COVID-19 Pandemic Creates New Opportunities for Manufacturing Industry Transformation. Are You Ready?
This year, the world has faced an unprecedented event with the COVID-19 pandemic. The threat poses considerable risk to billions of people and millions of enterprises around the world.
The father of the semiconductor, Morris Chang, pointed out that in addition to the pandemic affecting the global economy, it is placing many manufacturing industries in a life-or-death situation. Even the electronics heavyweight Samsung has had to close its cell phone factory in South Korea due to employees being infected with the virus.
With this in mind, it is not difficult to understand the impact COVID-19 has had on small and medium-size enterprises (SMEs) in manufacturing industries ranging from electronic components and mechanical equipment to petrochemicals and automotive components. Traditional industries have also been affected— especially those who are unable to receive government assistance.
But the fact is, despite this ongoing crisis, it is not impossible for factories to save themselves. With businesses facing the most severe economic conditions since the 2008 financial crisis, the question is how can they turn this crisis into an opportunity?
The impact of the COVID-19 pandemic has triggered more applications of and demand for innovation. At the same time, it has reinforced a sense of urgency for SMEs to implement IoT technology to help deal with social distancing measures.
Imbalance in Supply and Demand: The Attrition of Global Manufacturing
To deal with the COVID-19 pandemic, the best prevention measure appears to be social distancing. Many countries have implemented lockdown policies and have placed a ban on travel.
Such measures pose extreme challenges for manufacturing industries. Being unable to take business trips, experiencing material and component shortages, having to shut down production lines, and dealing with prolonged deliveries will inevitably result in a supply and demand imbalance. The most severe problem is that some factories may need to cease operating and place staff on involuntary leave.
An attrition of the world’s manufacturing industries has begun
Another challenge for manufacturing is machine repair and maintenance. As the most important asset for factories, machines are expensive, costing millions to tens of millions of dollars. Many manufacturers own multiple factories in different areas or even different countries. As such, some of them rely on subcontractors to meet their production needs, especially those who have set up in China or other parts of Asia.
Even before the current crisis, factories situated in other countries have machines that require repair personnel to visit the site for servicing, primarily because of the difficulty in trying to diagnose problems via telephone or email. Moreover, for cases involving IoT solutions, simply using a laptop to remotely connect to a control center is not enough because it poses a risk from machine data not being encrypted.
Now that countries around the world have closed their borders, the first challenge manufacturing industries face is remote management of factories in different areas or countries.
Breaking the Myths of Digital Transformation: How to Maintain Operations
Since the start of the China–US trade war in 2018, many companies have considered moving their production away centers from China. The United States and Japanese governments have also proposed policies to assist manufacturers in transferring their production bases. However, the COVID-19 pandemic has interrupted this plan.
Although the pandemic has had a relatively smaller influence on large-scale multinational corporations that generally have the capacity for remote management, this has not been the case for SMEs. The reason for this is their hesitation in implementing IIoT technology, and this hesitation can be put down to the following four reasons:
- The high investment cost of setting up a factory
- The high threshold for digital transformation
- A reduction in productivity from having to halt factory operations
- Concerns about information security and transmitting data over the internet
But these are only myths. The truth is that the difficulties of manufacturers and suppliers can all be easily resolved.
When connecting a machine to the internet, major concerns are whether entire machines need to be replaced, how much setup will cost, whether machines need to be reconfigured, if operations will need to stop, and potential security issues. From OT to IT, the technology threshold is so high that most internal engineers lack the understanding to bring about digital transformation. For them, it is simply too difficult.
When it comes to transforming a factory to IIoT, it cannot be over-emphasized a factory’s existing framework does not need to be changed, factory personnel do not need to learn how to develop software, and production lines do not need to be stopped. Companies need only install Moxa equipment and sensors to quickly and easily implement a remote monitoring system. By collecting on-site data, production information becomes transparent and companies can immediately transform their factories and speed up production planning.
Fast, Simple, and Secure Remote Management. Without Changing Your System.
As a real case, one of our customers who worked with subcontractors opted to not integrate IoT technology into their production lines. This meant that they only learned about production problems at the end of each day. However, this has been compounded with the COVID-19 pandemic. It is now virtually impossible to send personnel to any site to resolve problems, making it difficult to acquire key information in a timely manner, which troubles both parties.
To face this problem, a Moxa solution can be quickly integrated without having to shut down any machines. Using a Moxa switch with port mirroring together with DAQ and an IIoT gateway, data can be easily uploaded to the cloud. Because most existing equipment is Ethernet-capable, port mirroring can be utilized to duplicate data packets. Because this function does not require restarting the machine, on-site production will not be affected.
Moxa’s Cross-enterprise Production Collaboration Solution
Moxa’s IoT gateway can also translate Modbus to MQTT and other common protocols used by cloud services. This allows manufacturers to rapidly upload their data to the cloud and further integrate with systems at their main factory. This way, the main factory can immediately obtain data from subcontractors. When integrated with existing production management systems, they can conduct remote management with maximum efficiency.
For machine suppliers and system integrators, the need for remote diagnosis has increased considerably. However, this need can be met by using the Moxa Remote Connection Suite (MRC). Our MRC gateways are equipped with two Ethernet ports. When customers need to expand their interfaces, they use the EDS-2000, a small industrial switch. For serial network machines, our NPort 5000 series is ideal. The MRC is easy to install, is flexible for various applications, and provide a high level of information security. Users do not need to configure complex router and cloud VPN settings. All they need to do is to use the Moxa Quick Link function to quickly establish a secure pathway, making remote health checks safer, more convenient, and more reliable.
Moxa’s Encrypted and Secure Remote Diagnosis Solution
Seeing in the COVID-19 crisis the opportunity to transform
Globally, economic growth is in depression and many countries are possibly facing a recession if this continues. However, this crisis is an excellent opportunity for SMEs to implement digital transformation to IIoT and reestablish themselves. Ironically, the COVID-19 pandemic has created the best opportunity for manufacturing industries worldwide.
Are you ready?
Moxa: Your Trusted Partner in Automation
Moxa is a leading provider of edge connectivity, industrial computing, and network infrastructure solutions for enabling connectivity for the Industrial Internet of Things. With over 30 years of industry experience, Moxa has connected more than 57 million devices worldwide and has a distribution and service network that reaches customers in more than 70 countries. Moxa delivers lasting business value by empowering industry with reliable networks and sincere service for industrial communications infrastructures.
