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Lighthouses boost sustainability with Fourth Industrial Revolution transformation

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The World Economic Forum announces today the addition of 21 new sites to its Global Lighthouse Network, a community of world-leading manufacturing facilities and value chains using Fourth Industrial Revolution (4IR) technologies to increase efficiency and productivity, in tandem with environmental stewardship.

By deploying advanced technologies such as robotics and artificial intelligence (AI) in the production chain, more than half of all factories are making an impact on environmental sustainability through their 4IR transformations. A consumer healthcare company, for example, coupled advanced controls with green technology to deploy a sensor-fed automated system to cut energy consumption, resulting in 25% less energy consumed and an 18% reduction in CO2.

The Lighthouse network and its 90 sites are a blueprint for adapting to technology, improving processes and developing workforce skills to scale across the production chain. From pharmaceuticals and medical products and consumer packaged goods to a broad range of advanced industries, these diverse organizations spanning over 75 regions are demonstrating how 4IR technologies can increase profit, with a positive impact on the environment.

Among the 90 Lighthouses, three are receiving a new designation, Sustainability Lighthouses, factories and value chains achieving sustainability and productivity breakthroughs.

A new report, Global Lighthouse Network: Unlocking Sustainability through 4IR, outlines how manufacturers accomplished these results. Download the latest report HERE to learn how lighthouses are leveraging advanced technologies to achieve step-change improvements in sustainability and productivity.

“As discussed at the Forum’s Sustainability Development Impact Summit last week, increased global concern for environmental impact has made sustainability a must-have to maintain business viability. The Sustainability Lighthouses make it clear that by realizing the potential of 4IR technologies in manufacturing, companies can unlock new levels of sustainability in their operations and explore a win-win solution: greater operational competitiveness while simultaneously making commitments to environmental stewardship, leading in a cleaner, more sustainable future as a result,” said Francisco Betti, Head of Shaping the Future of Advanced Manufacturing and Value Chains, World Economic Forum.

Enno de Boer, Partner and Global Head Operations Technology, McKinsey & Company and Global Lead of its manufacturing work, said: “Lighthouses have achieved a sustainability breakthrough. Companies no longer have to choose competitiveness or sustainability because smart manufacturing lets them achieve both. Fourth Industrial Revolution technologies – think artificial intelligence, robotics and the internet of things – amplify human capability and technological innovation to accelerate sustainability while also strengthening competitiveness. From using advanced analytics to predict exactly the inputs and outputs needed for a manufacturing process to augmented reality that simulates a production line so machines can be operated remotely, Lighthouses are reducing resource consumption, waste and carbon emissions, while increasing productivity and profit – all at once.”

The goal of the Global Lighthouse Network is to share and learn from best practices, support new partnerships and help other manufacturers to deploy technology, adopt sustainable solutions and transform their workforces at pace and scale.

The extended network of “Manufacturing Lighthouses” will be officially recognized at Global Lighthouse Network Lighthouses Live on 29 September. The event will feature CEOs and innovators focused on scale-up entrepreneurial solutions to tackle global talent shortages, the climate crisis and advancing sustainable development. Click here to follow the meeting.

The locations receiving new designation as Sustainability Lighthouses are:

Ericsson (Lewisville): Ericsson’s greenfield 5G factory is powered 100% by renewable electricity from on-site solar and green-e® certified renewable electricity from the utility grid. The smart factory integrates sustainable technologies such as thermal ice storage tanks with the industrial internet of things (IIoT) stack to proactively monitor energy usage and is designed to utilize 24% less energy and 75% less indoor water usage, avoiding 97% operational carbon emissions* than comparable buildings. This year it became Ericsson’s first factory globally to achieve LEED Gold® certification.*

Henkel (Düsseldorf):In an effort to improve visibility of factory consumption to drive better decision making, Henkel deployed utility meters on machines integrated in a digital twin that connects and benchmarks 30 factories and prescribes real-time sustainability actions that has led to 38% less energy (kWh/ton) used and has reduced water consumption 28% (m3/ton) and waste 20% (kg/ton) across factory baselines set in 2010.

Schneider Electric (Lexington):In order to capture greater energy consumption granularity, when and where it happens in the plant, the Lexington smart factory leveraged IoT connectivity with power meters and predictive analytics to optimize energy cost. This has led to a 26% energy reduction (GWh), 30% net CO2 reduction, 20% water use reduction, and a Superior Energy Performance 50001TM certification by the US Department of Energy.

*Calculation based on EPA Greenhouse Gas Equivalencies Calculator

The 21 new Lighthouses are:

Europe

De’ Longhi Group (Treviso): In order to step up competitiveness, the De’ Longhi Treviso plant invested in digital and analytics to become more agile (reducing minimum order quantity by 92% and lead time by 82%) and more productive (improving labour productivity by 33%) and achieving high standard quality (improving field quality by 33% and obtaining Food and Beverage industry certification).

Flex (Althofen): Confronted with strong competition from lower-cost regions, Flex’s site in Althofen deployed 4IR technologies to improve operational efficiency and agility. By meeting higher regulatory and quality standards, Flex attracted higher-margin and longer lifecycle medical business, increasing revenue by 50% within the same physical footprint.

Johnson & Johnson Vision Care (London): J&J Vision Care transformed customer experience, through personalized 4IR technologies using Adaptive Process Control, AI and robotics to offset increasing complexity (+50% Units), which enabled 100% personalized packaging configurations, an eight percentage point increase in customer-service levels and reduced the carbon footprint for inbound freight by 53%.

Americas

Henkel (Toluca):This 1970’s factory characterized by low-mix, high-volume production, set out on a Fourth Industrial Revolution transformation journey centred on people, data transparency and availability to reduce processing costs by 15%, energy consumption by 14% and to enhance plant OEE by up to 90%.

DePuy Synthes, the Orthopaedics Company of Johnson & Johnson (Bridgewater):Faced with high complexity, cost pressure and operating room inefficiencies, DePuy Synthes deployed “Advanced Case Management”, a Fourth Industrial Revolution program leveraging open API architecture, machine-learning algorithms and a suite of digital tools across its joint restoration implant portfolio (hips and knees) value chain in North America. This reduced the number of instrument trays in the operating room by 63%, implant inventory by 40% and, ultimately, lowered the time to set up the operating room by approximately 15% per location.

Protolabs (Plymouth): Protolabs is a digital native manufacturer that embarked on a transformation journey taking it from a prototype-only provider to a production supplier by leveraging its digital thread to connect customers to its injection-moulding production services. As a result, it outperforms traditional manufacturing competitors by reducing production lead times to as low as one a day and generating a gross margin 20 percentage points above the industry average.

Asia

AUO (Taichung): Facing labour shortages, highly customized product requirements and extreme climate conditions in the very competitive industry of display panels, AUO Taichung Fab 3 invested in customized automation and developed a digital analytics and AI development platform to improve productivity by 32% and yield of advanced product by 60%, while reducing water consumption by 23% and carbon emissions by 20%.

CATL (Ningde): Confronted with increasing manufacturing process complexity and demand for high product quality, CATL leveraged AI, advanced analytics and edge/cloud computing to achieve, in three years, a defect rate per billion count at the speed of 1.7s per cell, while improving labour productivity by 75% and reducing energy consumption by 10% a year.

CITIC Dicastal (Qinhuangdao):Faced with rising expectations from automotive OEMs for smaller batch size and higher quality, CITIC Dicastal deployed flexible automation, AI and 5G to build a digital manufacturing system to improve flexibility with a batch size of one and reduce manufacturing costs by 33%.

Foxconn (Wuhan):To meet customer requirements for greater customization and shorter product order lead time, Foxconn Wuhan leveraged advanced analytics and flexible automation at scale to redesign its manufacturing system. This led to an 86% increase in direct labour productivity and cut quality loss by 38% and order lead-time by 29%, down to 48 hours.

Foxconn (Zhengzhou): Faced with a lack of skilled workers, unstable quality performance and demand uncertainty, Foxconn Zhengzhou adopted flexible automation to improve labour productivity by 102%, and utilized digital and AI technologies to reduce quality defects by 38% and improve OEE by 27%.

Haier (Tianjin):To meet increased customer expectations for diversified products, faster delivery and higher quality of service, Haier’s greenfield washing machine factory in Tianjin integrated 5G, IIoT, automation and advanced analytics to accelerate product design by 50%, reduce defects by 26% and save energy consumption per unit by 18%.

Innolux (Kaohsiung):In the context of fierce competition in the panel industry, and faced with increasing quality requirements from customers and severe decline in gross profit, Innolux fab 8 invested in advanced automation, IoT technology and advanced analytics to improve process capability by 40%, reduce yield loss by 33% and, in return, unlock niche product production.

LS ELECTRIC (Cheongju):To respond to an increase in demand and the need to reduce costs, LS ELECTRIC has transformed one of its plants in Cheongju, South Korea, with an IIoT-based automation, machine learning powered inspection and advanced process control, enabling mass customization and lowering production costs by 20%.

SANY (Beijing):Faced with growing demand and rising complexity in the multi-category and small-batch heavy machinery market, SANY Beijing deployed advanced human-machine collaboration automation, AI and IoT technologies to boost labour productivity by 85% and reduce production lead time by 77% from 30 to seven days.

Schneider Electric (Wuxi):Schneider Electric’s 20-year-old electronics parts factory in Wuxi, China, confronted increased demand for product adaptation and order configuration with a flexible production line by deploying 4IR technologies, such as modular cobot stations and AI vision inspection, to reduce time-to-market by 25%, and advanced analytics to auto-generate root-cause analysis and detect anomalies across the supply chain, which have increased on-time delivery by 30%.

Unilever (Taicang):To seize the booming business in e-commerce and big-box channel, Unilever Taicang ice-cream factory deployed one-scan, one-view platform to provide E2E supply chain visibility in manufacturing and food handling for customers, and combined the digital voice of consumers with an agile R&D digital platform to improve innovation lead time by 75%, from 12 to three months.

Western Digital (Penang):With an increase in flash memory demand of more than 2X, stringent quality requirements and the need to optimize costs, Western Digital Penang embarked on lights-out manufacturing journey based on Fourth Industrial Revolution technologies. By automating production and logistics, they were able to deliver 32% factory cost improvement, and transitioned to build-to-order with intelligent planning system, thereby reducing product inventory and order lead time by 50%.

Western Digital (Prachinburi):With rapidly growing demand, rigorous quality requirements and cost pressure for hard disk drive (HDD), Western Digital Thailand leveraged connectivity and advanced analytics technologies to transform a capacity-saturated manufacturing site into a digital operation system, with real-time visibility in suppliers, production, logistics and customers and data-based insights and predictions. This ultimately increased factory output by 123% – avoiding 30% in procurement and production costs – and cut the product return rate by 43%.

Middle East

Arçelik (Eskisehir):Confronted with rising customer demand and increasing product diversity, Arçelik leveraged its agile studio to deploy, in two years, over 30 advanced use cases in automation, robotics-enabled logistics and data-driven AI systems to enable flexible manufacturing with a return on investment of 1.2 years.

Saudi Aramco (Abqaiq):Motivated by the need to access new levels of quality and sustainability, the world’s largest oil processing and crude stabilization plant has harnessed the power of data, advanced analytics and automation to transform its manufacturing processes, achieving a 21% increase in product quality and 14.5% reduction in energy use.

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Satya Nadella Says AI Golden Age Is Here and ‘It’s Good for Humanity’

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The cutting-edge chatbot ChatGPT is capturing the world’s imagination. The new artificial intelligence site amassed 1 million users in just five days after its recent launch. It is but one of a dozen AI-driven so-called “killer apps” that will transform human productivity and the future of work.

ChatGPT answers complex questions via short prompts on a vast array of topics, and even writes lyrics and poetry. Underpinned by generative models such as GPT-3 and GPT-3.5, it is the most conspicuous example of technology dubbed generative AI.

Satya Nadella, Microsoft Chairman and CEO, in a session at the Annual Meeting, told Klaus Schwab, Founder and Executive Chairman, World Economic Forum, that a golden age of AI is under way and will redefine work as we know it.

“The future of work is not just about technology and tools,” he said. It’s about new management practices and sensibilities to the workplace.”

“Technology will provide more and more ways to bring people together,” he said. Public-private cooperation itself is moving virtual. The Forum’s Global Collaboration Village, for example, harnesses the power of the metaverse as a platform for collaborative, inclusive and effective international action.

“Microsoft is opening up access to new AI tools like ChatGPT,” said Nadella. “I see these technologies acting as a co-pilot, helping people do more with less.”

He provided two anecdotes of recent use cases of GPT technology. The first is an expert coder from Silicon Valley who improved their productivity by 80% by using the model to help write better code faster. The second was an Indian farmer who was able to use a GPT interface to access an opaque government programme via the internet, despite only speaking a local dialect.

“AI is just at the beginning of the S-curve,” said Nadella. The near-term and long-term opportunities are enormous, he added.

Looking ahead, he said Microsoft intends to lead on quantum computing. Microsoft has all the building blocks for a next-generation quantum computer. He said: “Microsoft will achieve quantum supremacy and aims to build a general-purpose quantum computer.”

On safety and security, Nadella said the operating principle for protecting critical infrastructure should be to assume the worst – “have zero trust”. “Safety and security needs to be included right at the design stage,” he said.

Sustainability is at the core of the business. “By 2050 Microsoft aims to not just be carbon-neutral but carbon-negative.” Last year the tech giant released “Cloud for Sustainability”, bringing together a growing set of environmental, social and governance (ESG) capabilities across the Microsoft cloud portfolio plus solutions from the firm’s global ecosystem.

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Cybercrime Initiative to Boost Coordination between Private Sector and Law Enforcement

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In an effort to tackle rising cybercrime levels, the World Economic Forum launched today at the Annual Meeting 2023 an initiative to map cybercriminal activities and identify joint public and private sector responses.

Building on the expertise of the Forum’s Partnership against Cybercrime, the Cybercrime Atlas initiative will provide a platform for leading cybercrime investigators, national and international law enforcement agencies, and global businesses to share knowledge, generate policy recommendations and identify opportunities for coordinated action to fight cyberthreats.

“The Cybercrime Atlas is a collaborative research initiative that gathers and collates information about the cybercriminal ecosystem and major threat actors operating today,” said Jeremy Jurgens, Managing Director, World Economic Forum. “The insights generated will help promote opportunities for greater cooperation between the private sector and law enforcement to address cybercrime.”

Cybercrime, such as the ransomware attack on Colonial Pipeline in May 2021 that caused US President Joe Biden to declare a state of emergency, is a threat to national security, public organizations and businesses of all sizes. Despite the amount of digital data collected on cybercriminal activities worldwide, the effort to fight it is often uncoordinated, disjointed and dispersed. The Cybercrime Atlas aims to map the cybercrime landscape, covering criminal operations, structures and networks.

First announced at San Francisco’s RSA Conference in June 2022, the Cybercrime Atlas has benefited from a year of pro bono analysis of 13 criminal groups by cybercrime investigators. Their approach and findings have been welcomed by law enforcement agencies.

“This initiative underlines the need for an enhanced multi-sector approach to combat the increasing cybercrime threat,” said Jürgen Stock, Secretary-General, International Criminal Police Organization (INTERPOL). “A global solution must include private sector insights to enable law enforcement to prevent, detect, investigate and disrupt cybercrime.”

The secretariat for the Cybercrime Atlas initiative will be hosted by the World Economic Forum for the next 2-3 years, with the support of Fortinet, Microsoft, PayPal and Santander, until it is sufficiently established to become an independent platform.

“The Cybercrime Atlas is an important initiative that will aid industry, law enforcement, and government agencies by providing a first-of-its-kind visibility to disrupt cybercriminals across their ecosystem and infrastructure,” said Ken Xie, Chief Executive Officer, Fortinet. “A global and unified effort will make it easier to get beyond the obstacles that shield cybercriminals.”

The Forum’s Partnership against Cybercrime initiative brings together a dedicated community to drive momentum for a public-private partnership to combat cybercrime.

“Cybercriminals work in the shadows and exploit vulnerabilities to inflict devastating attacks. The Cybercrime Atlas provides an important forum that brings the public and private sectors together to share actionable information and leverage cross-sector data, capabilities and expertise, crucial to disrupting cybercrime quickly, and at scale,” said Brad Smith, Vice-Chair and President, Microsoft.

“To mitigate and disrupt global cybercrime in today’s interconnected world, we need robust platforms to share intelligence and facilitate more meaningful institutional collaboration,” added Assaf Keren, Chief Information Security Officer and Vice-President, Enterprise Cyber Security, PayPal. “The Cybercrime Atlas represents a key next step in this work and an opportunity to unite global businesses, law enforcement and experts around concrete opportunities to protect the world’s citizens and their safety.”

“Given the global nature of cyberthreats, increasingly public-private collaboration is the best way to combat cybercrime,” said Dirk Marzluf, Group Chief Operating and Technology Officer, Banco Santander. “Organizations must look beyond their perimeter and combine efforts and resources with businesses, law enforcement and government.”

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Landmark Reports on Future of Metaverse Focus on Interoperability and Value Creation

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The Defining and Building the Metaverse initiative, launched by the World Economic Forum in May 2022, has released initial findings in two briefing papers – the first research of its kind on the metaverse. The initiative combines the expertise of more than 150 individuals in diverse sectors from the public and private sectors to understand and guide the future of the metaverse to become safe, interoperable and inclusive.

The governance briefing paper, Interoperability in the Metaverse, emphasizes the importance of removing friction for users. Interoperability is one strategy for allowing users to move across and between the physical and digital world with their relevant data, digital assets and identities. It can facilitate the free circulation of data and the secure exchange of information across systems.

The value creation report, Demystifying the Consumer Metaverse, focuses on consumer applications, foundational technologies and potential pathways to economic value and growth. The metaverse will require a diverse range of organizations to redefine their brands and change the way they monetize products and services to generate consumer value. The immersive, interactive nature of the metaverse will require businesses to move further away from the one-way delivery of products and services to becoming metaverse participants and providers. As consumer organizations experiment and incubate new business models for the metaverse, their work can inspire others and demonstrate the possibility of change in other industries.

The metaverse – an immersive, interoperable and synchronous digital world – represents the next era in the internet’s development. While its precise definition is still being debated, the metaverse is already forecast to become an $800 billion market in 2024. Unlocking the potential of this new field requires coordination of technology developers, corporations, governments and civil society. The World Economic Forum has convened experts from a broad range of fields to focus on two workstreams related to the future of the metaverse: governance and value creation.

Future workstreams will focus on two additional governance-related themes: privacy, safety and security; and identity. The value-creation track will issue additional outputs focused on other industries and the social implications of the metaverse.

“The metaverse is the next version of the internet and it is critical that it’s built by all, and for all. These two outputs reflect premier work on the metaverse involving such an extensive set of stakeholders and leaders, demonstrating the unique value of public-private partnership in metaverse development,” said Cathy Li, Head of Media, Entertainment and Sport, World Economic Forum.

Huda Al Hashimi, Deputy Minister of Cabinet Affairs for Strategic Affairs, Office of the Prime Minister of the United Arab Emirates, said: “Making the most of the metaverse will require governments to be proactive in understanding both the opportunities and the challenges that a persistent and interconnected virtual environment offers. This will also require developing new capabilities and importantly a different approach to regulation, informed by agile principles. This briefing paper clearly lays out a framework that can help governments gain a better understanding of the opportunity presented by the metaverse and makes a strong case for investing now in creating the conditions that will allow to generate public value from it, whilst protecting the public.”

Peggy Johnson, CEO of Magic Leap, Inc., said: “At Magic Leap, what excites us about augmented reality is the two-way bridge it creates between our digital and physical worlds, taking information from 2D screens into 3D spaces, where it is far more intuitive and engaging. We’re at a pivotal moment for this technology, and it is critical that we have a shared set of principles that support further innovation, ensure accessibility and promote interoperability between platforms.”

Yat Siu, Co-Founder and Executive Chairman of Animoca Brands, said: “The metaverse initiative is focusing on highly relevant topics to the metaverse, like interoperability – which is fundamental to digital assets. How do we ensure true ownership of assets? How do we improve the frameworks from those used in Web2.0? These are the complicated issues this initiative is taking on and finding answers to.”

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