A Conversation on the Economic Opportunity of Industry 4.0 in Michigan

Chuck Werner, manager of Operational Excellence at the Michigan Manufacturing Technology Center joins Natalie Chmiko, MEDC’s VP of Pure Michigan Business Connect & International Trade for a live conversation on the economic opportunity of Industry 4.0.

As small and mid-sized manufacturers across Michigan consider the impacts of adopting Industry 4.0 technologies, the economic opportunity these technologies present cannot be overstated. MEDC’s Natalie Chmiko was joined by Chuck Werner, Manager of Operation Excellence at the Michigan Manufacturing Technology Center to talk about the benefits of Industry 4.0 adoption in Michigan, resources for success and much more. See below for key insights from the conversation, and watch the full video to learn more.

Culture Drives Innovation

CHMIKO: There’s no doubt that culture plays an important role in this Industry 4.0 readiness, what do you think is the most critical when a company is looking at culture and when it comes to the adoption and implementation of these kind of Industry 4.0 technologies?

WERNER: Change management: anything that we invest in, anything that we adopt – and it goes back to things we've been doing for a long time Lean Six Sigma, continuous improvement, quality management systems – but even more so with technology. What we're doing is we're changing, and we have to make sure that we're a learning organization. And we have to make sure that we're prepared as leadership and as business leaders, owners, managers that we are ready to lead that change. And that starts with us being able to communicate the benefit of the change, which means that we have to understand it as well. If we don’t understand and accept the change, neither will our people.

We need to make sure that we are communicating with our teams as we are implementing the change, as we are implementing the technology. That we are putting something out there and we are seeing how it is working and we’re adapting to what we are seeing and the feedback of our teams. If everyone doesn’t see the benefit we are going to put a lot of things out there aren’t going to be accepted.

Technology helps businesses ensure they are making the most out of good employees

CHMIKO: When people think about industry 4.0, I think a lot of people think about the large companies that are huge investments so let's talk about the smaller mid-size businesses for a moment. What advantages can these technologies bring to their manufacturing processes?

WERNER: The benefit to the small to medium enterprise is in a lot of ways identical to the larger businesses. We can lean out our processes. We can eliminate waste. We can get rid of repetitive motion. The benefits in a lot of ways are exactly the same. One of the things that we don’t have when we are a small and medium enterprise is we don't have people to throw at the problems; we don’t have resources necessarily to throw at the problems.

Technology can help us with data. Technology can also help that data be real-time, so that the people who need to make decisions can have the information in front of them in real-time. Also, if you look around just about any state, we can't find enough employees right now. We can't find enough people to fill jobs so what we need to be able to do is we need to be able to make the most of the good employees that we currently have, and technology offers a wealth of opportunities there to take the jobs that maybe people don't like to do or people don't want to do and be able to use some automation and allow our people to enjoy their jobs or enjoy manufacturing a little bit more.

Automation can help to replace jobs that are dull, dirty, dangerous or demanding – without replacing workers

CHMIKO: Can you talk a little bit more about the relationship between these technologies and the workforce and whether this is something that both the employee and the management can champion in their day-to-day operations?

WERNER: There are the ‘Four Ds’ of automation or robotics. We've got jobs out there that are dull, dirty, dangerous, and some that are just demanding. Demanding can be in a couple of different ways. Demanding can be physical, where we're just picking something up and moving or twisting on a non-stop basis or demanding that it needs to be done in a certain way all the time, requiring us to check and recheck what we’re doing. These are the kind of jobs that it's really hard for people to enjoy doing. We should be identifying those sorts of functions or those sorts of areas as areas where maybe we can use the automation, but we do it hand in hand with people because typically we're not going to replace people in most businesses with automation.

Industry 4.0 technologies can be scaled to the size of the solution and bottom line impact a company is seeking

CHMIKO: When talking to small businesses, there's also a lot of hesitation for manufacturers when it comes to cost, so does Industry 4.0 adoption require a significant investment at the onset? How do these smaller manufacturers determine where to invest first and how they can measure success?

WERNER: I’m not going to say that there's no investment. The costs have come down dramatically over the years due to competition and more people that are supplying these, and then a lot of businesses are realizing, ‘I can’t just cater to the OEMs.’ Ninety-five plus percent of the business and hiring out there is being done by small and medium enterprises. That’s a lot of workforce and a lot of opportunity. So, if I’m a supplier of a technology that’s not engaging the small to medium enterprises, I’m going to miss out.

Our bottom-line performance metrics are our problems. And that is really where we have to start. We have to start by understanding what metrics are hurting our business, we have to drive to a dollar value and then from there we able to start to talk ROI. What are the opportunities? What are the possibilities? And we can scale the solution to the size of the problem or the bottom-line impact it is having to the business to make sure that we have an acceptable ROI.

CHMIKO: I think that's a great point because we're not just implementing these technologies just for the heck of it. There really is an impact to the bottom line, and looking at it strategically, we can see which things are going to make my company more efficient and more profitable.

MMTC’s Technical Opportunity Assessment helps manufacturers identify and plan for opportunities to support technology adoption to solve pain points and improve the bottom line.

CHMIKO: How is the MMTC working to help businesses prepare for Industry 4.0, and can you tell us a little bit about the technology opportunity assessments and some of the other resources that you offer?

WERNER: Absolutely, this is an extremely exciting time really here at the center. We kind of started our journey with Industry 4.0 about three years ago, and one of the first things that we were tasked with doing was coming up with the technology opportunity assessment that we perform. It’s 40 questions. We come to your facility. We visit for two hours. That includes a plant walkthrough and an overview of the value stream. Throughout the partnership with MEDC we are targeting 300 Michigan businesses over the course of this year and over the years coming up to be able to get face to face with the small to medium enterprises and perform the opportunity assessment, keeping in mind that the opportunity assessment is solely conducted for your business and what an individual operation really needs.

I think most businesses are pretty in touch with what's going on and their aches and pains, so it’s a little like going to the dentist or the doctor. We kind of poke and prod, and eventually you go, “Yeah, that hurts.” Then we start focusing on it. From there, we can build a plan with two or three top opportunities for us to be able to support and help the elimination of those issues.

Incremental steps tied to specific business needs offers the balance small and mid-sized companies need when looking to adopt Industry 4.0 technologies.
Chmiko (PMBC): As we are rolling out this Industry 4.0 initiative, what would you say is your top piece of advice for a small or medium-sized company that is looking at what they can be doing as it relates to Industry 4.0?

WERNER: Avoid analysis paralysis. I know a lot of people that spend years and years looking for the perfect solution or looking for that big thing to do. There is a reason they call it continuous improvement, right? It’s small steps. It’s incremental steps, so make sure that you're looking to do something; that there's a bias for action in what you're doing. Then make sure that it's tied to your business needs. That's really the biggest thing. Don’t do nothing, but don't do something that's not going to drive to your bottom line.

STEM education remains critical for an Industry 4.0 workforce

CHMIKO: How do we prepare students to be workforce ready in the Industry 4.0 economy?

WERNER: We have to get people into STEM, we have to get them into the right skill sets but we have to make them attractive. We will focus on what we give importance to. If we really want our students to be ready for the future, we have define what it is we want and define what it is we need as far as those skillsets and we have to make those skillsets as important as everything else we have in our schools.

I was just at a business yesterday, and I was talking to the business owner. He was showing me the microscopic welding and the robotic measurement systems. These are the things that his newer employees, his promising employees, his future employees like to do because it's the kind of technology they grew up with. And the more we show them that manufacturing isn't what we believe manufacturing used to be or we think it's dull, and it's dirty. If we can get them away from that we’ll start attracting people to manufacturing at a younger age.

No one does manufacturing better than Michigan

CHIMIKO: Why do you think Michigan, in particular is uniquely positioned to be a leader in Industry 4.0?

WERNER: The bottom line is we have at all levels of industry and at all levels of businesses, we have people that understand manufacturing. I always say that manufacturing is not easy, but it's simple. It’s making parts to put in a box to sell to a customer, and there is no other state that does that better than Michigan. And that has kind of the same from a knowledge base of the employees and the experience level. And when you look at the personnel we have, we have what it takes to support the adoption to support the change and to support the continuous improvement that some of these technologies provide us. And we just need to go out and adopt it.

To learn more about Industry 4.0 and how your business can access resources and support from not only the MEDC, but from other key industry experts at Automation Alley and the Michigan Manufacturing Technology Center, please visit michiganbusiness.org/industry4-0.

Watch Natalie Chmiko and Automation Alley executive director and CEO Tom Kelly discuss how Industry 4.0 can accelerate innovation here.

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