Alignment of IT and OT and why it's important to your business

A key element in both Industry 4.0 and 5.0 is the Smart Factory. For manufacturers, a Smart Factory system delivers real-time visibility, optimizes production processes, and enhances product quality.

The case for Smart Factory solutions:

1. Real-time production monitoring: Provides visibility on the shop floor, tracking production progress, machine status, and resource usage. This leads to reduced downtime, improved equipment performance, and lower manufacturing costs.
2. Product quality: By tracking product specifications throughout the production process, Smart Factory systems detect defects early, reducing rework or product recalls.
3. Traceability & compliance: Ensures detailed traceability of materials and components, helping companies comply with industry standards and making audits smoother.
4. Continuous improvement: Data-driven decision-making facilitates performance analysis, leading to better decisions, less waste, and lower energy consumption.
5. Workforce management: Helps manage and allocate labor effectively, ensuring the right skills are assigned to the right tasks while enhancing productivity.

So why don't all manufacturers have this in place yet? The high initial investment costs and the complexity of integrating these systems into legacy infrastructures have been major barriers, especially for SMEs. 

Traditional MES systems often require significant setup, configuration, and long implementation cycles. Additionally, because Smart Factory systems sit between the OT (Operational Technology) and IT layers, decision-making can become complicated. 

With the recent advancements within the technology behind systems like MES, these barriers have now been lowered. Let’s take Tulip MES as an example. It’s low-code, cloud native and have a user-friendly interface. Thereby you can get value out of the system within weeks instead of years. The system is so accessible, that your key users will be able to adapt the processes and the user experience themselves.

Why Industry 5.0 extends the value of Industry 4.0

While Industry 4.0 has focused primarily on efficiency, Industry 5.0 adds a new dimension by integrating human-centricity, sustainability, and resilience into the manufacturing process. One of the most compelling aspects of Industry 5.0 is its alignment with emerging regulations and societal demands around sustainability, such as the AGEC legislationin France. The AGEC law requires products to be designed for repairability, circularity, and overall sustainability, with a clear focus on minimizing waste and extending product life cycles. This shift toward sustainability is not limited to France but is reflective of broader European policies like the EU Green Deal, which aims to make Europe the first climate-neutral continent by 2050.

In this regard, I believe we are seeing a clear link between Industry 5.0 and crucial EU initiatives such as the updated Ecodesign Directive and the Digital Product Passport. These initiatives are designed to ensure that products not only meet today’s demands but also contribute to a sustainable and resilient future.

• The Ecodesign Directive sets stringent requirements for energy efficiency and environmental impact, driving innovation toward products that consume fewer resources while in use and are easier to recycle or reuse at the end of their lifecycle.
• The Digital Product Passport, part of the broader push for sustainability, will play a transformative role in enabling traceability throughout the product lifecycle. It will document materials, production processes, and reparability, allowing consumers and businesses to make informed decisions about the environmental impact of products.
  

Key Statistics:

• The European Green Deal aims for the EU to reduce net greenhouse gas emissions by at least 55% by 2030. 
• By 2024, the Digital Product Passport will be rolled out for several product categories, starting with sectors like electronics and batteries, to ensure transparency and promote circular economies. 
• According to the European Commission, increasing repairability could save EU consumers approximately €12 billion annually and reduce waste by 7 million tons per year.

These policies and initiatives reflect the core principles of Industry 5.0, which goes beyond profit-driven production to embrace a wider purpose that includes social responsibility, environmental stewardship, and long-term resilience. By embedding these elements into the manufacturing stack, businesses can not only meet regulatory demands but also create products that are future-proof, sustainable, and aligned with consumer expectations. This reflect the key elements of Industry 5.0 (see attached PDF for reference):

• Human-centric approach: Industry 5.0 puts workers at the heart of production, using technology to augment human capabilities rather than replace them. From collaborative robots (cobots) to digital tools that empower workers, Industry 5.0 is about enabling people to work smarter, not harder.
  
• Sustainability: Industry 5.0 aligns with the goals of a circular economy, promoting energy efficiency, resource optimization, and sustainable production methods. It encourages businesses to move beyond profit-driven goals and consider their environmental impact as a core metric of success.
  
• Resilience: In a world of geopolitical shifts and natural crises, Industry 5.0 prepares businesses to be more adaptable and robust. It focuses on building supply chain resilience and ensuring that manufacturing can continue even during disruptions.