China and Industry 4.0

China and Industry 4.0

September 3, 2018

China is leading the world in implementation of Industry 4.0.

Industry 4.0 is a digital factory concept that promises to dramatically increase productivity, decrease inventory holding costs, improve quality, and increase forecasting accuracy.  The IT architecture has to be built around the company’s unique business needs and processes instead of building a strategy around a particular technology to make Industry 4.0 work.

Investments in Industry 4.0 should have a payback period of less than two years.

This post is based on the McKinsey article, Imperatives for China’s factories of the future, by Anil Sikka, August 3, 2018. Image source: Shutterstock / Phonlamai Photo.

Discussion Questions:

1.  Industry 4.0 requires a major investment in IT architecture, e.g. data, analytics, robots. Are there limitations to implementation of Industry 4.0 that were not mentioned in the article for companies in the United States?

Guidance: Review the concept of scalability.  Students should recognize that the costs of implementation may limit Industry 4.0 to larger companies.  Additional issues that should be noted are workforce availability to implement and operate the IT architecture, and the requirement for tighter supply chain integration.

2. What happens to break-even quantity when Industry Continue reading

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Toddler Gets Popsicle by Drone

Toddler Gets Popsicle by Drone

August 27, 2018

Solving the last-mile delivery problem is difficult.

One approach that is being considered is delivery by drone.  Previous OM in the News posts have looked at drone use by Zipline and Doordash.  Now, the FAA has conducted a test with a drone out of line-of-sight of the operator.

The test: delivering a Popsicle in 6 minutes from a simulated store, to a 2-year-old more than a mile away. The FAA’s drone didn’t land, but instead hovered, and lowered the Popsicle with a tether.

Current regulations limit the use of drones to line-of-sight operation.  If tests like this one are successful, the line-of-sight limitation might be lifted.


Video Spotlight: Toddler’s Popsicle-by-Air Marks Milestone in U.S. Drone Delivery


This post is based on the Bloomberg article, Toddler’s Popsicle-by-Air Marks Milestone in U.S. Drone Delivery, by Alan Levin, August 8, 2018; and the Bloomberg video, accompanying Bloomberg video. Image source: wundervisuals/Getty Images.

Discussion Questions:

1. What problems are facing the use of drones for the last-mile-delivery?

Guidance: In the US, regulations are part of the problem.  The FAA hasn’t approved drones for use beyond line-of-sight.  The Popsicle delivery was one test of concept Continue reading

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