Augmented reveals the stories behind the new era of industrial operations, where technology will restore the agility of frontline workers. In episode #4 of the podcast, the topic is: A Renaissance of Manufacturing. Our guest is Enno De Boer, Partner, Digital Manufacturing Lead, McKinsey.
Augmented is a podcast for leaders, hosted by futurist Trond Arne Undheim, presented by Tulip.co, the manufacturing app platform, and associated with MFG.works, the manufacturing upskilling community launched at the World Economic Forum. Each episode dives deep into a contemporary topic of concern across the industry and airs at 9 am US Eastern Time every Wednesday. Augmented--the industry 4.0 podcast.
In this conversation, we talk about What is digital manufacturing? How to transform operations strategy, best practices, specifically the World Economic Forum Global Lighthouse Factories. We also tackle future developments: How to stay up to date in this fast moving field? What’s next?
My takeaway is that manufacturing is indeed undergoing a renaissance. There should be a tremendous amount of excitement among policy makers, industry professionals, and frontline workers about the changes in play. Technologies are maturing. The digital factory is becoming a reality. For those who already took on board the lessons of lean manufacturing and are exploring the latest opportunities, automation has become augmentation. Yet, there's still a lot to learn. The World Economic Forum's Lighthouse factories is one place to seek inspiration.
After listening to this episode, check out the World Economic Forum Global Lighthouse Network, McKinsey's Operations practice, well as Enno De Boer's social profile.
Augmented is a podcast for leaders in the manufacturing industry hosted by futurist Trond Arne Undheim, presented by Tulip.co, the manufacturing app platform, and associated with MFG.works, the open learning community launched at the World Economic Forum. Our intro and outro music is The Arrival by Evgeny Bardyuzha (@evgenybardyuzha), licensed by @Art_list_io. The show can be found at http://www.augmentedpodcast.co/
Thanks for listening. If you liked the show, subscribe at Augmentedpodcast.co or in your preferred podcast player, and rate us with five stars. If you liked this episode, you might also like episode #1 on From Automation to Augmentation or Episode #2 on How to Train Augmented Workers. Augmented--the industry 4.0 podcast.
Intro: [00:00:00] Augmented reveals to stories behind the new era of industrial operations, where technology will restore the agility of frontline workers. Augmented it is a podcast for leaders hosted by futurist Trond Arne Undheim, presented by Tulip.co manufacturing app platform and associated with MFG.works the manufacturing upskilling community launched at the World Economic Forum, each episode dives deep into a contemporary topic of concern across the industry and airs at 9:00 AM US Eastern time, every Wednesday, augmented the industry 4.0 podcast.
[00:00:41] Episode Intro: [00:00:41] In episode four of the podcast, the topic is a Renaissance of manufacturing Our guest is Enno de Boer, partner, and digital manufacturing lead at McKinsey & Company. In this conversation, we talk about what is digital manufacturing, how to transform operations strategy, best practices, specifically the world economic forum, global lighthouse factories.
[00:01:07] We also tackle future developments, how to stay up to date in this fast moving field. And what's next?
[00:01:16]Trond Arne Undheim, host: [00:01:16] Enno, how are you doing today?
[00:01:17] Enno de Boer, McKinsey & Company: [00:01:17] Very good.
[00:01:20] Trond Arne Undheim, host: [00:01:20] I'm excited to have our conversation. First off Enno, you're an interesting guy you've, obviously have a tremendous amount of experience working with a lot of manufacturing factories through your work at McKinsey and also now directly at the World Economic Forum, but what got you into manufacturing? What sparked this interest?
[00:01:40] Enno de Boer, McKinsey & Company: [00:01:40] I had always a passion for real things, for products and everything. And my dad was an engineer.
[00:01:46]He was a researcher in the steel industry and he wanted to get me into a steel, but I thought I wanted to have something a little bit more sophisticated. So I got initially into automotive, got really excited about it. And then. When you are in automotive, you need to go to the shop floor.
[00:02:02] That's where the real music is. So that's how I got into it. And then from there it took its toll and I went into any industry and I'm always passionate about manufacturing.
[00:02:14]Trond Arne Undheim, host: [00:02:14] Wow. That's where the real music is. You ended up getting your master's and your doctorate in mechanical engineering. I think they're all, from Dresden and from Achen. So you've been around the academic side and now very much on the combination, of consulting and advising but you enjoy.
[00:02:32] Getting into these factories and hearing the music basically.
[00:02:36] Enno de Boer, McKinsey & Company: [00:02:36] Yes, totally. Yeah. I started my career at BMW and it was amazing to see what product they are building, et cetera. And then I moved to McKinsey and it was always about the product and how can we make the products better? How can we get them better to the consumer?
[00:02:54]And also, how can we make literally the shop floor? A better environment and I think that's so exciting about what we're seeing at the moment with this digital revolution. And we're getting to that in a moment, but it's all about augmenting the operator and figuring out how do we take the dull, dirty and dangerous work out of manufacturing, making it very exciting.
[00:03:16] I think it's one of the most exciting spots to be for for all the young people, I just say, go into manufacturing. That's where all the fun technologies come to bear. Is it augmented reality, virtual reality? Is it digital twins? Is it AI? Is it digitalization? Is it 3d printing? All of that is coming there.
[00:03:35] Tell me any other industry where that's happening.
[00:03:37]Trond Arne Undheim, host: [00:03:37] I echo what you're saying and it's almost incredible. How long it has taken, but how long it's taking for the wider world to realize how many things are actually coming to a fore in manufacturing right now, give us a sense of what this environment looks like.
[00:03:53]There are many buzzwords, but what is digital manufacturing? Let's start simple here.
[00:03:58] Enno de Boer, McKinsey & Company: [00:03:58] Yeah. Digital manufacturing actually. It's interesting. It's an interesting term. So when we work with the World Economic Forum, we defined digital manufacturing is one on a 10 use cases that are spread across roughly half of them within the factory walls.
[00:04:16] And then something like predictive maintenance very apparent, but then half of them also outside of the four walls. So how do you connect to product development? Get your products faster, develop most likely with virtual reality with digital twins. How do you connect to the customer? How do you get customer orders in and immediately propagate them down to the shop floor and all the way back to the customer, the product lands.
[00:04:43] And you want to have this in one digital thread, how we call that? So that's very exciting. So that's digital manufacturing. It's very much about augmenting the operator. It's not so much about this idea that was out there in the eighties and nineties about the lighthouse factory and full automation.
[00:05:03] Nobody's talking about. This is really a concert of how do we bringing technologies to allow the operator, to bring out better products in higher quality and higher agility.
[00:05:15]I know industry 4.0 is a big term, but at the forum, there's also this notion of this fourth industrial revolution.
[00:05:24] Trond Arne Undheim, host: [00:05:24] So very specifically calling it a revolution. How do you feel about those things and are they even, are they perhaps wider terms than just focusing on the worker?
[00:05:33]Enno de Boer, McKinsey & Company: [00:05:33] I think it's interesting. I think it's partly we have an evolution because the manufacturing sector, you cannot change overnight.
[00:05:41]It's very complex to manufacture products. And you need many technologies so it feels not like that this is happening overnight though. I would say now with what we have gone through this terrible pandemic over the last year. It has almost switched and it totally accelerated the digital transformation.
[00:06:02] So I feel now it's becoming much more revolution because I'm seeing examples where innovation is not stopping anywhere. Like it's really about we have one lighthouse that we got new on the light house platform from Alibaba. They took an entire new stent on how do you do apparel manufacturers?
[00:06:22] How do you produce jeans now? That sounds very simple and sounds very labor intense. They took a stand this and fully connected it to the customer to get their ideas on how that would work. But then fully digitize that, and that allows them to create products, new apparel in only 30% of the time, and also bringing it to the customer 70% faster than anything we have seen before.
[00:06:50] So there's a real revolution going on in a Renaissance, I would say of manufacturing and the art of the possible. I would say the limit is the sky.
[00:06:59] Trond Arne Undheim, host: [00:06:59] But you said lighthouse, when you say lighthouse to me, I'm thinking a navigational tower, created out there in the ocean, with lights and signals to, to navigate against it.
[00:07:10]Give me a sense of what this metaphor means and what you have used when you built out this lighthouse network at the forum. What does it mean? And what's the purpose and why this metaphor.
[00:07:20] Enno de Boer, McKinsey & Company: [00:07:20] Yeah. And I think it's great that you ask him because I got a lot of questions at the beginning.
[00:07:25] It's lighthouse of right word, lighthouse is where we are driving on rocks. Is that not negative? And I said, no, it's like the light we need always role models. We need examples that we can latch on. We need things that we can learn from that are lighthouses.
[00:07:41] Lighthouses are towering example. They are high, they are shining out and they're shining the way. And. I'm a sailor. So I love lighthouses. So when I'm coming to the coast and the first thing is I see this light and it's gone up and it's leading me the way. And then I'm coming near, I get the contours and that's a lighthouse.
[00:08:01]So what is the lighthouse? The lighthouse is, we said it's not a shiny object. Yeah. I stop with these shiny objects. It's not about technology forward. That's wrong. It's not about just building an ivory tower and everyone is looking at very different three things. We're looking for with a WEF Lighthouse.
[00:08:20] First of all, we want to see impact at scale. Secondly, we want to see that unleashed by several use cases, several technologies that enable that like really innovation there. And then we want to see that this is sustainable, that there are the measures and the enablers below that it's not only sustainable, but also scalable.
[00:08:43] That is for us a lighthouse. And that's something that is exciting people. And they say I want to, I get every day, every week a call, I want to have a lighthouse in my organization. How do I do this? And that's exactly what we wanted to create. We wanted to create that everyone gets a feeling of what this really is, industry 4.0
[00:09:04] Trond Arne Undheim, host: [00:09:04] well. So then here's my question. How did this kind of project gets started and how do you select lighthouses and what exactly do you collect once you have selected lighthouses? And how is it that then it becomes helpful? Is it a collection of videos from these sites? Is it interviews with the people who have I don't know, designed to work processes there?
[00:09:27] W what is it exactly? Yeah, it started as always the first try is not working. So where we started at the first idea I had, I said look, we need these lighthouses. We need examples. It's like in the old lean terms where we had Japan, we had Toyota, we had Honda as a ways to go for the manufacturing community to learn.
[00:09:48] I said, we need to create the Japan of digital manufacturing. And the first answer was that I got from a couple of executives where I was on an executive committee. They said hell no, we're not share our secret sauce. We're ahead. And we don't want that others learn from it. And I said, I think that's wrong.
[00:10:07] You need. Open innovation you need to share, because this is such a dynamic environment where you can only stay ahead if you fully open, collaborate, and learn from the best and then stay ahead and it turned out to be true. And then I found the World Economic Forum. They loved the idea. We started to build this up jointly.
[00:10:29] And it's now something that everyone in the manufacturing industry aspires. So that's how it started. It was a lot of work, so we started almost three years ago to build this with the world economic forum. And we still feel we're only at the very beginning, we have now 54 lighthouses and more than a dozen actually to be announced soon that that are coming out.
[00:10:54]Enno de Boer, McKinsey & Company: [00:10:54] But if you put this into perspective this is 50 out of 10 million factories. So a lot of work to be done.
[00:11:05] How many lighthouses
[00:11:06] Trond Arne Undheim, host: [00:11:06] should there be?
[00:11:09] I think there should be many more. And I think every organization should have at least a handful, a dozen lighthouses, because what we find is like you need different lighthouses in an organization you'd need maybe a lighthouse that shows you how you connect your product development to manufacturing. You maybe need a lighthouse on how do you connect to the customer you need a a really sustainable lighthouse , there are already three. And then you need to start to use this light as a lighthouse is not a mean by itself. I think then you need to start
[00:11:43]Enno de Boer, McKinsey & Company: [00:11:43] That you get the entire organization to moving to to transform the entire value chain. They got the entire production network. So you could almost see that. And that's how I see it. I think we're very blessed with these lighthouses because for me, they are a little bit of the window into the future.
[00:12:03] That should be the standard in three, four years for any manufacturer. So if you ask me maybe 10 million. So all the factories should become lighthouses. Now every lighthouse will be a little bit different and needs to be built within its context.
[00:12:20] Trond Arne Undheim, host: [00:12:20] But are you saying that in order to qualify to be a lighthouse?
[00:12:24] There is an aspect that is better than the average, because otherwise you shouldn't be looking at it now. I'm just trying to figure out one how you select it and on what features , you select these things. And on the aspirational side, if I'm a factory owner or an organization, and I think, I'm inspired by what you're saying, how do I interact with this project. And how do I learn from the lighthouse? How do I build my own lighthouse? What is this thing?
[00:12:51] Enno de Boer, McKinsey & Company: [00:12:51] So I think you're spot on, like we said, we wanted to create the Japan of digital manufacturing. That was the vision, and that is still to be true. So what we want to have on the platform is lighthouses that that bring learnings to others.
[00:13:08] But that are willing to share those and that are towering and these learnings are important and interesting enough that everyone can learn from it. So yes, it should be over the average. It should be better than anything. It should be a best practice. Yes, of course. We are not looking for someone who has invested a ton of money into technology and has not gotten any returns out of it.
[00:13:32] There are a lot of examples of that. We are looking for the ones who have smartly invested into technology. Also driven the people. Transformation also have driven a business transformation with technology, and with that create an impact at scale. That's the number one we are looking for impact at scale.
[00:13:50] Number two is it driven through real technology innovation. And are these use cases there, and then is this sustainable? Is this just a quick blip of a performance or is this something where we feel that this company is taking this lighthouse really to fully transform themselves and literally the cluster they are working in?
[00:14:13]Can you give me some concrete examples? So some of these lighthouses there's 54 that have been announced that's too much to to cover in one quick talk, but give it, give me a sense of what kinds of things you already have in the portfolio.
[00:14:25] Yeah, so we started initially with. Factory lined houses.
[00:14:29] So the ones that are very factory, we had initially 16, and then we scale this up. One example is for example, Procter and Gamble, the Rakona site really interesting was about to be closed. They had a one last chance and the factory team was amazing. They said, we go all in. If you let us do it, we will go in.
[00:14:48] We take the challenge and they turned around this site with digital was fully digitizing. It was really on the bottom of the PNG manufacturing sites, it was a brownfield, I think a hundred years old very traditional. And they transformed it fully. And they are now one of the top performing sites in the Procter and Gamble network which says something and which says that anyone who has the ambition and has the leadership and is going full in, can do it. It's not a question of whether you're Greenfield. This is a Brown field. It's not a question of whether you are a new site or an old site. That's one example, another good example, just because we have quite a breadth there.
[00:15:29]I talked about Alibaba. Digital native company that fully went into apparel manufacturing to innovate apparel manufacturing. Another example Hanker they had very ambitious sustainability goals from the very get-go. They said we can only achieve that through digital transformation. They connected over 30 sites with a digital twin.
[00:15:53]They get really deep into the energy management, into predictive actions. And they were able to reduce the energy consumption by 38% and the water consumption by 25%, very sustainable example. Another one is Schneider Electric, and I could go on who reduced their carbon footprint by 78%. So we're not talking about, let's do another 10%.
[00:16:17] If someone comes to me and says look, let's do another 10% of this. I say, okay, you most likely don't need digital. Think harder. How do you want to hit customer break points? How do you want to do something really spectacular? And then let's build the full stack of digital together to innovate that?
[00:16:36]Trond Arne Undheim, host: [00:16:36] You've already given out some secrets, around transforming operations strategy these days Is a lighthouse strategy the first thing you recommend when you go into a company these days, or, what is your approach because you are an operation strategy expert in, in manufacturing.
[00:16:50]Is that the first thing you suggest or is it to look inward or what is the first thing one should do today?
[00:16:57] Enno de Boer, McKinsey & Company: [00:16:57] The first question I have, what business impact do you need to drive? Because that determines everything because a lighthouse is not a lighthouse. So first of all, I need to know whether you want to drive growth, whether you want to drive agility, mass customization, sustainability, productivity.
[00:17:17]Or speed to market. Let me know that. And that's already a hard question because a lot of
[00:17:23] say I haven't thought about it. I saw I'm coming to you and we're building a lighter as Elena. No, we're not building it. That was just for the LIDAR sakes. So let's figure out what is really the business impact you need. Then let's go from there backwards and say, what are the really out of the hundred 10 use cases that we have seen in the light houses?
[00:17:43] What are the ones that will really help you? Typically it's 20 to 30, maybe 40 use cases that immediately will drive fundamental value. Let's take them. And then, the most important thing is let's figure out how do we scale this? Because that's what has been the biggest challenge. And I would say that is what differentiate the 1% of the lighthouses or less than 1% of the lighthouses and the rest of the 99%.
[00:18:11] It's called pilot purgatory. We have seen thousands flowers bloom approaches, pilots over pilot, and they are not scaling.
[00:18:19] Trond Arne Undheim, host: [00:18:19] Why is there such a purgatory? Why is it so hard and what do those 1% do that the others don't.
[00:18:27] Enno de Boer, McKinsey & Company: [00:18:27] So the Y I think we're, we are looking at this question for quite long, and I think it's partly, I would say cultural in the manufacturing sector in the past was the one.
[00:18:39] They would as a CEO, you are asked, okay, give me another 5% cost reduction. And don't interrupt the production. There was no question of, okay. Look at this strategically. Tell me about how many factoring can be a competitive advantage. So really the thinking and being strategic about manufacturing.
[00:18:59] I think that's one part. The other part, I think, is culturally lean has learned as an lean is really a fundamental important part of the digital transformation, but lean has learned us to desegregate, to democratize and to spread literally everything across all our production network and let everyone do a little bit of something.
[00:19:23] Now, the problem is. That will be coming back in the future. And this is great: democratizing technology is the right thing to do. But at the beginning to get this started and getting out of pilot purgatory, you need to have some kind of a guided approach that is strategic, that is focused, and that is building certain capabilities that most likely these companies have not there in their networks.
[00:19:49]Trond Arne Undheim, host: [00:19:49] So are there really distillable small nuggets of best practices in this field or manufacturing, or is it so complicated that everybody has to, yes, they can look for paragons in these lighthouses, but you have also said one of the reasons you're so fascinated with this is you have to just hear the music.
[00:20:11] So what is the balance of, Listening to your own music, really just figuring out what is it that is happening in my own work process versus looking at other people's work process. What is the balance between the internal, the external, the inspiration versus the perspiration,
[00:20:28]Enno de Boer, McKinsey & Company: [00:20:28] I think it's like always, you need to start from where you are so that you cannot, and I think I'm glad that you asked this question. This is not about taking the lighthouse and then that's my blueprint. And then let's just do it and copy it. No, it won't work. You need to start from where you are. So it's, it starts with a diagnostic.
[00:20:50] It starts with, as I said earlier, it starts with what business goals. Everyone has different business goals, then it starts with where's your situation. So what, how do you manufacture there? Thousands of different types of manufacturing. So what's, you're starting to do is what's your maturity, what's your capabilities.
[00:21:08] What's your tech capability, all of that. And then build on that. I think there's for everyone tailored journey on: how do you then mobilize your people? How do you build the right capabilities? In-house to be then really able to scale something. And there are a lot of learnings from the lighthouses, how they have gone about it, how they have mastered too.
[00:21:32] To excite the shop floor, all of these lighthouses, the people love it. Yeah. So they get them excited, but you need to get the middle management also excited because they are, sometimes I call them the clay layer or something. They are maybe not so excited about all this change. So you need to get them on board that it's really helping them to do their job better.
[00:21:52]So that's something you need to figure out and then you need to figure out that's another thing that is biggest. In the past in manufacturing, we have already said okay, the it guys leave the it guys where they are, and we are only calling them when we really need them, but you need to closely work with IT because otherwise you cannot scale it.
[00:22:12] And then you would need to work with OT, like the operations technology. So connecting the sensor. So there's a lot to do. And I think. I think you need to find your own way and the puzzle pieces on the lighthouse network, you can find them there and then you need to put your puzzle together.
[00:22:30] Trond Arne Undheim, host: [00:22:30] I know you've worked with this for a long time.
[00:22:32] What are some of the surprises along the way that have shown up in your work and your experience? What are some of the good and bad surprises that you have learned along the way, things that you didn't expect either when you built out the lighthouse network or as you have been spending time listening to this factory music?
[00:22:52] Enno de Boer, McKinsey & Company: [00:22:52] Yeah. So couple of surprises. So one biggest surprise for me is, so I'm German. But I came over to New York 10 years ago and so I'm pretty now in the U S so I was I'm routing for the U S I'm also routing for German engineering, but. Guess what the US is behind on adopting these technologies and it's not behind on developing.
[00:23:17] It has fabulous startups. It has fabulous technology companies, but the digital transformation is not happening in the U S not as much as in China and also not as much as in Europe. And we should ask all ourselves, why is that? How do we mobilize. The U S manufacturing that's for me one.
[00:23:37] And I can tell you, I have turned every stone in the U S and looked under every stone to find lighthouses here. But fact is we have many more lighthouses in China and fact is, also, if you look at them, they are freaking exciting. So we can learn from China. Frank, is that a surprise? Yes, that is a surprise.
[00:23:57] That surprised me.
[00:23:59] Trond Arne Undheim, host: [00:23:59] Does this make you popular walking around in a America when you point this out?
[00:24:05] Enno de Boer, McKinsey & Company: [00:24:05] No, most likely not, but like freak, like I want to help you as many things. I am totally excited about you as many way. And I think there is all the capabilities. We have the technology here. We have the dealership we just need to do it.
[00:24:20] Just do it. And it's, as you said, it's about getting the inspiration. I think we should very quickly look at what's out there and then figure out a way and then put real effort behind it. And the U S has shown that over and over again, once we rally around something, we can really achieve big things.
[00:24:41] Trond Arne Undheim, host: [00:24:41] But what is the problem here? Is it a technology fix a fix or maybe an overconfidence in, the U S has always been innovative and we're leading everywhere and not looking at the human aspects, or is it a specifically a training challenge? Is that a misunderstanding of how some of these things work?
[00:24:58]Is it just the old kind of outsourcing thing that people have just said? All of that stuff is going to happen, in foreign factories. Anyway, it's not important here anymore. Or how did it start and how do you think we can get out of it? Here in the U S
[00:25:11] Enno de Boer, McKinsey & Company: [00:25:11] I think we have neglected manufacturing.
[00:25:14] As we have neglected manufacturing in the entire Western world. We w we found an easy way to offshore and bring it to low cost countries. And we literally, couple of decades ago, we have written off manufacturing and have put it. Said okay, this will just there will be a constant decline in manufacturing .
[00:25:35] Now I did a study in Germany. I think it's a 10 years ago. And honestly the result of the study was sobering because there was no digital and we had no, there were no ideas. We couldn't bring ideas together to, to innovate manufacturing. Now I must say what I've seen now and what is possible is.
[00:25:54]You can be really competitive in the U S with manufacturing because the labor differential is not the core thing, but what you need to do is you need to invest and you need to invest in the people you need to build and re-skill, and you need to augment with the technology, your people, and make sure that they get more productive.
[00:26:15] That's what you need to do, and then you can be productive. So I think there is, there's something happening now. And I can see that it's really taking off the conversations I had over the last six months, I would say are, fundamentally different from what I've seen before. So I'm very optimistic.
[00:26:36] Trond Arne Undheim, host: [00:26:36] That's great to hear. Next for me in my mind is, you spend all of your time, presumably on this, where do you go to get your insight? How do you sharpen your teeth? Are there influencers to look at, are there particular lighthouses or do you use yourself a lighthouse strategy or how do you digest all of the evolving manufacturing insight that's floating around. I'm just curious.
[00:27:04] Enno de Boer, McKinsey & Company: [00:27:04] That's a great question. So first of all, I sometimes sneak into some of these factory visits and I just do a real go see and see what they are doing. And I met the source. So I have that. I have the benefit. We have a big team and they have walked all the shop floors and.
[00:27:22] I can let them walk first. And then they tell me, I know this is the factory really, or this is a supply chain that you should really see, and then I can do that. So that's one inspiration. I think another inspiration is we have an amazing industry 4.0 expert panel that we have created with the WEF [World Economic Forum] that is literally selecting these lighthouses.
[00:27:44]And it's very independent. So I'm not on there to make this also very independent, but it's a power source. There are 30 individuals around the globe that I would say are the most experienced in industry 4.0. And it's. Some academics. I think the right portion of academics is important.
[00:28:03]But then it's also a lot of practitioners and that's where I'm getting my inspiration. And then I get into my inspiration, typically from client work, I'm spending time with CEO, COOs, and we at the moment building something truly amazing in the biotech sector where we are literally bringing all the best of digital manufacturing to this client and that's for me, always an innovation with. With young teams with people who really want to make a difference. And then with people who have really a lot of domain expertise. So I think also these teams of bringing the young, aggressive technology minded and then bring the ones in manufacturing who have the domain expertise who have seen this for 20, 30 years, bringing this together in teams is a true inspiration.
[00:28:54] Trond Arne Undheim, host: [00:28:54] What about the future? Where are we heading? We've talked a little bit about it. You think it's at a very exciting situation. Things are coming together, but we've also spoken about how long things take. Is there a danger now that the story has become one of revolution and indeed there are so many exciting things happening-- yet they have taken a while. How. How do you see this? What's next and how fast is the next going to evolve? We have talked a little bit about the U S being somewhat behind at least from this lighthouse context. Other places, how quickly is this entire thing coming together? And what's the outlook really for manufacturing?
[00:29:35]Enno de Boer, McKinsey & Company: [00:29:35] I would give you not a timing answer because I built my first digital manufacturing startup in 99. And it was just 20 years too early. And it failed miserably because all the ideas were right. And if I would have built it now, it would be maybe very successful, but 20 years. So I will not give you an answer on timing but I would say that we have audacious goals in the world.
[00:30:00] So number one, I think we really need to do something in terms of sustainability. The carbon footprint of [the] manufacturing sector is 20%, 54% of the energy consumption worldwide comes out of the factory and out of manufacturing. And we're seeing the lighthouse examples. We have maybe a dozen of lighthouses that make it truly impact on how we go to carbon neutral. How do we scale this up? That's for me one, and as I would say, we have the tool set. We have the examples. We have the role models. We need to grab it by the horns and do it. That's number one, I think number two is with this pandemic, which is really bad is there's a need for rethinking and there's a need for growth and there's a need on how do we master through, through a looming recession. And one thing we are seeing with the lighthouses, they are true inspiration for growth. So how do you grow with best digital capabilities? So I think: the good news is we have the two books it's ready. We have a real momentum here. Now we need to get everyone on board and everyone doing their work because a lot of work is for the next years ahead of us, but there, there would be also great outcomes out of it.
[00:31:15]So it's worthwhile the journey.
[00:31:18] Trond Arne Undheim, host: [00:31:18] So do I take it that for you? There is a true Renaissance of manufacturing. The last Renaissance came after a plague, arguably, right? If you look at very long historical perspective the Renaissance came out of the black death in a, at least that's one version of this story. Without, making that entire comparison taking you too far, the Renaissance of manufacturing, it can happen you think.
[00:31:48] Enno de Boer, McKinsey & Company: [00:31:48] It is happening in, not can have it is happening. What I've seen is when it hit us in New York, in March my practice, we were doing usually physical shop flow visits, and we switched within the day to virtual. It was possible. We couldn't believe it before then. It's possibly, we went a hundred percent virtual.
[00:32:09]I talked to the, CEOs that entirely managed their shop floor network from the couch. Yeah. In a way that they had that digital tools to really know what's going on because they couldn't go to the factory. So I think it's really happening. And I think this, if this pandemic has one positive, I think it gave us kind of the pause and also the need to really rethink and that's what happening now.
[00:32:36]I see real Renaissance. Yes. And we have also seen how important some products are. That we need those products. They are important. They're important for for not only the wellbeing, but if they are like life critical, in part. So having that scene, I think it's a, it was a good wake up call and and this would foster a lot of innovation in the coming years.
[00:33:02] Trond Arne Undheim, host: [00:33:02] Fascinating. Enno, I thank you so much for this talk. I hope we can stay in touch,
[00:33:08]Enno de Boer, McKinsey & Company: [00:33:08] and it was a pleasure. Thank you so much.
[00:33:11] Outro: [00:33:11] You have just listened to episode four of the augmented podcast with host Trond Arne Undheim. The topic was a Renaissance of manufacturing. Our guest was Enno de Boer, partner and digital manufacturing lead at McKinsey & Company. In this conversation, we talked about what is digital manufacturing, how to transform operations strategy, best practices, specifically.
[00:33:36] The World Economic Forum's global lighthouse factories. We also tackle future developments, how to stay up to date in this fast moving field. And what's next. My takeaway is that manufacturing is indeed undergoing a Renaissance. There should be a tremendous amount of excitement among policymakers, industry professionals, and frontline workers about the changes in technologies are maturing.
[00:34:03] The digital factory is becoming the reality for those we're ready to come onboard the lessons of lean manufacturing and are exploring the latest opportunities, automation has become augmentation yet. There's still a lot to learn. The world Economic Forum' lighthouse factories is one place to seek inspiration.
[00:34:22] Thanks for listening. If you'd like the show, subscribe at augmentedpodcast.co or in your preferred podcast player, and rate us with five stars. If you liked this episode, you might also like episode number one on from automation to augmentation or episode two on how to train augmented workers. Augmented -the industry 4.0 podcast.
Digital Manufacturing Lead
Enno is the global head of the firm's manufacturing work. He leads McKinsey's collaboration with the World Economic Forum around technology adoption and the ecosystem required to build large-scale transformations. ... Before joining McKinsey, Enno was a project manager at a global automotive company.