by Gary Mintchell | Jan 29, 2016 | Automation, Commentary, Events, Internet of Things, News, Operations Management, Technology
Industry 4.0 and Industrial Internet of Things describe manufacturing strategy as much as technology. But as I occasionally write here and write daily on my spiritual practices blog, there is a people side to all this technology and strategy.
Technologists (most people reading this site) tend to talk technology. Then they get carried away and think that technology will replace all need for people. Hence the science fiction writing and movies on that theme.
Arianna Huffington (the Huffington Post) attended the recent gathering of the world’s elite in Davos, Switzerland at the World Economic Forum. She discovered manufacturing and Industry 4.0. But she wrote a book on the power of getting enough sleep for your essential health. She managed to weave a story from both threads.
Manufacturing strategy
She writes:
The dominant topic of discussion this year — both inside the talks and panels and outside, as well — was transition. Klaus Schwab, the Forum’s founder and executive chairman, captured this sense — the possibilities as well as the challenges — with this year’s theme, the Fourth Industrial Revolution.
Schwab describes this new period as “the fusion of technologies across the physical, digital and biological worlds which is creating entirely new capabilities and dramatic impacts on political, social and economic systems.” It’s an era of automation, constant connectivity, and accelerated change, in which the Internet of Things meets the Smart Factory.
Yes, this new manufacturing strategy, which I must say seems to focus on what we call discrete manufacturing (think autos, airplanes), seeks to go deeper in employing digital technologies. In many ways it is following the lead of process industries (they hate the word manufacturing even though that is a government classification) which always seems to lead in applying math and rigor to its processes.
She continues, quoting Mark Benioff of Salesforce about people and technology:
If the Fourth Industrial Revolution will be defined by speed, connectivity, and change, there’s also a need for a countervailing force. Salesforce CEO Marc Benioff said, “Speed is the new currency of business.” But as he also said, the Fourth Industrial Revolution begins with trust, which has been at the heart of business as long as business has existed — and will only become more important in our more transparent ever-faster-moving world. Benioff’s point exemplified a larger truth of this year’s Forum, that far from being add-ons, a focus on trust, transparency, purpose, and a deeper kind of connection are central to meaningful success in the Fourth Industrial Revolution.
I’ve been writing about trust and transparency on my other blog this week. Sometimes we forget basic human values in our pursuit of either technology or profits.
Oh, yes, and she adds that we all need enough sleep each night to perform at our peak. You can go buy her book–or sleep on it.
by Gary Mintchell | Jan 28, 2016 | Data Management
Engineering collaboration tools. Old, yet new? Most of the news and trends I’m seeing center around increased use of the cloud. We have seen tools coming for several years. Now there seems to be a critical mass where engineers and managers can find increasingly powerful collaboration tools for a variety of functions.
This report just arrived from Accenture. It has launched a digital portal that helps product developers such as engineers accelerate delivery of products to market at lower costs through greater efficiency.
The Accenture Enterprise Product Information and Content (EPIC) Portal consolidates large amounts of product development data from multiple enterprise systems in a single, organized view, reducing the time needed for product developers to search for this data by up to 95 percent. Leveraging this portal, these professionals can use analytics to anticipate and solve problems, as well as develop insights and make better-informed decisions.
Accenture developed the EPIC portal for companies that design, engineer and manufacture complex products in the aerospace, automotive, consumer products, electronics, industrial equipment, high-tech and life science industries. The portal features pre-defined integration with product lifecycle management, enterprise resource planning and a range of other applications used in product design and production.
“Throughout large, complex companies, product developers grapple with data scattered across too many siloed databases, complicated system user interfaces, and cumbersome access to analytics and product data reports,” said Kevin Prendeville, a managing director in Accenture’s Product Lifecycle Services business. “The EPIC portal equips engineers with one integrated source to identify risks and speed product deliveries whenever they need to, wherever they are, which increases efficiency and lowers costs.”
For example, a supply chain procurement engineer with an automotive manufacturer could use the EPIC portal to more rapidly ascertain the engineering status of automotive parts and avoid delays delivering products to market. Knowing this status also benefits numerous other corporate groups, including engineering, sourcing, quality, marketing, manufacturing and operations.
“Accenture’s product information portal addresses a common product innovation pain point,” said Jeff Hojlo, IDC program director for Product Innovation Strategies. “The product lifecycle management (PLM) portal encompasses all product innovation content in an organization ranging from PLM, enterprise, quality or compliance systems. These capabilities are not meant to replace PLM provider capabilities; rather, they are meant to complement them and extend PLM information to the global team.”
This is going to be quite the competitive landscape in the near future. That will be good for everyone.
by Gary Mintchell | Jan 27, 2016 | Commentary, News
MergerMarket released a report on merger and acquisition activity during 2015. It was the hottest year since 2007. These get interesting. I just saw a blog post somewhere that stated that 40% of the companies on the Fortune 500 are no longer there. Some of these deals will contribute to further change in that list. Check out the entire report for specifics and charts.
Oh, and the authors believe that 2016 will be even hotter.
The Industrials & Chemicals sector recorded 3,118 deals worth US$ 474.3bn, the second highest value on Mergermarket record, up 16.5% in value compared to 2014 (3,263 deals worth US$407.1bn), thanks to a push in H2 2015, with 1,550 deals worth US$ 313bn, the largest H2 on record.
The report notes that M&A activity in China was strong. “Despite concerns over China’s slowing economy, especially in manufacturing, Industrials & Chemicals as a whole, was able to have a strong showing. The year ended with 705 deals worth US$ 165.9bn in Q4 2015, the highest valued quarter in Mergermarket history, and a 16.4% increase in value compared to Q4 2014 (845 deals worth US$ 142.5bn). ”
Industrial Merger Activity in US
The Products and Services (1,497 deals worth US$ 181.4bn) sub-sector, traditionally the highest valued sub-sector, was slightly edged out by Chemicals & Materials (422 deals worth US$ 181.9bn) to be the highest valued sub-sector for the year. Chemicals & Materials was up 72.7% by value compared to last year, which saw 469 deals worth US$ 105.3bn. The Chemicals & Materials sub-sector was boosted by E.I. du Pont de Nemours and Company’s US$ 77bn acquisition of The Dow Chemical Company, and Air Liquide’s US$ 13.4bn acquisition of Airgas, of which the two deals combined accounted for half of the sub-sectors total value for the year.
The Industrials & Chemicals sector globally has seen a positive shift of late, especially in the US and Europe. The US led the way with 770 deals worth US$ 235bn in the sector, accounting for 49.6% of the Industrials & Chemicals sector’s total value, and up 55.9% compared to 2014. The largest sub-sector in the US was Chemicals & Materials with 108 deals worth US$ 121.7bn.
by Gary Mintchell | Jan 26, 2016 | Automation, Internet of Things, News, Operations Management, Technology
The PwC Industrial Manufacturing Trends 2016 post has been released. Check it out. There are some interesting ideas.
The authors Stephen Pillsbury and Robert Bono cite the painful lessons of recovering from 2001 and 2008 as leading to caution now displayed by manufacturing leaders. We’ve had a bit of an economic jolt. Where is it headed? The uncertainty leads to caution.
They reach an interesting conclusion, “Manufacturing may be facing some headwinds, but it’s undeniably in the midst of a technological renaissance that is transforming the look, systems, and processes of the modern factory. Despite the risks — and despite recent history — industrial manufacturing companies cannot afford to ignore these advances. By embracing them now, they can improve productivity in their own plants, compete against rivals, and maintain an edge with customers who are seeking their own gains from innovation.”
It is time, they say, to envision and prepare for a data-driven factory of the future.
They reveal four technology categories that are already driving much of the change. I’ll summarize. Check out the report for more depth. Most of these are not surprising, but they certainly must be factored in the thinking of manufacturing leaders.
Industrial Manufacturing Technologies
- Internet of Things (IoT): The connected factory is an idea that has been evolving for the past few years. Increasingly, it means expanding the power of the Web to link machines, sensors, computers, and humans in order to enable new levels of information monitoring, collection, processing, and analysis.
But for industrial manufacturing companies, the next generation of IoT technology should go well beyond real-time monitoring to connected information platforms that leverage data and advanced analytics to deliver higher-quality, more durable, and more reliable products.
Before investing in IoT, however, industrial manufacturing companies must determine precisely what data is most valuable to collect, as well as gauge the efficacy of the analytical structures that will be used to assess the data. In addition, next-generation equipment will require a next-generation mix of workers, which should include employees who can design and build IoT products as well as data scientists who can analyze output.
- Robotics: In many cases, robots are employed to complement rather than replace workers. This concept, known as “cobotics,” teams operators and machines in order to make complex parts of the assembly process faster, easier, and safer.Cobotics is rapidly gaining momentum, and successful implementations to date have focused largely on specific ergonomically challenging tasks within the aerospace and automotive industries. But these applications will expand as automation developers introduce more sophisticated sensors and more adaptable, highly functional robotic equipment that will let humans and machines interact deftly on the factory floor.
- Augmented reality: Recent advances in computer vision, computer science, information technology, and engineering have enabled manufacturers to deliver real-time information and guidance at the point of use.
- 3D printing: Also known as additive manufacturing, 3D printing technology produces solid objects from digital designs by building up multiple layers of plastic, resin, or other materials in a precisely determined shape.
The authors conclude with recommendations of how to consider necessary investments in these emerging technologies.
by Gary Mintchell | Jan 25, 2016 | Automation, Commentary, News, Technology
Make no mistake about it, Siemens in “all in” on industry 4.0, otherwise known as digital manufacturing. As the company experiences some restructuring, the PLM business continues to add companies and technologies to its digital manufacturing business.
A news item from Reuters, also reported in many outlets this morning, says that Siemens is set to acquire privately held CD-adapco. This computer-aided-engineering (CAE) developer focuses on simulating engines and other mechanical systems. It looks like a good fit.
Reuters says the deal would be for about $1 billion. The founder/CEO of CD-adapco passed away in September. Is widow has been running the company since then.
The race between Siemens and GE just keeps getting more interesting. Meanwhile, Rockwell Automation focuses on the factory and process automation space, preferring to steer clear of the engineering and PLM software space. Schneider Electric’s moves have been interesting, although its attempt to acquire Aveva collapsed. ABB has been busy divesting and refocusing following former-CEO Joe Hogan’s sudden departure.
Digital manufacturing, especially featuring digital simulation of manufacturing processes, is the core of Germany’s Industrie 4.0 initiative. GE is pursuing a somewhat similar path, but it prefers the strategy of “Industrial Internet of Things.” Targeting automotive and aircraft manufacturers, these strategies hold the promise of not only increased manufacturing and supply chain efficiencies, but also possibilities of new business and income models.
What will be interesting to watch is whether Siemens and GE get so large in the space that they can no longer efficiently manage the diverse portfolio.
