CPG Benchmarking Study: Key Takeaways from 10 Industry 4.0 Dimensions

A little while ago and amidst the COVID-19 outbreak, SmarterChains published its first-of-its-kind Factory of the Future Benchmarking Study for the CPG Industry.

The study itself is based on an in-depth analysis of more than 336,000 data points gathered from 327 production lines in 50 participating plants worldwide, employing more than 24,000 people in 9 industry sectors, and involving 500 participating manufacturing professionals. The analysis was conducted based on the 10 Industry 4.0 Dimensions Framework, developed by SmarterChains. The outcome of the Study highlighted takeaways and key takeaways for each Dimension.

The pioneering research into the digital capabilities of consumer packaged goods (CPG) companies, benchmarks key areas of strength and opportunity within the sector’s adoption of advanced technologies. In this article, the Key Takeaways from 10 Industry 4.0 Dimensions are accumulated for a better and more cohesive understanding of SmarterChains' Framework. For additional information regarding the Study, you can download it from here and have a closer look.

Factory of the Future Leadership

Factory of the Future Leadership is the dimension where we measure the structures and the policies that inspire, support, and help accelerate the digital transformation of the plant and the enterprise. On this dimension, most of the participating plants in our study, lack in maturity even though the advanced plants score high.

A key takeaway is that all the advanced plants are part of an organization with an enterprise-wide Industry 4.0 strategy, part of a coherent plan, and an enterprise-wide, deployed strategy.

Digital Organization

In the Digital Organization dimension, we measure structures and policies that provide agility to design and roll out effective digital strategies. The advanced plants participating in our study have a significant difference with the early-stage plants in this dimension. A key takeaway from this dimension is that all the plants scoring high are in the most mature level of their internal operational excellence programs. This is a common subsequent of leadership. First organizations need to lead with a vision and then move to design the implementation of the vision. 

Process standardization is a key driver to proceed to simplification, then to digitization, and following that to the amplification across the enterprise. The level of problem-solving capabilities of an organization will never stop to be an accelerator, for any new type of technological needs that we chose to incorporate.

Data-Driven Maintenance

In Data-Driven Maintenance, we measure the implementation of different methods, systems, software, and hardware through which we can proactively manage the health of our assets and maintenance process, using data rather than experience. While most of the advanced plants in this dimension create the momentum, most early-stage plants in our study, still apply expensively reactive maintenance, meaning they find a problem and react to it.

A key takeaway from this dimension, from our study, is that the most advanced plants have a deep understanding of their equipment thanks to their mature operational excellence programs. These plants apply smart sensorization, while only a portion of the early-stage plants is investing in this area.

Maintenance is one of the oldest activities in manufacturing. Ever since there has been a machine, there is maintenance for the machine. Yet, we are too far from doing advanced maintenance. Maintenance relying on data, predictability. Maintenance is one of the key drivers to throughput, for which good and reliable equipment is required. Manufacturing leaders need to focus on maintenance creating and elevating the game, maximizing throughput, and resource.

Automated Data Flow

The Automated Data Flow dimension is about integrations, the connection of different systems in data exchange. A major productivity enabler but also a very complex activity. In this dimension, the CPG industry seems to be on top. Connecting different ERP systems with the MES is something that has been done for some time now.

A key takeaway deriving from our study is the ever-growing understanding of data correlations. Streaming the data real-time into central repositories makes them available for analysis. In this dimension, both advanced and early-stage plants participating in our study are still struggling with data collection in central repositories.

Automated Material Flow

Automated Material Flow is one of the most promising dimensions of the industry. We map all hardware, software and processes that help in automating material flow, within the manufacturing facility. Most plants are on the lower end of the spread spectrum, with forklifts driven by humans, being the king of material flow in the plants.

Although AGVs exist for a few decades, their adoption rate is not quite large in the CPG Industry. Our study reveals that Advanced Plants have identified financially viable use cases for automating manual-based material handling processes, while Early Plants are still in the process of making the business case for this type of automation.

Digital-ready Infrastructure

Digital-ready Infrastructure is the dimension where we measure all the different systems that can safeguard and enable the plant’s operations, such as communication networks & cybersecurity tools.

Most advanced plants have industrial-grade wireless network providing connectivity among their different assets throughout the plant, whereas only a third of the early-stage plants offer this. The connected factory in this connectivity and connectivity is of course interconnectivity and external connectivity. This is always a challenge to build a business case around which follows exactly the following with the automated material flow, as in order to be able to have things moving around, they need to be connected pretty well as them, we are going to be moving the downtimes that we're having in the past to IT and connectivity, downtimes, which again have a huge impact on the cost. And of course, the processes of the factory. I couldn't stretch enough the importance. We are going to discuss this as an insight for the industry as a whole.

360° Factory Visibility

The 360° factory visibility dimension emphasizes that eliminating silos by combining data from various areas of the value chain can improve decision-making and drive agility. While this dimension was – on average – relatively well addressed by the participating sample plants, advanced plants are still clearly front-runners.

Almost half of the advanced plants focus on flexible collaboration through remote and user-friendly interfaces to enhance real-time access to critical information, while early plants are making their first steps in this area.

Intelligent Quality

On the Intelligent Quality dimension, we measure the integration of sensors, software, and different techniques that leverage real-time data to manage quality control and quality assurance processes. In this dimension, only a few of the advanced plants have managed to separate themselves from the top-scoring, early-stage plants.

The key takeaway of this dimension is that advanced plants are moving aggressively toward replacing sample testing with technologies that enable real-time quality control and release, while early plants are following at a slower pace.

Tech-augmented Workforce

In the next dimension of the Tech-augmented Workforce, we measure all the different technologies we can provide our staff in order to be able to drive of course an improvement in their work processes and make their or optimize their workflows, augment their skill sets. The majority of the advanced plants as you see, have really separated themselves from the rest, showing their lack of investment into this dimension by most of the companies of empowering the employees on the shop floor with the most advanced technology to make their life easier.

A key takeaway here digitization of the work instructions across multiple processes, not only from assembly, changeovers, maintenance, is commonly adopted by advanced plants, while still, early-stage plants are still exploring the benefits of those solutions.

Zero-touches Production

In Zero-touch Production, we measure the hardware, software, and the practices that eventually will eliminate whatever, because it will never be 100%, the human effort in all things production, planning, and execution. In this dimension, we observed the biggest concentration of the plants between 25 to 50 points by our index, driven by the characteristic of the industry, which is automation or core production activities.

Now a key takeaway here is that although with, in comparison to other industries, the manufacturing execution systems are quite widely adopted, but the key differentiating factor between advanced plants and early-stage plants is the number of features which shows far more depth in their needs, in the operational and business needs. That we are using the systems to satisfy compared with the early stage plants.

Factory of the Future Benchmarking Study for the CPG Industry

In our study, you will find many additional detailed insights that will help to equip manufacturing leaders with the knowledge they need to make the most of Industry 4.0.

Download the pioneering Benchmarking Study here.