Improving business efficiency through digital technology in today's environment is a matter of global competitiveness and long-term growth. Digitalization covers all industries, processes and functions and the steel industry is no exception. More and more, the industry is adopting a wide range of digital solutions as part of the Fourth Industrial Revolution. According to World Steel Association experts, the steel industry is a leader in the field of «smart manufacturing» (worldsteel.org).

Let's take a look at specific examples of what smart manufacturing in the steel industry is and how the industry benefits from it.

Smart manufacturing represents a major change along the entire value chain in both vertical and horizontal integration, i.e. it is a transformation of the way we obtain raw materials, produce and market products, rather than just having a smart factory to produce steel, and an important factor is that the processes preceding the creation of smart manufactures are the processes of digitization of steel mills.

South Korean steelmaker POSCO, which has two of the largest steel plants in the world, is a pioneer in smart manufacturing. POSCO's history of digitizing factories begins in 2015, and in 2019, the World Economic Forum in Davos welcomed the company to the Global Lighthouse Network. For innovation in manufacturing since 2018, Davos has selectively named companies "Lighthouse Factories," and POSCO is the first South Korean company to be honored with this recognition (newsroom.posco.com).

Achieving such recognition is a difficult task. It was preceded by a year of various inspections by experts of the World Economic Forum. For example, other companies that have achieved this recognition include Nokia, Tata Steel, Siemens, BMW, Johnson & Johnson, P&G, Group Renault, Bayer, Saudi Aramco, Schneider Electric and a number of other companies. These are companies that demonstrate leadership in the use of technologies such as IoT, Big Data, Cloud Computing, Artificial Intelligence, etc.

So, as noted above, POSCO's digitalization history begins in 2015, which is when the company began actively adopting Big Data technology at one of its steel plants, which served as the foundation for the creation of smart manufacturing and the unique PosFrame platform, including a cluster of sensors, resulting in the integration of data, artificial intelligence technology and the deep expertise of POSCO employees in one place, and improving operational and financial efficiency.

POSCO's next step was to set up an intelligent system at the company's second plant, collecting various indicators and variables affecting the blast furnace of this plant to predict and control operations, resulting in an increase in daily metal production of more than 240 tons. In addition, the company plans to implement an intelligent system at its third plant to maximize productivity, control quality and eliminate various deviations in production processes, because steel production is quite complex, and deviations are inevitable.

Digital technology is transforming the steel industry along the entire value chain, from raw material supply processes, through complex manufacturing processes, to customer and stakeholder relationships, enabling cost optimization, operational safety, quality control, productivity and profitability growth, and creating opportunities for entirely new business models.