Why Taiwan Should be Center of Attention for a Global Industry 4.0 Transformation

Chaney Ho from Advantech

Author: Advantech, Translator: Athena Chen, Editor: Yunchieh Tsou

Taiwan, with its’ position as a manufacturing powerhouse among the Asia production and supply chain, has long been an important partner for globally renowned brands.

Such as TSMC and MEDIAtech, these two companies  have long been the leading roles in the global semiconductor industry. HTC, ASUS, and ACER also have topped the list of global leading consumer electronic brands.

But, as the world continues to be eaten up by software, the digital transformation of manufacturing is inevitable, Taiwan now faces an urgent need to bring itself one step closer to Industry 4.0.

Germany has long touted “Industry 4.0” at the helm of its economic initiatives, and they have realized that the factory size most suited for this new industry era is not the super factories of more than a hundred thousand employees, but their mid-to -small sized  counterparts. In the past, these mid-to-small sized companies have been pillar of strength in Taiwan’s economic miracle.

Apart from its’ strong supply chain experience, Taiwan is also the most dense production center of industrial computers- which can be see as the stepping stone to developing the new Industry 4.0.

Advantech manager Chaney Ho, with his extensive industry experience working across product marketing and building global brands, has also been lauded for his  organizational management and business development know-how.

Under his lead, Advantech has transformed into a provider of Industry 4.0 solutions, with 93% of revenue coming from abroad. The company has also consistently topped Interbrand’s “Taiwan’s Top 20 International Brand List”, and is now in the process of building Taiwan’s first Industry 4.0 factory, where they hope to demonstrate and promote a future of smart factories that are fully automated and managed in real-time.  

To further make sense of Taiwan’s positioning under current waves of Industry 4.0, TechOrange has sat down for a talk with Chaney Ho, to get a closer glimpse of what goals Taiwan is currently striving to achieve.

Reporter: What have you observed via discussions surrounding “Industry 4.0” issues in Taiwan? Why is it important that have conversations about it now?

Ho: One global trend that we have seen is: the hourly wage of Germany is 45.5 USD, and they have long been the pioneers of “Industry 4.0”; Trump is convinced that he will bring manufacturing jobs back to America, and the hourly wage is 38 USD, which is not cheap at all, either. These countries are now all developing data-led manufacturing, to further boost the domestic industry and to lower labor costs.

According to statistics, Taiwan’s manufacturing industry contributes to 30 percent of total GDP, and is also a huge driver in providing high-skilled job opportunities. Thus Taiwan should aim for an industry transformation and jump on board in developing “Industry 4.0”, leveraging our strong manufacturing foundations of the past. There is ICT know how in Taiwan, and it can definitely be transferred to building IOT. Since 2012, everyone has been talking about IOT, smart cities, and for the past two years, Industry 4.0 has been the topic of focus– no matter what it is, be it textiles, rubber tires, food processing, as long as you are manufacturing something, it is important.    

Guide to Industry 4.0: 4-Steps of Manufacturing Transformation

Reporter: As Taiwan’s manufacturing industry is striving to transform itself, how do you set solid objectives? What actions should be taken?

Ho: There are 4 steps to an Industry 4.0 transformation.

  1. Full Automation: Since the times of Industry 3.0, there has been an emphasis on machinery automation. There are numerous industrial computers within the machines, recording data while the computer’s function. There must be a capacity to keep these data in the computers, to be able to move to the next stage of Industry 4.0
  2. Data Collection: The emphasis from “What is the equipment doing” has shifted to “What is the equipment trying to tell us?”. Therefore, the status of the equipment, data from the process of production, and information of the environment in which the production is taking place, are all needed to be collected. The past where manpower was need to manually take numbers is no longer needed.
  3. Data Integration: According to data control MES systems, varied data collected from the machinery can be integrated, where factory stats can then be analyzed, calculated and displayed  in real-time, and the processed data can be visualized.

4.Cloud Analysis: The data can be used for material predictions beforehand, and can even ensure a tighter collaboration between upstream and downstream vendors. Data scientists need to work together with specialists that have in-depth vertical working knowledge of the industry, in order to garner meaningful readings of the data. This is the hardest part, and may take 3-5 years before concrete results can be reached, and is globally what everyone is focused on developing now.

The Industry 4.0 Revolution is Taiwan’s Golden Opportunity to Integrate Itself Into the Global Community Through Manufacturing Advantages

Reporter: Taiwan’s manufacturing has solid foundations, and we are globally renown for our product and supply chain. Our government has been actively pushing for an upgrade of our manufacturing industry, but under the disruption of Industry 4.0, what is needed to gain a competitive edge?

Ho: Taiwan’s edge is within its’ technical services, our high tech manufacturing is where we have an advantage. Taiwan has the world’s densest industrial computer manufacturing centers, and industrial computers are the building blocks of Industry 4.0 services. This is where the future of Taiwan’s competitive advantage lies.

With the example of Advantech, 93% of our products are being sold to the international market, and have established our brand name and our position as leaders within this specialised area. Industry 4.0 is about improving efficiency, but if you can also increase sales of products, you can gain 3 – 5 times in economic value.