Industry 4.0 is talked about everywhere, including the machine construction industry—can you give us a brief insight into the relevance of the concept for German machine builders?
It can basically be established that the domestic machine construction industry is very well set up for the challenges of Industry 4.0, and that it has now come of age with regard to the first phase. Many different technologies are already available for approaching the various solutions. Quite a number of companies have established networked or self-controlling processes and are already using IT-based automation solutions. But the topic of Industry 4.0 cannot be assessed with sweeping generalisations.
In my view, there are principally two distinct lines of action for companies in the market: the first is the huge challenge of introducing and implementing Industry 4.0 with its core elements of digitalisation and networking within one’s own organisation—starting from the improvement of production processes right through to networking outside the limits of the company itself and beyond national borders.
This includes among other things clarification of the questions about secure data exchange, data use and the legal framework. This is because Industry 4.0 is not conceivable without the free exchange of information.
In addition to this, the necessary infrastructure for digital networking must of course be created. Each company must develop its own strategy for all this, taking into account the economic benefit, and this strategy has to consider not only technology and processes, but also people and the organisation itself. And last but not least, there is the task of skilfully linking together the existing technology and solutions.
Secondly, companies within the machine construction industry have to direct their sights on their own range of products. It is conceivable that existing solutions can be further developed, so they are capable of Industry 4.0.
But new product innovations and the establishment of new business models, which are created through the digitalisation and networking of products and production, are also a completely realistic scenario, and one in which we at Multivac have already been working intensively for some time.
How relevant is Industry 4.0 for the company itself?
Digitalisation can result in a wide range of beneficial prospects for our company. The first—and one that is close to home—concerns the digitalisation of existing processes, with the aim of making these even more efficient and thereby also creating additional benefits for our customers.
We have already implemented this in many areas—I am thinking here of our logistics centre in Wolfertschwenden, which was successfully put into operation last year, and which future-proofs the supply of spare parts to our customers and subsidiaries in Europe. The latest warehouse technology, powerful IT and modern logistics structures are all perfectly intermeshed, and they ensure all the sequences in the process run smoothly as well as being highly efficient and transparent with the maximum possible output.
Another catchword is “digital production”, in other words, the integrated representation and control of all our manufacturing processes. But here also, it is necessary to have intelligent, efficient and above all software-supported and networked production technology, because it is not possible to achieve Industry 4.0 with IT systems alone.
The benefits are obvious: real-time tracking of orders, current data status, optimisation of throughput times and therefore adherence to delivery dates, as well as of course the opportunity to be able to react quickly to the needs of the market.
We have also digitalised our processes in the sales area—I would refer here to our customer portal and the many e-commerce platforms. We are already doing a significant share of our spare parts business through our Webshop, and we can create considerable benefits for our customers through linking them via EDI and OCI to our shopping systems.
You spoke just now about the first aspect being the digitalisation of existing processes in your own company. Do you see a second aspect as being the provider of digital services to your customers?
Absolutely. We call these Smart services. Under this, we collate all those service packages, which contribute to further optimise the packaging procedures of our customers and make them even more efficient.
Examples of these services are those such as predictive maintenance or analysis of overall equipment effectiveness, which enables the operating company to create a status analysis of the packaging machine and thereby further optimise the packaging procedure.
It is also conceivable that packaging machines could be linked to our customer portal and shop systems, allowing spare parts orders for wearing parts to be automatically triggered. This would help our customers relieve their maintenance work considerably.
What are the preconditions that have to be created for providing smart services?
A fundamental requirement is the equipping of packaging machines with a suitable sensor system. The Multivac X-line for example has a large number of sensors for monitoring and controlling the processes. As part of this, the multi sensor control captures all the relevant process parameters such as process values and sequences. This ensures that the machine is run permanently at or near the optimum operating point, since the individual part-processes such as forming, evacuation and sealing are optimised within closed control circuits.
Secondly, any deviations from the predicted processes and sequences are quickly detected, which ensures that the quality of the packs is maintained. These process values also form a valuable basis for the provision of our Smart services, such as preventative maintenance for example. Now we come to the second precondition, namely the linking of the machines to the Multivac cloud, so that the packaging machines can transfer the necessary process data to it.
Many customers are undoubtedly critical of linking machines to cloud systems. How does the company position itself as regards this question?
The company differentiates very precisely between process data and production data. The linking of our packaging machines to the cloud serves solely to transfer the necessary process-related information.
Production-related or customer-relevant data, such as information about the packaged product, is on the other hand much more critical for our customers. It is for this reason that we only make this information available to the customer.
Does the company see further prospects for digitalisation besides that of business processes and the provision of digital services?
In our view there are of course new prospects, which will arise from changes in business models within our market. Here I would give the example of online retailing of food. Market researchers predict that over the next 10 years there will be a significant breakthrough in online food retailing, even though consumer behaviour is currently still fairly restrained due to the high density of possible shopping outlets and a certain fear of new concepts.
With regard to food suppliers and retailers, there is a lack of cost-effective and consumer-friendly logistics concepts, to which can be added statutory food regulations, product shelf-life, high delivery costs and low margins. Nevertheless, it is expected that turnover in online retailing will increase within a decade from the current one billion to more than seven billion euros (US$7.84 billion) per year.
This all has an effect on the food industry. And the changing behaviour of consumers has direct effects on the design of packaging. In addition to ensuring protection of the product, packaging has traditionally also had the role of presenting the product attractively at the point of sale. This function is of course much less important with online retailing. Here we have to concern ourselves much more with the design of packs for efficient dispatch and optimum product protection.
Another point is the progressive individualisation of packs, from which will arise new challenges with regard to production of small batch sizes. And last but not least, it must also be mentioned that online retailing places far-reaching demands on the industry as regards traceability throughout the logistics chain.
Multivac is currently involved in various initiatives with other market participants to develop answers to these questions.