Imagine being able to make critical product decisions about material selection, scheduling and pricing, all in one place. That’s what a “smart factory” can do for you.

The world of software is coming full circle to cater to the physical needs of modern manufacturing, culminating in a new movement called Industry 4.0.

Industry 4.0 is the integration of manufacturing automation and data exchange, to create what has been dubbed as a “smart factory.” These factories will be controlled by a virtual production line that runs systems and monitors and completes their physical processes. These systems will communicate in real time, whether that means a customer tracking the progress of his (or her) order’s production, or a company ensuring the quality of its operations. Simply put, connected software systems will run our physical manufacturing automatically.

“Consumers care now more than ever about the integrity of their products. We use modern manufacturing technology to take our female empowerment mission all the way to the factory floor. Every dress is designed by and handmade by a woman — from our office in Los Angeles to our factory in India,” Kimi Verma, CEO of Shail K. Dresses, told me.

To achieve this Industry 4.0 goal will be challenging for manufacturers but within their grasp. Industry leaders are emerging who have broken away from the traditional factory structure and built companies spearheading the charge. Although there has been significant movement from larger companies, those established manufacturing leaders are still heavily encumbered by bureaucracy and face challenges in moving quickly with a unified vision.

So, it’s not surprising that smaller, more agile companies are the ones rapidly innovating in the world of manufacturing. In addition to their lean operations and motivated teams of specialized professionals, startups in particular are being propelled in their competitive quest to gain market traction through significant funding from the VC community.

Industry drivers are already riding this wave of “smart-factory” innovation, implementing advanced analytical software, automated services and short turnarounds, with high precision. One of them is San Francisco startup Plethora, which is blazing the trail on all three fronts, and presents a case study for how smart factories will evolve.

Plethora is a manufacturing service whose mission is to automate traditional manufacturing processes to produce high-quality machined parts with quick turnaround times. The company eliminates the inefficiencies created between traditional design and manufacturing processes by using a CAD add-in and web-enabled software to create instant pricing and manufacturing feedback; these processes allow customers to order parts directly from the software.

Plethora is CNC milling parts made out of 20 different materials for a variety of industries, including the automotive, aerospace and industrial communities. Overall, the metal fabrication industry was valued at $16.35 billion in 2015 and is on track to grow to $21.4 billion by 2024, and Plethora is strategically positioned in the machining industry to disrupt many traditional players, in the following three respects:

1. Advanced analytical software
Companies that can follow a maturity curve in developing their own software will come out with a significant competitive advantage over their rivals. Advanced software saves time and narrows the range of expertise and worker-hours needed to make critical decisions.

Advanced analytics will also address more than just the day-to-day needs of a customer. It will address new opportunities and business models on which it can continuously iterate. Plethora, in particular, has developed a software that instantly analyzes any part for its manufacturability in machining processes. For example, the company’s add-in matches the customer with its in-house machining services, allowing that customer to make critical decisions about material selection, scheduling and pricing, all in one place. The engineer can place orders via the CAD software directly to the factory.

2. Automated services coming soon
When it comes to service and shipping, customers often expect the process to be as seamless as that of a one-click Amazon Prime purchase. They want it shipped for free, and they want it in two days (or sooner), with tracking. Plethora is providing instant quotes through its software. Engineers can select their material, choose a delivery date, pay on the spot and track the parts’ production and shipping.

Direct-to-the-factory and quick, seamless customer interaction is a rare event in any industry. Imagine spending less than two minutes at your local DMV to obtain a new driver’s license. State government may be a long way from that, but in the manufacturing world, the changes in software and automation are making what used to be lofty goals actually possible.

3. Short lead times — high precision, low volume
Table-top equipment can already make a part quickly, but high precision and repeatability are hard to achieve in manufacturing. Engineers face issues like the fact that some shops are willing to make parts fast or in low volumes, but cannot guarantee precision. Many fabricators also take days to provide a quote.

There is still an industry need for precision parts in a wide range of manufacturing services, particularly in low volume. Plethora can make parts in time frames as short as three days (compared to the standard week or more) in single or low volumes, with high precision. This time advantage makes Plethora incredibly competitive and has made the company a favored vendor among hardware companies in the Bay Area.

Its smart factory tools have eliminated the usual back and forth when it comes to steps like issuing an accurate quote for a part that can actually be machined. Its proprietary in-house technology facilitates quality, high-precision manufacturing.

Bottom line:
Envision a future where physical products can automatically be manufactured with just a few clicks of a button. An entrepreneur can conceive an idea, design it and have it made by systems which make critical production decisions for that founder. This is the vision of Industry 4.0 and the factory of the future. Plethora is just one of an increasing number of companies well on their way to achieving this.

Source: Entrepreneur 

Rick Williams

Rick is the Managing Partner of Polk and Associates and Director of our Attest, and Manufacturing services divisions. He earned his Bachelor of Science degree in Accounting from Western Michigan University and earned his Accreditation in Business Valuation from the AICPA and is a Chartered Global Management Accountant. Rick is a member of the Michigan Association of Certified Public Accountants, American Institute of Certified Public Accountants, AICPA Forensic and Valuation Services section, Michigan Manufacturers Association, MMA Tax Policy Committee, SAE, Affordable Housing Association of Certified Public Accountants, and Automation Alley.

RWilliams@polkcpa.com