Achieving the Smart Factory Vision

Estimated reading time: 4 minutes

At the recent NEPCON South China event in Shenzhen, China, I was able to talk to James Liu, director of Standardization and Electronics Manufacturing at the Smart Factory Institute of the China Science and Technology Automation Alliance (CSAA), about how they can help small- and medium-sized companies in China transform their production into smart factories. He explained the challenges that these companies face, the future of automation in China, and the need for a free, open interface to connect disparate electronics manufacturing equipment and systems on the factory floor.

Stephen Las Marias: James, tell me about the Smart Factory Institute and your role in the company.

James Liu: We use the Smart Factory name because we can give the industry the total solution for the smart factory. That's our mission, and that's my job, because I'm in charge of the electronics industry division. I was in IPC China for seven years, so I'm very familiar with the Chinese electronic industries. I want to develop a very useful solution for them, especially for the small- and medium-sized companies.

Our solution is quite different from the others. Many people know about smart factories. A very popular example is Siemens’ Chengdu factory, a one-brand smart factory because all the equipment is made by Siemens. So it was easy to bring them together. In China, the situation is quite different. Almost every company uses various brands of equipment—different brands of screen printers, chip mounters, AOIs, and so on. It’s difficult to link them into one system. However, in the electronic industry, automation right now is getting better. The concept of smart factories is automation plus cyber physical systems (CPS). That means we use the industrial Ethernet to link every piece of equipment. For Siemens, it's very easy because they manufactured all the equipment; but in China, it’s very difficult because of the different equipment suppliers and the closed interface. Our solution is to develop a new interface that is free and open for the industry. That is my main job.

Las Marias: What would a smart factory look like for a small company here?

Liu: The smart factory means the production can be adjusted by the equipment itself. Also, it must be flexible. When you get an order, it gets sent to the designer and the designer gives them the specs. All the information is sent to the different equipment. The equipment runs automatically and the material control is also very flexible and automatic. For the electronics industry, the smart factory must be very flexible with a high level of automation.

Las Marias: You mentioned that you are focusing on the SMEs. Why is that?

Liu: In China, the very big companies are rich enough, so they contact big-name companies. SMEs have lesser capital. They want to use their limited money to improve their production level. They need more help and they need more free counsel—and that’s what we want to do.

Small and medium companies need to transform their operations into smart factories because the rules of the market have changed. Every user wants to use the equipment in their own way. They are always changing their requirements based on market demands. Manufacturers must follow these changes, so being flexible is very important. For a big company like Foxconn, which does mass production, there’s no problem. But in the future, the market will have more and more need for people working on individual products. There will still be a need for mass production from the big companies, but smaller companies must focus on the low-volume production.

Las Marias: How will they justify their investments in transitioning to a smart factory?

Liu: They need to consult first. They have to know what they want to do and what their purpose is. Initially, they will tell us what their purpose is and what they want to do. Then we can help them with the design and maybe give some lectures or seminars to let them know what they need to do, step by step. Different companies have different requirements and different purposes, so we develop different solutions. We teach them because small and medium companies don’t know what the smart factory should be; they just know they need to do this.

Right now, EMS companies are competing in price. Lower and lower prices cannot make money, so they want to get more orders, not only PCBAs, but they hope to get orders from the design through the final product. But they are not an OEM, so maybe this week they hope to get an order for a memory disc. Maybe next week, they will get an order for laptops. The change is huge and happens very frequently. Small- and medium-sized manufacturers face this situation. For mass production, Foxconn doesn’t have that problem because they might only focus on one product, for example the iPhone, but smaller companies change between orders very frequently. A friend of mine has an EMS company and he told me every week they get 30 customer orders made up of 380 different kinds of products. In one week! They are always changing between products.

Las Marias: That’s a big challenge.

Liu: Yes. So they have to use the smart factory to accommodate this.

To read this entire article, which appeared in the November 2016 issue of SMT Magazine, click here.