Manpower – The Biggest Deficiency in the Transition to Industry 4.0

Sinan Alçın, who has developed the test “Test4ware” to analyze the compatibility of Industry 4.0 with the facilities, says that “The most problematic area for companies is wetware. That is manpower. The textile workers need to be familiarized with the Industry 4.0 technologies and become e-literate.”

Industry 4.0 is defined as technologies and business practices that enable companies to reduce unit costs by using digital technologies in value chain and resource management activities, and to increase their unit prices and/or sales volumes by offering higher levels of value (benefit) to their customers, thus generating higher profits per unit.

Industry 4.0 is an opportunity to gain a valuable competitive advantage for all sectors, which will remain at the heart of business for a long time. In order for the textile sector to maintain or increase its existing competitive position, it should not miss the significant opportunities offered by Industry 4.0 and make necessary human and technology investments.

But how much aware are the Turkish textile companies of Industry 4.0? Are the infrastructure, machinery, equipment and human resources of the facilities suitable for transition to Industry 4.0? In order to find answers to these questions, we held an interview with Prof. Dr. Sinan Alçın, who teaches economics at Istanbul Kültür University and is also the founder of 4Ware Research. Sinan Alçın, who has developed the test “Test4ware” to analyze the compatibility of Industry 4.0 with the facilities, says that the share of textile companies that impelment the test make up of around 40% of the 275 companies in total. Emphasizing that the companies experience problems the most in the field of manpower, Alçın says, “What will determine the competitiveness of textile companies for the economies of the future will be their competent manpower.”

First of all, can you tell us about the importance of Industry 4.0 for the textile industry?

The concept of 4.0 Industry 4.0, which was used for the first time in 2011 at the Hannover Fair in Germany, rapidly turned into a global paradigm. Industry 4.0 points out a production and trade structure where relationality is at its highest level. Here, relationality encompasses all processes from procurement to design and manufacturing, storage, marketing and logistics, and finally to consumer experience. The technologies used by Industry 4.0 (Internet of Things, Artificial Intelligence, RFID Systems, Big Data, additive manufacturing…) also enable vertical integration in products and manufacturing structure. The aim of the largely integrated and associated production processes is to ensure both efficiency and the prevention of imitation economy.

The main reason for the emergence of Industry 4.0 in Germany is the development of cheap labor-based sectors, mainly in the Eastern countries, particularly in China, reducing the added value in the West. Particularly labor-intensive sectors, including textiles and ready-to-wear garments, have faced a need for change in the Industry 4.0 process. High productivity and value-added production, instead of competition based on cheap labor, are the distinguishing features of textile and apparel sectors. In parallel with the developments in both production technology and materials science, the area of technical textiles increases its weight in the sector.

How much aware is the textile industry of Industry 4.0? How can this awareness be raised?

When the export potential of textile companies is taken into consideration, we can say that they quickly realize the change in production systems around the world. In other words, one of the first industries in which the competition based on cheap labor force has come to a limit and the technical textiles field is developing and the high technology production systems are becoming widespread in the world, is the textiles and garment industry.

Of course, seeing what is changing does not always mean that we adopt and apply it quickly. The industry is currently strongly committed to traditional methods. Also due to the scattered and low capital structure of the industry, it is displaying both reluctant and inadequate behaviors to acquire innovative technologies. Being the largest investor of Industry 4.0 in the last three years and the leading cheap-textiles competitor, China is now changing its textile structure, which will also encourage Turkey to take steps in this regard.

As far as I know, you can measure the companies’ readiness to Industry 4.0 in a way you have developed yourself? Can you tell us a little about this method?

Transtition to Industry 4.0 is inevitable for Turkey as a country geographically situated in the midst of commercial lines. This is also the case for companies. But the companies are confused, especially regarding how the transition will happen. Where should the transition begin? Is it really needed? Will it increase our productivity? We are constantly facing such questions.

In order to start the transition to Industry 4.0, it is necessary to determine the strengths and weaknesses of the company and how and where to start the action in this process, and there is clearly no single recipe. Both the production potential and the competitive environment of each company push it to a different poisition in the transition to Industry 4.0. Although the target is the same, the path for each company is different.

The answer to the question of where to start the transition to Industry 4.0 depends directly on the company’s situation. During the Industry 4.0 process, I developed a test in which companies can score their current situation free of charge and prepare their inventories to provide a basis for the roadmap. Test4ware, which I developed for companies operating in industry and service sectors, can be downloaded at www.test4ware.net

What criteria do you use to evaluate the companies’ compatibility with Industry 4.0?

Test4ware measures companies’ Industry 4.0 competencies in four areas. The first of them is Hardware. Hardware refers to the machinery, equipment and infrastructure that the company has in line with the Industry 4.0 process. The second is Software. Software refers to the ERP and similar software systems needed in this process. The third is Netware. With Netware, I identify relationality. The company’s potential for global collaboration and its power to mobilize this potential define its netware competence. And the last one is Wetware. With Wetware, I identify the brain power. Industry 4.0 and, in general, the multi-talented manpower by the economies of the future, form constitute the basic element to differentiate companies and provide with a competitive advantage.

In light of the works you have performed so far, how ready are the textile companies in Turkey for Industry 4.0? What are the deficiencies the companies have?

The percentage of textile companies that implement the test among a total of 275 is around 40%. Among the four competency areas (hardware, software, netware and wetware) I mentioned above, wetware is the most problematic area for companies, i.e. manpower. Here lies the answer to the question of where to start the transition to Industry 4.0? Therefore, what determines the competitiveness of textile companies for the economies of the future will be their competent manpower. Some of the education, which we will take as the main determinant of competence is received during the primary and secondary education while another part during the lifelong education programs. The textile workers need to be familiarized with the Industry 4.0 technologies and become e-literate.

Are there any Turkish textile companies that have transitioned to Industry 4.0 and integrated their business in the best way? Can you please give an example?

Hugo Boss is the best example in Turkey. They are both in a transition and are creating platforms that other companies can also use and improve themselves. In addition, companies operating in the field of composite materials, for example, have entered the field of technical textiles, the textiles of the future.

Are there associations or structures in the textile industry that can help solve specific technical problems, or how can they be formed?

In fact, there are more than necessary attempts in the field of textiles, garments and home textiles. Among these, the creation of a fund that will allow research especially in technical textiles and the implementation of a clustering strategy are very critical. Perhaps the most important problem of industry in our country is the reluctance for clustering and cooperation. Any step to overcome this in the textile sector is worth gold.

How are the supplier and customer relationships in the textile industry? How close are or how can they be to “integration” that will be necessary for Industry 4.0?

The most challenging group in the textile industry is perhaps the customers. This will continue to increase its impact in the near future. New trends in the world and needs for differentiation make change inevitable for the textile industry. The companies with the highest turnover today are the ones that bring customers together with suppliers such as Air-BNB, UBER and Ali Baba. Investments in this area will continue to be valuable. Let us consider ourselves a decade ahead of today. The companies that can survive in the world ten years later will definitely be the ones in thewearable technology sector. And the preliminary works for this goal are carried out in the field of technical textiles. The efforts in the fields of wearable technology and technical textiles may make today’s companies tomorrow’s leaders.

 How suitable are the infrastructure, machinery/equipment, hardware, human resources, etc. in the textile industry to Industry 4.0? If not suitable, how can it be improved?

We have a great potential both with our geopolitical position as a country and with our population of 8 million aged between 14 and 25. Of course, when this potential is not managed properly, it can turn into a problem area. The rate of youth unemployment, which corresponds to 25%, is one of the most important macroeconomic problems that we need to find a solution to in the near future.

Actually, machinery and equipment is the easy part. Because you can buy them with money. But the manpower with the capabilities needed by the economies of the future cannot be attained instantly. Today, the problem of skill, which is the main problem faced by companies in the labor force, is a handicap that we should overcome in the near future.

Interview: Dilek Hayırlı