▼Founding Prospectus / Philosophy / Mission / Vision

Founding prospectus

In the past 10 years, the Internet society has changed much the way people live and work, and at the same time, the structure of society and industry is about to change drastically. It is no wonder that the speed of these changes is accelerating, and that 20 years from now, we will be living in a world that we cannot even imagine today. The Cyber-Physical System that unites cyberspace and the real world, accelerated by IoT (Internet of Things) technology, is about to engulf all the realities that make up our society.
 Will the technology and passion of the manufacturing industry, which prides itself on being unbeatable in skill of manufacturing products, continue to shine for the next 20 years in the newly formed competitive environment?　In a networked society, will each company’s high level performance in production sites be able to take another leap forward with the help of IT? In the new era where digitization is the norm, we cannot survive without a system of “Connected Factories” and “Connected Workplaces”. As IT and manufacturing integrate, decisions will be made with unprecedented efficiency and speed, and factories and sites that are unable to keep up with this trend will be left behind.
 The Japanese way of manufacturing is people-centered manufacturing. Manufacturing will not disappear from Japan, but Japanese style manufacturing may disappear. At many production sites, people who work there discover various problems, devise creative ways to solve them, and through kaizen, they are finally improving the quality and performance of entire factories. If we promote top-down introduction of IT, there is a risk that these activities will become unacceptable.
When a global ecosystem that integrates IT and manufacturing is created, the players who created this world will take the lead in controlling it, regardless of the superiority of their elemental manufacturing technologies. In other words, the players will be the ones who create the rules of the game itself. Even if we are proud of the world’s best manufacturing at the moment, unless it is open and connected, it will not become the standard for the next generation.

Industrial Value Chain Initiative will find a way to solve the problems that each company is facing, problems that have been difficult to solve by themselves, by building a system that connects multiple companies. In the competitive environment that each company finds itself in, we dare to set up areas of cooperation and work together with the members to develop the manufacturing and IT systems for those areas.
 In order for the various workplaces of various factories to be connected beyond the differences in industries and business conditions, it is necessary to align the formats of their work and information to some extent in advance. In order to change the manufacturing system from a self-supporting one, where everything was built from scratch, to one where common parts are procured from outside and resources are focused on only the parts where the company excels, it is necessary to start by identifying what is common and what is unique.
 The key lies in the interface between IT and the workplaces, and the technologies and know-how that are produced in the production sites. In order to create a system that incorporates the elements of the people who work there, and to make the most of the unique efforts of individual sites, it is necessary to build a “Reference Model” for networking through loose standards. In this way, individual companies will be able to connect with each other in a new ecosystem, while keeping the technologies they are good at in black boxes, and a new market for a new era will develop globally. By daring to take such initiatives ahead of others, we can take the initiative in a new era.

Industrial Value Chain Initiative supports the establishment of Reference Model for “Connected Factories” not by a single company but jointly by multiple companies. It promotes the networking of production technology and production management, and globally develops manufacturing in which people and machines coexist, and in which individuals and companies cooperate, in a new trend that is said to be revolutionary. This challenge will be solved by a number of stakeholders, including owner-manufacturers with overseas manufacturing sites, vendor companies that provide facilities and equipment to factories, and integrator companies that provide factory systems as infrastructure.

Yasuyuki Nishioka,
Founder and Representative of IVI
Professor, Design Engineering, Hosei University
June 2015

Idea

1. Think after you have tried it
   2. Get back to the reality of the actual site
   3. Spread harmony by using opinions as a basis

Mission

Create an ecosystem for “Connected Manufacturing” through a bottom-up approach.
Create value from manufacturing knowledge and know-how through a mechanism for sharing Loose Standards.
Contribute to the creation of rules for cooperation and competition in a balance between open and closed systems.

Vision

In the digital society, in order to strengthen the mechanism of bottom-up value formation with manufacturing sites at the core, and to create a more flexible and high value-added system that is interconnected as Connected Manufacturing, we will provide a forum that includes regions and overseas, as well as provide theories, methods, tools, and standards to make this happen.

▼Message from the President

It is said that the digitization of manufacturing sites is lagging behind the rapid digitization of social systems. With the exception of factories that are thoroughly automated with the latest equipment, many factories are indeed still analog, with no reduction in the number of tasks that require human labor. It is said that if this trend continues, we will not be able to compete with foreign countries where labor costs are low.
 However, what if we change our way of thinking? Rather than recklessly automating factory floors to eliminate people, we should aim to double or triple the productivity per worker by drawing out more of their abilities and potential.
 This can be done by thinking in factories, trying out ideas in factories, and making factories profit centers that generate profits. In some cases, factory floors will be the central hubs, acting as command posts to control various departments involved.
For Industrial Value Chain Initiative (IVI), launched in 2015, the future of manufacturing is always bright and shiny. The excitement that we feel when we make things will be the same whether it is digital or analog, but perhaps with digital, we can expect it to be amplified many, many times over.
 Another important thing is that these factory sites are digitally connected to each other. This will expand the capabilities and possibilities of each individual, and at the same time, expand the joy and fun. Productivity will increase by a factor of 20 or 30.
 These new developments in the manufacturing industry are being carried out by small and medium-sized companies, the majority of which are small and medium-sized. New innovations will not come from harsh competition alone. There is a need for a management philosophy that balances competition and cooperation by standardizing what can be standardized.
 We expect that this kind of Connected Manufacturing will lead to a global trend toward smart manufacturing in which manufacturing sites and management are integrated. In the open environment of IVI, we would like to open up a new world of Connected Manufacturing with you.

Yasuyuki Nishioka, President, Industrial Value Chain Initiative

Organization

Organization chart

▼Director, Auditor, Organizer, Fellow – Evangelist, etc.

Director

Hiroyuki Kumagai
Hiroyoshi Konno
Yasuyuki Nishioka (President)
Osamu Horimizu
Morihiko Okura
Yukihide Seki
Atsushi Morita
Toshimitsu　Kawano

Auditor

Hironori Hibino
Hideo Hayashi

Organizer members

IHI Corporation
Izu Giken Kogyo Co., Ltd.
Omron Corporation
Kobe Steel, Ltd. (Deputy Chief Organizer)
Konno Corporation
CKD Corporation
JTEKT CORPORATION
Toshiba Corporation
NEC Corporation
Panasonic Corporation
Hitachi, Ltd.
BROTHER INDUSTRIES, LTD.
Busyu Kogyo Co., Ltd.
Fujitsu, Ltd. (Deputy Chief Organizer)
Bechhoff Automation
Mazda Motor Corporation (Chief Organizer)
Mitsubishi Electric Corporation
YASKAWA Electric Corporation

Fellow

Osamu Horimizu (Hitachi, Ltd.),
Yukihide Seki (NEC Corporation),
Yuji Watanabe

Technical Supervisor

Yasutaka Koga
Shinichiro Chino

Evangelist

Keiichiro Nabeno (Frontier One)
Hatsuko Takaga (Fujitsu, Ltd.)

Chairman

Yoshihiko Watanabe, Chairman, Business Cooperation Committee (Izu Giken Kogyo Co., Ltd.)
Makiko Naemura, Chairman, General Planning Committee (Hitachi Industrial Equipment Systems Co., Ltd.)
Yoshinao Kitano, Chairman, Education Promotion Committee (NEC Corporation)

Number of members

Members: 239 companies, 704 members (as of August 25, 2021)

▼ Constitution (Terms)

• 000 Articles of Incorporation
• 001 Rules for Admission and Membership Fees
• 002 Rules for Establishment and Operation of Committees
• 003 Rules for the Management of Intellectual Property
• 004 Rules for Working Groups
• 005 Rules for Project Management
• 006 Rules for Liaison Organizations
• 007 Rules for Handling Confidential Information
• 008 Rules for Evangelists
• 009 Platform rules
• 010 Rules for Positions Related to Technology
• 011 Rules for ASG (Advanced Study Group)

▼ Frequently Asked Questions

What does “Connected Factories” connect to?

Until now, factories have been connected to each other through the movement of parts and intermediate products. In addition to this, “Connected Factoryies” will connect the production lines and operations of factories at one level of detail, either within the factory or beyond the walls of the factory or company. In addition, the factory will be connected to the customer as the end user, the factory will be connected to the workers who support it, and the people involved in logistics, sales, and service will be connected beyond time and place through ICT.

What is the difference from BPR (Business Process Reengineering)?

In order to review the business process, we will incorporate BPR methods, model the production process, and use ICT to implement the PDCA cycle, including the operational aspect, which was not possible with BPR in the past. In the case of BPR, operations were considered at a relatively large granularity, but with “Connected Factories”, operations can be organically connected to the production process in the factory through actual data, because the granularity can be fine-tuned to the operations in production sites.

With automation and ICT advanced, won’t there be less need for people?

Repetitive tasks and low value-added tasks will be replaced by machines and computers through automation and ICT. On the other hand, tasks that can only be done by humans, such as those that require ingenuity, individuality, and sensitivity, and those that respond to situations that cannot be predicted in advance, will be handled by humans. With automation and ICT advanced, it is expected that the number of high value-added tasks that can only be done by humans will increase, further enhancing human capabilities.

I am worried that other companies will imitate our technology by opening it up.

In openness, only the areas in common with other companies are disclosed in the first place. In other words, only the areas that are minimally necessary for connection are disclosed. Company-specific internal logic and artisanal know-how will be hidden. By black boxing the proprietary technology and actively disclosing the interface to use that technology, the technology will spread and benefit the company.

Is this irrelevant to the companies that have completed everything on their own?

In areas where there is not much technological innovation and not a phase of competition, there are companies that have high rate of in-house productions and, from the supply chain perspective, do not need to dare to improve efficiency any further. However, within the companies and in the factories, technologies for “Connected Factories” are needed for further cost reduction, such as operation and maintenance management of facilities and machines, efficient asset management and sub-material management through ICT.

How can I make use of big data?

At each step of the production process in a factory, the history of the process is not only recorded, but can also be utilized as big data by recording it in relation to the things (parts and products) produced. In addition, production data is also recorded in relation to the equipment and workers that produced it. The accumulated data can then be analyzed using products, facilities, and workers as keys, and new insights can be obtained from various perspectives, such as stable operation of facilities, efficient working methods of workers, and improvement of product quality.

Wouldn’t that be a huge development cost?

If the various operations in a factory, the design process in manufacturing, marketing, and after-sales service are all converted to ICT in the conventional way, a huge amount of development cost will be required. On the other hand, “Connected Factories” can greatly reduce the development cost, because some of the contents that were previously outsourced to external ICT companies will be developed as part of the company’s own kaizen activities. By having in-house members take the lead in development, we can create a system that meets our needs at a lower cost. At the same time, we can train engineers to make the connection, and at the same time, we can respond quickly to various subsequent requests for system modifications.

Are you sure about the security?

For the “Connected Factories,” the issue of security is always one that requires the utmost attention. The digitalization of various technologies and know-how increases the risk of their leakage, and in the event of leakage, the extent of the damage will also increase. In any world, there is no such thing as 100% security, but if everything is guarded, it is impossible to do business. Therefore, it is important to have a company-wide policy that separates the areas that should be open and the areas that should be closed and protected.

What is the future role of system integrators (SIer)?

System integrators are sometimes referred to as SIers, who work with vendors who develop individual devices, equipment, and software, and combine these individual elements to complete a connected system of a factory. There are two types of SIers: factory automation SIers that mainly deal with factory automation, and IT SIers that deal with information systems such as business systems and core systems. These SIers are a group of experts for “Connected Factories”. Especially in the future, as small and medium-sized manufacturers become more active, FA-related SIers are expected to attract a great deal of attention in Japan.

What is the second type of system?

Until now, engineering has been about designing artifacts as industrial products. These are the first type of systems, which target the world of things governed by physical laws. On the other hand, the second type of system targets the world where there is a complex relationship between things and people, and manufacturing with human intervention at production sites. The second type of system requires ergonomics and management engineering, as well as the ability to respond to an artistic world that is not repeatable.

Will our relationship with robots change?

Robots are an important component of production line automation in factories. Robots are capable of performing tasks faithfully according to predetermined work methods. “Connected factories” will not only automate the execution of these tasks, but will also make it possible to teach the robots how to perform the tasks, share know-how among robots, and maintain the robots in case of malfunction, across factories and companies. There is also a possibility that robots will expand manufacturing outside of factories, closer to consumers.

Our company makes different things every time, so it is impossible to automate.

In “Connected Factories,” automation of the production line should be done as needed, not as a prerequisite. Even if the final products and parts are different, the parts of the production process that are highly repetitive or require stable quality will be automated little by little as needed. In the process of organizing work procedures in this way, the company’s know-how becomes clearer, and there may be room for the development of new technologies.

What is the relationship between kaizen activities, 5S, and lean manufacturing?

In the Japanese style of manufacturing, the bottom-up approach where workers at production sites discover and solve problems on their own is a strong point. On the other hand, ICT systems are usually designed in a top-down manner, starting with the definition of requirements. “Connected Factories” approach combines the best of both approaches in the sense that, in order to utilize ICT, kaizen is implemented in each production site and each business unit, and at the same time, waste in the information flow is eliminated from an overall perspective.

Isn’t this about big companies and not so much about small and medium-sized manufacturing companies?

Further networking through ICT will, in turn, open up opportunities for small and medium-sized manufacturing companies with strong technical capabilities. Companies that undertake parts processing and other services will be able to greatly streamline the auditing and prior consensus building process for new business development with major companies, as well as to deal directly with overseas companies and provide optional products for individuals. In addition, for global niche and top companies, strengthening the “Connected factories” through a network of small and medium-sized manufacturing companies will allow for greater mobility and higher quality manufacturing.

Isn’t it possible that the country will be further hollowed out?

The widespread use of the “Connected Factories” platform will make it easier for manufacturers to expand overseas as the situation demands. On the other hand, small and medium-sized companies with advanced technologies may be able to increase the number of orders they receive from overseas manufacturers on “Connected Factories” platform while remaining in Japan. Factories that are highly automated and require advanced processing technology will have an advantage in being located in Japan. In the future, there will be a clear distinction between manufacturing in Japan and overseas, and the tendency for factories with higher added value to remain in Japan will become even stronger. As a result, we can expect to see an increase in the number of jobs related to such high value-added manufacturing in Japan.