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Digital Transformation in Steel Industry

Digital Factory Malaysia

Digital technology is gradually changing the world and bringing dramatic improvements to our manufacturing process and operation since the acceleration of industry 4.0. Steel and metal manufacturer are now transforming their traditional model into a digital operational model with advanced technology. It offers a lot of benefits to the manufacturer, such as improved operational & production efficiency, quality product & customer service, higher flexibility, and profit margin with lowered operational cost. The acceleration of digital transformation in the steel industry is mainly driven by the innovation of analysis, the popularization of mobile technology, automation, and technological advancements such as artificial intelligence, sensor, data scanner, and machine learning. In addition, the cost of data storage, data acquisition, and data analysis have dropped and some digital solutions are available today at a relatively affordable price. The company can choose to implement a small scale pilot test that starts with few digital use cases at the beginning and focus on specific business units, stage, or geographic market.

Artificial Intelligence Malaysia

There are three opportunities to be covered under the term ‘Digital’ in the industry and each has enabled a set of technology and approaches. The first one is the implementation of advanced analytic and artificial intelligence (AI). It can analyze a large volume of data generated from the production and maintenance process, identify the pattern and provide insight on the operation to help us increase the overall productivity. For instance, AI and predictive algorithms can analyze the historical market demand and demonstrate relevant factors that affect it. The company can based on this analysis to adjust the production and performance in order to meet the market demand. This category has accounted for more than 50% of digital adoption. The second category is the implementation of robotics and automation which contributes around 20 to 30 percent of the total digital improvement. The invention of robotics has replaced the need for human intervention in non-decision-making positions and allowed the operation to run under a controlled and stable environment. It has greatly reduced the requirement of manpower and human error. Another category is software automation and process digitalization, it involves the use of mobile devices to connect workers, send instructions, access the data when performing their works. It will greatly improve the overall efficiency in the manufacturing, back-office, and maintenance process.

Digital Technology Malaysia

Digital transformation can be implemented in several business units such as manufacturing process, product quality control, warehouse management, logistic, supply chain, maintenance, customer service, etc. Here we will examine few technologies applied in some units.

Product quality control

With the use of advanced data analytical tools and techniques, it can perform image and video analysis that resolves the challenges facing in steel manufacturing. The analytical tool can provide better measurement and control of the quality parameters through visualization of image and video. We also can predict output quality parameters by analyzing the past production and quality data.


In the extreme processes of steel manufacturing, the advancement of sensor technology, processing mechanism, and data capture can be used for capturing most of the operation parameters and improve operational efficiency. It can process a large volume of real-time data to come out with ideal operating setpoints that fully optimize the consumption of energy and capacity. The Digital twin uses sensors to analyze each aspect of the manufacturing process and then replicate the physical assets, processes into a digital form. It can simulate the process and do a trial run before taking action in the real process to avoid unnecessary incidents. The imaging and video capturing and analyzing functions also help to visualize the process inside the furnace, so we can have better control over the furnace.

Twin Technology Malaysia

Supply Chain

Data integration and visualization tools can be used to manage the complex supply chain that involves external stakeholders such as suppliers and customers. We can use the tracking tools to track the inventory and have better management over the orders from suppliers. By converting manual process to digital format, it connects different parts of operations, helps to optimize ordering lead time, and reduce the time in locating the items.


The data captured from the machine can be used for assessing the condition of the equipment and monitoring its performance. The predictive analytic tools, failure mode & effects analysis can predict the machinery breakdown in advance. The system will automatically schedule the maintenance time and servicing works during off-peak hours based on the data collected and analyzed. It diminishes the possibilities of unexpected breakdowns that can disrupt production and lead to dramatic losses.


The safety requirements in this extreme working environment of steel manufacturing are very important. A real-time image and video processing tool is used to analyze the environment and send alerts if any safety non-compliance. It helps to ensure the safety of the machinery, PPE compliance, and better shop floor management. With this technology, the company can greatly reduce injury in the workplace.

Ultimately, the system will be collecting data, continually learning and updating itself over a period of time. It will learn to teach itself the optimal way to produce steel with minimum resources include reducing energy input, lesser raw materials, and lowering labor costs. It does not only improve the overall performance but also ensures all the business units are working together in greater harmony and transparency. Besides, a step-by-step production record accompanied by a fully digital product history provides the customer a higher level of satisfaction and confidence in the products. Along with the development of new technology, the emergence of the online trading platform that replaces the one-to-one business relationship between the manufacturer and customer is also impacting the traditional business models. Digitalization of the steel industry has already entered its early stage, we need to embrace the changes and opportunities, start to implement the needed systems and technologies to increase the company’s competitiveness.

Digital Transformation Malaysia

Photo Credit: bearsystems, industrytoday, theagilityeffect, roboticsandautomationnews, innovationatwork

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