by Gary Mintchell | Apr 20, 2015 | Automation, Data Management, Education, Internet of Things, Leadership, Operations Management, Productivity
I took 10 days off to go on vacation in Europe. I tried to write ahead, but ran out of time. So last week I reposted several older items.
We did the Danube cruise on Viking (you can see its ads on Masterpiece Mystery on PBS) from Nuremberg to Budapest–two of my favorite cities.
Three are many notable takeaways from the trip, but one thing stands out from a professional perspective. That would be workforce recruitment and training.
Every person on the ship’s staff was obviously screened well and then trained impeccably. It’s the same reason I like to stay at Marriotts. The staff is invariably friendly and trained–not only to do their jobs well but also to excel at customer service.
This contrasted markedly with the poor American Airlines guy who was managing (sort of) the queue through security at JFK. He’d do one thing, then reverse himself, then reverse again. All this in the space of 15 minutes! The queues were hopeless. Some industrial engineering training would go a long way toward adequate customer service at JFK.
Big Data and Jim Pinto
Meanwhile, I’ve finished sorting through about 1,200 emails today in addition to a couple of meetings. Catching up with work after a trip is so much fun.
Jim Pinto’s latest blog message was buried in my email folder. Turning from his recent ruminations on life, he turned to the Big Data subject.
Here’s Jim’s summary:
A revolution that compares with the impact of the Internet is changing the way that business, politics, health, education – almost everything – is being conducted. It is pervasive to the extent that everyone knows that it’s there, but no one can do anything to stop encroachment Every digital process that surrounds everybody at all times generates data: messages, updates, images posted to social networks; readings from sensors; GPS signals from cell phones. What’s revolutionary is that something can now be done with the data. Online retailers develop algorithms to predict what individual customers like, performing better every time recommendations get a response or are ignored. Political campaigns analyze large datasets to create predictions, giving data-savvy campaigns a major advantage. Big data has become the basis of competition and growth.
What with sensors everywhere, all that data must go somewhere in order to be useful. The consumer domain has been struggling with this. And it is all so debatable. Is is service or invasion of privacy for all these consumer companies to compile all that data about us? On the one hand, they hope to serve us ads and information that would be relevant to what we’re interested in. On the other, what if a nefarious agent–say the Department of Homeland Security or the local police–grabbed all that data and then trumped up charges against us?
In the manufacturing/industrial domain, ubiquitous sensors and massive amounts of data are old hat. But…are historians adequate to the tasks required by modern manufacturing methods? What do we need to learn and incorporate from the new database technologies from consumer big data? Who is working on that? This is crucial to the success of Industrial Internet of Things.
Anyway, check out Jim and debate with him–he loves that!
by Gary Mintchell | Feb 20, 2015 | Commentary, News
This m&a activity was reflected in my own practice. There was much activity in divestiture on some company’s parts which means acquisition for other companies. It was an active year. Following is a report from PwC US. Interesting reading throughout–as much about workforce issues as companies restructuring.
Following a strong fourth quarter, the industrial manufacturing industry closed out a stellar year for merger and acquisition (M&A) activity, according to Assembling Value, a quarterly analysis of global deal activity in the industrial manufacturing industry by PwC US.
Total deal value (for transactions worth more than $50 million) soared in 2014, reaching $127 billion, an increase of 163 percent over the prior year and surpassing the 10-year high of $92.4 set in 2006. There were 213 industrial manufacturing deals (worth more than $50 million) recorded in 2014 for a total of $127 billion compared to 148 deals worth $48.3 billion in 2013.
Both deal value and volume spiked drastically in the fourth quarter of 2014, recording 56 deals worth $24.1 billion compared to 38 deals totaling $9.6 billion in the same period the previous year. Megadeals worth more than $1 billion were also in abundance in 2014 with 24 announced transactions worth $91.6 billion.
“The strong momentum for manufacturing deals in 2014 carried into the fourth quarter as horizontal consolidation and divestitures of non-core business continued to drive robust activity,” said Bobby Bono, U.S. industrial manufacturing leader for PwC. “Companies are monetizing non-core or underperforming assets, leveraging scale in core businesses and considering joint ventures and new strategic alliances to expand into long-term attractive markets, particularly in developing economies with a growing middle class. In addition, management’s attention has shifted away from headcount reduction and cost-cutting programs toward growth initiatives and filling the talent gaps.”
Manufacturers continue to struggle to find and retain talented workforce and a skilled labor portfolio is becoming a more important factor in evaluating potential M&A targets. Sixty-four percent of respondents to PwC’s Q4 Manufacturing Barometer cited a need to fill skill gaps in their businesses over the next 12-24 months and over the past year, two-thirds also reported having open positions that they were unable to fill with experienced or skilled employees. In order to begin filling the gap, 78 percent of respondents plan to hire new skill function employees over the next 12-24 months with the broadest needs in engineering/design (62 percent), manufacturing (44 percent) and R&D (28 percent).
Regionally, acquirers from Asia led the way in terms of volume in 2014, accounting for 107 of the 213 deals; however, inbound activity in the region remained subdued. China was the most active acquirer nation, accounting for 35 percent of all deals during the year.
While emerging market activity boomed in the fourth quarter, local market deals remained dominant and no cross-border activity was generated from Asia. Europe, on the other hand, saw a significant amount of local, inbound and outbound activity despite continued economic malaise in the region. Local and foreign buyers continue to scour the region for high quality businesses as they look to align their business portfolio with long-term attractive markets.
“China-involved deals in 2014 exceeded any year of the past 10; however, foreign buyers have become increasingly wary due to an oversupply of capacity, materials and debt in the region and local market consolidation. Given a perceived lack of innovation, inability to move up the value chain and cooling domestic markets, we expect Asian manufacturing companies to begin looking for opportunities in established markets in 2015,” said Bono.
According to PwC, strategic as well as financial investors continued to pursue high-quality industrial assets and were more willing to acquire companies with stable growth prospects, even at a higher valuation. In the fourth quarter of 2014, financial investors accounted for 36 percent of all deals.
“We expect market expansion, access to next wave technologies, and the compelling need to generate synergies to drive manufacturing M&A activity, particularly in established markets. The potential impact of the first round of regulatory tightening on U.S. economic activity along with the talent crunch will be key areas of focus for management but companies with healthy balance sheets and favorable access to financing will have a clear opportunity in 2015,” Bono concluded.
by Gary Mintchell | Feb 10, 2015 | Automation, News, Operations Management, Workforce
The ARC Forum, held annually in Orlando, drew approximately 700 total attendees including perhaps 60 members of the media for the 19th iteration—Industry in Transition. Media members devote Monday afternoon each year to meeting with a parade of companies presenting new products and ideas.
First up this year in my writing agenda is an update to industrial process workforce training tools. I’m seeing increasing sophistication in companies combining ideas and technologies from computer gaming with simulation of process plants to train the current and future workforce—especially the new people who grew up with gaming technology.
Honeywell Process Solutions (HPS) managers announced its new UniSim Competency Suite, which improves operator competency and helps prepare them faster through realistic training experiences for console and field operators in the process industries.
Leveraging more than 30 years of experience in process simulation and operator training, Honeywell’s new suite of simulation software offers an integrated, robust training experience that will help industrial facilities address a growing shortage of trained operators.
“In the near future, many operators at industrial plants in developed countries will retire, while process industries in emerging economies will continue to face the challenge of critical skill shortages,” said Ali Raza, vice president and general manager for Honeywell Process Solutions’ Advanced Solutions business. “The expanded UniSim Competency Suite helps our customers train its workforce faster in a more realistic environment to drive safe, incident-free, efficient startups and ongoing operations.”
The UniSim Competency suite features proven simulation models as well as new technologies including:
- UniSim Operations: Operator Training Simulator (OTS), a dynamic plant simulation system that allows users to accelerate knowledge transfer by consolidating an entire lifetime of experience into a concise process training curriculum; features realistic process, control and safety systems modeling
- UniSim Curriculum: Customizable competency model that aligns and assists in improving critical requisite skills and behaviors; tracks operator progress; built from Abnormal Situation Management Consortium’s research into operator competency to help businesses define, deploy and manage a structured competency program
- UniSim Tutor: Knowledge capture and propagation tool; provides a repository for domain knowledge and experiences; teaches and evaluates “what if” reflexes and diagnostic abilities
- UniSim Field View: Interactive, navigable, panoramic view for realistic field operator training; uses actual facility photographs and extends UniSim Operations simulator training to include field operators
- UniSim 3D Connect: UniSim Operations simulator integration and connectivity to 3D virtual environment; provides credible and realistic experiences for field operator
“Industrial plant owners and operators around the world recognize how simulation technology can help them achieve a significant competitive advantage in today’s demanding global environment,” said John Roffel, Operator Competency product director for HPS. “This suite provides our customers with the confidence and tools needed for operator competency management.”
by Gary Mintchell | Feb 2, 2015 | Automation, Internet of Things, M2M, Manufacturing IT, Networking, News, Operations Management, Software, Technology
This report from Accenture looking at technology trends that will affect manufacturing among other businesses shows how people outside of the depths of automation, manufacturing, production arena are amazed by many technologies that we take for granted.
Check out the list of five trends, though. We already do some, but there are others that we will be adopting. Do you have your plans, yet?
Accenture report
Annual technology forecast highlights 5 technology trends affecting tomorrow’s digital businesses.
In its annual outlook of global technology trends, Accenture has identified a 180-degree shift to what it calls the “We Economy” that is re-shaping markets and changing the way we work and live. According to Accenture Technology Vision 2015, pioneering enterprises are tapping into a broad array of other digital businesses, digital customers and even digital devices at the edge of their networks to create new digital “ecosystems.”
These leading companies have already begun using technology to transform themselves into digital businesses and are now focusing on combining their industry expertise with the power of digital to reshape their markets. These businesses see great potential to make a difference – and a profit – by operating as ecosystems, not just as individual corporate entities, and driving the emergence of the “We Economy.”
This shift to the “We Economy” was confirmed in a related Accenture global survey of more than 2,000 IT and business executives, which found that four out of five respondents believe that in the future, industry boundaries will dramatically blur as platforms reshape industries into interconnected ecosystems. While 60 percent of those surveyed said they plan to engage new partners within their respective industries, 40 percent said they plan to leverage digital partners outside their industry and 48 percent said they plan to engage digital technology platform leaders.
“In last year’s Technology Vision report we noted how large enterprises were reasserting leadership in their markets by adopting digital to drive their processes more effectively and transform how they go to market, collaborate with partners, engage with customers and manage transactions,” said Paul Daugherty, chief technology officer, Accenture. “Now that digital has become part of the fabric of their operating DNA, they are stretching their boundaries to leverage a broader ecosystem of digital businesses as they shape the next generation of their products, services and business models to effect change on a much broader scale.”
The Accenture Technology Vision 2015 report offers examples of how, in the rapidly growing Industrial Internet of Things – i.e., the interconnection of embedded computing devices within the existing Internet infrastructure – companies are using digital ecosystems to offer new services, reshape experiences and enter new markets. This is supported by the Accenture survey, which found that 35 percent of respondents are already using partner APIs to integrate data and collaborate with business partners, with an additional 38 percent planning to do so. One example is Home Depot, which is working with manufacturers to ensure that all of the connected home products it sells are compatible with the Wink connected home system – thereby creating its own connected home ecosystem and developing potential new services and unique experiences for Wink customers.
Philips is taking a similar approach, teaming with Salesforce to build a platform to reshape and optimize the way healthcare is delivered. The envisioned platform will create an ecosystem of developers building healthcare applications to enable collaboration and workflow between doctors and patients across the entire spectrum of care. The ecosystem to achieve these improved outcomes is vast including electronic medical records as well as diagnostic and treatment information obtained through Philips’ imaging equipment, monitoring equipment, and personal devices and technologies.
Accenture Technology Vision 2015 notes that by tapping into digital ecosystems, Home Depot, Philips and other companies have the ability to grow and generate new sources of revenue in ways they could not achieve alone. The report also highlights five emerging technology trends that reflect the shifts being seen among the digital power brokers of tomorrow:
- The Internet of Me: Our highly personalized world. As everyday objects are going online, so too are experiences – creating an abundance of digital channels that reach deep into every aspect of individuals’ lives. The range of emerging channels that companies report they are using or experimenting with to engage customers includes wearables (cited by 62 percent of survey respondents), connected TVs (68 percent), connected cars (59 percent) and smart objects (64 percent). Forward-thinking businesses are changing the way they build new applications, products and services, and reaping benefits as a result. To gain control over these access points to individuals’ experiences, businesses are creating highly personalized experiences to both engage and exhilarate customers — but having to do it while making sure to not violate customer trust. The majority (60 percent) are seeing a positive return on their investment in personalization technologies. Companies that succeed in this new “Internet of Me” will become the next generation of household names.
- Outcome Economy: Hardware producing hard results. Intelligent hardware is bridging the last mile between the digital enterprise and the physical world. As leading enterprises come face-to-face with the Industrial Internet of Things, they are uncovering opportunities to embed hardware and sensors in their digital toolboxes and using these highly connected hardware components to give customers what they really want: not more products or services, but more meaningful outcomes. In fact, 87 percent of survey respondents acknowledged a greater use of more intelligent hardware, sensors and devices on the edge of networks, leading organizations to increasingly shift from selling products or services to selling outcomes. And 84 percent of respondents touted a deeper level of understanding of how products are being used and outcomes customers want resulting from embedded intelligence in products. These “digital disrupters” know that getting ahead is no longer about selling things, but about selling results. This is the new “outcome economy.”
- The Platform (R)evolution: Defining ecosystems, redefining industries. Digital industry platforms and ecosystems are fueling the next wave of breakthrough innovation and disruptive growth. Increasingly, platform-based companies are capturing more of the digital economy’s opportunities for growth and profitability. In fact, 75 percent of survey respondents believe the next generation of platforms will be led not by large tech companies but by industry players and leaders. And nearly three-quarters (74 percent) are using or experimenting with industry platforms to integrate data with digital business partners. Rapid advances in cloud and mobility are not only eliminating the cost and technology barriers associated with such platforms, but opening up this new playing field to enterprises across industries and geographies. In short, platform-based ecosystems are the new plane of competition.
- Intelligent Enterprise: Huge data + smarter systems = better business. Until now, advanced software has been geared to help employees make better and faster decisions. But with an influx of big data – and advances in processing power, data science and cognitive technology – software intelligence is helping machines make even better-informed decisions. This is the era of software intelligence where applications and tools will take on more human-like intelligence, according to eighty percent of our respondents. And 78 percent of respondents believe software will soon be able to learn and adapt to our changing world and make decisions based on learned experiences. The next level of operational excellence and the next generation of software services will come out of the latest gains in software intelligence, which will drive new levels of evolution and discovery, propelling innovation throughout the enterprise.
- Workforce Reimagined: Collaboration at the intersection of humans and machines. The push to go digital is amplifying the need for humans and machines to do more, together. The majority of survey respondent companies (57 percent) are adopting technologies that enable business users to complete tasks that previously required IT experts, such as data visualization. Advances in natural interfaces, wearable devices and smart machines are presenting new opportunities for companies to empower their workers through technology. This will also raise new challenges in managing a collaborative workforce of people and machines. Seventy-eight percent of the executives surveyed agree successful businesses will manage employees alongside intelligent machines – ensuring collaboration between the two. And 77 percent of respondents believe that within three years, companies will need to focus on training their machines as much as they do on training their employees (e.g., using intelligent software, algorithms and machine learning). Successful businesses will recognize the benefits of human talent and intelligent technology collaborating side by side – and will embrace both as critical members of the reimagined workforce.
“Rather than simply focusing internally, on improving their own operations, successful companies are looking externally to create and become part of digital ecosystems,” said Daugherty. “They’re beginning to see the importance of selling not just products and services, but outcomes — and that requires weaving their businesses into the broader digital fabric that extends to customers, partners, employees and industries.”
For nearly 15 years, Accenture has taken a systematic look across the enterprise landscape to identify emerging IT trends that hold the greatest potential to disrupt businesses and industries. For more information on this year’s report, visit www.accenture.com/technologyvision or follow the conversation on Twitter with #TechVision2015.
About the Methodology
Accenture’s Technology Vision is developed annually by the Accenture Technology Labs. For the 2015 report, the research process included gathering input from the Technology Vision External Advisory Board, a group comprising more than two dozen executives and entrepreneurs from the public and private sectors, academia, venture capitalists and startup companies. In addition, the Technology Vision team conducted nearly 100 interviews with technology luminaries, industry experts and Accenture business leaders. The team also tapped into the vast pool of knowledge and innovative ideas from professionals across Accenture, using Accenture’s collaboration technologies and a crowdsourcing approach to launch and run an online contest to uncover the most-interesting emerging technology themes. More than 1,700 Accenture professionals participated in the contest, contributing valuable ideas and voting on others’ input.
In parallel, Accenture Research conducted a global survey of 2,000 business and IT executives across nine countries and 10 industries to capture insights into the adoption of emerging technologies. The survey identified key issues and priorities for technology adoption and investment. Respondents were mostly C-level executives and directors, with some functional and line-of-business leads, at companies with annual revenues of at least US$500 million, with the majority of companies having annual revenues greater than US$6 billion.
by Gary Mintchell | Jan 22, 2015 | Manufacturing IT, News, Operations Management, Software
I no more had outlined the post generated from Tim Sowell’s latest blog post, when an invitation arrived to talk to the General Manager of Scott Fetzer Electrical Group (SFEG) and the CEO of ERP manufacturing software supplier Kenandy about an application based on the salesforce.com platform which is so easily configurable that even the GM can do it.
SFEG produces electrical products, such as motors, blowers, power supplies, transformers, and electromechanical timers, for large and small OEMs and distributors. Its products are used in products such as blenders, commercial printers, consumer appliances, and electrical signs.
Before deploying Kenandy, it had an on-premise ERP system, but the software was very difficult to use and was not agile enough to support their growth objectives.
Encumbered, not enabled
“Our business was encumbered by our ERP system, not enabled by it,” said Rob Goldiez, General Manager at SFEG. “The software was so hard to use that many people simply stopped using it. The data got stale. We wanted the benefits of a modern cloud platform that’s easy to use, has built-in social and mobile capabilities, and is always current with the latest version of the software.”
SFEG wanted to modernize their operations to support business automation and robotics. They also plan to add features to their product that require the support of a cloud-based system. Kenandy enables them to quickly respond to best industry practices and business innovation.
“Moving to Kenandy eliminates legacy challenges and allows us to focus on quickly growing and extending functionality,” said Goldiez. “We’re excited that we’ll be able to use Kenandy to support innovations, such as enabling our products to be connected over the Internet. We’re committed to living and breathing our innovation vision throughout the company, and Kenandy is integral to that vision.”
Since deploying Kenandy in November, SFEG’s operations have become more efficient. With the previous system, SFEG’s controller required physical signatures on purchase orders. With Kenandy, the process is managed through an automated approval process. SFEG also uses Salesforce Chatter to attach conversations to their sales orders and purchase orders, keeping all the related information together for easy reference. The employees enjoy using the system so the data is always current. They also appreciate the real-time visibility into the business, which helps them make decisions more quickly.
“SFEG’s story is not an uncommon one. Because legacy ERP systems are difficult to use, manage and upgrade, they’re written off as a burden by many users,” said Sandra Kurtzig, Chairman and CEO of Kenandy. “Since Kenandy is built native on the cloud, it offers flexibility that just hasn’t been available before. Modern enterprises need an ERP system that helps them adapt to the needs of their business as quickly as possible.”
SFEG was also interested in Kenandy because it’s built on the Salesforce Platform. They were attracted to the ease of customization, the strong reporting tools, and the robust security down to the field level. They also knew they would benefit from the third-party apps available on the Salesforce AppExchange.
“I evaluated other cloud-based ERP systems and Kenandy really stood out. There was nothing else out there that could compete,” said Goldiez. “We also wanted a system that would be easy to implement. We were up and running on Kenandy four months after signing the initial agreement. That’s fast!”
Kenandy met all the key criteria for SFEG’s new ERP system including:
- Ease of use for technical and non-technical staff
- Customizable workflows and approvals
- Real-time, tailored dashboards and reporting
- Customer portal to allow direct access to status and shipping updates
- Collaboration to facilitate communication around orders
- Mobile interface for anytime access to the system
- Business rules enforcement
Goldiez told me in a follow-up interview, that just about everyone in his plant touches the new system. The old system? Well, there were two “experts” who worked with it, but it was so hard to get into that most people didn’t bother. Not only that, SFEG’s system was tied to a paper report system. Another inflexible and cumbersome preventing widespread use.
Using the configurable cloud-based system is so convenient, that when someone needs a new report or feature, Goldiez can configure it with no need for special work orders through IT.
He said that today there are lots of eyes on the system. People are accountable to the data they are supposed to be managing. It is easier to use since it has a familiar interface.
Kurtzig added, “Millennials are coming into the workforce. They need software as easy to use as Amazon. They have higher expectations—and they also expect to use mobile devices.”
Because the application resides in the cloud as Infrastructure as a Service, new business rules and updates can be added without destroying the core and disrupting use.
