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1 Introduction

With the purpose of increasing operational performance and competitive advantage, many manufacturing firms have developed and deployed lean production programmes with the ultimate goal of creating a culture of continuous improvement [1,2,3]. Recent developments towards the Fourth Industrial Revolution, or Industry 4.0 [4], now encourage manufacturers to look at/into advanced technologies, automation and digitalization as the next digital frontier for improving the lean enterprise and achieving operational excellence.

Toyota Motor Co. is recognized as the pioneer of what has become widely known as lean production – with the company’s corporate philosophy: “The Toyota Way”, firmly underpinning its operations model, “The Toyota Production System (TPS)”. Sugimori et al. [5] was one of the first to describe the infamous TPS, describing it as two fundamental sub-systems: the Just-in-Time (JIT) system and Respect-for-Human (RFH) system. Furthermore, a description of the principles and behaviours underlying the “Toyota Way” philosophy can be found in Liker [6], who describes Toyota’s managerial approach as a set of 14 core “lean” principles. Some examples of these are “use only reliable, thoroughly tested technology that serves your people and processes” and “make decisions slowly by consensus, thoroughly considering all options”. These specific examples support the notion that Toyota, as a company, is a slow adopter of new technology. However, one should by no means dismiss the new opportunities presented by emerging Industry 4.0 technologies [7] for further improvement and/or innovation of manufacturing operations. [8,9,10,11,12,13] present limited insight into the co-existence of both approaches, focusing on smart products, smart machines and augmented operators and cyber-physical JIT delivery respectively. This paper aims to offer a more holistic account of lean production and Industry 4.0 integration, presenting actual industrial Proofs-of-Concept (PoCs) from an explorative case study.

2 Literature Review

This paper addresses the co-existence and potential integration mechanisms of Industry 4.0 technologies [7] with existing industrial lean production programmes. This section provides an overview of relevant literature combining the fields of lean production and Industry 4.0 (see Table 1).

Table 1. Recent literature addressing Industry 4.0 and lean production integration
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From literature, it is clear that Lean Production and Industry 4.0 can be successfully integrated. In fact, it appears that the realization of lean principles can be further enhanced from the support offered by innovative digital technologies and cyber-physical systems, which are the major contributions introduced by Industry 4.0. Moreover, it is possible to consider the two approaches as complementary, because the strength of lean manufacturing that is based on participation and standardized practices can take advantage of the collaborative environment and structured data collection and analysis offered by Industrial Internet of Things (IIoT) and Cyber-Physical System (CPS) technologies. In order to better clarify the opportunities of combining lean production and Industry 4.0, we first provide a brief description of the technologies that are considered as the pillars of Industry 4.0 (see Table 2) [7, 15].

Table 2. Industry 4.0 technologies: commonly accepted definitions [7, 15]
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3 Research Methodology

A single, exploratory case study approach is adopted, taking insight into the current Industry 4.0 programme (i.e. Digital Transformation) of an Italian producer of automotive parts and brake systems: Brembo S.p.A. – http://www.brembo.com/en.

A selection of ongoing Industry 4.0 initiatives and Proof-of-Concept (PoC) pilots were discussed with representatives of the company, including: Operations Director, Industry 4.0 Programme Manager, Continuous Improvement Manager, Shift Supervisors and Lean-Lab Coordinator.

By providing valuable insights from this explorative use case, this paper is able to highlight several ways in which Industry 4.0 technologies can be used to support and further develop a company’s existing lean production programme.

4 Exploratory Case Description

With approximately 9,000 employees distributed across 15 countries and 19 industrial production sites, the company achieved a turnover of €2.2 billion in 2016, following successive growth year-on-year in the previous ten years. Delivering OEM and after-sales parts and systems to the major automotive companies, and with an existing lean production programme (since 2008) and lean production “office” with eight lean-labs worldwide, the company demonstrates a clear understanding of its value propositions and major value streams.

The company established an Industry 4.0 committee and programme management team in 2015, and currently has more than 50 on-going Industry 4.0 initiatives, managed by “Digital Factory Project Managers” and executed by “Digital Factory Engineers”. The “Digital Personnel” works closely with personnel from the lean programme office to ensure the alignment of both initiatives. An example of this collaboration is the company’s lean-lab, which has recently been redesigned to cater for two core types of lean-training, the first for the more traditional human-intensive areas such as manual production and assembly operations, and the second for more Industry 4.0 relevant, capital-intensive areas like robotics and automation.

This investigation focuses on the company’s activities in the machining and assembly operations in the Italian factory, which has approximate 1,000 employees and produces in excess of 2,600,000 units per year. The factory has approximate 50 CNC machines and 50 assembly lines. We examine the company’s Industry 4.0 proofs-of-concept in machining, powder coating, and quality control operations, in addition to the company’s proof-of-concept for data management and e-learning. All four proofs-of-concept have been envisioned as strategic applications of Industry 4.0 technologies (see Table 3), and have been constructed as experiments implemented in the Brembo Factory located at Curno in Bergamo, Italy, in order to promote organizational learning. It is anticipated that the outcome and results of each PoC will be evaluated based on its contribution towards the company’s Profit and Loss (P&L) statement and strictly measured in terms of Return on Investment (ROI) before successful implementations are eventually rolled-out worldwide.

Table 3. Strategic applications of Industry 4.0 technologies at Brembo S.p.A.
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4.1 PoC A: Machine Cell Automation and Smart Tool Management

Adoption of Industry 4.0 technologies [7] for automating machining and assembly operations shows extensive signs of promise for supporting both JIT and RFH systems. Applying a modular concept for machine cell automation based on standardisation and further machine improvement has resulted in improved performance in Quality, Cost, Delivery and Safety (QCDS) metrics. Robots are used for picking and visual inspection of raw metal-castings, as well as deburring. In-line quality inspection is also automated with use of integrated Coordinate Measuring Machines (CMMs), which has allowed 1/11 parts to be inspected instead of 1/100 without increasing the cycle time.

In the future, the company will realise autonomous set-ups – but today continue to work with the lean practice of Single Minute Exchange of Dies (SMED) for continuous reduction of set-up time. All machine cells are also AGV-ready (Automated Guided Vehicle), suggesting a move towards unmanned logistics in the near future.

In addition to the efforts in machine cell automation, the company has also marked every tool with a unique identification, allowing for “Smart Tool Management”.

A database tracks the location and remaining lifecycle of each tool in real-time and generates a tool-wear forecast, allowing for more effective and efficient planning for tool replenishment in the tool preparation area. A production supervisor suggested, “Operators in the tool preparation area are now able to prepare replenishment before the machine operator realizes the need”.

The movement toward “Smart Tool Management” has resulted in at least 30% reduction in tool-inventory – and has an even greater effect with regard to tooling cost because of moving from fixed lifetime tool changes to condition-based tool-life.

4.2 PoC B: Powder Coating Automation

Following an analysis of the causes for poor quality in the powder coating department, the company realised that the masking and unmasking operations were responsible for generating a significant amount of defects. For this reason, the masking and unmasking operations have been fully automated using a high degree of innovation and robotics – resulting in significant cost savings and a swift return on investment. The process must manage 600,000 pieces per year, with a range of 15 colours and 30 different geometries, requiring 12 set-ups per day.

4.3 PoC C: Quality Control Digitization

The company has developed a “Smart Quality” concept, which involves the digitization of all dimensional quality control checks. This system also involves a 300-parameter in-line paperless CMM check. Before, there was a significant paper trail with regard to recording results of quality control, and the quality engineers/supervisors would have to physically search for documents from machine-to-machine. Now, the shift supervisor has a single access point (his/her PC) and receives a push warning via an on-line app on his smartphone should the pre-determined workflow render this necessary. This resulted in a paperless Quality Management System – with real-time Statistical Process Control (SPC), real-time process capability analysis, and real-time alerts in case of defect-detection.

4.4 PoC D: Data Management and e-Learning

The final proof-of-concept is the “Analytics Platform”, which connects all production lines on a common database and web-platform. A set of touch-screen dashboards situated directly in the shopfloor provides an instantaneous overview of the state of operations throughout the factory, in real-time. This allows for full real-time traceability per unit (including individual parameter information and test results), as well as web-analytics for shopfloor monitoring of both product and process. Because the information is collected and stored on a web-platform, workflows can be defined for various events, such as the detection of defects. For example, when a defective part is detected, automation in the production cell will remove the part from the line, and the system can deploy a push-message to the shift supervisor’s smartphone. This system secures a fast flow of information to key stakeholders, offers broad visibility and provides a hierarchical escalation mechanism in the event of unplanned event detection. Most importantly in terms of the “Respect-for-Human” principle, the web-platform guides the production operator to act in the correct way.

The system also supports an e-learning mechanism for operator training. Digital instructions are provided across several levels – including safety, machine installation/set-up procedures, machine maintenance procedures, and assembly procedures/work instructions. Each instruction is based on a 3D digital model of the machine, – and provides an animation that allows the operator to repeat the instruction in real life, acting as a self-assessment and test of understanding. This system was used to accelerate the opening and ramp-up of production in the company’s new factory in Mexico.

5 Findings and Discussion

Findings were organized according to the seminal work of Sugimori et al. [4], that describes TPS as the aggregation of two sub-systems: Just-in-Time (and JidokaFootnote 1) system and Respect-for Human System. These sub-systems are subsequently broken down into a sub-set of actions, as shown in Table 4. It is also suggested the enabling functionality of Industry 4.0 technologies for the various “lean production constructs” – on which the lean production programmes of many companies are based.

Table 4. Enabling functionality of Industry 4.0 technologies
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6 Conclusions and Further Research

This paper provides a review of lean production in light of emerging Industry 4.0 technologies. Specific reflections have been made regarding the potential of these technologies to build on existing lean production programmes and serve as enablers for leaner production. In particular, an exploratory case study of an Italian company operating in the automotive sector has been discussed in order to present some evidence from an actual implementation of Industry 4.0 proofs of concept. From the case study, the potential of digital technologies to support key lean manufacturing constructs emerged. This paper aimed at providing the foundations for further research, which can be towards a more detailed framework for “Digital Lean” or “Lean 4.0”.

In terms of limitations of the work, we recognize that from a single case study, it is difficult to make accurate theoretical generalisations of the topic(s) under exploration. Therefore, further case studies are required to verify the significance of the propositions presented in this paper. In addition, as the results presented in this paper cannot be considered exhaustive and fully extendible to all possible industrial realities, further development will include the enlargement of the sample considering different sectors in the B2B and B2C contexts, as well as extending the analysis to different tiers of the supply chain.