Case Study: Johnson & Johnson’s Award-Winning Supply Chain Smart Factory
Johnson & Johnson successfully pilots a scalable smart factory strategy to modernize operations and transform how digital capabilities are incorporated
Company Fact File –
Company: Johnson & Johnson
Sector: Health Care Products
HQ location: New Brunswick, NJ
Revenues: $10 billion+ annually
Employees: 5,000+
Web url: www.jnj.com
Health care is a vital part of humanity, and Johnson & Johnson is committed to changing its trajectory by addressing patient, consumer, and customer needs. To accomplish this ambitious goal requires a high degree of visibility, flexibility and resiliency in the manufacturing operation.
Because the external environment has a dynamic impact on production, J&J developed a smart factory strategy that modernizes site operations by building digitally enabled capabilities to solve information, process, product, and human pain points. The smart factory is built upon a cohesive plan and foundation using data along with capabilities such as edge/high performance computing (HPC), process data mining/analytics, asset optimization, AR and VR mobility platforms, and modular systems that are threaded across the value chain – all designed to help optimize flow, improve reliability, resiliency and agility, while ensuring quality and safety.
The Journey to Smart
Many digitalization elements of J&J processes, digital stack, and standard data architecture and design supporting the smart factory began in 2017. Foundational programs like the development of a common data layer architecture, cloud environments, cybersecurity, ERP design, and a next generation manufacturing system platform are needed to ensure access to required data that will enable digital capabilities and solutions that will support processes, people and technologies.
“You can’t look at the individual technologies level,” says Bart Talloen, J&J’s Senior Vice President Supply Chain Strategy, Innovation and Deployment. “It’s all about the ultimate integrated capability for the business that you enable. The interoperability – system thinking – is fundamental because all the elements are interconnected.”
In the first quarter of 2021, the J&J Consumer business segment sites in Lititz, Penn. (USA) and Bangkok, Thailand began the internal diagnostic and review processes for key product value streams and how smart factory initiatives could improve business processes to support the customer. The smart factory process required engagement from all levels of the site’s organization to establish and link short- and long-term business objectives, vision and metrics.
The process included six phases:
1. Visioning
2. Diagnostics
3. Current to future state digital capability
4. Prioritization
5. Roadmap
6. Business planning
The smart factory requires good planning in how investments are made, sequencing, and people skill analysis to ensure optimal performance, agility, and resiliency objectives are met.
Since its inception, the smart factory rollout was extended to two additional J&J consumer sites in the third quarter of 2021 and then deployed across the entire global manufacturing network in the first two quarters of 2022.
“The right deployment strategy is critical. It’s always important to start small, nimble – what we call test and learn experiments to test something out,” says Talloen. “Then you take the learnings from those test and learns, and that informs you about deployments strategies.”
Ultimately, identification of common information flow breakers will populate an expanding digital solutions use-case library. Meanwhile, the capability and skilling process of J&J’s people will enable scaling and accelerate lead time reduction and agility around the globe.
