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smart factory Implementation

Top 5 Challenges in Smart Factory Implementation

Industries are constantly seeking to diversify, optimize operational efficiency and increase market share via participation; subsequently, the primary initiative is to adopt Industry 4.0. Industry 4.0 assures to facilitate connectivity, real-time data accessibility, enhanced production and overall smart operations management. Smart factories operate with intelligence that helps stabilize, predict and optimize industry mechanisms.

Scope of Smart Factory Initiation

The scope of smart factory is vast and accommodating as it empowers factories with intelligence, IoT, and other technologies. Whilst the vast scope and ample advantages of smart factory initiation and implementation, the process of transformation can be challenging on certain frontiers. Though challenges are not inherent to the smart factory itself, a smooth transition from legendary to smart industry requires careful consideration, choice and administering for a seamlessly smart operation management system in the long run.

The benefits of the smart factory implementation are so many that research by Deloitte states that 86% of manufacturers believe the main driver of competition by 2025 will be smart manufacturing. Given this data, it is evident that smart factory initiatives can significantly enhance business and boost production with lowered manufacturing redundancy rates.

To understand better the nuances of smart factory initiation/implementation, this article will delve into exploring the benefits and challenges that are to be noted in order to enable unhindered journey of transformation and thereafter its use.

Benefits of Smart factory implementation

Smart factory implementation is adopted by industries for the many benefits it offers. Some of the notable benefits that distinguish smart factory from that of a legendary factory are listed below. 

a) Increased Connectivity – Smart factory implementation involves sensors and advanced machinery that connects production processes. Smart factory extends to connect all factory operations and facilitates businesses to operate with intelligence at fingertips.

From resource allocation to logistics management and business processing, devices and procedures are connected via internet, data is captured and cloud software platforms are equipped to enable intelligent timely actions for effective operations management.

b) Data-Driven and Customer-Centric – With connectivity, ample data regarding factory floor operations and consumer preferences from market demand at real-time is captured, analyzed and made accessible to machine operators, management and stakeholders.

Factory operations data empowers management and equipment operators to stay well-informed about machine health and production efficiency on a real-time basis, eventually allowing agile manufacturing whilst engaging in customer-centric operability.

c) Minimize Waste and Optimize Production – The network of sensors and connectivity across factory floor operations help generate data at real-time. The raw data is further processed with advanced algorithms and converted to readable formats that are categorized as different parameters for assessment like that of resource consumption, resource wastage, production life cycles, machine performance and supply chain.

The AI-powered smart factories are equipped with intelligence that analyze, predict and help prevent factory wastage and enable production optimization with data that arms operators/management to take necessary actions for efficient industry operations.

d) Improved PredictabilityIIoT enabled smart factories capture real-time data on a wide variety of equipment specifications that determine health and performance of machines that are further transmitted to a cloud. Metadata will further be assessed by ML algorithms to observe and identify abnormal patterns in operations.

e) Enhanced Reliability and Safety – High-level automation powered by smart factories enables the performance of factory operations with minimized human errors. More safety for workers is ensured through safety checks of industry equipment and replacement of manual labor performing dangerous tasks.

Smart factory implementation

Challenges of Smart Factory Implementation

i) Advance Technical Skills Gap – Industry week magazine reports 36% technical skills gap hurdles industries from reaping benefits from investment in smart factory. For successful implementation and progress with smart factory, industries are required to employ workforce possessing digital dexterity – persons that understand and work with manufacturing processes and digital tools to support, enhance productivity and omit time consumption with technical skill gap recovery.

ii) Inaccurate Change Management – Another challenge with the implementation of smart factory is the lack of adequate project specifications coupled with inaccurate change management procedures. The success of smart factory initiation and implementation depends on the clear delineation of requirements, definition of project scope and elaborate description of the procedures for management of change throughout the various departments of factory operations.

iii) Insufficient Senior-level Input – Smart factory initiation and the entire process of implementation involves all departments in the operations and management of an industry. As a result, large-scale implementation is inevitable and inputs from all senior-level boards are required for a successful implementation and business plan thereafter. With the change that affects each department, some senior-level employees might be hesitant to provide sufficient inputs for effective smart factory transformation.

iv) Unrealistic Expectations – Industry stakeholders and management might have personal opinions on the requirements and expectations of smart factory implementation. Unless experienced, it often become tough to gauge the impact of any project. Similarly, in the vague understanding and perspectives of stakeholders and management, unrealistic scheduling of resources and expectation of an overnight digital transformation can be challenging. Stakeholders and management are to be aware of digital transformation as a journey and not a quick change.

v) Opting the Wrong Technology Partner – Opting the right technology partner for a smooth transition in adopting smart factory is important in the success of the implementation. Before picking a technology partner, make sure to assess the product offerings and support they provide. Be sure that the technology partner has both, the operational and technical experience of implementing smart factory and overseeing a project that suits your corporate culture. - The Smart Factory Software

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How to Practically Solve Implementation Challenges?

a) Organization level initiative – Smart factory implementation is required to be an organizational initiative as the stakeholders from across information technology (IT), operational technology (OT), engineering technology (ET) and supply chain will witness shifts in the organizational design and methods of operations.

The adoption of smart factory implies the convergence and alignment of a paradigm shift that emphasizes on employee and work culture, approach, decision taking and technologies in operation at the organization level. Therefore, it is ideal to encourage smart factory implementation as an organizational initiative rather than an individual initiative.

b) Proper strategy and plan as an incremental model – In order for a paradigm shift such as the implementation of smart factory to become successful, a proper strategy to suit specific needs of the organization accompanied by an incremental model plan is a requisite. Proper strategy and an incremental model plan, streamlines the process of transformation without hindering ongoing productivity and work efficiency.

Typically, a strategy will look into the current status of the organization, identify needs for smart factory implementation, describe the pros and cons, state the goals, estimate financial implications, define methods of adoption and identify an incremental model for the transformation process. This will significantly decrease redundancy ratios in the event of smart factory adoption.

c) Pilot and prove before moving into next use case – Implementing a smart factory will not assure an overnight success with multiple use-case pertaining to your organization. It is best advised to pick a pilot project specific to a use-case, execute smart factory solution and prove its authenticity and credibility before implementing the solution as a full-fledged counter to existing challenges of factory operations and management.

d) Educate the leadership and operators before rollout – Once it has been decided to adopt a digital transformation journey, it is important to assess employee and management technical skills, identify gaps and educate likewise to ensure smooth rollout of a smart solution across the factory floor.

e) Define change management and adoption processes – Managing change is certainly not as easy as it might seem. Employee work culture, employee skill, organization frameworks, operations management and many such aspects will be tailored / mended to meet the requirements of a new digital transformation journey. When such is the case, defining change management, policies and procedures along with the adoption processes with respect to different wings of the organization is critical in administering a seamlessly development-oriented transition.

f) Identify and upgrade infrastructure for digital readiness – The adoption of smart industry requires an enterprise/organization to be mindful of the pre-requisites with regard to infrastructure and readiness. It implies that organizations/enterprises must own upgraded infrastructure to accommodate digital tools, systems and equipment to harness potential of smart factory.

Digital readiness implies the assessment of existing technologies whilst stating the requirements to house technology/equipment feasible for the adoption of smart factory tools and processes. With the identification and upgrading process, enterprises/organizations become awake and stay alert with the nuances of change management and the extraction of smart management of all operations.

g) Get vendors and partner commitment and support – Opting the right partner for continued commitment and support in their services is essential with executing smart factory implementation. It is advised to identify, assess and filter a list of vendors and pick a suitable as well a reliable technology partner for an assuring digital transformation journey. Omitting the majority of technology challenges rests with the partner you pick, hence be conscious of your technology service provider and their facilities.


As a matter of fact, the advantages of smart factory implementation are many and can be seamlessly furnished provided all challenges are mindfully addressed in the initiation process. Although smart factory implementation does not inherently have drawbacks, the journey of transformation is to be carefully tackled to ensure a seamlessly progressive AI-enabled smart factory.

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