The Social and Economic Impacts of Smart Factory

Smart factory refers to a factory with digitalised environment where machines and devices have the ability to improve process through automation and self-optimisation. It is one of the key component for Industry 4.0, every country is attempt to mobilizing national resources to transited over. Due to globalisation and continuous changing market competition based on customer demands, majorities of companies started to embark on smart factory journey in order to stay as top competitors in the industry. The shift from traditional factory to smart factory had brought many impacts economically and socially. What are the economic and social impacts of smart factory?

Economically, smart factory can be seen its impacts on production, services, final products and customers. Smart factory involves the use of smart devices such as intelligent machines, robots and workpieces that collaborate and communicate in continuous manner in the production processes. This intelligent production optimises operation through self-organising and self-adapting which in turn produces the final products called the smart products. In addition, through intelligent production, customers satisfaction are achieved as the production are of high quality, custom-designed, has short-production lead time and delivery time.

Socially, smart factory shows its impacts on employment market and safety and labour law of workers. When company embraces smart factory, the factory becomes automated and self-optimised. This transforms the employment market where the number of less skilled workers are reduced as some works and functions are replaced by smart devices. While, more skilled workers will be needed to handle the operation of the smart devices. Additionally, smart factory creates new jobs opportunities and opportunity for training and career advancement which results in the reduction of unemployment rate. The transformation of the factory into smart factory creates another work hazards to the workers. This enhances the improvement of work environment safety and labour law in order to ensure compliance with human rights as well as reduces risk at workplace.

In conclusion, smart factories give numerous positive impacts both in economic and social aspects which include asset efficiency, worker safety, reduced production cost, agility of production, environmental sustainability and improved quality. “In high level and aggregate, this round of industry 4.0 will free up massive of manual and semi labour, even highly skilled labour and replaced by highly precision programmable robotic based automated smart factory that can run 24×7 non stopping and custom production small number of variety accordingly to the actual and adjust for latest demand and supply, that is the positive side for the transition. Just like the previous revolution, a massive amount of labour is freed up from the agriculture sector and replaced by capital intensive equipment and large scale agriculture to boost productivity. This round aims to free up all kinds of traditional factories and become smart factories.” further added by Vincent Lim, E-SPIN Group subject matters expert (SME) and consultant.

E-SPIN Group in the enterprise ICT solution supply, consulting, project management, training and maintenance support for multinational and government agencies, across the region E-SPIN do business. Please feel free to contact E-SPIN for your inquiry and requirement, so we can assist you on the exact requirement in the packaged solutions that you may required for your company digital transformation (DT), industry 4.0 transition requirements.