Periodic Reporting for period 1 - WORKSHOP4.0 (Automated real-time production forecasting for industry)
Reporting period: 2016-02-01 to 2016-07-31
The working principle of WORKSHOP4.0 is to reveal mathematically the complex co-relations between the hundreds of parameters involved in the production processes and the product control stages in which defects are detected or any other final fixed objectives controlled. Once these co-relations are known, WORKSHOP4.0 suggests the optimum operating conditions for a set of specific production targets established by the company management strategy, i.e. lowest rejection rate, highest productivity, lowest energy consumption, shortest processing time, etc. Furthermore, as WORKSHOP4,0 is running and interacting with the manufacturing process itself modifies its behaviour, our solution includes a self-learning routine that compensates periodically this effect while increasing the accuracy of the predictions over time.
The main conclusion of the action is that the need and/or acceptance of Workshop 4.0 will be greater than anticipated in previous studies, and that the market evolves towards a clearly growing demand, not less than 7% annually in emerging economies and 2% in Europe.
- It is necessary to accelerate the ""time to market"". Specific training of the leading team of VEIGALAN has been carried out to empower the product commercialization.
- Another conclusion and decision is to prioritize those most interesting niches for being profitable, unique and with a brighter future. (Iron foundries and aluminium HPDC).
- An exploitation plan has been developed and the economic potential of the project has been measured with potential customers. The final results state a significant saving for companies and a reduced pay-back time in all studied cases of less than one year.
- The global patent search carried out revealed that no other similar alternatives are patented at this moment. The freedom to operate is guaranteed.
- Thanks to this first approval in Phase 1 granted by the SME Instrument from the European Commission, VEIGALAN has been able to update and prepare an improved feasibility study that reflects the high market possibilities and supports the decision making mechanism for a successful business.
Objective: Analyse the feasibility of the innovation project and determine the business model to adopt in order to guarantee the profitability of the investment in the current market and future scenarios.
Tasks: Five different tasks have been implemented during the project execution:
- Task 1: Technical Feasibility
- Task 2: Market
- Task 3: Value proposition, business model and commercialization
- Task 4: Cost, revenues and funding scheme
- Task 5: Feasibility study
TIMETABLE: The work done has been executed from February 1st 2016 until July 31st 2016
RESULTS: The main remarkable results that have been achieved are related to the study of the market and to the business model. The feasibility study done during these six months has helped us to better understand the manufacturing market and our positioning in the value chain. Commercial network and technical network has been established to have success in the exploitation of the product, reducing the time to market of our product. As well, new customer relations have been started recently.
The main economic benefits for the users of WORKSHOP4.0 come for three sources: reduction defective products, reduction of productions costs, and improvement of quality of products. In addition, WORKSHOP 4,0 is fully integrable into existing ERP in the company and can be used as an advanced management system to analyse trends in key processes, indicators and identifying root cause of any deviation. As well, the use of these systems has been identified as a powerful instrument to reduce indirect costs due to the simplification of data capture and management.
Anyway the best application of this system has been identified in the two market niches (iron foundries and aluminium HPDC) for the defective reduction. WORKSHOP 4.0 will help the customer to optimize their production and reduce their defective product in a range between 50-60%. Performed calculation with potential clients have shown manufacturing costs saving potentials than allow a product pay-back of less than one year. The case of the first demonstrator located in a Spanish cast iron foundry is especially significant. This company in addition to benefit from reduction of defective products and reduction of processing costs, has used WORSHOP4.0 to manufacture cast iron pieces of exceptionally high quality of material. The obtained mechanical properties have been high enough to substitute steel in certain application like train bogie parts, being these 30% more expensive. Now, this foundry is unable to cope all the demand to substitute steel products with high quality iron ones, and the estimated economic effect is:
- Internal rejection: Reduction from 12% to 6% (50%) which it translates into 300,000 €/year
- Reduction of production costs: 4%. 150,000 €/year
- Increase in demand: +10% additional incomes of 200,000 €/year
- This makes an average profit increase of 650,000 €/year.
The objective is to achieve in a medium term a global leadership position in providing the ferrous castings and aluminium HPDC with the Workshop 4.0 solution obtaining a significant share in the market, which will allow VEIGALAN to position in the edge of the sector worldwide.