Making Industry 4.0 a reality for Malaysia
By Sharmila Ganapathy-Wallace August 2, 2017
- Industry 4.0 can help companies eliminate wastage and lower costs
- Myanmar, Thailand and Vietnam will be ahead in the Industry 4.0 game
THE terms “fourth industrial revolution” and “Industry 4.0” often make an appearance during conferences and in media coverage, although they haven’t really been popularised in the Malaysian context. Why? One reason is that perhaps locally, many have not yet applied Industry 4.0 within their organisations.
Before we get into how that is being tackled, let us broach the definition of Industry 4.0. According to global consulting firm McKinsey, Industry 4.0 “is the next phase in the digitisation of the manufacturing sector, driven by four disruptions: the astonishing rise in data volumes, computational power, and connectivity, especially new low-power wide-area networks; the emergence of analytics and business-intelligence capabilities; new forms of human-machine interaction such as touch interfaces and augmented-reality systems; and improvements in transferring digital instructions to the physical world, such as advanced robotics and 3-D printing.”
That may seem like a mouthful of jargon, but the reality is that Industry 4.0 will take manufacturing to the next level, increasing productivity as well as lowering costs for companies.
A public-private sector initiative in Malaysia is set to take locally-based companies into this new reality, via training employees of industries, as well as students pursuing their studies at local universities and polytechnics.
Training the Industry 4.0 workforce
The training programme, which commenced in April 2016, is being jointly conducted by local technology training provider Knowledgecom Sdn Bhd and the Penang Skills Development Centre (PSDC).
The two training providers are working closely with the Ministry of Human Resources, Ministry of International Trade and Industry, Human Resources Development Fund, Economic Planning Unit, Malaysia Digital Economy Corporation, Talent Corporation Malaysia and Yayasan Peneraju Pendidikan Bumiputera.
According to Knowledgecom chief executive officer S T Rubaneswaran (pic, above), there are nine technology pillars that define Industry 4.0. They are: autonomous robots, simulated and augmented reality, horizontal and vertical integration, the industrial Internet of Things, cybersecurity, cloud computing, additive manufacturing [think 3D printing], supply chain and big data analytics.
Worldwide, he says, most companies have addressed the pillars in silos, but not in totality. Commenting on why Malaysian companies need Industry 4.0, Rubaneswaran says it can help companies eliminate wastage, lower costs, increase their customer base and rise above the competition.
This is the future as he sees it: “There will be no more people working on assembly lines in the next 20 years, everything will be automated.
“In 50 years’ time, as we reach artificial intelligence, computers will be more prevalent. Companies will need to change processes and train people to help them transition. Without training, companies doing business the way they have for the past 10 years may become obsolete.”
Hence, he says that in local companies, top level managers should have an Industry 4.0 policy in place and have mid-levels manager get training to implement this policy.
Rubaneswaran also believes that Industry 4.0 will eliminate Malaysia’s dependency on low-skilled foreign labour.
“We need to upgrade local workers to mid-level skilled positions so you have jobs for Malaysians. We have some three million foreign workers in Malaysia, yet there are an estimated 300,000 to 400,000 unemployed Malaysians.”
He admits that it will not be an easy process, with key challenges being workplace culture and change management. However, he emphasises that most countries will move towards Industry 4.0, hence the faster we change, the better for us.
“Myanmar, Thailand and Vietnam will be ahead in the game. Thailand has a 4.0 policy framework and like Vietnam, being an agricultural nation, will find it an easier transition to manufacturing 4.0 compared to Malaysia, which still has a lot of 2.0 and 2.5 systems,” he opines.
He notes that these days, technology that is available in Europe and other developed nations can be in Asia almost at the same time. “Companies can move faster if they are 4.0 ready, they can offer customisation and lower costs,” he adds.
Under the public-private sector initiative, Knowledgecom and PSDC offer training currently for five of the nine technology pillars mentioned earlier. The training covers horizontal and vertical integration, industrial Internet of Things, cybersecurity, cloud and big data analytics.
The funding comes from the Ministry of Human Resources for the training, while the funding for industries is from the Ministry of International Trade and Industry, he shares.
“We will soon begin supply chain training. We are targeting 50 sites by year end in eight states, currently we have over 26 sites currently spread over six states now. Each state has a polytechnic, skill centre and university receiving training,” he explains.
The six states are Penang, Perak, Johor, Negeri Sembilan, Sabah and Sarawak. More than 500 people have been trained to date, comprising mid-level managers in industries, university undergraduates in the third or fourth years of their degree, as well as pre-diploma polytechnic students, who are later given internships with companies after their training.
According to Rubaneswaran, of the 150 companies that have been trained so far, 58% are multinational corporations and 28% small-and-medium enterprises. “By the end of the year, we would have trained a total of 1,500 people and as many as 400 companies.”
There’s a reason the initiative kicked off outside of the Klang Valley, he says. “We found an imbalance in technology in Malaysia, there’s not enough talent pool in the other states. We saw the gap, hence started the training outside of the Klang Valley.”
Do we need Industry 4.0?
PSDC CEO Muhamed Ali Hajah Mydin (pic, above) recalls that when they started a year ago, industries were facing a problem when implementing Industry 4.0 projects.
“After a year of visiting companies, we have been able to create an industry implementation programme for the ecosystem. We have shown them and the government that it is not about buying new equipment or investing a lot of money. It is about getting them [companies’ to be more productive, reduce costs and be more profitable,” he says.
Sometimes, he says, companies do not understand why they need Industry 4.0. “We show them that by moving to this, the focus area is increasing productivity, reducing costs. We also guide them so they can estimate the return on investment from upgrading to 4.0.”
Commenting on the feedback from the companies they have trained, Muhamed Ali says that the companies have been “impressed with our capability to produce programmes to transform their companies via top-down implementation.”
While it remains to be seen if Malaysia can play catch-up with Thailand for instance in the Industry 4.0 race, it is good to know that things have already been put into motion for the ecosystem as well as the education system so that the future workforce will be more Industry 4.0 ready.