The North Jeolla provincial government in South Korea has started a smart project to help local businesses with digital transformation and manufacturing innovation.
A memorandum of understanding (MoU) for the project with Samsung Electronics Co., Jeonbuk-Samsung Smart CEO Forum, Jeonbuk Technopark, and 14 cities and counties was recently inked by the provincial government.
With the signing of the Memorandum of Understanding, local governments and private businesses will collaborate for the first time to broaden the public-private cooperation for the deployment of smart factories.
The goal of the project is to increase the competitiveness of SMEs by constructing smart factories with the help of Samsung Electronics, local and federal governments, and small and mid-sized businesses.
Such smart factory initiatives were previously completed through nationwide competitions; however, the North Jeolla region project has broadened the scope of support by setting up funds specifically for businesses located inside the region.
The North Jeolla provincial government increased its funding for business projects involving public-private cooperation in March, taking it from 58 million won ($44,000) in the previous year to 796 million won this year, with the goal of creating 300 smart factories by 2027.
Furthermore, participating enterprises’ corporation burden was lowered from 35 percent to 20 percent. There are now 30 annual targeted initiatives instead of just 15.
Apart from government initiatives, plans are afoot to individually construct seventy smart factories a year starting next year.
In accordance with the MoU, the 14 municipalities and North Jeolla Province are investigating exemplary examples in various regions and are giving administrative and financial support for the initiative.
Samsung Electronics will help SMEs with manufacturing innovation by extending its cutting-edge technological and business know-how. Samsung Electronics will provide these mentors with its knowledge of building smart factories once the province has completed the mentorship program.
For the purpose of growing smart factories, a private consortium called the Jeonbuk-Samsung Smart CEO Forum provides member companies with project marketing and preparatory skills.
The reason for the active participation in smart industrial projects is their demonstrated efficacy.
The nationwide smart factory projects saw a 44 percent increase in productivity, a 14 percent improvement in on-time delivery rates, and a 53 percent decrease in defect rates among the participating companies, according to a survey conducted by the Korea Federation of SMEs between 2018 and 2021.