Packaging firm taps AI to cut waste, save costs in production process

An automated production line converts paper boards into boxes at Federal Packaging Industries. It also packs the boards to be delivered to customers. ST PHOTO: CHONG JUN LIANG

SINGAPORE - For home-grown packaging company Federal Packaging Industries, a minute of downtime for its paper box manufacturing process can have significant consequences.

It could lead to a 10 per cent to 20 per cent wastage in raw materials, energy and man hours.

The firm supplies packaging boxes for many businesses including multinational corporations and small and medium-sized enterprises like itself.

To help cut down on downtime costs, Federal Packaging is working with local technology firm Evercomm to develop an artificial intelligence (AI) algorithm that can help detect bottlenecks and problems in the box production process early to prevent manufacturing disruptions.

This will be done with co-funding from the Infocomm Media Development Authority's (IMDA's) Advanced Digital Solutions scheme, which helps SMEs digitalise by adopting advanced technologies, such as robotics, AI and Internet-connected devices.

Under the initiative, SMEs can get up to 80 per cent funding support for eligible digital solutions.

Last Friday (March 4), Minister of State for Communications and Information Tan Kiat How announced during the debate on his ministry's budget that the Government will grow the initiative's current list of 30 solutions, with an emphasis on AI-enabled and cloud-based solutions.

Almost 500 firms have adopted or are in the process of implementing solutions under the initiative.

The scheme was announced in March 2020 to help companies deepen their digital capabilities and deal with difficult situations so they can continue to function with little disruption.

For Federal Packaging, the company hopes that by using the AI solution co-funded by the scheme, it can detect machine issues earlier and rectify them faster.

To help it develop the AI, sensors were installed in the company's machines. The sensors collect data such as machine temperature, energy consumption and water flow rate. Data collection began around the middle of last year.

About six to 12 months' worth of data collected is needed to train the AI algorithm.

Once the AI model is ready, Federal Packaging can use it to monitor its machines for issues so that they can be dealt with early to minimise production downtimes and wastage.

"When we have data on our machines, we will know very quickly if there are abnormalities detected by the AI. This gives us more time to act earlier on any issues that occur, on top of actions that we have already taken," said Federal Packaging's chief vision officer Lau Chee Herng.

Federal Packaging Industries' chief technology officer Jason Tan (left) and chief vision officer Lau Chee Herng at the company's automated production line on March 7, 2022. ST PHOTO: CHONG JUN LIANG

By using the sensors instead of having staff to do checks on the machines, the firm estimates it enjoys manpower savings of 90 per cent.

But using AI and sensors does not mean employees are out of work. When the AI system is ready, the company envisions retraining existing staff, including senior ones, and upgrading their skills to help manage the system. This means workers' jobs could be redesigned as well to be less labour-intensive. New staff could also be hired to support the team.

And with the sensors doing the machine "inspections" and workers spending less time dealing with unforeseen machine issues, employees can be freed up to do other types of value-added work.

"They have more time to think about how to innovate and improve processes," said Federal Packaging chief technology officer Jason Tan.

Besides the Advanced Digital Solutions scheme update, Mr Tan also announced last week that IMDA and Enterprise Singapore's Grow Digital initiative, which helps firms tap e-commerce platforms to sell their products in international markets, will include more e-commerce platforms.

Since the scheme's 2020 launch, Grow Digital has helped more than 2,500 firms access markets in 10 countries. They include South-east Asian countries, China and India.

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