“Industry 4.0 transformation affects every business unit and operational process and requires end-to-end systems to manage the entire product lifecycle”
From dynamic global leaders to ambitious local firms, KPMG’s The Strategy Group works with a range of industrial businesses across diverse sectors. Every business we work with is different. Not only in terms of its size, industry or operating model, but also in terms of its technological maturity on its journey to Industry 4.0. It’s through our understanding of this variation that we help our clients maximise business value: buy, sell, integrate, separate and improve.
The ultimate objective of Industry 4.0 is to maximise service and product quality for minimum cost and wastage. Achieving this depends on having accurate, high-quality data. Not only to minimise physical waste (materials, energy and time), but to encompass the entire supply chain, from raw materials to customer usage, in a continual loop. All too often, a high-quality customer experience at the front-end is hindered by a negative experience at the back-end, due to poor supply of a product or service.
Examples of true customer delight, where promises made at the point-of-sale are matched or exceeded by the full end-to-end experience, are less common. But those organisations that do achieve it are the ones that thrive, with strong customer relationships and high levels of loyalty, not to mention the highest deal appeal.
When customer experience is let down by reality
| Customer promise | Traditional organisation | I4.0 organisations |
| Next day delivery | A day or more late, package lost, damaged or hard to access, polystyrene disposal issues |
Same day delivery, easy to open and environmentally sensitive packaging |
| Produced just as you like it | Delivered from a large stockholding of a few standard configurations. Manufactured on poorly maintained plant leading to poor quality issues | Customer configures item on- line which is additive manufactured to order with a batch size of one |
| Responsive on-going service | Item sent back to a service agent. Long wait due to service part shortage and no substitute loan item offered | Real time monitoring and predictive maintenance. Serviced at a place to suit customer with a replacement loan item if needed |
Few organisations have the luxury of a clean slate start-up and even fewer have the luxury of unlimited capital to exploit a new idea. But there are some common traits we see time and again within successful Industry 4.0-focused businesses:
Clear, meaningful strategy: An clear strategy that is relevant to all functions and people in the organisation. End-to-end investment plans to ensure all aspects of the supply chain are synchronised in their capture and use of common data (single point of truth).
Embracing continuous learning and common values: A united workforce with enquiring minds, open to new ways of working, accepting of technology and empowered to suggest and make changes. Continuous improvement methodology is embedded across the enterprise and not just a sporadic manufacturing-only activity.
Research and development: A systematic way for collecting and using information about future developments. Not just in product/service design, but across the supply chain and back-office functions, too. The knowledge does not necessarily need to be created in-house, but it needs to be readily available and accessible.
Awareness of surroundings: Activities are driven by evidence-based knowledge and consideration of changes in the global ecosystem, suppliers, competitors and customer expectations. Education is often provided to both suppliers and customers. This enhances long-term relationships and helps manage expectations.
Agile technology: Connected systems that are secure, but able to adapt at minimum cost to the needs of customers and new functionality, e.g. AI, block chain, digital twins. The technology solution provides real time controls via the blended use of ‘Edge’ and ‘Cloud’, combining the best of in-house systems and outsourced solutions.
Capital equipment and future proofing: Where possible, manufacturing equipment is configurable and can be developed and modified at minimum cost. Early decisions around in-house or outsourced manufacture to maximise agility and logistics. This allows focus to be maintained on areas of differentiation.
Our Strategy Group works with industrial clients and targets wherever they are in their digital transformation journey. For specific examples of how we are helping clients across the globe address the challenges and opportunities of Industry 4.0, see:
