Oliver Wyman: Insights into Factory of the Future
According to a report by , the international management consulting firm, the adoption of Factory of the Future (FoF) technologies by companies is gaining momentum across the manufacturing sector, following the results of a new survey by the firm and L’Usine Nouvelle.
With firms having completed the first round of proof-of-concept (POF) phase, they have begun to embrace the full-scale implementation of key disruptive innovations, such as: cobots, additive manufacturing, machine-to-machine communication, big data, and analytics.
Having conducted several test-and-learn initiatives on these disruptive technologies, firms have a growing understanding on key Industry 4.0 technologies and are now keen to begin implementing them across their operations, the report says.
A new survey conducted by Oliver Wyman/L’Usine Nouvelle of industrial firms found that 80% say that they were familiar with key FoF concepts, while 20 percent say that they were familiar with all the concepts.
In contrast, a survey conducted a year earlier found that just 65% were familiar with the core concepts, while just four percent knew about all of them.
Furthermore, the survey found that while operational teams are familiar with additive manufacturing, simulation tools, big data, and analytics, and cobots, deployment is still in its nascent state and limited to a few production lines.
However, the growing share of capital-expenditure (capex) budgets aimed at digital transformation underscores the rapid pace of change, the report pointed out. A quarter of manufacturers surveyed said that they are investing between 20% and 50% of capex into digitally transforming their production capabilities – a significant increase from 2016.
The sectors furthest along on their digital journeys are the automotive, aeronautics, utilities, and transportation sectors, it adds.
The 2017 survey also highlights a growing disparity between the bigger and smaller companies in their approach to FoF. Large companies are working on more than half of the digital concepts, with equipment modernisation (especially the human/machine interface) heading the list of priorities, followed by big data and analytics, real-time visual management, and automating tasks.
More than 70% of respondents have implemented solutions for storing and using data, opening doors to more opportunities, such as predictive maintenance, planning and scheduling optimisation, and process improvements. Meanwhile, smaller firms are falling behind, with only a third of them having studied the concepts, the Oliver Wyman report highlights.
In addition to internal benefits, client satisfaction and service improvements are at the forefront for companies, with more than 65% of survey respondents stating that they expect digital technologies will allow them to be more responsive to clients and provide better services, as compared to just 50% in 2016.
Additionally, the technologies will lead to new services based on data, improving margins, and generating new streams of revenue.
However, the greatest challenge facing manufacturers – large and small – is the issue of human capital, rather than concerns about hardware or smart-robot deployment. Neary half of the respondent companies point to a lack of both hard and soft internal skills to push the transformation along.
A third of all respondents say that they lack competency in key areas, including operation technologies, data, cybersecurity, systems integration, and change management. To tackle this hurdle, more than 70% of respondents highlight that they are developing their operating model together with partners, including IT companies, start-ups, and academics.
Finally, the report points out that another roadblock facing the manufacturing industry was the need to make a case for the Return on Investment (ROI) on what is certain to be a costly investment, particularly at companies with more than 1,000 employees. Therefore, getting an overarching view on ROI should be a requisite for the transformation, it concludes.
Timeline: Tesla's Construction of Gigafactories
Tesla's mission to accelerate the world's transition to sustainable energy
Founded in 2003, Tesla was established by a group of engineers with a drive to "prove that people didn’t need to compromise to drive electric – that electric vehicles can be better, quicker and more fun to drive than gasoline cars." Almost 20 years on, Tesla today is not only manufacturing all electric vehicles, but scaleable clean energy generation and storage too.
"Tesla believes the faster the world stops relying on fossil fuels and moves towards a zero-emission future, the better," says Tesla. "Electric cars, batteries, and renewable energy generation and storage already exist independently, but when combined, they become even more powerful – that’s the future we want. "
In order to deliver on its promise of "accelerate the world’s transition to sustainable energy through increasingly affordable electric vehicles and energy products," Tesla's Gigafactory journey began in 2014 to meet its produciton goals of 500,000 cars per year (a figure which would require the entire worlds supply of lithium-ion batteries at the time).
By ramping up its production and bringing it in-house, the cost of Tesla 's battery cells declined "through economies of scale, innovative manufacturing, reduction of waste, and the simple optimisation of locating most manufacturing processes under one roof." With this reduction in battery cost, "Tesla can make products available to more and more people, allowing us to make the biggest possible impact on transitioning the world to sustainable energy."
2014: Giga Nevada and Giga New York begin construction
Born out of necessity to meet its own supply demand for sustainable energy, Tesla began the construction of its first Gigafactory in June 2014, in Reno, Nevada, followed by its Buffalo, New York facility the same year. "By bringing cell production in-house, Tesla manufactures batteries at the volumes required to meet production goals, while creating thousands of jobs," said Tesla.
2016: Reno, Nevada grand opening
Tesla’s construction of Giga Nevada came to an end in 2016, the first of its Gigafactories to complete its construction project. The factory’s grand opening took place in July 2016, and by mid-2018 reached an annual battery production rate of 20 GWh, which made it the highest-volume battery plant in the world that year.
2017: Giga New York begins production
Two years after Tesla’s second Gigafactory began construction, Giga New York was complete, and started its production operations in 2017.
2019: Giga Shanghai construction to production in record time
In 2019, Tesla selected Shanghai as its third Gigafactory location. The company constructed the factory in record time, taking just 168 working days from gaining permits to finishing the plant's construction.
2019: Giga Berlin begins construction
Announced in November 2019, Tesla began the construction of its first European Gigafactory in Berlin. The Gigafactory is still under construction.
2020: Giga Texas begins construction
The following year in August 2020, Tesla began the construction of its Giga Texas factory. The company’s third Gigafactory in the US is still under construction.
2021: Giga Texas and Giga Berlin expected completion of construction
Looking to the future, Tesla expects to complete the construction of its Giga Texas and Giga Berlin factories in May 2021 and July 2021 respectively.