Most crucial challenges will rise from dramatically changing market dynamics - Shailesh Sheth, Corporate Strategy Adviser, Management & Manufacturing Technology
The manufacturing sector has truly transformed in the last decade. As evidence, let us look at some parameters. First is quality – there is a dramatic improvement in the quality of Indian products and among manufacturers, there are 27 companies that have won the coveted Deming Prize, recognised globally as a mark of world-class quality. Another area where one can see strong improvement is in the area of productivity; various awardees at national productivity championships have shown many innovative ways in which companies have enhanced productivity. The third area of transformation is in the creation of proper industry structure; we now have a reasonably well-patterned structure of OEMs, intermediate sub-assembly makers, component producers etc, constituting a minimum of four-tiered structure.
However, the most crucial challenges for the manufacturing sector will rise from dramatically changing market dynamics. Product lifecycles are shrinking and volumes are giving way to variety. There is no option but to mass customise. Is our manufacturing set up capable of handling it? If not, the future CapEx will have to ensure that we do have this flexibility. These transformative changes are wide and deep, requiring major rethinking of how we run a manufacturing enterprise.
It’s safe to say that the manufacturing world is changing very fast. It’s up to us – either we are in sync with it or we sink. But a decade ago, a similar existential situation prevailed on the ‘quality’ front, which the Indian industry overcame. I am confident that India’s manufacturing sector will overcome these challenges as well, by converting disruption into opportunities and not missing the bus when manufacturing shifts away from China.
It’s high time to focus on skill development along with knowledge - Vijay Kalra, CEO, Mahindra Vehicle Manufacturers & Chief Manufacturing Operations, M&M
The Indian auto industry is now the fourth largest in the world with manufacturers including the Japanese, Korean, European, American & now the Chinese. The competition in the industry is very stiff and it has led to the survival of the fittest. Now, the quality of the product is not only compared by its specifications, but is driven by customer perceptions and the value it is adding to the customers. Offerings have become uniform; product life cycle has shortened, and customisation is on its peak.
Adoption of technologies like automation, robotics & data analytics has helped the industry to be agile, increase responsiveness and deliver in-built quality products to customers. Initially, to execute digitalisation across M&M manufacturing plant, we faced some internal challenges like IT infrastructure, equipment compatibility, skill gap, etc. Lot of investments had to be made for upgradation of IT infrastructure and similarly, latest controllers & sensors are installed in old machines to make them compatible for network connectivity.
For building future capabilities, like mechatronics, robotics, etc, all our manufacturing plants have a mechatronics lab to train our associates on the basics of automation and PLC programming. Along with this, we have partnered with institutions like IIT Bombay & TAACT for supporting us in this initiative. Now, manufacturing without sustainability cannot be imagined. It is important to develop a ready to change culture in the organisation & create an ecosystem which has the capability to adopt changes ahead of its competitors. We have implemented many pilot projects in Industry 4.0. It’s only a matter of scaling up and further building on the data gathered till now through intensive use of AI technology. This also includes giving equal importance to small Kaizens needed in the generation and implement it while involving associates. In the last few decades, the industry has witnessed many enablers which have come with time & need to be implemented. Now, its high time to focus on skill development along with knowledge.
The whole organisation needs to embrace the change rather than denying it - Shirish Divgi, Managing Director, Milacron India
From labour driven to data driven – the past decade has seen manufacturing undergo a rapid transition – . Shop floors are getting a major overhaul to collect data and convert it into meaningful information, which helps the management to make informed decisions. The workforce is being trained to use more sophisticated technologies at various levels.
With the continual pressure to reduce costs, minimise wastage and maintain margins, there will now be an added increased pressure on cost reduction as the customers become more and more demanding. The challenge would be to include newer technological advancements into the shop floor, get the right people and maintain deadlines and to upgrade the vendors and the entire supply chain to keep up with the pace of change. With the introduction of AI, more insights will appear on the processes and more automation will come into the picture. The need for change will be far more evident than ever before. The whole organisation needs to embrace the change rather than denying it.
The industry needs to come together with educational institutions and initiate steps to make the human resource more competent to handle future challenges. Similarly, compatible industries should integrate to maximise their resources, set up training centres and pool resources to make themselves future ready. The future of the companies will not be defined just by the Human Resource (HR), but also by the Intelligent Capital (IC). That’s the main reason Milacron invests heavily in training programs to upskill the HR to IC. We have been able to learn various processes from different industries and modify it in order to suit the same to our industry. For example, the concept of flowline used in the automotive industry has been involved into building machines at our company, of course, with a little modification to suit the heavy machines.
Modernisation will be linked to a clear cost benefit analysis - Raghavendra Rao, Associate Partner & Senior Vice President, Frost & Sullivan
The last ten years have been the defining years for manufacturing. It is the decade that saw China gallop into being a global powerhouse of manufacturing. The decade also saw the Chinese low cost advantages being eroded and newer low cost economies of Vietnam, Indonesia etc, emerge as significant players. India, on its part, continues to walk along a path that boasts of a young, educated and skilled workforce. The previous decade also saw an enhanced movement to digitise and automate operations. Indian plants are no exception, though the rate of adoption of digitisation, technology and automation has been selectively restricted by the availability of low cost skilled labour. Also, supply chain development and maturity has been triggered not only by the ever demanding automotive industry, but also by the plethora of shopping malls & e-commerce websites that make sure that demands from supply chains are always maintained at a stretch level.
As for the decade to come, with an increasing workforce that is relatively young and productive, Indian companies will continue to evaluate investments in technology, automation and digitisation etc, from the lens of cost benefit. This means that they will restrict investment to areas that justify the investment, which cannot be delivered by human skills, either due to volumes, quality or consistency thereof. This modernisation will be linked to a clear cost benefit analysis. Of course, the situation could be different if the rupee appreciates. But a further depreciation will lead to an even more selective basis for technology adoption.
We need to initiate steps that will see us owning global technologies and being a globally acclaimed manufacturer of capital goods in the core sector. Wishfully thinking, we need many Googles and Teslas emerging from India. Also, industry bodies must compel the government to make invention-friendly policies and incentivise those who patent the technologies that will have a long-term positive implication for India, by way of royalty/licenses.
We need to encourage large scale investments in newer technologies - Vikram Sirur, Chairman, Miven Mayfran Conveyors
Currently, the manufacturing in India constitutes only 15 to 18 per cent of the GDP. The Government of India is promoting industry-academia collaborations for rapid growth in R&D activities; central research laboratories are being activated to work with the industry to meet the demands, besides developing appropriate technology for use. All these will have an immense effect and the Indian manufacturing industry will soon catch up with the world in terms of technology, skilled manpower, meeting customer demands, as also meeting the challenges of the market demands. However, the need of the hour is to encourage large scale investments in the newer technologies and training of people at all levels. The industry, in turn, has to become lean, agile and technologically advanced by using the government facilities, scale up the production and look at the international market rather than focusing purely on the domestic market.
The world is seeing tremendous disruptions in every economic and manufacturing field. India has to bear this in mind, set aside monies from their operations to promote R&D, with encouragement given to the younger generation to experiment development of more and more disruptive technologies, which fortunately our children are quite capable of doing.
To understand the newer trends in the industry, we joined hands with Siemens in developing and supplying industrial automation products for all manners of manufacturing activities. We have developed and supplied various kinds of automated material handling systems as required by the foreign automobile industry by setting up their manufacturing plants in India. This has helped us to upgrade our knowledge base from being a simple solution provider to being the supplier of newer technological solutions to the manufacturing industry.
We are going to have more of a connected future - Navid Talib, Plant Operations Head, Honda Cars India
We were first a low/medium production country. However, now the Indian manufacturers are looking at other markets. The purchasing power in the country is also on an increasing trend; because of this, people are looking for newer avenues and options, for which we need to improve our production and operation efficiency.
Earlier, in terms of products, we would sell whatever we produced. However, with the advancement of the internet and social media, the customer is more aware of what the global trend is and what is happening in the industry worldwide. Thus, as we progress further, we need to strengthen our feedback systems and based on that, our development process needs to be much faster. So, we need to have flexibility in our systems to cater to customer demands and have manufacturing technology that can cater to multiple products on the same line.
In terms of workforce, as we have seen the automation levels increasing in the past years, we are skilling up the workforce – we are making them ready to handle automation, because automation, too, needs to be handled and monitored by people. Therefore, if we compare, in the past 10 years, we have had people who are skilled in automation, robotics and many other technologies. Also, moving forward, this workforce needs to be skilled-up on a continual basis with the rapidly changing technology trends. So, we should be able to take care of our workforce and their skills, and imbibe a sense of security in them that, with changing times and automation, their jobs are secure. Additionally, in the next 10 years, we are going to have more of a connected future; we’ll be connected to the manufacturing workplace and that workplace will be connected to the customer. Furthermore, that customer will be connected to other customers and so on.
Developing economies like India are the future markets of CNC controlled process automation - Manjit Singh Matharoo, CEO, Matharoo & Matharoo Inc
The machine tool sector in India has been facing challenges of different nature, e.g. weakening auto sector, onslaught of e-vehicles, uncertain economic downturn, sluggish exports (the China-US standoff and Brexit) and the struggling MSME sector. Business models and technologies are now trying to offer remote and predictive maintenance, real-time condition monitoring, improved manufacturing processes and digitalisation and virtualisation of total production. But the future of shorter lead times and quality efficiency are yet to be achieved. Machines need to become smart, highly automated and IoT ready. Developing economies like India are the future markets of CNC controlled process automation. Additive Manufacturing has the potential to boost the growth of the Indian engineering sector by offering light weight, cost effective and quick solutions to achieve concept validation. The advanced CNC functions of machines equipped with precision counting, measuring devices and self-adjusting control systems will be the preferred choice. Robotics could be the big thing in the next decade. It could replace operators in hazardous machining operations. With rapidly changing requirements of customers due to rapidly changing requirements of the end-users, the CNC application coupled with modular design could still be the saviour of our sector.
There are new challenges every day and our experience has taught us a lot. Properly trained technicians and operators are still an issue, but operator-friendly machines have always helped us to keep ahead. Conventional machines and equipment will remain a very important cog in the scheme of manufacturing things, and manufacturers making these will always remain in demand. India is a developing country with diverse needs and requirements. We have had the best of both; we made a smooth transition from producing low-cost automation modular units into CNC driven modular units. In this competitive world, there are many places where conventional wisdom has not conceded ground. In fact, combining both, we have given our customers a competitive edge.
Investments in the manufacturing industry are on the rise - Neeraj Bisaria, MD & CEO, Premium Transmission
The manufacturing industry has grown by leaps and bounds in the past ten years. From advances in IoT and Augmented Reality (AR) to growth in Virtual Reality (VR), the past few years have offered plenty of opportunities for manufacturers to digitally transform their operations. These technology innovations, which bring greater insights, were at the top of business wish lists. Automation in technology is one of the central, crucial elements of almost all manufacturing processes. Due to technological advancements and new inventions, automation has gained momentum in this sector. But these advancements also bring the requirement of more skilled labours in the market. My major learning during the past years has been that, it is imperative to change and keep pace with latest technological advancements. It is extremely important for any organisation to invest in training and skill development of people. In order to be in sync with the ever growing market, it is important to invest in R&D and innovation, which has become a consistent requirement now. Investments in the manufacturing industry are also on the rise, both in the domestic and foreign markets. Initiatives like ‘Make in India’ and the government’s major focus on this sector, aiming to make India a global manufacturing hub, will help this sector reach greater heights; this sector has definitely emerged as one of the high growth sectors in India.
India is an attractive hub for foreign investments in the manufacturing sector. Several companies are looking to establish their manufacturing base here. Cloud storage for wireless data, diode lasers for creating invisible seams, sensing, measurement and process control are the technologies that will have the greatest impact on factory environments. Industry 4.0, the fourth industrial revolution, is changing the dynamics of the manufacturing industry by providing manufacturers the opportunity to utilise advanced manufacturing capabilities and Information Technology (IT) throughout the product lifecycle.
We may have to unlearn all that we learnt in the last decade - Gautam Doshi, Advisor, IMTMA
The manufacturing industry has transformed significantly in terms of technology and customer expectations. Manufacturing has started talking in terms of ppm levels rather than percentage defectives. The choice available to customers has increased dramatically. All these changes have led to improved manufacturing processes.
Plus, the next decade is going to see a quantum jump in automation. In fact, the next decade is going to be driven by digitalisation; Industry 4.0 or smart manufacturing is going to be the driving force. This will lead to transparency in the supply chain. Besides, 3D printing, AI and machine learning are going to mature in the next decade. These will create threats and opportunities to existing companies. New opportunities can also come for totally new industries based on biomechanical engineering. In the last decade, manufacturing industries have focused inwardly, catering to domestic markets. The next decade calls for a rethink and an outward-looking strategy to cater to the global market. Obviously, this will lead to even greater challenges.
But the biggest transition from the last decade to the next decade will be a change from being followers to becoming leaders. We may have to actually unlearn all that we learnt in the last decade. There is, unfortunately, no smooth transition; companies must be on the constant look out for newer technologies and business models that are likely to disrupt their current business – they must employ a young workforce and maybe even promote start-ups that could compete with their current business. Employing young, curious and energetic employees will be a necessity and not an option. Exposing their current workforce to new technologies and weeding out those who are unable to unlearn and relearn will be mandatory. What’s more, rules and regulations that have worked well in the last decade may have to be relooked at, especially the processes related to increments, promotions and rewards. Industries will have to look beyond their own industry and assimilate the best practices from other organisations.
It is essential to manage inventory allying to market dynamics - M G Hegde, Manufacturing Head, Makino India
Focusing on people transformation while embracing disruptive change has been exhilarating and has brought unprecedented increase in productivity, whilst helping meet higher customer expectations. Introduction of cutting-edge technologies in machining/assembly, unmanned CNC machining centres & robotics have led to productivity increase by up to 2.5 times, and introduction of digital management on the shop floor has enabled shop floor leaders to focus on productivity improvement rather than people management. The industry is presently a mix of young and experienced people on the shop floor; it has led to having a highly lean and agile team, who can take on unprecedented challenges. Applications of innovative process engineering, assembly fixtures/tooling/jigs, have eliminated human fatigue and implemented higher safety standards.
The manufacturing industry has moved away from rigour of 100 per cent inspection to assurance with partnership of suppliers, supplier quality engineering, continuous process improvements and process audits resulting in a significant reduction in inspection costs. The gradual shift from preventive to predictive to prescriptive maintenance has led to an uninterrupted production flow. With the product shelf-life continually reducing, new products need to be introduced every two to three years compared to four to six years during the last decade, which is challenging. The other increasingly tough challenge is meeting product customisation requirements of customers, who have options, as competitors and are willing to go great lengths to serve. It is essential to manage inventory allying to the market dynamics – buy when prices are low and buy from the most economical source.
In order to have a smoother transitioning into the next decade, adapting to changes faster can lead to a significant increase in demands from customer. Exposure to new technologies like unmanned operations, robotics, process engineering capability and using semi-automation strategically is the need of the time. The effort of our organisation to create special task force to handle customer care, spare management and timely support to customers has increased customer satisfaction and consequently enhanced revenue. We have achieved exponential effect on efficiency due to our ERP system implementation and two years of effort in building synergy with several departments of ours. Operation-based system clocking and standard hours improvement have increased production by 2.5 times, while maintaining the same in human resources.