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Local manufacturers need to get ‘smarter’ for Industry 4.0, says SAP

KUALA LUMPUR: Technology solutions provider SAP Malaysia Sdn Bhd believe ‘intelligent production’ or ‘smart manufacturing’ is an inevitable consequence of digital transformation that is sweeping across businesses from all industries as well as the general society.

According to SAP Malaysia managing director Duncan Williamson, this transformation is accompanied by changing consumer behaviour, as consumers become more informed and much more demanding.

“There is an expectation that the products we purchase will adapt to us, rather than the opposite. Instead of mass production, ‘mass individualisation’ will be an area that every manufacturer must address sooner or later,” said Duncan.

He added that the Fourth Industrial Revolution (Industry 4.0, or IR4.0), in which intelligent production is key, builds on the foundation of the previous three IRs, and like them, involves a paradigm shift.

“The first Industrial Revolution mechanised production; the second electrified mass production; and the third automated production using information technology (IT). Industry 4.0 integrates production through Internet and cloud technologies,” he explained.

He was speaking to NST Business on the sidelines of the launching ceremony of the National Policy on Industry 4.0 here today.

The event, which was held at the international trade and industry ministry, was officiated by Prime Minister Tun Dr Mahathir Mohamad.

SAP was a participant at the event.

Duncan pointed out that IR4.0 requires highly-flexible production processes, as well as machines that are capable of dynamic production adjustments.

“The challenge is in providing highly-individualised products with the same price and delivery time as their mass-produced equivalents,” he said.

In his opinion, Industry 4.0 requires collaboration, integration, and to some degree, openness, particularly vis-à-vis technology providers.

“The choices are simple – companies can either go it on their own, or they can collaborate with a technology partner like SAP. I think the second choice is preferable,” he said.

This is especially so when it comes to the topic of open platforms, as concerns regarding data security, data protection, confidentiality, and intellectual property protection need to be addressed.

“Companies need ensure that connecting their machines to their vendors doesn’t result data leaks of any sort.”

A significant component of SAP’s IR4.0 solution is its SAP Business One (B1) product line.

Duncan said that that B1 has been built with digital business enablers in mind.

“Digital business is enabled by analytics, big data, cloud technologies, and mobile technologies. It is accelerated by the Internet of Things (IoT), advances in machine learning, and innovations like blockchain technology,” he said.

He added that B1 can form the digital core for SMEs wishing to become “intelligent enterprises”, integrating and automating vital functions such as sales, operations, inventory management, production, project management, accounting, and administration, amongst others.

“Furthermore, the SAP Business One integration framework (B1iF) connects B1 with other applications, services, and devices. This allows businesses, whether SMEs or larger companies, to connect themselves to their vendors, subsidiaries, franchisees, shared service centres, and permanent establishments,” Duncan added.

B1 integrates natively with other SAP products, such as the SAP Ariba network and B2B marketplace, SAP Concur’s professional edition to manage company travel expenses, SAP Hybris Cloud for Customer to expand CRM sales functionality, and SAP Customer Checkout (SAP’s point-of-sale solution).

Additionally, it also integrates non-SAP systems, Web and cloud-based applications, and services as well, using established integration standards such as XML and XSLT. The second version of B1iF includes an IoT programming model, and is optimised for cloud computing.

“Business integration can be foundational in the areas of business cooperation, integration of employees from other countries, and connecting business units,” said Duncan.

“Especially in this era of digitalisation, B1iF can help SMEs and larger enterprises alike to meet the challenge of connecting different software components, such as different systems, mobile applications, sensors, and so forth, to become more automated, intelligent, and connected companies,” he concluded.

Source: NST