Industry 4.0 for Small Manufacturers: Tech is Great, but People are Greater and Essential

In today's fast-evolving industrial landscape, the quest for the "technological silver bullet" is more relentless than ever. With innumerable potential solutions like automation, collaborative robots (cobots), Additive Manufacturing, Industry 4.0, Digital Twins, IoT, Blockchain, Robotic Process Automation (RPA), Hyper automation, and, of course, the current hype-generator-in-chief, Artificial Intelligence, being touted in every on-line forum, podcast, trade show, seminar, that quest can be fraught with confusion. That list grows with each passing month. The sheer number of tech solutions can be overwhelming, especially for companies with few expendable human resources who are seeking help with these solutions.

They are tools, only tools! Beware of the hammer looking for a nail.

These technologies have assisted manufacturing companies in boosting efficiencies and revenue. I do not mean to take anything away from all these fantastic developments, inventions, discoveries, and the people and companies behind them. They are incredible! However, it is vital to emphasize to those seeking to use them that these are merely tools and not the magic pill to be taken once that will somehow solve all your problems. Like all tools, they need to be applied appropriately to the problem. Just as one cannot effectively use a hammer to insert a screw, an ill-defined problem will appear solvable simply because a specific tool is at hand. Therefore, searching for the best tool, tech, or business process is not the optimal starting point for addressing manufacturing challenges. Sadly, that is where that quest, more often than not, usually begins.

While they can support increased productivity and effectiveness, tech tools alone cannot guarantee sustained revenue growth for long-term survival. At best, when used superficially without the painstaking investigations to understand the deeper issues involved, these tech solutions yield mixed results. There are always, always, deeper systemic issues involved. That is a given. Guaranteed!

What can you do?

What do you think is best to approach this task of solving your pressing and annoyingly recurring problems? As the owner, you would do much better if you could clone yourself and a few key people. That is, sadly, a dream that is yet to materialize.

Time, in labor hours, is a commodity that small manufacturers do not have in abundance. There are people, public organizations, and companies that help small manufacturers succeed. But they are, unfortunately, few. Why? Simple economics. Larger manufacturing companies are more lucrative revenue prospects.?They tend to go after larger manufacturing companies to survive as a business.

Even then, for an external entity to come in and, in a matter of weeks, months, or even years, collect, comprehend, and fathom the unique complexity of your internal operations, the decades of experience and experiential history of what has gone wrong, the derived solutions to those problems, tribal knowledge, and so on, is no easy task. I'm not too fond of the word impossible, but here I will relent, in this case, and say – it is nearly impossible.?

The solutions suggested by an outside company may work for a while, but as is typical for solutions that do not address the root cause of the problem, they reappear again. At best, in a different form, but still stemming from that unaddressed root cause. It becomes a game of whack-a-mole with these problems.?? Hence, strategies of relying solely on external help do not guarantee long-term survival.

If you are a small manufacturing company owner with happy, repeat customers and a profitable product line, you are on a solid track to success. However, most typical small manufacturing companies are not as fortunate. You may have employees fighting "fires," fighting problems, jumping through hoops to fulfill orders with materials that have not yet materialized on your dock, chasing suppliers and shipments, figuring out substitutions, working on expediting orders, and placating angry customers who are unhappy for a million reasons. You know these daily challenges only too well. Most small manufacturing companies inevitably have these ubiquitous problems.

Barring bias and tunnel vision, given sufficient time to analyze and explore these problems, you and your team are the only ones best suited to solve most issues afflicting your organization. Yet, time is something that you don't have. Your plate is full. You lack time as it is to take care of daily operational issues, let alone set time aside and analyze the problems you are facing. What you need is additional time. Since you do not have enough of that, you seek outside help.

You join trade associations, assign some people to attend workshops and seminars, and scour through the literature to learn about the latest and most extraordinary developments allegedly working wonders at Company XYZ. Consultants offer personalized and customized advice. Claims of miracle solutions flood your inbox daily.???

You are a product maker. Hence, you tend to gravitate to service-as-a-product solutions that represent something definite. For example, a Supply Chain Management platform that "solves" all your supply chain woes, Quality Management platforms that "fix" all your quality problems, Lean Manufacturing packages to "eliminate" all your waste, ERP systems that will make your operations "flow," business process automation packages that will "reduce" the time spent on repeatable tasks, and so on. They have a clearly defined and finite cost. They are not open-ended contracts. Hence, you feel more comfortable with that. And rightly so. You may even get to evaluate them before buying - try before you buy.

However, productized service offerings are derived from intelligent people who put their heads together and work out the supposedly "best way" to run a manufacturing company. They package this and sell it as a panacea to flying-by-the-seat-of-your-pants-manufacturing. The solution is designed to be the Jack-of-all-trades solution, working for every possible variation of a manufacturing company. They offer a menu of convenient tools and workflows that you can select and choose to use. There are numerous excellent, well-designed, and tested products in the marketplace. There is nothing wrong with using these solutions to help you better manage your business systems. That is until your best customer calls in, yelling because they have not received a promised shipment for that day. You look into the system and discover no reason why that should have happened. Your investigations lead you to find that Ed, down in the scheduling office, has been using an Excel spreadsheet on the side, tracking things in the manner and format he is comfortable with. Ed has been consistently lax when transferring that data to the newly installed official system. "That can wait till I get done with figuring out the "Hot" orders," he has been thinking for days, nay months. That keeps happening until catastrophe hits.

Sounds familiar? I am sure you know an Ed or two in your shop. In defense of the Eds and Edna's out there, they were most likely trained in a classroom setting, shown on a screen how to navigate the formidable interface screen of this fantastic third-party solution you installed at great expense and with even greater expectations. They were most likely not trained with a hands-on approach. After all, that additional one-on-one training was on the project proposal as a separate line item as "optional" training, a convenient way to mask the actual true cost of a solution. You discover, too late, that that was not "optional" but essential!

Your problems may need an entirely different approach beyond the scope of any single systems package or a software tech solution. Your company probably differs from Company XYZ or Company ABC, highlighted in the sales literature you received, as a grand success story. That convincing story, a few hours of research, and sitting through sales pitches convinced you to install this magical system. If this gives you any comfort, sadly, you are not alone.

You typically only need some of the features that get packaged into these products. They could solve some of your problems and provide temporary relief, but they can never solve all your core problems. These solutions end up being only band-aids without addressing the root cause. They are usually overkill, with needless features you never need or use. Or, worse yet, you may have to adjust your otherwise functional, time-tested, existing processes and adopt a workflow with needless data and information collection requirements that further exhaust strained resources. That gets the Eds and Ednas to resort to the side-bar solutions they are comfortable with.

So, what else can you do??

Here is one possible approach. You can fall back on your existing people. You'll need to do some pre-planning before you follow this plan. Find those who have been with you for the longest and have the most experience. Assign them to a team exclusively devoted to process improvements as a full-time job. I know that it is painful to lose such brain power from the operations side of things. However, if you genuinely want to solve your problems, you must give them the freedom from their previous assignments and allow them to think outside the box without worrying about other responsibilities. Stop them from getting dragged into the daily firefighting, which they will naturally get pulled into because of their experience or gravitate towards since that is in their comfort zone. Make sure that this new responsibility is a promotion with commensurate generous rewards. Make it worthwhile for them. They will make it worthwhile for you. Now, along with these veterans, add bright-eyed-bushy-tailed young recruits fresh out of vocational school or college. They will come armed with a wealth of knowledge of the latest technology and devoid of experiential bias or burnout from daily firefighting. Make sure you choose those who know the new tech out there. Get some outside expertise as a coach or guide if you must. Pareto-ize your historical problems and then let them get to work solving those at the top of the list. Please give them the authority to function freely. Have them report directly to you, the owner. If you assign them to someone else who is not as vested as you in solving this problem once and for all, it will typically end up not so well.

Getting someone to attend classes or brush up on Systems Thinking will be an additional boon that drives deeper thinking. It would help if your process improvement team applied Systems Thinking for genuinely effective solutions.

Once this team starts producing potential solutions, run small pilot projects before jumping on any single solution and implementing it plant-wide. Always run pilots to test the efficacy of a solution. Give the pilot projects sufficient time (typically no less than a year) to yield results and manifest weaknesses. Have the team go back and revisit and redesign their solution to improve on weaknesses or inadequacies discovered during the pilot phase. If the pilot is successful and proves robust, scale that solution across the shop floor with sufficient training and oversight to ensure the implementation follows the team's recommendations. Don't strive for perfection in the early days. 80% is good enough and will yield far greater returns than the quest cost for 100%.

Solutions like these are not rocket science. These methods have been around since the days of Shewhart, Deming, Juran, and Crosby. The misguided focus on short-term profitability has kept companies from finding the time to effectively invest in success.

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National Federation of Independent Business (NFIB) National Association of Manufacturers - NAM U.S. Small Business Administration Manufacturing Extension Partnership (MEP) MFG Talk Radio AMT - The Association For Manufacturing Technology NTMA Precision Manufacturing Institute (PMI) Fabricators and Manufacturers Association IndustryWeek SME Manufacturing.net PMA Indiana

A version of this previously appeared on the Clarity Manufacturing Consulting blog. https://clarity-manufacturing.com/industry-4-0-for-small-manufacturers-tech-is-great-but-people-are-greater-and-essential/