Partnerships Newsletter

Are smart factories only for the big players?


While major automation has traditionally been the domain of big, heavy industry, tech advances, innovating thinking by Industry 4.0 companies, and dropping costs have put smart manufacturing solutions in the hands of companies big and small. Increased nimbleness of machines means they can be reprogrammed easily to adapt to a greater range of tasks, and through the use of AI, production lines can be monitored with improved focus, leading to improved efficiencies of processes.

Humans’ ability to produce things has improved dramatically over time, with the first major leap coming with the industrial revolution – the era in which manufacturers began to automate, using steam-powered machines, for the first time. Further advances came with the advent of electricity-powered production lines, and again in the latter half of the 20th century, when the first, simple computers and robots were introduced.

Today’s advances, in AI and the interconnectivity of computer-controlled processes has led some to refer to the current advances as “Industry 4.0” – the latest iteration of the industrial revolution. 

Read more for key takeaways: 3 tips to transform into smart manufacturing

  1. As tech improves and costs come down, smart manufacturing is increasingly being employed outside the traditional areas of automation – increased flexibility in robotics hardware, through modularity, and AI and IOT-enhanced programming, even less standardised industries like food processing, (which deals with uniquely shaped food items every time) will increasingly benefit from the introduction of smart manufacturing.
  2. Cost-sensitive industries, especially those which operate in batch manufacturing, like shoe- and clothes manufacture, also stand to benefit as the new generation of robots are flexible enough to be repurposed and reprogrammed easily, allowing for different configurations to be adapted to the new task at hand.
  3. The future belongs to the ‘cobot,’ or collaborative robot, which combines the adaptability and innate problem-solving from the human side with the precision, speed and repetitiveness from their machine counterparts to provide an ideal balance for production settings, where long stretches of mundane tasks combined with a need for on-your-feet problem-solving.

AI-built tools are able to collect and analyse vast troves of data to spot patterns and develop insights that humans would be unable to do, taking thousands if not millions of data points to enable significant cost savings and efficiencies, while reducing time and material waste, and a new generation of modular robots are designed for adaptability are allowing even small factories to invest in systems that can be accurately programmed for specific tasks, such as in batch manufacturing.

As the tech improves and costs come down, smart manufacturing is increasingly being employed outside the traditional automated areas, like car and heavy machinery manufacture.

Although the auto-industry still accounts for more than 50% of the robotics technology applications in China, according to Leo Li, Partner, Automotive & Manufacturing Industries Practice, at consulting firm Oliver Wyman, the cost of less advanced robotics technology is dropping, allowing a boost in adoption rates in the world’s manufacturing hub. Industries as diverse as food processing and light manufacturing such as the textile industry, are increasingly employing smart tech on their shop floors.

The advantages are clear – increased efficiency and productivity while setting or maintaining high quality standards, all with a built-in system for monitoring, analysing and improving workflows and processes, often sparing factory workers from dull, dangerous or repetitive tasks. While setup and maintenance costs can be high, Industry 4.0 proponents say that the ROI is such that even small companies can recoup their initial investment quickly.

When manufacturers look into adopting this technology, there are considerations beyond the technical, such as how, strategically, will automation/robotics help a business achieve competitive advantage? Potential adopters, for example in light industry, need to see how an improvement in efficiency will contribute to the company’s overall competitiveness.

The question of what technologies to adopt is also highly relevant in this fast-changing tech climate, although modular technologies can help offset this concern. Depreciation is one factor to consider, as is the cost of ownership, and if factories can give the technology a test run to see how it’s compatible. And while automation is supposed to make employees’ lives easier, those considering a tech upgrade also need to consider if they have the right staff to run it, or if they can afford new hires.

Going forward, says Oliver Wyman’s Li, the application of robotics will become less and less about simply replacing manual processes, but “more about collaborating and they will provide brain power on improving decision making.” The emergence of ‘Cobots’ – collaborative robots which work hand-in-hand with humans – to provide a perfect balance between repetitive, or precision, tasks best suited to robots, and flexibility, which is a human strength.

The barriers to entry for adopting smart tech in factories have been greatly lowered in recent years, and the industry has been nimble in creating solutions to spur greater use.

Intelligent and modular manufacturing have the potential to transform workflows for companies across the spectrum, and advances in creating systems adaptive enough to handle small batch and personalized manufacturing mean that these systems can be attractive – and within reach – of even small businesses.

Case study

Robotocising small businesses

The enduring image of an automated factory is one of large, efficient robot arms doing repetitive tasks on a car or item of heavy machinery on a clean, expansive factory floor. But as costs have come down and tech has improved, companies like Inovo Robotics ...

Seasoned pros

In the field of Industry 4.0 and smart technologies, Pro-Technic Machinery was founded in 1977. The company established itself as a supplier of precision manufacturing equipment from Europe and Japan before expanding to provide professional manufacturing...

AI: Not just for robots

While data harvesting from machine processes is a major component of the push to digitise the modern factory shop floor, PowerArena’s focus on using AI in smart manufacturing has settled upon a lesser-explored side of...


This manufacturing-focused programme matches SMEs and their business needs with innovative companies which can help them achieve their goals.

50 mid-cap corporates and SMEs with a manufacturing focus, including but not limited to textile, consumer electronics, food, and healthcare have joined SPRINTER 2 – organised by HKSTP with lead partner HSBC—to accelerate innovation adoption and co-creation within their existing production processes, as well as mitigate risks in their businesses.

In December, tech ventures from the field of smart manufacturing will be invited to showcase innovations at our Solution Day. Stay tuned with us!

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