Industry 4.0: Building the digital enterprise. Metals key findings
PwC’s 2016 Global Industry 4.0 Survey is the biggest worldwide survey of its kind, with over 2,000 participants from nine major industrial sectors1 and 26 countries. It goes to the heart of company thinking on the progress of Industry 4.0. The study explores the benefits of digitising your company’s horizontal and vertical value chain, as well as building your digital product & service portfolio. We include a detailed description and definition of Industry 4.0 in the main global report on the survey. In summary, industry 4.0 is being driven by digitisation and integration of vertical and horizontal value chains, digitisation of product and service offerings and the development of new digital business models and customer access platforms.
Behind the scenes of the world’s leading industrial and manufacturing companies, a profound digital transformation is now underway. The metals sector is no exception. Companies are digitising essential functions within their internal vertical value chain, as well as with their horizontal partners along the supply chain. In addition, they are enhancing their product portfolio with digital functionalities and introducing innovative, data-based services.
- Metals companies in our survey plan to invest 4% of annual revenue in digital operations solutions over the next five years. They are setting themselves ambitious targets for the level of digitisation and integration that can be achieved. Nearly two-thirds (62%) expect to reach an advanced level of digitisation and integration within the next five years.
- Digitisation has moved from being a ‘nice to have’ or augmenting capability for metals companies to something that is now vitally important for differentiation and becoming a disruptive force. It is delivering supply chain agility, deeper process understanding and higher production utilisation. Companies are planning for a future where much greater horizontal supply chain integration with customers and suppliers is possible across the whole product life cycle.
- Automation is combining with data analytics to enable much higher flexibility as well as more efficiency in production. Algorithms are linking the physical properties of the materials with production costs and plant constraints to improve efficiency. Processes that were previously separated are now being integrated, leading to reductions of heat loss, energy consumption, throughput time, inventory as well as better price optimisation.
Many of these developments are happening now. Others remain for the future. The vision is for digitisation to encompass the entire value chain with real-time data linkages upstream to suppliers and downstream to customers and beyond to encompass after-service as well as end of product life management. The digitisation, integration and automation opportunities offered enable companies to collaborate both internally and across their value chains in ways that can provide a step change in productivity as well as design and build quality. And they are opportunities that are increasingly important as companies seek to stay relevant as the era of digitally-connected smart infrastructure develops.
