The Impact of the Health Crisis on the Industrie 4.0

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December 8, 2022

Industry 4.0: The Impact of the Health Crisis on the Industry of the Future

For more than a year, the industry, like many sectors, has undergone an upheaval in its functioning due to the health crisis. During the initial containment, some manufacturers even experienced shortages of raw materials. Others were sometimes unprepared to respond quickly to new customer demands. Industry 4.0 players are now facing difficulties related to the functioning of their value chains. They have had to adapt and innovate not to bring their production units to a standstill.

A Health Crisis to Support the Adoption of Industry 4.0

With the decree of a national lockdown in March, companies have seen their working habits change dramatically. Teleworking has become the norm and has pushed many companies toward the industrie 4.0. Such a crisis has therefore allowed many industry players to reassert their remote control capabilities. The integration of digital twins, in particular, reduces the need for an on-site workforce.

Industrie 4.0 has also benefited from the government's recovery plan. Indeed, France Relance provided 900 million euros to modernize SMEs and ETIs. French industry is under-equipped with robots compared to its main rivals (Germany, Japan, etc.). In addition, these subsidies aimed at modernizing industrial equipment should also be extended over several years.

Tech 4.0 Allows More Adaptability for Industry Players

The health crisis and associated restrictions have caused many shortages. Some of these shortages have been economy-wide. Such as the container crisis in sea freight. This shortage is due to several causes: longer unloading times due to a lack of staffing; changed transport plans with much less frequented ports (and, therefore, empty containers not recycled in the maritime loop). It is also noted that in 2020, the number of end-of-life containers taken out of the circuit was much higher than the number of new containers introduced, which creates an imbalance. To avoid or overcome such a crisis and improve the traceability of containers and the management of their flows, solutions such as the use of IoT (Internet of Things) coupled with blockchain and advanced planning solutions incorporating artificial intelligence are possible.

Ship to transport the industry

The recent semiconductor crisis is a fascinating case to study more closely. The situation occurred despite a steady increase in demand for this type of product over several decades. Microprocessors are widely used in the automotive industry. Each vehicle contains 300 to 400 euros of electronic components. With the confinements of the first half of 2020, car manufacturing has come to a halt or has slowed down. The demand for electronic components fell in the same proportions. However, specific sectors have been in strong demand: headphones, PCs, servers, 5G smartphones, new video game consoles, etc. Faced with the uncertainties linked to the pandemic, investment in new production capacity has slowed down.

In the automotive industry, demand and production picked up towards the end of the second quarter of 2020. They accelerated sharply in the autumn of 2020 in the automotive industry. However, as the automotive sector picks up, cumulative demand for semiconductors exceeds the production capacity of foundries. Manufacturers are then forced to arbitrate, as they cannot serve all markets. As automotive components are the least profitable, their production is not prioritized. As a result, many automotive factories are running well below capacity in 2021 due to a lack of electronic components. The fact that the automotive industry operates on a just-in-time basis, whereas the supply cycles for electronic components are 3 to 6 months, further accentuates this problem.

To avoid encountering this type of problem in the future, it is essential, on the one hand, to ensure better global planning of microprocessors by the automotive ecosystem with the constitution of intermediate stocks. On the other hand, it is vital to put in place computerized planning 4.0 tools.

These two examples above highlight the vulnerability of globalized supply chains and the need for better risk management in the supply chain. We can also conclude that it is necessary to think about production on continental plates. This would reduce lead times, improve visibility and allow for more controlled management. Relocation to Europe is thus a desirable solution. But setting up factories in Europe requires the choice of highly automated and much more flexible solutions to be able to produce at a lower cost.

Intervention by External Actors to Promote Innovation

For several years, many companies have been using external companies to help them integrate 4.0 technologies. And these companies have given rise to many technologies enabling companies to adopt new working methods.

Companies such as Dillygence offer to help companies to improve their operations considerably by providing digital twins to visualize, analyze and control more effectively. Dillygence's solutions are distinguished by their speed, far superior to current offers, allowing the exploration of a wide range of possible improvements to identify the most relevant to the production system. Upstream of implementing solutions, Dillygence also supports your transformation to Industrie 4.0.