Engineer touching laptop to check and control welding robotics automatic arms machine in intelligent factory automotive industrial with monitoring system software. Digital manufacturing operation.Industry 4.0

By: Neli Ivanova

Digitalisation is boosting the market for increasingly sophisticated manufacturing automation technology. Neli Ivanova, Sales Manager, Industrial Equipment at Siemens Financial Services in the UK examines how integrated finance helps OEMs and their customers capture the benefits of automation in a financially sustainable way.

Automation has been commonplace in the manufacturing sector for decades and can now be found in nearly every sector of industry. Automated systems that reliably perform repetitive, standardised tasks continue to enable manufacturers to operate with greater efficiency. This is evidenced not only by speedier production rates but also aspects such as reduced factory lead times, more efficient use of materials, and increased control over product quality and consistency and yet, compared to other advanced economies, the UK invests relatively little in industrial automation and robotics. This is surprising, as around 92% of UK manufacturers are convinced that ‘Smart Factory’ technologies will help them increase their productivity levels but manufacturers are often, unsure where to begin when modernising their production process, concerned about ongoing costs, and worried that their products and processes are too bespoke to automate private sector finance can help relieve some of these pressures when investing in new technology by offering flexible financing solutions that are tailored to the needs of manufacturers.

One example of digitalisation in the manufacturing sector is the introduction of cloud platforms.  By using cloud-based, open IoT operating systems such as Siemens Mindsphere, manufacturers can connect their products, plants, systems, and machines to collect, analyse and harness data from every area of the factory floor. Cloud-based systems can also allow manufacturers to connect to customers and suppliers in order to understand their supply and demands, and tailor production processes to the requirements of the entire supply-chain.  Moreover, these operating systems enable manufacturers to analyse real-time digital data such as vibration indicators and quality analysis, in order to make them aware of alerts and impending faults that cannot be identified by humans. This kind of predictive maintenance allows manufacturers to spot warning signs of problems before they occur, preventing damage to the machine and saving the cost of repair and machine downtime.

Another advantage of digitalisation, and particularly of cloud systems, in manufacturing automation is predictive quality. Through real-time data analysis, defects in a production batch can be detected before they actually happen. Sensors analyse the quality of every product and warn of the tiniest changes. Crucially, these changes are flagged while they are still within the range of acceptable quality and are not yet considered defects. Being alerted to these marginal changes allows manufacturers to solve the problem before an entire batch of products is more seriously affected and has to be discarded. Predictive quality is especially useful when it comes to mass customisation, a growing segment in manufacturing. With customers demanding bespoke products, predictive quality allows manufacturers to cater to the needs of the client and produce product variations on a mass scale without allowing errors to creep in.

As customers as well as potential providers of digitalised technology, OEMs play a crucial role in industry-wide adoption of new  equipment. Not only can they capture the benefits of digitalisation for their own production processes, but they can create new product ranges that include the machinery as well as the digitalised technology and create new business opportunities by including sustainable financing in their offering. . This creates new business models for OEMs, and allows their customers to invest sustainably in new technology and equipment with the help of providers that understand the demands of their industry. OEMs engaged in the manufacture of machinery can leverage these benefits to drive sales, by integrating Finance 4.0 into their overall offering and helping their customers invest in new technology. Such finance arrangements tend to be offered by specialist finance providers that have a deep understanding of how the digitalised technology, and the manufacturing industry works. Such financiers are able to work with OEMs to demonstrate how that technology can be practically implemented to deliver efficiencies to the manufacturing sector. As the financing arrangement can be an embedded component of the value proposition, OEMs are able to introduce customers to the latest equipment and technology and simultaneously present them with a financially sustainable method to invest in digitalisation. OEMs offering an integrated financing solution to their own customers have the potential to enhance their offering and remain competitive. In other cases, the technology provider will refer its customer to one or more finance providers to fund a sale.

The advantages of investing in digitalised technologies in manufacturing are clear and manifold, but companies need the tools, the trust, and support to invest sustainably. With new technology being introduced into the sector, new opportunities for cooperation and business appear, opportunities that OEMs and their customers can exploit to leverage the benefits of Industry 4.0.


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