Augmented Reality: Exponential Technologies in the Smart Factory


We live in the era of Cyber-Physical Interfaces (CPI), and without a doubt Augmented Reality (AR) is one of the man-computer-machine interfaces with the greatest potential for development and high impact on the efficiency of manufacturing. Together, with robots and 3D-printing, AR will configure the Smart Factory of the Future. What makes AR interesting is that it sees the human as the driver of the operation, increasing its potential. Hence the name of Augmented reality.

Augmented Reality is an extension of Virtual Reality, where the user, the Internet of Things and the computer interact in real time by adding layers of virtual information over a live camera feed into a headset display or through any other smart device. This gives the user the ability to view three-dimensional images of the physical environment (real) and with the digital (virtual) creating a Mixed Reality. According Gartner “Augmented reality is the real-time use of information in the form of text, graphics, audio and other virtual enhancements integrated with real-world objects. It is this “real world” element that differentiates AR from virtual reality.  AR integrates and adds value to the user’s interaction with the real world, versus a simulation.”[1]

While the origins of the concept go back few decades, even a hundred years for some stereoscopic engines, the technology became popular with its use in Video Games (1995, Nintendo Virtual Boy) and the appearance of Google Glasses (2012). While the success of Google Glasses was doubtful, due to its early release in a consumer market where the technology was not yet mature, and the annoying feature of heating up and become uncomfortable to the head. Google learned from this experience and redirected its product to the B2B market, through Google Glass Enterprise, which allowed many companies -among them mine- to be able to consider the use of the AR in the factory. Over time, the exponential development of technology, computer power, and its increasingly affordable price have helped many companies develop products and solutions designed for production environments. According to a study recently published by Singularity University and Deloitte, the Interfaces VR/AR/MR market will reach $163B in 2021[1], with 100 million units sold same year. IDC forecasted a market $209.2B in 2022[2], 14% engineering applications (Woodside Capital Partners; Goldman Sachs)[3].


Begin to consider the implementation of AR systems in our operations is already a must, in order to enhance the smartization of our factories, and turn our operations into a competitive advantage based on efficiency, quality, flexibility, agility, safety and sustainability with the human at the centre.

The most convenient would be to start by taking small steps to go further and experiment in processes where we can streamline the whole workflow, achieving quick wins in efficiency, flexibility and security, while helping to develop a corporate culture open to innovation and the utilisation of enabling technologies. People become more creative and collaborative, improving decision making, reducing cost, realising the flows in a faster way and minimising errors, which are also recorded for further analysis and learning.

Current manufacturing applications of AR headset displays

In a PWC study on which sectors are investing most in AR, just over 30% of executives in the Automotive and Technology sectors said they were implementing AR solutions to be effective in 2020. According to an article by the Harvard Business Review (2017), the first application of the AR in companies is in service: manuals and instructions, remote expert guidance, customers faithful self-service. And the second in manufacturing: quality assurance, assembly instructions, performance dashboard. There are already several companies that use AR-based solutions for production and engineering: Siemens, General Electric, Hitachi, Volkswagen, BMW, Airbus, Caterpillar, ABB, Fujitsu, Schneider Electric, Bosch, Emerson, most of them in the following applications

  1.     Product-Manufacturing design

  2.     Training

  3.   Support

  4. Simulated environments

  5. Process Optimisation

  6.    View data from computer and sensor

  7.    Guiding assembly processes

  8. Guiding maintenance

  9.     Field services

  10. Inspection and recording

  11. Interfacing with remote experts

  12. Collaborative processes with robots

  13.   Remote control

  14.   Logistics


Key Benefits of AR utilisation in Manufacturing

As stated by Abraham and Annunziata in their article at HBR[1], a study conducted by Boeing showed that AR improved productivity in wiring harness assembly by 25%. At GE Healthcare a warehouse worker receiving a new picklist order through AR completed the task 46% faster than when using the standard process, which relies on a paper list and item searches on a work station (view video here). Additional cases from GE and several other firms show an average productivity improvement of 32% (view the video here).

However, because many of the AR applications are still in the experimental phase, which are the ones that really offer an immediate benefit?

  1. Efficient Product Design and Development

  2. Better safety training

  3. Speed Assembly Training

  4. Hands-on Processes

  5. Streamlined Logistics & Planning

  6. Processes Automation

  7. Quality Assurance & Inspection

  8. Improved Maintenance

  9. Expert Remote Support

Future potential applications of AR

We can say that the limit is beyond the imagination -soon 3D holograms will have practical use as AR interfaces, but we will list the most plausible, in terms of reliability and accessibility, fostered by the arrival of 5G that will allow greater mobility on field use in the AR-B2B. By 2022, 70% of enterprises will be implementing these immersive technologies for consumer (B2C) or enterprise use (B2B), while 25% will be implemented in production[1].

  1. Design and optimise factories

  2. Simulate the entire factory

  3. Interact with the digital twin (digital model simulation)

  4. Use safely in dangerous production environments

  5. Remote collaborative work in distributed manufacturing

Business Cases of AR utilisation in Manufacturing[1]

1. Design: Ford Motor uses AR (Microsoft HoloLens) to overcome new parts in physical prototypes and visually check results. (View the video here)

2. Assembly: Boeing uses AR (Google Glasses) so that its operators can consult data and information if they have to turn their eyes away from the field of operations.

3. Training: Lockheed Martin engineers use Microsoft HoloLens headsets to view the holographic renderings of an aircraft’s parts, as well as the instructions on how to assemble them before working. (View the video here)

4. Planning: Mercedes-Benz employees use tablets to compare and analyse parts. (View the video here)

5. Field Repair: BWM, Bosch, Porsche guide their engineers in the processes of disassembly, assembly and adjustment. (View the video here)

6. Future Learning: Airbus uses AR for collaborative and innovative team learning with different backgrounds and locations people. (View the video here)

7. Field Repair: Porsche dealers uses AR to fix problems in a car, even if they don’t know where to start. (View the video here)

8. Field Maintenance: Tyssen Group to visualise and identify problems with elevators ahead of a job, and have remote, hands-free access to technical and expert information when onsite: (View the video here)

9. Remote Inspection: Asahi Beverages is using augmented reality glasses to allow almost instant access to specialist support when production equipment breaks down in remote locations. (View the video here)

Will AR be disruptive in manufacturing?

We can say that yes, by offering improvements of more than 30%, when we hardly achieve optimisations from 3% to 5% for usual procedures, the implementation of the AR will be unstoppable, becoming disruptive for current manufacturing systems and processes. The main potential challenge could be the lack of talent and manufacturing skilled workers, as the graph shows how the gap between job offers for skilled workers and hires continues to grow. But converting that challenge into opportunity AR can help train current manual workers and turn them into a skilled workforce integrated into digitised processes, also increasing their efficiency and productivity, and consequently -hopefully- in better salaries. 



The AR has left the movies and video games to integrate into companies. Even being far from the Augmented Reality that we saw operate Tom Cruise in the movie Minority Report, it has evolved in a practical way so that it can be easily integrated into production processes, repair, maintenance, inspection, logistics and operations. AR helps to reduce lead times, improve quality, increase efficiency and allows collaboration between remote locations. In addition, by integrating data flows, AR integrates horizontally the upstream and the downstream of the supply chain, eliminating silos and leading to collaboration in multidisciplinary teams, fostering transparency.

There are already many examples that we can find of how companies have started using AR to create competitive value and take first steps effectively towards the full digitalisation of production in the smart factory. Considering the fast speed of its implementation, we can find that very soon the companies that have not implemented AR suffer severe disruptions, not being able to compete with the most advanced.








About the Author

Dr. Jorge Calvo is Deputy Dean and Professor at Globis University

Daniel Camara