Since the invention of the wheel, technology has driven industrial progress. Today’s advances give manufacturers an array of options to produce high quality, consistent products faster, more efficiently and, ultimately, for less cost. So how do manufacturers transition to new technologies while remaining profitable? And what impact is technology having on the workforce? Our Manufacturing Council presented some answers at its July meeting.
The panel offered three different perspectives on today’s manufacturing technology, from the academic research angle to the engineer’s experience to a CEO’s overview. Presenters included those with experience in what is being called Industry 4.0—the 4th industrial revolution that is happening right now:
- Kemper Lewis, MOOG Professor of Innovation, and Chair of University at Buffalo’s Department of Mechanical and Aerospace Engineering
- Mike Garman, Senior Engineer in the Advanced Automation Group of Buffalo Manufacturing Works
- Kyle Swiat, CEO of STI-Co., an Orchard Park manufacturer of custom antenna systems for high performance mobile applications
The future is now.
Lewis offered a broad overview of Industry 4.0 and where it is headed. He noted that countries such as Germany and Japan have gotten a competitive jump by investing in new manufacturing technologies through private and public partnerships. UB has responded by creating an initiative under the umbrella of Industry 4.0 to influence the direction of manufacturing technology on the state and national level.
Lewis outlined four target areas of opportunity on which the UB initiative is focused and where manufacturers can invest in technology as a means to enhance profitability:
- Data and Interoperability. Digitization across an enterprise enables an organization to capture, store, manage and retrieve incredible amounts of data. Interoperability is critical to the use of this data, meaning new technology must be able to work with legacy systems already in place.
- Analytics and Intelligence. Analytic systems help make sense of all the data from machines, products, customers, etc. allowing manufacturers to pinpoint where investments and changes need to be made.
- Human-Machine Interaction. Lewis spoke about keeping the human in the loop. While automation may reduce some job positions it will also create new positions for which the workforce must be trained and ready.
- Digital to Physical Conversion. Even with all the available technologies, ultimately, the manufacturer still has to make products. Companies must be able to integrate technology seamlessly without interruption to physical operations.
He also pointed to the strengths of technology investment such as improving the health and safety of employees; improved quality control optimization; and increased productivity, market share, revenues and profits. On the downside, new technology is expensive, especially integrating with existing systems, and new resources for training and workforce development must be considered. Still, Lewis noted, the opportunities outweigh the costs, including the creation of new and different jobs supported by new educational programs and initiatives.
Why make the investment?
With more than 25 years of experience in engineering, including design and implementation of specialty automation systems and robotics, Garmin has a unique understanding of how investment in new technology can enhance profitability. He noted that a statistic from the Partnership’s recent CEOs Speak event indicated that only 3% of CEOs in Upstate New York saw investment in new technology as means to enhance profitability.
Garman cited studies by the International Federation of Robotics and shared his experience on how investments in technology can enhance a manufacturer’s bottom line including:
- Reduced operating costs
- Improved product quality consistency
- Improved quality of work by employees
- Increased production output
- Increased product manufacturing flexibility
- Reduced material waste and increased yield
- Improved workplace health and safety
- Reduced labor turnover
- Reduced capital costs and work process costs
- Space savings in manufacturing areas
Garman concluded by paraphrasing Martec’s Law which describes how slow-to-change and adapt organizations are left behind in the rapidly changing technological environment. Garman notes that manufacturers must choose to embrace technology in order to stay competitive.
Seeing the benefits.
Swiat shared how STI-Co.—which custom engineers and manufactures application-specific antenna solutions for freight and passenger rail, law enforcement, homeland security and transit agencies—has benefitted from technology investments. The company.
She noted that investments in technology don’t have to be astronomical in cost to make a difference, especially for smaller manufacturers. She explained that STI-Co. recently invested in two state-of-the-art CNC machines and the company is already seeing payback. The cost of producing some machined components has dropped as much as 50%, with an uptick in gross margins as they have implemented the CNC machines.
As an added benefit, Swiat said the employees are excited to use the new technology and have the chance to learn new skills, seeing the technology as an investment in the company’s future, as well as in their own career. As such, the investment has also helped the company retain skilled employees.
Swiat also explained that the purchase of the CNC machines provided the company an opportunity to work with a consultant in performing a full audit of their assembly and machine shop operations. As a result of the audit, STI-Co. purchased an automated labeling system which has reduced labeling time for a product from 30 seconds down to 8 seconds.
Technology is certainly a topic the Partnership and our Manufacturing Council will continue to follow as we bring members up-to-date information to help make decisions on investments in manufacturing. To learn more about the Council and find out how you can join, click below.