At the beginning of April 2019, Tencent Research Institute (TRI) publishes the first AI + Manufacturing Industry Research Report. The report analyzes current AI technology and its connection and application in different industries. Integrating the history and development path of AI, report forecasts the tendency of AI + Manufacturing with the existing and possible situational effects.
The AI technology has been included in whether developing and developed countries’ national strategy plan: China’s Made in China 2025, Germany’s Industrialization 4.0, Japan’s Society 5.0, etc. Developed countries can improve unemployment and other social issues and trade deficit, and developing countries can benefit from industrial restructure for a sustainable growth.
AI + manufacturing has 6 verticals in 3 different categories: application, platform, and foundation. Foundation includes industrial robotics and the IoT (internet of things) in manufacturing; platform has manufacturing cloud (public cloud), manufacturing big data and data analysis, and manufacturing AI (algorithm); application is the smart manufacturer solution/application.
The combination of AI and manufacturing has several major benefits and impacts as listed below:
- It helps manufacturers to improve efficiency (no longer limited by working shift) and quality (lowered or diminished human errors in production) and lower costs (reduced wastes and possible worker compensation costs);
- The employment market will be overturned since robotics will replace human labor but increase the need for maintenance labor and tech force;
- The manufacturing industry structure will be upgraded. A number of non-intelligent electronics will be gradually eliminated by time and be replaced by smart electronics. The transition will breed waves of AI companies with strong algorithm R&D abilities;
- International division of labor will be reshaped. The traditional demographic dividend will wear off and new form of international cooperation will appear.
With the assistance of internet, the power of AI + manufacturing will be amplified. Internet can contribute to the combination through three means: AI + product, AI + service, and AI + manufacturing. The three means penetrate the whole supply chain of commodity’s circulation based on internet’s functions including connecting (user to manufacturer), information security, big data, cloud computation, and algorithm (intelligence level),
With benefits of implementing AI into manufacturing, the challenges that drag the intelligentization process come from several dimensions.
China’s core competency in technology is yet to be developed. From integrated circuit (IC) to algorithm, China lacks related accumulation due to historical reasons. Plus, due to the international political tension, the technological communication breaks down for times and China needs to firm its technology ground and reduce the dependence on other countries.
Industrial standards are under building. Lacking industrial standards fails to improve efficiency or quality in products. Government and industries are building the standard but machineries imported from regions with varied standards easily cause the incompatibility problems among machines and software.
The outdated large body of traditional industry organization becomes a burden in internal structural reformation. The pyramid-shaped internal management structure has too many layers in organizational structure. The bottom members of the pyramid cannot handle multi-tasks and have low flexibility in adapting to new change.
With yearly reduced profit margin in manufacturing industry, capital market losses interests to invest. The investment in manufacturing will not have a positive short-term return and hence investment organizations will be more cautious in making decision. Without long-term and continuous financial support, the AI + Manufacturing process cannot move forward at an ideal speed.
China’s manufacturing and industrial reformation, though with above-mentioned challenges, is still in progress. The AI + Manufacturing is a must for all countries to build their competencies in a global market. Strengthening and encouraging R&D force, building unified industrial standard, completing information security system, and others steps should be able to help the realization of AI + Manufacturing.