Q: Siemens has just launched its first digital factory. Can you brief us on the announcement and its larger significance?
A: The kalwa factory has been in operation for many years and we had to take a big step forward to increase efficiency. We are using all Siemens’ product for automation and even after-sales service. This is a unique story we are showcasing to India. Here, all the data is transformed in a digital format. Even the use of paperwork has been eliminated. This is a completely digital workshop that starts at the level of R&D all the way through simulation, setting up the manufacturing line and running it apart from using data for lifecycle management. This is what makes it unique.
Q: What are the implications of this new technology for the larger Indian industry and Make in India?
A: In Make in India, 25 per cent of GDP is coming from manufacturing in 5-10 years. That translates into $1 trillion contribution. So, that means roughly $700 billion of additional contribution to GDP coming from manufacturing in 10 years. This would require a capex of around $2 trillion. And to attract that capex, a lot of global players would move to India for manufacturing. Also, a lot of the output would have to be exported.
Digitalisation will play a big role in this entire transition to make sure we create world-class quality products. There is an entire digital spread in a factory with data flowing from one end to the other. This includes designing the product, its production planning and then its automation to service.
Earlier, the factory had 3 lines making 77 variants of the products. Now, one line alone is making 180 variants. Earlier, the cycle time for each variant was 21 seconds. It has now been brought down to 9 seconds. We have globally benchmarked products which are subjected to extensive quality testing. This testing has to happen within a 9-seconds cycle. And, we are doing 68 quality checks now as compared to 22 earlier. All of this has been made possible by digitalisation.
Q: What does it mean for the Indian SMEs?
A: This level of digitalisation is the only way SMEs can get scale – mass customisation in a very short cycle-time from a single production line. This allows our local companies to fight against the scale that would come from competitors.
For Siemens, the siginificance of the event lies also in the fact that this demonstrates we are making Siemens using Siemens – right from the product design software, production planning software and the manufacturing execution software to the automation software, it is all Siemens. The significance also lies in being able to produce world-class quality product and still maintaining flexibility of production. Also, even the workflow in the factory is automated. This showcases how digitalisation can drive the next generation of technology required for Make in India in a way that allows scale.
Q: What is the overall cost of deploying this digitalisation technology?
A: There is RoI for sure. But, being a public listed company, we do not disclose P&L at this level.
Q: Is there a limitation of the kind of SMEs where this technology can be adopted or it can be deployed across different sectors within the SME domain?
A: The technology can be adopted wherever parameters like quantity, quality, time-to-market and efficiency are important. For example, here we are talking about electronic and electromechanical devices but it can also be applied to auto ancillary or aviation ancillary industry. This even applies to the suppliers related to the sub-assembly of these industries. Because the basic process is the same – from designing to manufacturing to sales – and digitalisation cuts down time taken for innovation. The increased complexity of making cars customised can be handled only when the processes are in a digital format. That is why it creates a lot of opportunities for SMEs.
Q: How soon would Siemens make the next announcement of digitalisation at another factory?
A: All the 22 Siemens factories have some degree of digitalisation and there is a roadmap for all of them. We would like to use this switchgear factory as a benchmark for others. It is an ongoing process. Even from a global point of view, we have more than 300 factories and we have defined the digitalisation roadmap for each and every one of them. We need to achieve higher standards for productivity because we are in a very competitive environment. This also serves as a showcase for our automation and digitalisation customers.
Source: Economic Times