by Gary Mintchell | Apr 30, 2011 | Commentary, Operations Management
I find it interesting to eavesdrop on conversations about the price of gasoline in the U.S. Then there are the news items (that I don’t read in detail since they are only reporting on political mudslinging) about which political party is responsible.
Gimme a break–as they used to say. There are times where a confluence of consumer behavior, events in other countries and global economic factors come together like when the Ohio River at flood stage dumps into the Mississippi River at flood stage, joined by the Missouri River, Tennessee River and so on.
Try this line of reasoning–Americans cannot give up their love affair with driving large vehicles for long distances at high rates of speed plus the Chinese are now discovering that same love plus the drop in the relative value of the dollar.
[Don’t forget, some people benefit from the low dollar (manufacturers and farmers who export, for example) while others suffer. Happens with all economic tinkering, I think.]
The policy part–and unintended consequences–comes from the extra political power the agriculture lobby has due to the 2-Senators-per-State part of the U.S. Constitution. When you take the number of Senators from states with lower populations that are dependent upon agriculture and compare to the number of Senators from oil-producing states, you get agriculture-benefitting legislation.
Case in point, we support farmers and (supposedly, ha!) cut our consumption of petroleum through tax breaks for ethanol production coupled with mandates for ethanol added to gasoline. This is a government mandated increase in the price of corn. This leads to higher food prices for consumers–the unintended consequence.
Check out this article in The Wall Street Journal (if you have a subscription, which I just got), “C. Larry Pope: It’s Getting Harder to Bring Home the Bacon.” It’s an interview with the CEO of Smithfield, a huge pork products producer where he explains why his mom can’t afford to buy his bacon.
by Gary Mintchell | Apr 29, 2011 | Leadership, Standards
I love conferences. No, really. I don’t like the packing and unpacking and new routines and trying to squeeze in a workout. But I really get energy from conversations with the many smart people in the industry.
Anyone who has read me for long knows that I see immense benefit from interoperability standards. Perhaps some vendors pay lip service to a standard while trying to close their systems (ISA95 has often been abused by suppliers this way), but overall as engineers adopt these standards and put them in their specs, the more manufacturing will benefit. That means we all benefit.
This week at the Packaging Automation Forum, Bryan Griffen of Nestle described in detail how adopting PackML–itself an outgrowth from ISA88–is beginning to save his company time and money. After all, our focus must be on making manufacturing a contributor to our companies’ growth and profits–otherwise, why exist?
But another conversation involved “the younger generation.” One generation of engineers has devoted a chunk of their lives for the greater good of the profession by working on all these standards. But the work is not over. We don’t see many young engineers stepping up to take up the cause.
One person thought this might be because of the environment in which these people have been raised. That is–the emphasis on self, on how much money can I make, on “what’s in it for me.”
But they said that about my generation–the Boomers. And the current generation of standards developers all come from that generation. You don’t want to let marketing definitions color your view of people. We had greedy people and idealistic people. So does the younger generation.
I wonder if the problem is boomer management. While some decry coming retirements of boomers, others like me notice that management has been forceably retiring that generation for several years now. As engineering departments are cut, there is little time for other work. Add travel restrictions and management’s lack of vision, and you get other reasons for lack of involvement.
So, what do you think? What have you seen? More important, what can we do about it?
by Gary Mintchell | Apr 27, 2011 | Automation, Events, Operations Management
Automation World’s and Packaging World’s sixth annual Packaging Automation Forum was yesterday. We had the best speaker lineup from top to bottom of the six. We learned about preparing packaging automation lines to accomodate personalized packaging trends at major retailers, how companies are optimizing manufacturing lines, how standards make for more effective packaging lines, the latest about safety standards and implementing them in a company and reporting metrics to optimize manufacturing.
Jim Whalen, manufacturing line optimization program leader for Rich Products, speaking about his experiences noted, “You can get a lot of payback–if you do it right.” But many don’t. He also advised to get the experts out of the way and get the people involved.
Bryan Griffen (pictured above), head of electrical and automation engineering at Nestle, spoke about the difficulties of having single specified automation suppliers and how trying to source additional OEM suppliers often caused comments such as “we can use your specified automation platform, but we don’t know it, so it will cost you twice as much, take twice as long to deliver, and we can’t guarantee it will work.” Eventually, Nestle realized it would have to find a way to have several platforms in a plant–but they would have to work together and they would have to be able to be maintained.
The fact that packaging machines employ a lot of high-speed motion control that Nestle engineers didn’t want technicians to tinker with, meant that trouble shooting within a machine was minimized. The problem of interoperability is being solved with the adoption of PackML from OMAC and Ethernet–although they are somewhat discouraged by the many flavors of Ethernet and are trying to find one solution there.
Ed Michel, from Frito Lay, discussed his experience with implementing CMMS tools to improve equipment reliability. A couple of summary quotes: “Without a well-defined process, the best people and technology will be less effective. It boils down to not just reporting the score, but changing the score” and “When you focus conversations on performance, teams will work to drive performance.”
A panel of safety experts (shown above, Roberta Nelson Shea of Safety Compliance Services, Fred Hayes from PMMI, and Dave Herrington of Kraft Foods) brought the audience the latest standards status updates, gave hints about proper risk assessment and discussed implementing a safety culture.
Finally, Don Enstrom from private label bottler Cliffstar, took the audience along his jouney to gaining a competitive advantage by bulding a common approach to performance measurement.
by Gary Mintchell | Apr 26, 2011 | Automation, Events, Operations Management
I took a day of vacation (sort of) with my family in Florida and figured a Good Friday post wouldn’t be read that much. But the real reason for this prelude is to remind everyone to Back Up their files. I was doing some work Sunday afternoon when suddenly everything stopped. Couldn’t get the computer to work at all. My excuse–only one day at home between trips to Florida and Chicago.
Instead of heading directly to the Make-to-Pack Workshop that kicked off Packaging Automation Forum again this year at the Westin O’Hare, I drove directly to the Apple store at the Woodfield Mall. Turned out it was only the battery. I thought so, but you never know for sure. Back in business yesterday afternoon late. Relieved, but with a new sense of Back Up Your Files.
But to wrap up the ABB experience–ABB always does a good job of organizing its conference. It is preceded by an internal sales meeting, so the people are charged up before customers arrive. It is such a big company that encompasses so many technologies, that attendees come from many areas of production and manufacturing. I didn’t find stories this year, but in the past this has led to some interesting discussions. Maybe the first time people from an electric utility sat down with engineers and managers from a large customer.
My sense is that ABB will be sticking to its plan of strategic acquisitions to fill gaps in its offering in parallel with organic growth and technology development. The discrete manufacturing part is coming to gether and growing nicely. There wasn’t an emphasis on process automation, but I got the sense that it is a backbone technology. The 800xA platform incorporated many advances at the time of its development. It seems to be doing its job. Certainly it had a big chunk of the show floor.
Many executives had new positions this year, and that seemed to charge them up. This is definitely a “big company” strategy, but it is good for executive development and growth, too. Many remember the tough times of several years ago, and this gives them the incentive to work for growth and not repeat the mistakes of the now-distant past.
Oh, and did I mention that you should back up your files? I’ve started using Dropbox in addition to an external hard drive. Now, drag those files to the cloud…
by Gary Mintchell | Apr 20, 2011 | Events, Operations Management
Blog Wednesday
Joe Hogan met with me for a few minutes on an appointment packed Tuesday at ABB’s Automation and Power World conference. What’s the biggest constraint for ABB’s future growth? Hogan answered, “People. Finding the right talents with deep understanding of the process.” He’s looking for people with deep experience in ABB’s various customer’s industries. The talent search is not just technical, but technical people with managerial knowledge and experience.
Managing Acquisitions
Big companies need to grow both organically and through acquisition. It is so easy for acquisitions to go poorly. And ABB was just touting all the acquisitions completed in the past year. So I asked Hogan about his philosophy and action plan for successful integration of new companies.
The Baldor acquisition was large and strategically important. Hogan said one key was humbleness. In other words, ABB didn’t come in and tell everyone to change the way they did business, wipe out management and subsume the company’s image. Instead, they kept every one of the top 80 managers. He has monthly updates about the process that includes Baldor’s management. In fact, Baldor’s management is running the combined motor sales organization. Similar with Ventyx.
Hogan concluded, “We have many organic growth opportunities in addition to acquisitions. We are focused on technology to solve problems for our customers. We’re trying to know what our customers want and what we can do to help them.”
Discrete Automation and Motion
After that, I got an update on the discrete automation and motion division from Ulrich Spiesshofer, global business unit manager, and Greg Scheu, who is business unit manager for North America.
There are five strategic areas within the division with two key enablers.
The first is robotics. ABB is one of the global leaders in robotics. This product area has rebounded from a loss in 2009 to profitability in 2010. ABB is “strongly, cautiously optimistic” about the robot business in the near future.
The next area is industrial motion, which includes drives and motors. Things that enable and control movement. ABB had a very strong base in standard IEC motors. With the Baldor acquisition, ABB feels it is now in a strong global leadership position. The strategic plan for integrating Baldor’s organization into ABB is to assure “you keep the soul of the company while leveraging what ABB can do for Baldor.”
Power quality and control is the next area. ABB has won a big contract with Deutsche Bahn, the German train system, to retrofit the electrical power system on a train. It is now running at 15 points higher efficiency than before. Other technologies include stabilizing power supply into automation, high end UPSs, and now a battery storage solution.
For renewable energy markets, ABB has decided to focus on wind and solar. The company has had a strong base in wind, but it has come late to the solar party. But it is developing its technology for both grid and consumer markets.
ABB entered Emobility on the charging side tied to its power electronics capability. It is now working with battery and car manufacturers.
2 key enablers
The first enabler is packaging applications, that is, don’t think about selling individual components, but package them into solution packs.
The second enabler is service. Not just spare parts, but using technologies such as remote condition monitoring and predictive maintenance information for customers.
