by Gary Mintchell | Jun 13, 2016 | Automation, Manufacturing IT, News
I’m in Orlando at the annual summer gathering of Rockwell Automation distributor and customer tech specialists. This is where they go for training in current products and introduction to new ones. And to get a little fired up about the company.
Rockwell Automation currently bills itself as the largest company solely devoted to industrial automation. True to the billing, current Senior Vice President and incoming President and CEO Blake Moret told the 2,100 gathered attendees, “All we do is industrial productivity.”
Moret’s other significant quote revealed a huge cultural shift that Rockwell Automation has undergone under current CEO Keith Nosbusch—We describe the value of the Connected Enterprise to customers in language specific to each. That means that the company has learned to speak other terminology than discrete manufacturing and machine control. Historically it lost credibility by going into batch and continuous processing companies and describing offerings using the terminology of discrete. Now they can talk pharma, or oil & gas, or whatever.
Sujeet Chand, SVP and CTO, gave the technology keynote. Chand talked about connecting silos of information—something we’ve discussed for years but seems closer to reality than ever before.
He did not spend much time on trends (collaborative robots, wearables, mobility), but pointed out that many countries are starting advanced manufacturing initiatives. The danger of so many independent initiatives is that this could lead to multiple standards, which would be a mess. He urged us to work for common standards.
Chand reinforced the value propositions for the Connected Enterprise, Rockwell’s focus for several years:
- Faster time to market
- Lower total cost of ownership
- Improve asset utilization
- Enterprise Risk Management
Why do we care about IT/OT convergence—something else we’ve discussed for years. This convergence is a key factor for Connected Enterprise, however, another benefit is it leads to improved workflow.
Since I follow all things IoT, I found Chand’s “IoT Stack” interesting. It’s fairly typical, but he differentiates data abstraction from data accumulation in the mix and does not specifically use the term analytics.
- Collaboration & processes
- Data Abstraction
- Data Accumulation
- Edge Computing
- Connectivity
- Physical devices
Frank Kulaszewicz, SVP Control and Architecture, delved into High Performance Architecture. Fundamental to high performance architecture are devices that are self-aware. A photoelectric, for example, can send a notification that it needs to be aligned or cleaned. Or a motion control servo drive can be self-tuning. Stepping up from self-aware devices are systems that are “system-aware.”
Dean Kamen, prolific inventor and entrepreneur, was the “star” keynote.
He began with a bit of discouragement, “As society get older, adoption of technology slows.” But then he showed development of some of his notable inventions that have made the world better for many. There is the insulin pump, portable dialysis machine, prosthetic arms with such great control that people can pick up a grape and eat it without crushing the grape designed for people who have lost their entire arms. Lack of clean drinking water is the #1 killer of children globally. He invented “slingshot” a machine that distills and condenses water such that just about anything wet even from manure piles can be converted to safe drinking water. He partnered with Coca-Cola to get them distributed to areas of great need.
His greatest achievement is the invention of the FIRST Robotics competition. Begun in 1989 to inspire high school kids to develop a passion for science and engineering, the movement has spread to 86 countries.
Technology development, especially through the middle ages and even by technologists like Da Vinci, was for development of tools of war for their princely benefactors. Kamen’s vision is to challenge kids (and the rest of us) to develop technology to solve human problems. No Terminators, here.
by Gary Mintchell | Apr 18, 2016 | Operations Management
Part of the promise of digital manufacturing, also known as Industry 4.0 or Industrial Internet of Things, concerns breaking the digital barriers, freeing information to flow to where it is needed.
This relates to the promise of implementing an Enterprise Resource Planning (ERP) system in a manufacturing enterprise, which always fell a little short due in large part to the lack of integrated information. Timely, accurate data from production did not find its way into the enterprise system.
Effective digital manufacturing extends beyond just the facility into the ecosystem of company facilities, logistics, suppliers, and customers. In other words, the next great leap of progress will be an integrated, digital supply chain.
“The Current and Future State of Digital Supply Chain Transformation,” by Capgemini Consulting, GT Nexus and Infor, reports on a study that surveyed over 300 executives from some of the largest global manufacturing and retail organizations across North America and Europe, and found that:
- Currently, only 15% have access to data from their extended supply chains, and just 23% of those that have access, actually analyze that data for decision making purposes
- Almost 50% of respondents admit that right now “traditional” methods such as phone, fax, email are still the dominant ways to interact with supply chain partners
- Only 23% say that the majority of data from the extended supply chain is analyzed and used for decision making, but in five years, that number is expected to jump to 68%
Most research studies conducted on the topic so far have examined Digital Transformation within organizations, or between organizations and their customers. This new research project is the first of its kind that explores the current state and future of Digital Transformation especially between organizations and all of their partners across the extended value chain.
The study surveyed 337 executives from some of the largest global manufacturing and retail organizations across Europe and North America.
Key findings of the research study include:
Digital Transformation of the Supply Chain is important
- 75% of respondents say Digital Transformation of the supply chain is “important”
- 50% say that Digital Transformation is “very important”
- 70% say they have started a formal Digital Supply Chain Transformation effort
Progress has been slow so far
- >30% of respondents said they are “dissatisfied” with progress so far
- Only 5% are “very satisfied”
Key technology enablers have been identified, but are not widely used yet
- Supply Chain Visibility Platforms/Tools (94%), Big Data Analytics (90%), Simulation Tools (81%) and Cloud (80%) are seen as the biggest technology enablers of Digital Supply Chain Transformation
- But 48% of respondents admit that right now “traditional” methods such as phone, fax, email are still the dominant ways to interact with supply chain partners
Dramatic changes are expected within just five years
- Today only 15% of respondents say that the majority of data from the extended supply chain is accessible to their organization. In five years, that number jumps to 54%
- Today only 23% of respondents say that the majority of data from the extended supply chain is analyzed and used for decision making. In five years, that number jumps to 68%
- Five years from now, 95% of respondents expect more processes with suppliers to be automated
- Five years from now, 94% expect to receive more real-time status updates from across the entire supply chain
The expected benefits of Digital Supply Chain Transformation include, but go well beyond cost reductions for logistics, inventory and maintenance, improvements in customer service and higher overall equipment effectiveness. Perhaps more importantly, Digital Supply Chain Transformation is expected to dramatically improve an organization’s agility. Agility is necessary to respond to changing market conditions, to new market entrants that can threaten existing business models or to unexpected supply chain disruptions. Such disruptions have already caused major harm to the financial performances and reputations of countless organization over the years.
Mitigating the impact of these unforeseen disruptions has become a main priority and a major driver behind the need to digitally transform. But according to the study, current levels of collaboration and visibility across the network are still low. That limits agility.
“75% of respondents say Digital Transformation of the supply chain is important, but a massive gap exists today between where companies are today and where they expect to be in just five years from now,” said Mathieu Dougados, Senior Vice President, Capgemini Consulting. “Transformation initiatives inside the four walls of the enterprise pose significant challenges within themselves. But in today’s globalized and outsourced world, Digital Transformation can only be successful if companies approach it with a holistic view of their entire value chain. That value chain can include hundreds of partners. So connectivity between partners, cross-company access to data, and the use network-wide analytics become the key focus areas.”
“Supply chain transformation is a massive undertaking that requires leadership and vision at the C-level, and a holistic transformation approach that fosters automation, connectivity, data sharing and collaboration across the entire value chain,” said Kurt Cavano, Vice Chairman and Chief Strategy Officer at GT Nexus. “This survey showed that manufacturers and retailers clearly have an idea of where they need to be and what digital technologies will get them there in the next five years. But it’s going to be a real sprint given the current reliance on outdated, analogue technologies such as phone, fax and email to collaborate and execute in the global supply chain. Meanwhile, risk of supply chain disruptions runs high, with an expensive cost to pay.”
by Gary Mintchell | Apr 14, 2016 | Technology
We all expect 3D Printing, also known as Additive Manufacturing, to be a disruptive. Or is it everyone who expects it? Will 3D Printing become the next technology to collapse layers in manufacturing just like the software and communications layers I’ve been discussing?
PwC just reported on its 2015 survey of manufacturers’ experiences and attitudes toward the technology. The results are somewhat mixed, as you would suspect given how new the technology is and how rapidly it is gaining acceptance.
PwC’s Robert McCutcheon posted a blog on LinkedIn introducing the latest results. I’m quoting the post here:
There are many different types of technology that are at the fingertips of manufacturers looking to become the next Factory of the Future. But there’s still that hesitation, there’s still the question: Is 3D printing (3DP) just hype?
According to PwC’s recent study, it’s not. In fact, it’s become quite clear that the technology, also known as additive manufacturing, is crossing from a period of experimentation to one of rapid maturation. Industrial 3D printers, once almost exclusively used for prototyping, are now on some of America’s factory floors and being rolled out on production lines.
How do we know?
Two years ago, PwC tested the waters to figure out to what extent U.S. manufacturers were adopting 3DP into their operations and how they expected the technology to play out in the future. In our latest report, we share what’s changed and the three most significant shifts that have emerged:
- More “doing,” less experimenting: Fewer manufacturers (17% versus 29% two years ago) are simply experimenting with 3DP to figure out how to use the technology. Now, just over half are using it for prototyping and final-products versus 35% two years ago.
- Greater expectations: Two years ago, just 38% of manufacturers expected 3DP to be used for high-volume production over the next 3-5 years. Now, 52% do. Interestingly, we saw a drop from 74% to 67% in the number of manufacturers that expect 3DP to be used for low-volume, specialized products.
- 3DP is still disrupting, though how it’s disrupting continues to evolve: Twenty-two percent say it will be disruptive to restructuring supply chains. The same percentage say it will threaten intellectual property.
Eighteen percent believe it will change relationship with customers. Two years ago, the primary concern was how it would disrupt the supply chain.
In “3D Printing comes of age in US industrial manufacturing“, we dive further into these three shifts and uncover sentiment from 2014 versus today. What’s clear is that the growth in 3DP and the range of ways it’s being implemented is demonstrating 3DP will be an important discussion to how manufacturers are assessing, shaping and expanding their businesses.
However, no matter where one is on the adoption scale, there are questions that must be addressed.
by Gary Mintchell | Mar 24, 2016 | Automation, Internet of Things, Interoperability, Operations Management
Owner/Operators do see great benefits to standards for system-of-systems interoperability. Getting there is the problem.
Aaron Crews talked about what Emerson is doing along the lines I’ve been discussing. Tim Sowell of Schneider Electric Software hasn’t commented (that’s OK), but I’ve been looking at his blog posts and commenting for a while. He has been addressing some of these issues from another point of view. I’m interested in what the rest of the technology development community is working on.
Let’s take the idea of what various suppliers are working on and raise our point of view to that of an enterprise solutions architect. These professionals are concerned about what individual suppliers are doing, of course, but they also must make all of this work together for the common good.
Up until now, they must depend upon expensive integrators to piece all the parts together. So maybe they find custom ways to tie together Intergraph, SAP, Maximo, Emerson (just to pull a few suppliers out of the air) so that appropriate solutions can be devised for specific problems. And maybe they are still paying high rates for the integration while the integrator hires low cost engineering from India or other countries.
When the owner/operators see their benefits and decide to act, then useful interoperability standards can be written, approved, and implemented in such a way to benefit all parties.
Standards Driving Products
I think back to the early OMAC work of the late 90s. Here a few large end users wanted to drive down the cost of machine controllers that they felt were higher than the value they were getting. They wanted to develop a specification for a generic, commodity PLC. No supplier was interested. (Are we surprised?) In the end the customers didn’t drive enough value proposition to drive a new controller. (I was told behind the scenes that they did succeed in getting the major supplier to drop prices and everything else was forgotten.)
Another OMAC drive for an industry standard was PackML—a markup language for packaging machines. This one was closer to working. It did not try to dictate the inside of the control, but it merely provided an industry standard way of interfacing with the machine. That part was successful. However, two problems ensued. A major consumer products company put it in the spec, but that did not guarantee that purchasing would open up bidding to other suppliers. Smaller control companies hoped that following the spec would level the playing field and allow them to compete against the majors. In the end, nothing much changed—except machine interface did become more standardized from machine to machine greatly aiding training and workforce deployment problems for CPG manufacturers.
These experiences make me pay close attention to the ExxonMobil / Lockheed Martin quest for a “commodity” DCS system. Will this idea work this time? Will there be a standard specification for a commodity DCS?
Owner/Operator Driven Interoperability
I say all that to address the real problem—buy in by owner/operators and end users. if they drive compliance to the standard, then change will happen.
Satish commented again yesterday, “I could see active participation of consultants and vendors than that of the real end users. Being a voluntary activity, my personal reading is standards are more influenced by organizations who expect to reap benefit out of it by investing on them. Adoption of standard could fine tune it better and match it to the real use but it takes much longer! The challenge is : How to ensure end user problems are in the top of the list for developing / updating a standard?”
He is exactly right. The OpenO&M and MIMOSA work that I have been referencing is build upon several ISO standard, but, importantly, has been pushed by several large owner/operators who project immense savings (millions of dollars) by implementing the ecosystem. I have published an executive summary white paper of the project that you can download. A more detailed view is in process.
I like Jake Brodsky’s comment, “I often refer to IoT as ‘SCADA in drag.’ ” Check out his entire comment on yesterday’s post. I’d be most interested in following up on his comment about mistakes SCADA people made and learned from that the IoT people could learn. That would be interesting.
by Gary Mintchell | Mar 8, 2016 | Commentary
One set of questions popping up frequently over the past few years among corporate executives of industrial technology supplier companies concerns response to the Industrial Internet of Things regarding industrial merger and acquisition.
Are we in the IIoT market? What acquisitions should we search out to further exploit the IIoT? Should we look at expanding into other aspects of the IIoT market?
Executives analyzing the IIoT system check out networking products plus sensor products plus analysis products. Should I buy into an adjacent area?
One of my favorite new media sites is The Information. It is subscription only. Maybe a model I might morph to someday. Jessica Lessin and her team have assembled a top quality news site covering Silicon Valley entrepreneurs and start ups.
Jessica wrote recently about Yahoo and all the vultures, er companies, circling around to see what sort of deals they may get picking over the various parts of the company that is obviously for sale.
She made this point, “But these two reasons reflect the biggest mistake companies make when it comes to M&A. Executives focus on how a potential deal would help the company get into a new business. But those type of deals, while attractive in theory, often fail miserably. On the other hand, deals that help companies double down on a core business do much better.”
She offers some examples such as AT&T’s purchase of John Malone’s TCI cable company in the late 1990s and News Corp’s $580 million acquisition of MySpace in 2005.
Her advice to those itching to make a deal—just like Pilates, look to your core.
“But the best deals strengthen a company’s core business. The reason is simple: Organizations act in their self-interest; it is how they make money and keep growing. That’s their DNA, more than wishy-washy things like whether employees wear suits or hoodies or work out of a loft or a high-rise.”
Example? “Google pulled that off when it spent $3 billion for DoubleClick in 2007, for example. It was a steep sum but Google already knew search advertising. DoubleClick helped it grow further by selling the similar products to similar customers with display.”
If I’m advising a company again today, I’d pretty much stay with what I thought three years ago—be wary of buying into adjacent or new market areas. To do so requires a clear strategy—and a lot of money.
The only one in the IIoT space of which I’m aware right now is the effort by PTC to enter that space entirely through acquisition. See my post. PTC has acquired at least four companies in the space. A couple it bought for technology. Two it paid huge premiums for. I’m guessing they see such an upside revenue stream that the premium looked small in comparison.
Do you see any other major IIoT plays? I mean other than the German companies focusing on Industrie 4.0 (sort of IIoT plus)—Siemens, Bosch, and others. Rockwell Automation with Connected Enterprise. ABB, GE, and Schneider Electric on IIoT. The big companies are simply focusing efforts they’ve made for years into the new paradigm.
But are there startups to watch? Mid-level acquisitions? Any excitement out there at all? Let me know.
