Smart manufacturing offers clear benefits and cost savings

How AI, IoT, and the cloud are shaping the future of production

In today’s rapidly evolving manufacturing landscape, companies face unprecedented challenges. From volatile supply chains and increasing customer demands to the urgent need for sustainable practices, the pressure to transform is immense. Smart manufacturing leverages advanced technology like artificial intelligence (AI), machine learning, cloud, the Internet of Things (IoT), and data analytics to optimize production processes. By connecting systems, processes, and people, smart manufacturing enables real-time data collection, analysis, and automation. All this drives increased efficiencies, lower costs, and enhances product quality. Ultimately, smart manufacturing changes how products are designed, produced, and delivered.  

Blending physical and digital processes  

Smart manufacturing is the orchestration of physical and digital processes within factories and across other supply chain functions to optimize current and future supply and demand requirements. Gartner says organizations accomplish this by “transforming and improving ways in which people, processes, and technology operate to deliver the critical information needed to impact decision quality, efficiency, cost and agility.”

The National Institute of Standards and Technology (NIST) uses a slightly different definition, describing smart manufacturing as “fully-integrated, collaborative manufacturing systems that respond in real-time to meet changing demands and conditions in the factory, in the supply network, and in customer needs.”  

Regardless of which definition you use, cloud computing rests squarely at the heart of smart manufacturing. In fact, SAP says the concept is grounded in cloud connectivity. “[Smart manufacturing] is a combination of human creativity, digitally connected machines and assets, and AI-powered systems and analytics,” the company states. “The integration of AI and smart tools helps fuel adaptability and speeds up the capacity to customize outputs based upon real-time data and intel.”  

Smart manufacturing in action  

Ever since the term “smart manufacturing” was coined in the late-2000s—right around the time the cloud and IoT were both becoming more prevalent in the production process—companies have been integrating their digital and physical systems to gain efficiencies, optimize production, and improve quality.  

Take West Liberty Foods for example. A food processing company in Iowa, West Liberty successfully shifted from “reactive” to “proactive maintenance” using smart manufacturing technologies, according to industrial software provider L2L. Slow, manual data entry and reporting processes meant technicians took days to respond to maintenance issues.  

To address problems like tedious manual data entry and time-consuming reporting processes, the company implemented a connected worker platform that provides real-time machine data analytics and full visibility into shop floor operations. Key benefits include an 88.5% improvement in resource utilization, a 10% increase in operational availability, and $2 million in maintenance costs savings. 

In another example of smart manufacturing in action, landscaping machinery manufacturer John Deere was using a high-volume steel welding method that required robotic arms, and dealing with frequent porosity issues that its manual defect inspection process was either missing or taking too long to identify and mitigate. 

Using an integrated AI solution and Intel's hardware and software, John Deere adopted a computer vision and neural network-based inference engine to identify defects in real time during the welding process. “When a defect is detected, the system automatically stops the welding process, enabling immediate corrective action,” L2L reports. “As a result, the company substantially reduced scrap and rework costs.” 

Smart manufacturing is also being used in the healthcare setting, where ProjectManager.com says BJC Healthcare runs a smart factory, which incorporates IoT into its processes. For example, BJC uses radio frequency identified (RFID) technology to track medical supplies. “For BJC Healthcare,” L2L points out, “smart manufacturing has reduced costs, increased the efficiency of its operations and improved the overall functioning of its company.” 

Core benefits of smart manufacturing 

Businesses are using smart manufacturing strategies to streamline processes, increase productivity, stay competitive, and prepare for the future—even if that future holds Black Swan events like global pandemics. According to food processing and packaging solution provider Tetra Pak, smart manufacturing also supports: 

• Improved collaboration and knowledge sharing. Smart manufacturing improves productivity and engagement by making it easier for employees to communicate and develop their competence.    
• Better data insights. You get more data —and you get it faster. Real-time reporting means better problem-solving, improved productivity, and more uptime. 
• Maximized plant efficiency. The factory becomes more efficient because production can be real-time responsive in terms of materials, sourcing, production and human resources.    
• Faster problem solving. Because everything is in real time, smart manufacturing allows for faster problem-solving and decision-making when it matters most.   
• Tracking products across the value chain. When processing, packaging, and labeling have all been digitized in the cloud, every element of manufacturing can be tracked and analyzed, from raw materials to manufacturing to delivery.  

In the labeling space, smart manufacturing systems help monitor and control the labeling and artwork management processes to prevent errors and defects, effectively supporting good product traceability. By tracking products across the production process, these technologies also help companies readily identify and address issues as they arise. 

Smart manufacturing systems also help drive both operational excellence and ESG performance. By automating and controlling labeling processes, these systems prevent errors, enhance traceability, and ensure accurate product information, leading to reduced waste, improved efficiency, and minimized risk—key aspects of materiality that contribute to a company's financial health. Smart labels, equipped with technologies like QR codes and RFID tags, act as dynamic data carriers, providing real-time insights into a product's journey throughout the supply chain and empowering companies to optimize inventory, enhance quality control, and respond swiftly to issues.

Activated by triggers like container filling, smart labels are a cornerstone of smart manufacturing. These labels enable real-time tracking and data collection for products throughout the supply chain by incorporating technologies like QR codes, RFID tags, and Near Field Communication chips to communicate with a device. They can provide information on a product’s origin, expiration date, temperature logs, and more. By providing crucial data, smart labels enhance inventory management, quality control, and operational efficiency, fostering a digitally connected manufacturing environment. 

Delivering real results 

With its fusion of advanced technologies, smart manufacturing is poised to reshape entire industries. From optimizing production lines to streamlining supply chains, the benefits are undeniable. As companies like West Liberty Foods and John Deere have already discovered, smart manufacturing isn't just a futuristic concept; it's a tangible strategy delivering real results today.   

By leveraging solutions from Loftware, which enhance labeling and compliance processes, companies can further increase efficiency and accuracy throughout their operations. Learn more about Loftware and how we can help your organization here.