Making sense of Industry 4.0

EVEN if manufacturers were once reluctant to change, they now know the need for Industry 4.0. Yet what exactly that means may be less clear.

"Three years ago, ... the conversation with many SMEs (small and medium-sized enterprises) especially was: 'Why transform? So painful'," says Senior Minister of State for Trade and Industry Koh Poh Koon. The discourse has since shifted towards what to do, and how: "People know that they have to transform."

Dr Koh is co-chair of the Future Economy Council's manufacturing subcommittee, which oversees five industries: electronics, precision engineering, energy and chemicals, aerospace, and marine and offshore.

Industry 4.0 is essentially about using three enablers - digitalisation, data, and automation - to raise productivity and efficiency, and create opportunities for new products and services, says Dr Koh. Yet firms might have differing understandings of Industry 4.0, and not know where they are on the journey, he adds. Some might think they are further ahead than they truly are, or vice versa.

This is where the Economic Development Board's Smart Industry Readiness Index (Siri) comes in. Launched in 2017, it helps firms assess how far they have come in adopting Industry 4.0, and discover where the gaps are.

One of the firms that was involved in Siri's pilot is GlobalFoundries Singapore, whose senior vice-president and general manager Ang Kay Chai is also a co-chair of the manufacturing subcommittee. With the semiconductor foundry's plants dating to 2003 or earlier, was moving to Industry 4.0 a giant leap? "Not for us," says Mr Ang.

The firm's Fab 7 facility opened in 2003 with automation in place. As the machines had the required ports for Internet connectivity, it was not hard to take the setup online. For them, transformation has often involved incorporating tech into existing operations: "It's an ongoing process."

The firm's 200mm wafers used to be manually loaded and unloaded from machines. Then the facility was retrofitted with autonomous robots that travel along ceiling rails to transport wafers. More robots were later added for further transport, including along corridors. Relevant labour needs are 30 per cent of what they used to be, while output has not fallen - meaning higher productivity.

Other Industry 4.0 technologies that GlobalFoundries has adopted or is exploring are artificial intelligence and machine learning, augmented reality for training, and "work in process" simulations for predictive analysis of production. Systems integration is key: not just integrating within the factory, but down to shipping, costing, and invoicing, says Mr Ang.

Data collection and analysis is particularly valuable. "With Industry 4.0, it becomes easy to find the root cause of low yield," says Mr Ang, noting that a wafer undergoes some 600 to 1,200 steps in fabrication. "At any step, you can make a mistake and scrap the wafer. Therefore the process control of individual steps is important."

While firms might worry about the costs of investing in Industry 4.0, perhaps the best response is given by its gains: with tech, GlobalFoundries has increased its yield per wafer.

Moving on together

The data-driven approach drives its suppliers to transform too, as GlobalFoundries might request data about the quality of material being supplied, down to batch details.

Multinational corporations (MNCs) and large firms rely on SMEs in supply chains, notes Dr Koh. "Therefore the ability of the SMEs to keep up with what the MNCs need is quite crucial to a very effective transformation."

SMEs can take the initiative too, says subcommittee co-chair Amos

Leong, chief executive officer of precision engineering firm Univac. His message: "Don't wait for the large enterprises to drag you along."

One proactive firm is optical solutions provider Moveon Technologies. Says CEO Chee Teck Lee: "Our transformation is more the ability to see a little bit further and position ourselves ahead of the curve."

Moveon started in 2007, providing optical design services for parts such as phone camera flashes. It went into prototyping in 2010, and volume production in 2011. To stay aligned to industry needs, it provides full services from design to production.

And it has gone further: becoming relevant pre-emptively. In 2015, Mr Chee heard of diffractive flat optics, "a very new genre in optics". Applications for this, such as in 3D cameras or distance-sensing in autonomous vehicles, were not yet common.

"But we realised that if we really want to engage the future needs of our customers, we definitely need to get into (that) area," says Mr Chee.

Moveon started looking for suppliers, but found that development was still mainly in labs. It then met a German nano-3D-printing startup that could fabricate the tiny structures required in flat optics, and became the first commercial entity to buy its equipment. In 2016, Moveon worked with the Agency for Science, Technology and Research's (A*Star) Institute of Materials Research and Engineering to find a way to make nickel shims, which it could use to define a process for scaled-up production.

In mid-2016, a client agreed to try them out for flat optics. Volume production began in 2017. Moveon can now print millions of such parts each month, and flat optics has grown to account for 30 per cent of revenue.

Back in 2015, recalls Mr Chee, many clients were exploring flat optics too. "But they were also stumbling in the dark, because they did not know where to start, just like us."

"We realised that we cannot wait until our customers are knowledgeable enough and then they come and approach us," he says."Of course it's crystal ball-gazing. But sometimes you have to take the plunge." It has paid off: many clients who previously used refractive optics have embraced flat optics and found new uses for it.

Granted, not all firms may have such clarity. "A lot of people perceive advanced manufacturing to be just simply using some robotics," says Mr Leong. Yet successful firms do not just buy equipment, but redesign processes. And though a factory with data collection may seem "smart", "if you don't use the data, you are not moving forward in productivity".

Trade associations are one source of aid. The Singapore Precision Engineering and Technology Association (SPETA) has monthly events to raise awareness of what Industry 4.0 entails and help firms discover gaps. Its advisers help firms transition to and implement smart factory and advanced manufacturing solutions.

In the past, it was easier to make intuitive decisions about how to transform, says Dr Koh. Today, with change being more complex, firms can tap A*Star's Operation & Technology Roadmap (OTR) programme to translate visions into tangible steps.

These roadmaps chart out actions and goals across several years, and are shared such that workers become active participants, says Dr Koh: "(They can) say 'Look, we are in this together... so that when we see the next milestone being hit, we all feel that we all have reached this place together.'"

Working with partners

Worker buy-in is crucial to counter fears of being made obsolete. "Initially, obviously operators had a little bit of worry about the autonomous robots replacing their work," says GlobalFoundries' Mr Ang. But they soon appreciated their mechanical partners "because all the mundane, manual handling is already replaced", letting them do value-added work such as planning and wafer analysis.

"The important thing is to realise that actually a machine cannot do everything that a worker does," says Dr Koh. Firms must reskill workers away from repetitive tasks: "You are the user of the machine, you are not being replaced by the machine."

The menial, low value-added tasks given to machines are not meant for today's workers, says Mr Leong. To let employees learn how they can become "Worker 4.0", Univac collaborated with Singapore Polytechnic on bite-size workplace learning.

Workers can drive innovation too. To foster this, firms should promote collaboration and a flatter hierarchy, says Mr Leong, whose firm holds a quarterly townhall for engineers and shop floor workers to share ideas.

Done correctly, transformation improves workers' lives - and has the added benefit of attracting them. "Semiconductors used to be hard work," says Mr Ang. Engineers had to go down to the factory to inspect the production process in person. Today, the job is more attractive to young workers "because there's a lot more sophistication: they can do a lot more work at home, they can access the factory at home through the Internet".

Since 2017, GlobalFoundries employees have had remote access to factory data. With this and other digital initiatives, its IT team is about 500-strong, creating roles in software engineering and cybersecurity.

Apart from providing mentorship for second-generation business leaders and students from polytechnics and the Institute of Technical Education, SPETA facilitates factory visits for students "to change the common misconception that manufacturing is 'dangerous, dirty and difficult'," says executive director Steven Koh.

Collaborations with institutes of higher learning (IHLs) have the indirect benefit of getting students interested, potentially leading to employment, says GlobalFoundries' Mr Ang.

Of course, such collaborations are primarily about innovation. Apart from IHLs, firms can also work with A*Star. Its T-Up scheme sends scientists and research engineers to help SMEs with research and development.

The Model Factory at A*Star's Advanced Remanufacturing and Technology Centre is a safe environment where firms can test ideas before actual implementation. "Importantly, it solves the chicken and egg issue that a lot of companies grapple with: How to make the first move without destabilising their entire operations and ecosystem," says Dr Koh.

In innovation, Moveon works with both large and small partners. Since 2016, it has invested in deep-tech startups in areas such as augmented reality, thermal imaging cameras, and nanofabrication - in short, firms that can leverage Moveon's own competencies, says Mr Chee: "So hopefully one or two of them become unicorns and become our customers."

Collaboration can go further yet. SPETA supports the formation of strategic alliances such as the Smart i4.0 Transformation Alliance of eight local firms and 12 MNCs, working together to bag projects and co-innovate. The Jurong Innovation District gathers players from across the ecosystem, with partnerships perhaps arising from proximity. GlobalFoundries promotes transformation abroad via industry bodies such as the Singapore Semiconductor Industry Association and SEMI Southeast Asia.

While firms may be cautious about sharing information, there is a difference between trade secrets and transformation tips. GlobalFoundries has spread the word about autonomous robots to other firms. Some firms in research tie-ups have let the resulting solutions be "cookie-cut" and shared with others, notes Mr Leong. After all, there are no secrets to digitalisation: "The tools are out there."

Brought to you by the Future Economy Council