Present Status of building smart factories in Korea the government has launched the Presidential Committee on the Fourth Industrial Revolution, the revitalization of the manufacturing industry is re-emphasized and a strong policy-drive is being implemented to expand the smart factories. However, due to the companies’ lack of motivation to invest and their low technologies, the country does not have advanced world-class smart factories in reality.
In this regard, Min Sung-hee, a senior researcher of the Korea Development Bank (KDB), recently presented the examples of overseas smart factories in the report, “‘The Examples and Implications for Building smart factories,” examining the problem of introducing smart factories to Korea and announcing an improvement plan.
According to this report, overseas smart factories are being advanced to pursue cost-reduction and reflect customer needs. In particular, it progresses with the aim of reducing production costs with decreasing added values, companies focus on expanding productivity through their own factories as well as extending capabilities as a supplier through technological development.
In addition, they are expected to evolve to minimize the costs incurred in the value chain process while reflecting the needs of customers according to the manufacturing paradigm changes, thus affording a direct link between consumers and producers through a platform and the expansion to an on-demand business model.
On the other hand, Min claims that the strategy of building smart factories in Korea tends to be modeled after those of advanced countries, rather than to set its own direction. He emphasizes that there is a limit to the long-term and continuous construction of smart factories due to the investment conditions of domestic companies.
Min explains further, “The advancement of the overseas smart factories is largely attributed to their long-term accumulation of technology and efforts to attain their objects. Likewise, we need to establish clear goals and long-term plans to keep in the same groove. There are difficulties in establishing long-term and sustainable plans for building smart factories due to limited market scale for large enterprises and SMEs’ perceptions of the smart factory construction policies as similar to IT Support Project of Small Business conducted in the past.”
Min also added, “The overseas smart factories utilize highly intelligent machines with a high-level of technology, while the level of foundation techniques regarding smart factories in Korea is low. Despite the need to expand the investment in technical development, Korean companies tend to maintain a conservative stance on investment in technical development, and a large proportion of development expenses depends on self-funding, making it unavoidable to evade risks in the case of investment losses.”
In order to solve these problems, Min suggested, “It is necessary to raise a specific purpose and interest in building smart factories. The government should establish infrastructure and set a detailed mid- to long-term agenda to induce relevant companies into market participation and share it with those participating, while companies should create a friendly atmosphere with continuous interest from the CEO. Additionally, the financial sector needs to provide differentiated support depending on the scale and characteristics of the smart factories.” | Blog Magazine of korean electronics, brands and Goods