How to Drive Value with Lean Circular Economy Solutions & Manufacturing Smart Factories

If we want to reduce our impact on the planet, industry must take the lead. While 25-30% of emissions and waste come from households and individuals, “the vast majority of global emissions (70-75%) can be reduced directly by the decisions of those who run businesses, utilities, buildings, and governments” (Project Drawdown).

The circular economy is more than a sustainability initiative – it’s a transformation framework to help industrial companies make and save money by maximizing the use of resources. Waste in the circular economy is “fugitive” or lost value. There is good news – established manufacturing methodologies like lean are enablers to circularity journeys because they share the common goals of waste discovery and elimination. A majority 68% of industry has already started adopting lean concepts including; Muri (process overburdening), Mura (variability signals), and Muda (waste results) as well as visualization tools like value stream mapping (VSM) to guide systems thinking and streamline stakeholder buy-in. In the white paper, Lean Manufacturing in the Age of the Industrial Internet, we discuss how Velotic customers have used our lean-driven software solutions to achieve up to 15% improved labor utilization, 15% reduced work in process, in addition to faster turnaround and production optimization for on-time delivery.

Velotic is actively developing new lean circularity solutions to help industrial companies start thinking about their waste as valuable inventory. We’ve seen how our inspiring customers are using our Historian, Automation, and Analytics products to capture and create value from waste, as well as meet regulatory reporting requirements. By observing and listening to their feedback, we are driven to help companies unlock value and reinvest in continuous improvement for their business while benefiting society.

• Cincinnati’s “Smart Sewer” reduced overflows and cut costs from $0.23/gallon to $0.01/gallon using Proficy Historian high-speed database and HMI/SCADA solutions. Velotic software helped create a Wet Weather Operational Optimization System with operator visibility to monitor flows. Controls implemented helped achieve 400 million gallons of overflow reduction per year and compliance with the federal clean water Consent Decree.
• SAGW automotive manufacturer reduced inspection costs by 40%, experienced a 20% improvement in equipment utilization, a 30% reduction in inventory, and 80% reduction in required storage space with Velotic HMI/SCADA and Proficy MES manufacturing software. Paper process elimination enabled accurate and meaningful data for decision making, as well as the sharing of data with value chain partners.
• Gallo glass company improved quality, safety, and efficiency by adopting Velotic’s HMI/SCADA process visualization and control solutions. Optimizing production reduced defects by 25%, downtime by 25%, and saved $5 million in operations costs annually. By shortening their supply chain and owning both glass production and bottling, Gallo was able to reduce freight and maintain just-in-time delivery service.

As industrial companies continue down this path, they’ll need digital solutions that can support their business and operating models – which is why digital transformation is so important. Smart factory technology combined with lean culture are driving the future of waste elimination and circular industry.

Our industrial heritage makes Velotic a strong innovation partner.

Thanks to our history of success in serving diverse industrial sectors with both hardware and software for optimizing operations, Velotic's software solutions are smart enablers for industrial companies on a digital transformation and lean circular journey. Building on interviews and the success of customers leveraging our existing products, we have identified three problems worth solving to focus our circular innovation efforts:

• Measure use: To deliver circular industrial and manufacturing systems, a holistic set of data is required to build the right metrics/KPIs to drive action. This extends beyond traditional production metrics to include the social, environmental, and economic impact of each resource used.
• Use less: There is a pressing need to reduce resource consumption (materials, energy, and utilities) to achieve circularity/sustainability goals and meet regulatory requirements. This requires the ability to measure, reduce, and optimize usage at the process, equipment, and product level.
• Track and Trace: A major challenge for circularity is understanding the history of each product, part, and material. The majority of those interviewed seek to track and trace their raw materials, products, and components to understand their condition, quality, performance, composition, and history (e.g., recycled content). This will inform their operational strategies for reuse, recycling, as well as marketing strategies for product differentiation. Now mandated in the EU, this is a foundational component for the “Digital Product Passport.”

With 73% of consumers willing to change their behavior, enterprises are acting. A true circular economy is some way away, but Velotic has the tools needed to get there. Adopting smart factory technologies is an important step on the lean circularity journey. For the resiliency of our environment, societies, and bottom lines, utilization of smart factory solutions for lean circularity is the greatest industrial opportunity of our time.