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Towards a new industrial footprint for France – A new plea for Coronavirus

You never let a serious crisis go to waste. And what I mean by that it’s an opportunity to do things you think you could not do before

Rahm Emanuel – Former Mayor of Chicago and Former Chief of Staff of President Obama

A few months ago, I gave an interview for Bpifrance calling for a new industrial footprint for France. We’re in the middle of a COVID-19 crisis. The most pressing question today is no longer of deconfinement but of the future, of knowing what opportunities should emerge from this crisis. In other words, COVID, has accelerated the mega-trends and, in 10 weeks, has projected us into a world we were supposed to arrive in 10 years’ time. As an industry expert, I will confine my remarks to industry. In line with the interview mentioned above, the action we propose can be summarized in the following acronym: REFORM. REFORM being the acronym for Relocate, Form and Modernise. To paraphrase Rahm Emanuel, in the quote above: since the crisis is here, let’s take advantage of it!

Relocate

Relocate the production tool in France. This certainly involves the manufacture of vital and basic necessities, such as medicines, whose importance has been seen during the crisis, but also consumer products. This relocation will have at least a two-fold effect: job creation in France and the reduction of supply chain loops with the resulting ecological impact. Beware, as the popular saying goes, “this is easier said than done”. Indeed, this ambition faces several challenges:

  • Competitiveness: Offshoring has emerged as a result of companies’ desire to reduce costs. Factories will not be brought back to France on a long-term basis if this point is not taken into account. The solution we propose is the modernization of production tools, discussed below.
  • Capability and skills: “no longer eating fish, the Tasmanians ended up not knowing how to fish anymore”. The skills lost as a result of relocation are very complicated to regain and even to recreate. It will therefore be necessary to have an ambitious information plan to support this transformation. This is discussed below.
  • Restructuring the supply chain: this is a key point because, as a general rule, for every €100 of value created by a manufacturer, €70 comes from its suppliers. Therefore, the supply chain is an important component of the relocation equation. We don’t discuss it in this post. We will come back to it in a future post. 

Form

Training is at the centre of the transformation. It is important to realize that many of the positions that have disappeared during the crisis will not return. New jobs means new skills. In the industrial world, the aim of this training must be to bring out the expertise that can accompany the modernisation of the industrial tool. The main training courses will therefore have to revolve around skills relating to industry 4.0. The aim will be to train all these available resources, who are already familiar with the profession, in Industry 4.0 technologies. We call this “bilingualism”. This goal can almost be achieved today on a constant budget by transforming the financing of short-time working so that it can be used more to pay people to train. 

Modernize

Modernization is based on two pillars: the need to take into account the energy transition and the levers provided by technologies at the heart of the fourth industrial revolution. 

The industrial tool relocated in France will only make sense if this operation is carried out without significantly impacting the competitiveness of companies. To do so, it is important to modernize production facilities. Methods of operational excellence (e.g. lean) can contribute to this. However, it would be “like lighting a candle nowadays” to ignore Industry 4.0. Technologies used include: artificial intelligence, advanced robotics, simulation and visualization solutions (virtual reality, augmented reality, …). The main initial steps to get started are to perform a maturity assessment, set up the necessary prerequisites (governance, training, data availability, minimum value chain organization), one of the main deliverables of which is a Roadmap, and finally initiate pilot projects. We advise to start with pilot projects that focus on “visibility” or the best understanding of your flow. Indeed, workflow management, as well as people management, is essential to improve the competitiveness of companies. This is why DILLYGENCE, which wants to be at the heart of the Industry 4.0 transformation, has positioned itself on the 3 main stages of the implementation of Industry 4.0. Best of all, DILLYGENCE offers its customers an IoT platform that allows them to better visualize, understand and make optimal decisions regarding plant performance.

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