including productivity, sustainability and eco-efficiency, agility, speed-to-market and customization, says the Forum report, which was prepared with McKinsey. Productivity improvements include increases of factory outputs and overall equipment effectiveness , along with reduction in product cost, operating cost and quality cost. Sustainability gains come from reducing waste along with water consumption while increasing energy efficiency. More agility has led to reductions in inventory, lead-times and changeovers. Speed-to-market reduction reflects shorter design iteration time, and customization has yielded lot size reduction and improved configuration accuracy.

“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,” Francisco Betti, Head of Shaping the Advanced Manufacturing and Production, World Economic Forum, said in a statement. “They have the opportunity and responsibility to become the engine of the Great Reset.”

The new lighthouses include:

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%.

In other news this week:

HEALTH

Bionic Europeans

Nearly two thirds of people in leading Western European countries would consider augmenting the human body with technology to improve their lives, mostly to improve health, according to research commissioned by Kaspersky.

Doctors In Australia Are Preparing To Implant A Human Bionic Eye

Over a decade’s worth of work by scientists working at Australia’s Monash University has produced a device that can restore vision to the blind, using a combination of smartphone-style electronics and brain-implanted micro electrodes. The system has already been shown to work in preclinical studies and non-human trials on sheep, and researchers are now preparing for a first human clinical trial to take place in Melbourne.

Apple Introduces Virtual Fitness Subscription Service

Apple rolled out a new virtual fitness service and a bundle of all its subscriptions, Apple One, focusing a holiday-season product launch on services that are the backbone of Apple’s growth strategy and that cater to customers working at home during the COVID-19 pandemic.

Gene Editing That Is Better Than CRISPR?

Graphite Bio, A San Francisco-based startup that aims to use gene edits to cure sickle cell anemia, raised $45 million this week. Its technology cuts genes in targeted spots, but then redirects the formation process of new genes with custom-designed templates that fix the underlying genetic issue in the patient’s DNA. In other words, if CRISPR is the “cut” function on a computer, Graphite Bio says its technology is “cut and paste.”

FINANCIAL SERVICES

SWIFT Announces Strategy To Expand Beyond Financial Messaging

Interbank payment network Swift is to expand beyond pure-play financial messaging to offer member banks a range of transaction management services. Operating over a two-year timeframe, the new strategy is aimed at enabling financial institutions to deliver instant and frictionless end-to-end transactions.

Australian Startup Unveils Opening Banking Powered Corporate Credit Card

Australian startup Cape is preparing to launch a corporate credit card powered by Open Banking technology early next year. Founded by a team of UK fintech veterans with experience at Funding Circle, Funding Options and 11:FS, Cape is coming out of stealth as it prepares to launch into a tough economy for small businesses hit by the Covid-19 pandemic.

FOOD AND AGRICULTURE

Farmstead Launches Grocery OS To Help Other Grocers Get Online Dollars

Online grocer Farmstead announced that it is making its in-house grocery delivery software, Grocery OS, available to other national and regional grocers. Farmstead’s pitch is that Grocery OS can help traditional grocers migrate from physical stores to online, working up through dark stores and into warehouse-only formats. In doing so, Farmstead says Grocery OS will also provide more delivery capacity and get retailers more e-commerce revenue.

German startup InFarm raised $170 million this week to grow its urban farming network.

InFarm’s vertical farms are centrally located in urban areas, in facilities like supermarkets, distribution centers and restaurants that place food production and consumption closer together. The facilities are also hooked up with cloud-connected smart devices that monitor plant health and resource consumption.

MOBILITY

Volocopter Opens World’s First Electric Air Taxi Flight Reservations

Germany’s Volocopter has opened up reservations for the first commercial electric air taxi rides in an electric vertical takeoff and landing (eVTOL) aircraft.

RETAIL

Walmart is still gunning for TikTok. Under the latest plan Walmart and Oracle could together own a significant stake, according to The Wall Street Journal. That move, if combined with existing American investors, could put majority ownership in U.S. hands.

DATA PRIVACY

European Companies Left In Limbo Over U.S. Data Transfers  Some of Europe’s largest companies have called for guidance on how they should transfer data to the US, after facing legal challenges from activists. Meal delivery group Just Eat Takeaway, Danske Bank and the University of Luxembourg all said they wanted clarification from regulators after Noyb, a non-profit privacy campaign group, filed official complaints against them and 98 other organisations for failing to protect the data of their users. Noyb has filed complaints to national data regulators in Europe against 101 European websites that use Google Analytics or Facebook Connect, arguing that they are not compliant with the ECJ ruling.

CYBERSECURITY

China-backed Hackers Broke Into 100 Firms And Agencies, According To The U.S.

The U.S. Justice Department said this week that a group of hackers associated with China’s main intelligence service had infiltrated more than 100 companies and organizations around the world to steal intelligence, hijack their networks and extort their victims.

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About the author

Jennifer L. Schenker

Jennifer L. Schenker

Jennifer L. Schenker, an award-winning journalist, has been covering the global tech industry from Europe since 1985, working full-time, at various points in her career for the Wall Street Journal Europe, Time Magazine, International Herald Tribune, Red Herring and BusinessWeek. She is currently the editor-in-chief of The Innovator, an English-language global publication about the digital transformation of business. Jennifer was voted one of the 50 most inspiring women in technology in Europe in 2015 and 2016 and was named by Forbes Magazine in 2018 as one of the 30 women leaders disrupting tech in France. She has been a World Economic Forum Tech Pioneers judge for 20 years. She lives in Paris and has dual U.S. and French citizenship.