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The impact of Industry 4.0 on purchasing decisions for manufacturing equipment

clock 5.5 minutes | 22 Oct 2019

Industry 4.0 is not a product that you buy, plug in and go. Rather, it’s a concept that involves the Industrial Internet of Things (IIoT), which is about getting more data out of your equipment to maximise its performance to gain efficiencies. That data then needs to transfer to a server where it can be collected and analysed. From there, action is taken depending on what you learned. IIoT is all about connecting sensors, data, automation systems and so forth. IIoT is at the heart of Industry 4.0. It’s what makes Industry 4.0 a revolution.

The dilemma for manufacturers is how far they can afford to implement IIoT in their factories – and how to do it. For starters, the right protocols could help.

Which protocols?

IIoT relies on protocols. Protocols are sets of rules that permit devices to communicate with each other using different languages. Like spoken languages that evolve over time to better help people who speak them, protocols also keep developing to better accommodate industrial networks. Protocols for the Internet of Things (IoT) are way ahead of those for the Industrial Internet of Things. (The difference in IoT and IIoT is essentially consumer connectivity vs. more demanding and complex manufacturing connectivity.)

Automation and connectivity are already happening in the plastics industry. “Our belief is new 4.0-related protocols will be released well into 2019,” Wittenmann Battenfeld President David Perusse told Plastics Engineering in January, “However, a release is merely a guideline that OEMs of injection molding machines (IMMs) and auxiliaries may follow as a way to agree on signals and data transfer in 4.0 integration.”

Yet the challenges of developing IIoT protocols center around the lack of standards. Granted, there are protocols available on the market that allow for the transfer of data. It’s a question of unanimity as to which should be adopted across the industry.

IIoT involves incredibly vast and diverse applications that generate and collect data, which requires seamless interoperability. It’s not easy when machines answer to different protocols. Neither are protocols cheap. By standardizing IIoT protocols, the price would come down. SMEs could afford to take advantage of IIoT, by either purchasing devices such as sensors to log data or even investing in IIoT-enabled machines.

Start small?

Few manufacturers want to unplug perfectly sound machines and start from scratch, and who can blame them? Of course, your investment can start small. Industry 4.0 can be built on legacy equipment. It depends on what you have, however.

For machines that don’t produce their own data, sensors can do the job. Transferring that data is tricky, however. Equipment use different communication protocols, and then, some simply lack the capability to communicate.

As Industry 4.0 advances so, too, will options for retro-fitting. Another issue that will affect your purchasing decisions: older control systems will be unable to produce substantial data, which is the whole point of Industry 4.0. This doesn’t mean retro-fits aren’t possible. A cost-benefit analysis will tell you if it’s worth it.

Another tool to consider is a modem that acts as the communications hub. As explained by Plastics Engineering, “each device can be authenticated and automatically drive the IP device connection.”

The patented modem belongs to Wittenmann Battenfeld. Perusse tells the journal:

“It would be impractical for processors to run around their plant for every piece of equipment change for different parts and mold setups, or if a device has to be swapped out for maintenance . . . security is going to be important, so this hub does not allow erroneous data exchange or an unfamiliar device connection.” In fact, “we had a cyber security firm come in to try to hack into our connections and verify bad data cannot move between non-authorized devices. When systems are kept separate and firewalls can protect the user from breaches, customers will get their IT advisers to verify 4.0 can be safe—and far more useful than molding operations of the past.”

The best scenario is that molders work with a controller that shows them the mold’s setup “recipe”, and which devices are plugged in. Perusse goes on to explain,

“The user unplugs the devices not called for, then they plug in the correct device. . . . next, the device must authenticate. then the user loads the setup data to the device—such as tcU set points, blender recipe, dryer settings, and robot program for the molded part.” Otherwise, the worker might “run around the IMM to do all this to each device. What we’re hearing from our early adopters is the setup is mistake-free. Without connectivity 4.0 advantages, molders said they forgot to turn on tcUs or set the correct temperature set points. They didn’t go up on a mezzanine to set the dryers properly. so, they produced a shift of suspect parts. Our setup made it foolproof for second and weekend shifts to make mold changes error-free.”

Other ways to enter industry 4.0

There are a host of other opportunities on the market to enable manufacturers to begin digitizing, such as Software as a Service (SaaS). This could give you a machine overview with information and documents about each machine, including a catalog of components and parts.

You can also use a Manufacturing Execution System (MES) specific to injection molding. This is a computerised systems that “facilitates the planning, control and monitoring of the entire production process by providing real-time data on overall equipment effectiveness, molds, machines and rejected parts,” Plastic Machinery magazine writes. This would reduce the number of inadequate parts you produce and enable your machines to perform more productively.

Financing isn't easy

While manufacturers are on board with at least the concept of Industry 4.0, not all lenders are convinced by automation alone. They’re unsure of the benefits to the customer, which means they’re not yet persuaded that the business and its processes are sustainable.

Consider that the dearth of skilled workers has driven some manufacturers to adopt automation elements such as robots, end-of-arm tooling, sorters, vacuum pickers and optics. Yet, some banks – too many, in fact – view these technologies as passing trends, Chris Lyle, President and CEO of Equipment Finance Group (EFG) in Dayton, Kentucky – specialists in plastics manufacturing – told Plastics Engineering.

Rather than fall under the mighty weight of larger competitors who have the money to automate, smaller manufacturers are turning to retro-fitting. There’s no question that technologies are making these businesses successful and eliminating inefficiencies and the associated costs. It’s therefore puzzling that these technologies are viewed as not adding value to the process. Lyle says those lenders view the technologies as “non-remarketable.”

While this is automation we’re talking about, Industry 4.0 has not yet created waves in the lending industry. So far EFG hasn’t had anyone knocking on their doors asking for the money to buy 4.0-enabled equipment. So far, most manufacturers are looking to retrofit for automation. It’s Lyle’s opinion that 3D printing, which has grown incredibly over the last five years, will show how buy-in to Industry 4.0 will unfold.

Like retrofitting for automation, it looks like the same will happen for Industry 4.0 as manufacturers play catch-up. Financing isn’t the only problem but finding skilled workers to operate the technology.

Manufacturers are cautious

Given all of this, it can hardly be surprising that only around a third of manufacturers worldwide are rolling Industry 4.0 out at scale. Most projects are caught in ‘pilot purgatory’, as described by a 2018 report by the World Economic Forum (WEE) in partnership with McKinsey, meaning that the pilots are going on for an extended time.

Reasons preventing a full roll-out:

% of respondents

Lack of resources, knowledge to scale


High cost of scaling


Hard to justify business case without short-term impact


Pilots demonstrate unclear business value


Too many use cases to prove out


Numerous platforms to test


Lack of trust in scale ability platforms


Vendors not willing to subsidise pilots


Lack of leadership support and attention




Decisions, decisions

The benefits of technology are undeniable. According to the report by the WEE and McKinsey, “Technology and innovation have been and will remain central to how production evolves and is transformed. Over the past 20 years, worker productivity across industries in the United States increased by 47%, driven primarily by technology adoption and innovation.”

The next move is Industry 4.0. As of 2018, only 15% of assets are connected in production. That leaves the door wide open for manufacturers willing to brave the waters. Automation is already killing off those that failed to adopt technologies, because they simply could no longer compete. The effect of Industry 4.0 will be even more dramatic. The manufacturers able to generate and collect data, analyze it to identify where they can optimize performance will be the big winners.

Technology companies are already investing heavily in hyper-scalable platforms for industrial use. The issue of standard protocols could also be solved soon. If you haven’t already, you’ll then have some buying decisions to make about how you enter or scale up your Industry 4.0 efforts.