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62 SMT Magazine • December 2015 by Jorey Guzman SiEMEnS inDuSTRY manufacturing on the rise The manufacturing industry in Asia has been increasing steadily in size and contribu- tion to the global economy. No longer is Asia seen as the low-cost manufacturing haven for multinational companies looking to take ad- vantage of scale and labor cost; the region has been stepping up their innovation and quality to compete in the global market. Together with the industry's boom comes the need for factories to optimize their pro- cesses and iron out issues that could potentially lead to inefficiencies. Looking at the bigger pic- ture, the requirement for advanced factories is more pressing. In Southeast Asia, for instance, the ASEAN Economic Community—the goal of which is regional economic integration by the end of this year—is expected to present bigger opportunities for manufacturers in the region while at the same time offer challenges in terms of increased competition. As manufacturers look to the future, they need to examine how advanced information and communication technologies can boost their value creation. Smarter manufacturing In the evolution towards the smart manu- facturing paradigm, end-user requirements are set to evolve and become more complex than ever before. Global suppliers find it increasingly difficult to meet the growing needs of the end- users that are further augmented with a very high degree of complexity. But the current sce- nario will also provide the biggest opportunity to realign one's existing business approach and forge alliances and partnerships with market participants, according to Frost & Sullivan. The result would be a newly built supplier ecosys- tem that can effectively address end-user needs for growth in near- and long-term perspectives. In Germany, this development is called Industry 4.0. Similar initiatives have been launched in other European countries, the Unit- ed States, China, and elsewhere. Industry 4.0 aims to achieve production-related advantages by creating a networked, flexible, and dynami- cally self-organizing manufacturing process for highly customizable products. Over the next 15 to 20 years, it is expected to be accompanied by a paradigm shift that could justifiably be called the fourth industrial revolu- tion. The result will appear to be revolutionary from today's point of view, but ultimately it will involve a large number of development steps in a process of evolution. According to Frost & Sullivan, a new wave of influence is disrupting business dynamics between end-user and supplier. This change is founded on new service paradigms—founded on frameworks defined by advanced information and communication technology (ICT)—that are enabling end-users to achieve high degrees of cost optimization and enhanced operational efficiency. Services based on such advanced ICT concepts, were found to hold more than 75% of the global industrial services market in 2014. Digitalization on the Horizon ArTiCle

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