Smart Factories Will Give $500bn Boost To Global Economy By 2022

Manufacturers expect investments in technologies such as the Internet of Things (IoT), big data analytics, artificial intelligence (AI) and advanced robotics to pay off big time, according to Capgemini research.

The report states that the growth of smart factories will drive a 27 percent increase in manufacturing efficiency over the next five years, adding $500 billion (£386bn) to the global economy by the end of 2022.

Future smart factory features include collaborative robots, augmented reality components and predictive maintenance, which will all go towards increasing productivity and flexibility, while lowering operating costs.

Factory 2.0

Manufacturers expect that, by the end of 2022, 21 percent of their plants will be smart factories, with sectors such as aerospace, industrial manufacturing and automotive expected to lead the way.

Indeed, 67 percent of industrial manufacturing organisations have smart factory initiatives, closely followed by aerospace and defence at 62 percent. However, just 37 percent of life science and pharmaceutical companies are integrating digital technologies.

Over half (56 percent) of those surveyed have already invested $100 million (£77m) or more in smart factory initiatives over the past five years and a fifth have invested $500 million or more (£386m).

Organisations in the US and Western Europe have so far been early adopters, as half of respondents in the US, France, Germany and the UK have already implemented smart factories compared to just 28 and 25 percent in India and China respectively.

However, it is clear that more progress needs to be made, as only 14 percent said that they felt ‘satisfied’ with their level of success.

“This study makes it clear that we are now in the digital industrial revolution. The impact on overall efficiency will be profound,” said Jean-Pierre Petit, global head of digital manufacturing at Capgemini.

“The next few years will be critical as manufacturers step up their digital capabilities and accelerate their digital outcomes to maximise company benefits.”

Knock-on effect

Of course the main issue that accompanies mass digitisation of any kind is that worker’s skillsets quickly become outdated.

We have already seen so-called ‘skills gaps’ become widely publicised in other areas of technology, perhaps most notably in data science and cloud computing, but the shift to smart factories could lead to the biggest shake-up yet.

But organisations are acting on this “skills imperative”, with 54 percent providing digital skills training to their employees and 44 percent investing in digital talent acquisition to bridge the skills gap.

Businesses are also focusing on enabling employees to work with machines rather than replacing them, as Grégoire Ferré, chief digital officer at Faurecia explained: “We use smart robots in our business where there are ergonomic issues, ultimately creating a safer environment for workers and it gives them time back to focus on other, more-important tasks.”

Digital transformation is happening in all industries, but this report suggests that manufacturing organisations will have to move quickly if they want to reap the financial rewards.

Test your knowledge: The tech quiz of 2016