Digital Transformation in Manufacturing #3
Building on our previous discussion, we delve into the core challenge for mid-sized manufacturers: transforming fragmented, non-standard factory floor expertise into a truly transferable digital asset. We explore how human-machine collaboration and integrated AI offer the essential economic solution for SMEs to overcome knowledge gaps and achieve operational resilience against inevitable workforce changes.
Returning to our discussion, we hear from Shinichiro (Shin) Nakamura, President of one to ONE Group (o2OG), a global company specializing in steel tube engineering and manufacturing, and Arjun Chandar, Founder and CEO of IndustrialML.
Why SMEs Face Data Challenges in Industry 4.0
Moderator: Building on the previous discussion, what other challenges, particularly given the necessity for operational resilience, can be mentioned regarding workforce issues?
Shin: At the top of it is the availability of workforce data in a digital format. Ideally, once the skilled expertise from the factory floor is digitized, it is transferable across generations and locations. This culminates in the ideal of a "flexible and sustainable manufacturing site where humans and machines collaborate," enabling anyone to create value efficiently.
Mod.: Aren't we already collecting a significant amount of data by IoT in the context of Industry 4.0?
Shin: Basically, older, larger, and more sophisticated companies tend to employ mass production, with data generated by machines. But SMEs or smaller enterprises have more complicated and fluctuating data that was not previously processable and accessible.
Mod.: That is a crucial distinction. What solutions are possible?
Shin: Transitioning to human-machine collaboration provides an economical approach for bridging the resource gap often found in large companies with substantial financial resources. This allows mid-sized firms to stay competitive.
In countries with aging populations, like Japan where DSTI, the core company of o2OG, is based, there is an increasing need for this kind of approach.
AI's Strategic Role: Transforming Knowledge into a Transferable Asset
Arjun: Leveraging AI can be a solution. It strategically means we are transforming accumulated, tacit knowledge into a truly transferable asset.
The use of AI in manufacturing is not about AI handling everything; rather, it focuses on organizing the information necessary for humans to make decisions or stopping people from accidentally taking risky actions.
This fundamental shift allows us to make workforce training demonstrably better and effectively lower the barrier to proficiency for every new worker. Critically, by securing this institutional knowledge, we are building operational resilience that allows the organization to adapt and thrive regardless of inevitable changes in the labor composition.
Shin: AI is fundamentally a tool, and to make it truly intelligent, it must be integrated with human action.
Mod.: So, does your system have this concept?
Shin: Accidentally, we needed to do things this way due to our operation.
Mod.: Accidentally?
Shin: Yes. Basically, this journey is coming from not having a very clear blueprint for what we're going to do, but we figured it out to make our operation more profitable, more efficient as we go by making use of data, more sustainable, and more transformable for our different locations.
Because we are not a giant, such as Fortune 500 companies, but a medium-sized company with products that are not necessarily high-profit with more complicated operations. This very fact allowed us to meticulously examine and implement the mechanisms required for making us fully digitally capable.
Mod.: In that sense, do you believe your approach is equally applicable to mid-market companies struggling with skill transfer and labor shortage?
Shin: Yes, but both, SMEs and large companies.
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Solving the labor shortage and knowledge transfer crisis requires moving beyond mere automation. It demands adopting a system designed to maximize human flexibility and operational resilience. For deeper dives into truly future-proof your manufacturing enterprise, subscribe to the o2Oh blog for exclusive access to our ongoing insights.
