The Industry 4.0 and Prodsmart’s ambition

Prodsmart was invited to share its opinion about the industry’s future in regard to the special segment about the World Economic Forum, in Davos.

Read the article on Dinheiro Vivo and the full interview below.

Dinheiro Vivo – How do you see the Fourth Industrial Revolution applied to Portugal?

Gonçalo Fortes – The Fourth Industrial Revolution is the technological movement that represents the next step of production, which implies the absolute digitalization of production systems, binding machines, people and processes. Portugal is a nation with a vast industrial history but one that has lost competitiveness and productivity in the last decades and now needs to be back at the frontline. The renewal of the whole Portuguese industrial network and the increase in exports are one of the key priorities to achieve a proper economic recovery in our country. Portugal produces lots of innovation and is a nation of entrepreneurial and brave people, who are far from being scared to face the unknown and change. I consider we are in a perfect position to adopt and to adapt ourselves to this upcoming revolution, which will only bring benefits.

DV – And what about your own company?

GF – One of the goals of Prodsmart is to catalyze the Industry 4.0 by thoroughly embracing the systems that allow this shift to take place. We are a production management system (PMS) on cloud, which uses mobile devices and sensors to collect data directly from the plant’s floor, eliminating the use of paper and providing a set of in-real time analysis that allows plants to reduce waste in about 80% whilst increasing efficiency in 20%. This brings a blatant cost reduction through stock elimination and reducing production deadlines, precluding stoppages and maximizing the use of productive resources.

The Prodsmart technology operates already in three cornerstone areas for Industry 4.0:

– interoperability, meaning that all the “actors” (people, machines and processes) which belong to a productive system are in constant communication;

– real-time capabilities, giving the plants the ability to collect and analyze information as soon as it takes places, acting upon urgent events immediately.

– orientation to service, taking into consideration that our system is spread on cloud, treating it as a service and not as a traditional purchase of a very expensive and very demanding software for infrastructure. This considerably reduces the acquisition costs and the loan repayment risk.

The three remaining cornerstones (virtualization, decentralization and modularity) belong to our future vision.

Beyond such, one of our greatest goals is to shatter the individual plant’s fences, establishing an ecosystem of interconnected plants throughout the entire value chain, allowing them to work together efficiently and to adapt themselves if some changes do take place in one of the plants. As an example, a biscuit factory will be able to deliver broken cakes, that do not have any other issue whatsoever, to a yogurt factory which will use those as filling. The second will always know how much yogurt it can produce based on the first’s “waste”. We aim to eliminate stock on the planet and turn production into a “download bar”. This connection will reach the final customer, one that will be able to trigger the production process by himself, to influence the production deadlines and to follow the process with absolute transparency and tracking when it comes to used materials. You may be drinking coffee at your favorite cake shop and the plant which supplies it will start working, permanently aware of the final distributors’ needs.

We also help factories to reduce their ecological footprint, by reducing the waste internally and also applying the “circular economy” logic aforementioned, integrating waste in others’ production chain.

DV – What sort of impact this Fourth Revolution might bring to the Portuguese economy? Will it increase wealth?

GF – The impact will be quite positive. The Portuguese industrial sector still has a vast number of small and medium-sized enterprises which started as family businesses deeply based on cheap labor force that our country was able to offer back then. However, with the economic globalization, changes to border regulations and customs and the access to information and communication speed brought by the Internet, cheap labor force is no longer a factor in competitiveness. Revitalization will have to compulsorily subscribe to Industry 4.0. To reach high productivity levels it is necessary an adaptation and modernization. Not only regarding the system and machines, but also in relate to processes, always including people as well.

DV – How will the most traditional sectors face such revolution?

GF – Modernization has much to do with size. Despite the fact that Portugal has several major companies, with an extended international presence, most of the Portuguese industrial network is still based on very small sized companies. In Prodsmart we aim to bring a system which adjusts itself to this kind of more traditional businesses, whilst deploying a layer of virtual automation that major companies can achieve through machines or some quite expensive systems, often inapproachable to these companies.

DV – What challenges and opportunities will it bring to companies?

GF – The challenge is that will always be necessary to subscribe the movement in order to keep competitiveness. The opportunity is that if they do so they will keep competitiveness and they will grow.

DV – And regarding human resources? How can we avoid worsening inequalities?

GF – In such disruptive changes within a sector, in which the manual labor is replaced, what often happens is a displacement. In this case, a dislocation to safer and more challenging jobs, as well as creating a whole new labor market, one more intertwined with knowledge, a market that will build physical and logical systems which will act as groundwork for the Industry 4.0.