The Adidas Speedfactory: Reinventing an Industry
In the Bavarian town of Ansbach, Germany, a state-of-the-art robotics factory is using advanced production techniques, innovative engineering and digital designs to transform the way trainers are produced. This large-scale production project -The Speedfactory belongs to the global sports brand giant Adidas. It is the creation of a subdivision known as the “Future Team” consisting of approximately 100 people who are thinking 2 - 7 years ahead. They are responsible for game-changing innovations. The facility pairs a human workforce with advanced technologies including 3D printing, robotic arms and computerised knitting to make these next generation running shoes. In circumventing the traditional supply chain model which relies on manual production in Asia, Adidas have bucked the trend by localising manufacturing and significantly shortening their supply chain. They will now be able to conceptualise, prototype and create specialised shoes for individual runners in different cities, all in a matter of weeks.
Towards a mass personalised sport shoe
The launch of the AM4 sneaker series - Adidas Made For - sparks the beginning of a route which will take the Adidas Speedfactory through six cities. The “Adidas Made For London” AM4LDN and the “Adidas Made For Paris” AM4PAR will be followed this year by other unique models: Los Angeles AM4LA, New York AM4NYC, Tokyo AM4TKY and Shanghai AM4SH. Following an in-depth analysis of each location, the models will be designed to adapt around the geographical features and terrain unique to each city, all to enhance the running experience.
In London, many runners commute on foot and need sneakers with high visibility for rainy days and dark nights. In Paris, the revolutionary shoes will be modified to tackle the cobbled streets. New York City is constantly under construction and organised in a grid structure, so runners require a shoe which can deftly handle the numerous 90-degree corners. Los Angeles, by comparison is hot and more humid due to its proximity to the ocean. In Shanghai, preliminary research reveals that people generally exercise indoors.
A 4.0 factory, leveraging speed and a new business model to create local jobs...
Currently, trainers are constructed from an assortment of textiles and components sourced from different suppliers. The process between initial design through to finished product can be quite tedious and involves multiple prototypes, exchanging of samples and retooling factories around new models - all of this can stretch up to 18 months. The high speed, hyper flexible production system of the Speedfactory has the capability to create a new pair of trainers intantly using just raw materials. Adidas Group’s Vice President of Corporate Communications Katja Schreiber explains: “We’re trying to bring our products closer to where our consumer is, cutting out the phase where the product needs to be transported. Ideally retailers will be able to place orders based on current trends, and we won’t need to keep huge warehouses of products just in case.”
This move will provide highly skilled, technical jobs in the countries where the Speedfactories are located. Oechsler Motion, the company which operates the Ansbach facility, employees 160 people to manage advanced manufacturing techniques and software platforms specifically for the Speedfactory project.
Amazon's “One click” has become the industry benchmark for agility as drone deliveries are made within just 30 minutes following an order. The Speedfactory is adidas' response to this paradigm shift in consumer expectations. It encapsulates mass customisation, rapid response time and demonstrates how advancements in technology can truly benefit the consumer. “Speed is far more than a business strategy for us”, said previous Adidas Group Executive Board Member Glenn Bennett, who held responsibility for Global Operations. “Speed is all around us. It’s what athletes train for, and it’s essential to our consumers who live in a world of immediacy.”
Driving innovation and customer centricity
Perhaps the biggest strategic motivation which explains the impetus behind the Speedfactory is the relentless need to constantly innovate and create new customer centric business models. Michael Voegele, Adidas’ Chief Information Officer states how they didn’t want to be disrupted by the outside and draws comparisons with the taxi and hotel sectors encounters with external forces like Uber and Airbnb.
At this initial stage, priced at €220 and representing just 0.5 million out of 403 million Adidas shoes manufactured last year, the AM4 series remain a product for a niche audience. However, the Speedfactory project illustrates a significant step towards industry 4.0 and exemplifies its fundamental characteristic: an industry which puts customers' -now called users'- experiences and demands at the very centre of its business model. It also highlights the new opportunities that digitalisation presents and the subsequent race that every company enters to master new markets before they are conquered by agile emerging startups. Adidas have made a bold, pioneering step to advance in this direction, which other organisations will follow?