Manufacturing in Malaysia is embracing ‘Industry 4.0’, which involves the integration of digital and physical technologies to improve business processes, operations, productivity, growth and innovation. Unlike previous eras, ‘Industry 4.0’ looks to create new business models and enhance existing ones, says leading data and analytics company GlobalData.
According to the Department of Statistics Malaysia (DOSM), manufacturing sector employed more than one million people in 2016. Malaysia External Trade Development Corporation (MATRADE) and DOSM report that the sector accounts for over 80% of all exports and 23% of GDP. However, manufacturers are under pressure and face significant challenges.
Dustin Kehoe, Technology Service Director of APAC at GlobalData, says: “On the supply side, the industry is seeing an increase in global commodity prices and diversification from traditional low-cost production markets. On the demand side, average order value is falling, the demand for customization is increasing and margins by and large are under pressure.
“To address these challenges and drive the evolution of a technology-driven global economy, Malaysia is gearing up to launch the national policy by mid-2018. In the past, innovation was focused on one company. Industry 4.0 looks to extend these capabilities across the entire upstream and downstream supply chain. It focuses on the convergence of operational technology– hardware and software that monitor and control physical equipment and processes integrate with traditional IT systems.”
Industry 4.0 introduces what is referred to as ‘smart factory’ in which cyber physical systems monitor real time physical progress of the factory and are able to make decentralized decisions. This is being driven by a number of breakthrough technologies such as autonomous robots, big data analytics, cloud computing, Internet of Things (IoT), additive manufacturing (3D Printing), system integration, cybersecurity, augmented reality and simulation.
Kehoe continues: “The manufacturing sector in Malaysia will continue to adopt new technologies to help increase visibility in both production and process. Having more granularity in both areas through technology drives better quality control, such as fewer defects and overall business efficiency. Uptime is very important for this industry. An unplanned outage can lead to significant delays and costs.
“In terms of technology, Artificial Intelligence (AI) will drive IoT adoption and the two technologies are converging. The integration of AI and IoT will lead to further innovation, automation and data management. Manufacturing will be among the early adopters of AI-enabled IoT. The first deployments are starting in areas such as machine sensors, advanced electronics and will gradually move to other areas such as robotics, driverless vehicles and drones.”