How HP Singapore put sustainability at the centre of its Fourth Industrial Revolution (4IR) strategy in Southeast Asia.
Article by Tian Chong Ng, Managing Director, Greater Asia and Steve Connor, Vice President, Ink Supplies Manufacturing at HP.
As a base to launch a sustainable Industry 4.0 strategy, Southeast Asia (SEA) ticks all the boxes for global supply chain professionals. Keen to diversify their global footprint, a few multinational enterprises (MNEs) have been quick to optimise their manufacturing capacity across the region, combining physical operations and production with digital technologies.
While COVID-19 continues to cast some uncertainty, Southeast Asia’s manufacturing prospect looks increasingly promising. Advanced manufacturing hubs, green infrastructure, investment in digital and talent reskilling are expected to deliver extended growth for the region as it recovers from the pandemic. Early 4IR adopters in SEA have already achieved high productivity gains of 10 to 50 percent, according to McKinsey, and academics project that sustainable technologies could triple the job-creating impact of the region’s fossil fuel industries. Most manufacturers recognise the 4IR presents a major opportunity, but the adoption in the region
remains nascent. Although there are big gaps in industrial development among the ten states,
firms willing to modernise their production facilities can achieve significant operational and environmental cost savings.
This is what makes this current moment seems very promising for MNEs in the region. As manufacturers begin to operate at the intersection between the physical and digital, it will be through measures of efficiency like throughput, yield, and cost reductions that show a competitive edge that depends more on sustainability than cheap labour.
There are significant productivity gains to be made for all except the most advanced manufacturers. But, as a whole, the region is still reliant on the labour-intensive operations that are more akin to Industry 1.0 and 2.0. Levels of foreign direct investment (FDI) to SEA also suggest that a ‘China Plus One’ strategy is a key driver of SEA industrial activity. FDI to the region exceeded China by 4.5 percent during 2016-2020 and has grown by more than double the rate of China in the last ten years, according to the UN Conference on Trade and Development (UNCTAD). But what hasn’t grown much in SEA is Industrial Automation. UNCTAD’s ‘Investing in Industry 4.0’ suggests greenfield investment in 4IR has remained flat at 12 percent across the SEA states since 2010.
This isn’t only a SEA issue. The World Economic Forum (WEF) has said manufacturers are experiencing “pilot purgatory” and that more than 70 percent of companies globally are still experimenting with advanced technologies. The Forum hopes a small network of 4IR leaders can be a beacon for the industry to follow. This year, the WEF recognised HP Singapore’s Smart Manufacturing Application and Research Centre (SMARC) as a WEF Global Lighthouse Network member. HP is sharing research and expertise from the centre in Singapore to help MNEs identify and unlock smart capacity through digital technologies rather than increase spending on capital infrastructure.
The SMARC Lighthouse Over SEA
The HP Singapore SMARC facility is the home ground in Southeast Asia for its engineers and industry partners to experience, trial, and prototype solutions. Since HP’s Ink Supplies Operations established the centre in 2017 to implement 4IR into their production lines, they have moved from labour intensive and reactive processes to highly digitised, automated, AI-driven processes.
In this period, HP has reduced manufacturing costs by 19 percent and saved US$1.5 million by reducing waste from production processes. In addition, using analytics and HP’s factory floor management platform, Command Centre, the operational impacts have seen a 70 percent productivity boost and reduced issue resolution time by 90 percent.
The Five Pillars Of 4IR Technology
MNEs are always looking for ways to manage their supply chains. Still, firms that continue to follow a low-cost, low-skilled labour model will quickly lose ground to those applying 4IR technologies to achieve profitable and sustainable growth. In their conversations with manufacturers, the company stresses that using 4IR technologies is a gradual process of much more than just the technology.
HP perceives 4IR as a workforce transformation. Their plan to improve their operations and identify where they could add value according to their strategic pillars was driven by teams of trained individuals who came onboard with them on the journey, experimenting with technologies and deploying them into HP’s manufacturing lines. The transformation was built on four pillars: robotics and automation, Industrial IoT, additive manufacturing, predictive analytics, and, most importantly is HP’s people.
Pillar One: Robotics And Automation
HP deployed collaborative robots ‘Cobots’ and Autonomous Intelligent Vehicles (AIV) to perform manual and routine tasks, boost productivity, reduce operator fatigue errors, and protect their operators’ physical well-being.
AIVs are used to move heavy goods across the floor, and Cobots are programmed along the line; to tear the protective film from cartridge moulds, pick up parts from any direction, and place them in the correct orientation for assembly. Quality control was enhanced by automated inspection machines that would detect physical defects in printing while applying machine models to improve screening accuracy, helping HP to maintain the quality of large format high-definition prints, one pixel at a time.
Pillar Two: Industrial IoT
Industrial IoT is an essential component of a digital transformation journey. HP connected and collected real-time data from analogue and digital devices, sensors across its entire manufacturing line to dynamically visualise and manage factory performance. Using Project SafeEye to set up real-time analysis of camera feeds, HP can maintain safe social distances and manage the human flow. HP’s Shop Floor Tracking System digitised manual data entry to significantly cut down process “scrap” and resource waste from production processes, as well as minimise unnecessary paper usage.
Pillar Three: Additive Manufacturing
HP introduced more flexibility by deploying Additive Manufacturing to their line using the HP MultiJet Fusion 3D printers. These 3D printers helped to replace machine parts, avoiding costly downtime when vendors could not be on-site. The company also printed much cheaper and lighter replacement pallets used for goods transportation on their conveyor belts. This results in an improved design of the Drill Extraction Shoe with the 3D printer, reducing operational cost and its production time from three to five days to just 24 hours.
Pillar Four: Predictive Analytics
Predictive Analytics and machine learning models enabled real-time detection, diagnostics, and product quality prediction across HP’s manufacturing lines. The focus is to diagnose and recommend the right set up for tools and manufacturing lines, reducing downtime while increasing precision. The algorithm automatically detects and alerts issues that are affecting machines and processes, while predictive models replaced traditional “destructive testing,” and reduced waste so that they could meet unique product specifications more accurately.
Pillar Five: Workforce transformation
All of the strategic 4IR pillars above were pursued together, but HP knew they had to elevate their people to make the transformation successful. HP takes pride that 35 percent of its technical workforce have had the opportunity to take on new roles with continuous internal and external training and reskilling. Their highly-skilled teams have allowed them to think flexibly in the agile environment while the technology performs its function and tells them what they never knew.
Southeast Asia stands at the intersection between the physical and digital worlds, and 4IR technology represents a system upgrade for a manufacturing sector that is gradually moving away from basic mechanisation. Highly skilled technical workforces are changing the face of manufacturing. As more firms realise the size of this opportunity, it will be sustainability that powers exciting opportunities in this region.
HP Singapore is a member of the World Economic Forum Global Lighthouse Network as a leader in applying 4IR technologies to manufacturing and achieving profitable growth sustainably.
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