Michael UngarCEO of the Industry 4.0 Club

Maximizing Profits: The Key to Industry 4.0 Success

21 Apr 2025 · 2 min

Watch on YouTube

1:55

In this monologue, the speaker explains how he drives Industry 4.0 adoption by translating digitalization projects into concrete financial and operational metrics. He describes the challenges of gaining leadership buy‑in at Stanley Black & Decker, where he had to demonstrate a $100 million savings forecast and negotiate the impact on plant‑manager budgets. At Covestro (Questro), he used global OEE data from a year plagued by multi‑week outages to model the lost EBITDA and presented the potential gains from digital tools to the board. Across both companies, he emphasizes meticulous calculation of dollar savings, energy reductions, and safety improvements to satisfy executives, while also highlighting the importance of delivering a better job for workers. The narrative showcases a systematic, data‑driven approach to selling digital transformation, the tension between central leadership and local managers, and the dual focus on profit and employee experience.

Chapters

Throughout my career, I've always looked at what's the dollar savings or benefit behind whatever it is that we're doing. And if we can save on greenhouse gases and improve safety while we're at it, even better. And so, when we look at, say, at Stanley Black& Decker, where we're trying to introduce Industry 4.0 at most of the sites, there were a few that were like showcase sites, but it wasn't prevalent, and trying to make improvements, there was leadership who didn't understand what was needed in order for that to work. So, you have to present it in such a way that You're saying, okay, I'm going to save you $100 million over this amount of time by doing these changes, but you have to be able to count it. And all of that, if you think about it, if you're improving productivity, that could be that the plant manager's going to lose some of their budget. So it's always a negotiation. Right. And at Covestro, what we did was we looked at the overall OEE for the year across around the world at all the sites. and calculated, you know, we took a— picked a bad year where there were several multi-week outages at different locations due to instrument failures or equipment failures and calculated, okay, well, how much would that have been had that not happened? And said— and so I, at Questro, I, you know, went to the board when I was asked to digitalize manufacturing. It was like, well, if we had the right tools in place, these things wouldn't happen, which would have made a big difference on the EBITDA on that year. And the same with Stanley Black& Decker. We calculate everything we do, even though it was tedious and a lot of my team kind of pushed back on doing that extra work. When you take it to leadership and say, but here's the money we're saving, it's like, oh, well, that makes sense. And then you get that acceptance. So the top layers want to know how much money they're saving or energy or how they're being more efficient. And the workers want a job that's better than it was yesterday.