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Seven Steps towards Industry 4.0 for SMEs

Industry 4.0 (i4.0) is the roadmap of digital transformation for enterprises. Yet, despite the long and continuous process of i4.0, it will definitely lead enterprises to move progressively towards the goal. i4.0 development seems to be an unaffordable investment to many local enterprises. They can indeed take a “Great Vision, Quick Fixing” approach to achieve digital transformation in accordance with their own business strategy and market trends, while the scale can also vary from budget availability. As long as the enterprise starts taking the following "Seven Steps", the road towards i4.0 is always promising.

1. Define and Create a Digital Strategy & Roadmap
The objective of digital vision is to become a smart enterprise, forging ahead towards the ultimate goal of i4.0. Starting with pilot projects in small-scale, enterprises can base on their development strategies and resources to gauge the business benefits of digitalisation and give fresh impetus to digital transformation. They can then formulate their own digital strategies and roadmaps, planning ahead the needs of resources in short, medium and long term, as well as talent development.

2. Integration & Coordination of IT infrastructure
Digital infrastructure, information technology systems and lean processes are the backbone of i4.0. Enterprises should start from the technical perspective in order to grasp the opportunities brought by digital transformation. Building digital infrastructure and making continuous improvement in lean processes are the keys to drive the highest value for your business.

3. Digital Integration of Horizontal and Vertical Workflows
i4.0 real-time data integration solutions require workflow coordination. Digital integration of critical workflows helps companies master real-time and complete information. Horizontal and vertical digitalisation across the value chain can be achieved through digital integration solutions, including sensors, production machines, control systems, resource management systems, and smart business applications. Such kind of solutions can be extended to the customer and supplier sectors.

4. Real-time Data Acquisition
Enterprises can utilise the Internet of Things (IoT) and sensor technology, along with a robust management system and database, to get themselves well-prepared for formulating their future smart factory solutions.

5. Smart Data Analytics Optimise Production
Upon obtaining sufficient and necessary real-time data, enterprises can conduct data analysis, such as regression analysis, to optimise production process instantly, thus enhancing production efficiency.

6. Autonomous/Self-optimisation
i4.0 enterprises start from establishing a series of data databases that cater for big data intelligent analysis, which are also applicable to business services and applications. Not only can such a system control and manage the internal and external operations across the enterprise, but also undergoes the process of self-optimisation in a timely manner.

7. Formulate New Digital Business Model
Traditional enterprises nowadays face new challenges due to the advancement of digital tools, rapidly changing customer demands and evolving industry ecosystems. Given the limitation in resources, know-how and time, enterprises are encouraged to foster collaboration with external partners in the value chain. Through the concerted efforts of exploring new solutions, they will be able to face up to new challenges and achieve all-win situations, for example, to develop personalised services and products.

Management support is a decisive factor determining whether or not a company will take the above seven steps. Meanwhile, digital transformation requires digital talent, all of whom should be recruited and retained to build a strong and agile team in order to formulate and execute the i4.0 development plan. A digital workforce helps nurture the innovation culture of willing to “innovate” and “change”, which is also conducive to accelerating cross-team digital transformation.

Seven Steps towards Industry 4.0 for SMEs

Key Steps of Digital Transformation for i4.0

Hong Kong Federation of Innovative Technologies and Manufacturing Industries (FITMI) has been funded by the "SME Development Support Fund" of Trade and Industry Department of HKSAR Government. The Hong Kong Productivity Council has implemented the project to promote the implementation of Industry 4.0 for SMEs in Hong Kong. One of the companies implemented the above key steps to move towards i4.0.

Any opinions, findings, conclusions or recommendations expressed in this material/event (or by members of the Project team) do not reflect the views of the Government of the Hong Kong Special Administrative Region, Trade and Industry Department or the Vetting Committee of the SME Development Fund and the Dedicated Fund on Branding, Upgrading and Domestic Sales (Organisation Support Programme).