Thursday, December 31, 2015

Smart Manufacturing: What if they threw a revolution, and nobody came?


Pizza party at your house,I went just to check it out

Nineteen extra larges, 
What a shame, No one came

A Complicated Song” by Weird Al Yankovic

Let’s face it: the promises of Smart Manufacturing just aren’t being realized by the majority of manufacturing organizations. For the most part we aren’t seeing the improved productivity, optimized production, higher levels of safety, enhanced security, accelerated decision-making, reduced regulatory effort, or faster market response times that current technology enables. Yet the trade publications continue to trumpet the coming revolution; it’s not hard to understand why many consider it to be all marketing hype by vendors who want to sell products.

The benefits of Smart Manufacturing are not phantasms – they are very real. Many large manufacturers in automotive, food & beverage, consumer goods, aerospace, and other industry sectors can testify to their success implementing these techniques. But a vast majority of enterprises are small to medium-sized businesses (SMB), and they perceive significant barriers to applying new technologies which some of their larger contemporaries have resources to overcome.

It isn’t unusual to find an organization with less than 100 employees that has no formal IT group. The application support they require is provided by third parties and knowledgeable internal staff. You’ll hear things like “Dave is our IT department” or “Mike is just a wiz with Excel”. These organizations are able to function successfully with IT point solutions, using applications like spreadsheets and personal databases to integrate point solutions into an end-to-end system. Even though it is inefficient, this unfettered pragmatism works well enough to enable them to compete in the marketplace.

Just as with IT, many smaller manufacturers also have no formal automation group. They rely on their machine builders and system integrators to provide PLC/PAC programming, SCADA systems, and other operational technology. You won’t usually find things like ISA88, PLCOpen, or B2MML specified by these companies. Again, pragmatism is the key driver in the requirements presented to third-party solution providers. If you ask them what standards they demand in the systems in which they invest, the response is typically “whatever the integrator decides is necessary”. Why would system integrators adopt ISA/IEC/ISO automation standards if their clients aren’t insisting they be used?

So here’s the situation in which most manufacturers (over 95% of all manufacturers are SMBs) find themselves: IT investments that were not strategically managed and legacy automation systems that were built to no consistent standards. (SMB’s shouldn’t get too distressed by this statement – many of your larger competitors are in the same boat in spite of having full-fledged IT and Automation departments). Now read the stories of Smart Manufacturing through the eyes of an engineer or manager in one of these companies. Connected Enterprise? IT/OT Convergence? Service-oriented architecture? Industrial Internet of Things? None of these seem applicable to their day-to-day operations. Is it any wonder the usual response is “You can’t get there from here”?

SMB’s have one great advantage over larger manufacturers: they can be extremely agile. What may be at first perceived as a barrier may in fact be turned to a competitive advantage – with the proper direction. Larger companies have a great deal more inertia than smaller ones: more machines, more legacy, and more politics. SMBs can quickly navigate around impediments if the benefits justify the effort. What’s missing from the big picture though is a discussion of the “on-ramp” for SMBs – how do they engage with the technologies which enable Smart Manufacturing – given their current state, competitive position, and available resources?

Smart Manufacturing initiatives have the support of governments worldwide, are discussed by multiple industry organizations, and are finding their way into the curricula of universities globally. But unless small-to-medium sized manufacturers figure out how to join the party, there will be a lot of leftover pizza.

Tuesday, December 8, 2015

You Say You Want A Revolution?


Smart Manufacturing is heralded to be the next industrial revolution; will small manufacturers benefit?

 I was recently doing some pre-work for a potential client – a smaller local manufacturer with less than 250 employees – when I noticed a machine operator holding a sheet of paper (a work order, I was told) and typing information into the performance management system. Curious, I asked why one digital system didn’t just share the information with the other digital system rather than the inefficiency of printing it out from one system, handling the paperwork, and then re-entering the information into the other system. After all, it is the 21st century and systems have been known to talk with other systems. I wasn’t surprised by the answer – they hadn’t really thought about it. The ERP and the performance management system each had represented major steps forward for this business, and they hadn’t considered how these two systems might work together.

My next step was to speak with the performance management software provider to find out how we might enable communication between the client’s ERP and their software to allow more efficient workflow. This provider caters to small-to-medium manufacturing organizations, and their response was such data exchanges were not possible with their software. Theirs is very much a point solution, and their client base was not asking for such capabilities. This is an interesting conundrum: Smart Manufacturing is all about the connected enterprise, yet smaller manufacturers (who comprise over 95% of the marketplace) are not demanding the capabilities from their system providers which make Smart Manufacturing possible!

Wise Up, Grow Up, Power Up

I can’t fault the solution providers; they will always give their customers what they ask for. Solution providers are aware of industry trends, but if features have no market demand they have no economic incentive to include those features in their products. It is up to manufacturing organizations themselves to stay abreast of the changing technology and how they might leverage it to their own competitive advantage. Fortunately there are industry organizations which can help with this; one example is MESA International. In regards to Smart Manufacturing, MESA has a soon-to-be released white paper entitled “Smart Manufacturing Demystified – The Landscape Explained”. This paper was authored by industry thought leaders from companies such as Rockwell Automation, IBM, ATS Global, PTC, iBASEt, Plex Systems, and Efficient Plant, and will help manufacturers of any size familiarize themselves with the concepts of Smart Manufacturing. Smaller manufacturers especially need to take advantage of this information and incorporate it into their strategic planning. Then they will be better informed when selecting system software, or when pressing the suppliers of their existing systems for new capabilities.

Organizations of any size go through a system maturation process – some even do it intentionally. MESA has modeled this as a four-stage growth sequence. At the initial stage, an organization exhibits application-centric thinking: every problem needs its own application as part of the solution. This has led to a proliferation of three & four letter acronym solutions built around common industry problem sets. Do you have an MES? How about a PLM? CMMS? EMI? SPC? QMS? At the next stage in the maturation process, organizations begin to realize there are commonalities between these applications, and begin implementing data governance and master data; they are demonstrating data-centric thinking. Then comes a realization that these applications cross organizational boundaries, and would be more valuable if their capabilities could be combined in different ways via an enterprise service bus. This stage promotes interface-centric thinking. At the apex of the maturation sequence is process-centric thinking; the confluence of systems and services to facilitate end-to-end process workflow. Studies at MIT’s Center for Information Systems Research have shown that organizations moving from the initial stage to the second stage reduce IT costs by 15%. Organizations which mature from the second to third stage save an additional 10%. But something interesting happens to organizations which grow into the fourth stage: IT spending increases because those companies are finding a significant increase in ROI and effectiveness. Smaller organizations often are not staffed to direct this maturation process, which means it occurs more slowly. Many have yet to transition from application-centric thought processes.

Another of the problems smaller manufacturers face is a lack of leverage when it comes to industry solutions. Let’s face it, a company with 20 employees just doesn’t have the same clout as one with 20,000. It can be hard for a small organization to get the attention of the providers. As in the case of my potential client, just one customer asking for features which allow better enterprise integration will not be enough for the solution provider to invest in making the changes. Two forces will motivate solution providers: the threat of clients switching to different suppliers and the ability to go after new market prospects. For small manufacturers, switching costs for existing point solutions are very likely high enough to preclude a serious threat to the supplier. A small niche manufacturing entity also is unlikely to influence a provider’s roadmap because of a narrow market, blunting that force as well. A third force is required: user groups. User groups have long been a staple of large software houses such as SAP, Microsoft, Autodesk, PTC, and Oracle. These groups collaborate with the solution providers to help map the future state of their products. Small manufacturers who wish to have a larger voice in the direction their technology investments take should participate in user groups. If such a group does not exist, it is easy enough to create one via social media (meetup.com, for example).

If small-to-medium sized manufacturers wish to benefit from the coming Smart Manufacturing revolution, they need to wise up by taking advantage of the information available in the manufacturing community, grow up intentionally through a directed maturation process, and power up through collaboration with technology users who have common interests.

Monday, November 16, 2015

The PLC is Dead; Long Live the PAC

Will your executive board be surprised at the cost of replacing your automation controllers?

Obsolete controls – every industrial organization deals with them. Whether it’s manufacturing, mining, oil & gas, water/waste water, or building automation, electronic controls don’t last forever and eventually need replaced. I suspect many companies are facing this issue now, particularly as it concerns their programmable logic controllers (PLCs). IEC 61131 (the international standard for PLC programming) was first introduced in 1993, and standards-based devices soon followed. Many of those devices have been in operation for two to three decades, which means we are now in the midst of first-generation controller replacement. This is sparking numerous conversations on social media, such as this one on LinkedIn’s Automation group forum: “What about automatically converting PLC software from one system to another”.

It’s clear we are reaching the end of the era where machines were isolated cells of production; modern automation is expected to be far more integrated into the business processes in ways first generation controllers were not capable – leading to “programmable automation controllers” (PAC). They must provide data to facilitate maintenance. They must interact with enterprise resource planning, manufacturing operations management, and product lifecycle management systems. They may be required to collaborate with other machines, materials management systems, robotic systems, and quality management systems as well. Automation controllers are no longer limited to managing machine behavior – they have become core components of manufacturing intelligence.

Obsolete controls are an example of what’s known as “technical debt” in the information technology world becoming exposed in the operational technology field. When a device (a PLC, for instance) is first commissioned, it begins to accrue a debt that will eventually need to be paid. The environment around the device changes, changing the problem set for which the device was the intended solution. Sometimes an organization will elect to re-engineer the process to adapt to changing conditions, but the more typical response is to “tweak” the system and delay the eventual expense and effort required, increasing the debt payment. Just as with financial debt, this isn’t necessarily a bad thing – but unmanaged debt usually leads to undesirable consequences.

In operational technology, technical debt has broader reach than is first apparent. Beyond the cost of the controller, the software to program/maintain it (plus the training to keep personnel current), and reprogramming/commissioning costs, there is the surrounding infrastructure to consider, from I/O wiring to networking to support servers and services (OPC, revision control, etc.). Modern controls are typically accessible via a corporate network, even when isolated using technology such as V-LAN or DMZ; security has become a greater concern. There are also newer industrial standards which should be included as part of the debt analysis; it isn’t just the controls hardware which has become obsolete. There are modular programming standards (ISA-88/IEC 61512), integration standards (ISA-95/IEC 62264), and automation system security (ISA-99/IEC 62443) which should be incorporated as part of a complete controls update program. The standards continue to evolve as well; the ISO Automation Systems and Integration Technical Committee (TC-184) is working to adopt the ISA/IEC standards as well as adding standards around robotics and industrial data management.


Obsolete controls programs should cause industrial organizations to pause and reflect on their operational strategies; what do they want their production processes to look like five to ten years in the future? What will their competitor’s processes be like then? Such questions will have an impact on decisions such as “do we spend the time to re-write the PLC code for a new processor, or do we just do the minimum work required to fit the new device into our existing processes?” If those questions are not asked, automation managers will choose the most direct route to keeping production processes operational. They will elect to increase the technical debt.

Thursday, October 22, 2015

Bridging the Skills Gap with Automation

Old bridge in the city of Koblenz, going over the Mosel river by Cristina Sarasua. Courtesy of WikiCommons

There are three significant trends with which manufacturers need to come to terms.  The first is the skills gap. According to a 2014 report jointly authored by The Manufacturing Institute and consulting firm Deloitte:

“Over the next decade, nearly three and a half million manufacturing jobs likely need to be filled and the skills gap is expected to result in 2 million of those jobs going unfilled.”

The breakdown of the job requirements is over three quarters due to “baby boomer” retirements rather than business growth; manufacturers will see a significant amount of experience exiting the labor force over the next 10 years. They are also finding the available labor pool lacks the necessary skills in science, technology, engineering, and math (STEM), in problem-solving capabilities, and in basic technical training.


The second trend is technology adoption. Manufacturers are approaching the end of the first generation digital automation, which according to Jim Schindler of Litzler Automation, was essentially characterized as “relay replacement”. Modern automation has far more capabilities than the devices which are now going out of service. There is an interesting dynamic in digital automation; the control devices themselves (PLCs and CNCs, for example) are not subject to Moore’s Law – they are expected to provide reliable service for 20 years or more. It is not unusual for a PLC to be active for over 30 years. But digital automation exists in an environment very much subject to Moore’s Law. As the first generation of automation gives way to the next, manufacturers are discovering that simply swapping the new devices for the old is inadequate; there is an expectation of tapping the business value of the capabilities of the new technology.

There is an effect of Moore’s Law on automation technology though; it places a pricing pressure on the control devices. To a very large extent, devices like the PLC have become a commodity – the true value comes from vendor support rather than technical capabilities. Costs for automation technology across the board – from controllers, to user interfaces, to advanced robotics – have fallen over the last decade. Interestingly though, this doesn’t seem to have caused an acceleration in the adoption of automation technology.

There is a fascinating article entitled “The Automation Myth: Robots aren’t taking your job – and that’s the problem” by Matthew Yglesias. He argues that the evidence of increasing automation adoption would be an increasing GDP per hour worked and a decreasing hours worked per worker. He points to a report showing both metrics are essentially flat over the last five to seven years and concludes that manufacturers are not adopting technology as they should.

 Demos Report


In a related article in the Harvard Business Review, there is a significant difference between the productivity of “frontier” organizations (those that are integrating new technologies) and everyone else, which is an obvious competitive advantage for those organizations.

"Productivity Is Soaring at Top Firms and Sluggish Everywhere Else", HBR, August 24, 2015

The third trend impacting manufacturing is “Smart Manufacturing”. This has been referred to as “the next industrial revolution” and “the fourth wave”. This is all about utilizing the leading edge technologies of Social, Mobile, Analytics, Cloud, and the Internet of Things (SMACIT). According MIT’s Center for Information System Research (CISR), it’s not any single technology that is causing business disruption but an amalgam of all these technologies working together to provide business benefit.

There are several national initiatives across the globe to utilize the disruptive force of these technologies. Here in the US, there is the Smart Manufacturing Leadership Coalition. In Germany, it’s known as Industrie 4.0. In China, it’s called “Made in China 2025”. What is clear is that nations are expecting technology to significantly affect the productivity of their manufacturers and are working to ensure they remain competitive.

How should manufacturers respond to these trends? Obviously workforce development is necessary, but by itself is insufficient to allow manufacturers to remain competitive. Skills can be taught, but will not replace experience. Also, some skills have low market demand – not that they aren’t important, but without demand there will be little incentive for people to develop those skills. Finally, skill development takes time – often months to years – so there is no “quick fix” using labor force development to address the skills gap. Continuous improvement initiatives such as Lean provide some benefit, but tend to be asymptotic without innovation (“perfection” of the current state is an upper limit). Manufacturers should institute a two-pronged strategy for dealing with all three trends: workforce development and technology (automation) adoption. This should be done proactively, because a reactive approach will leave manufacturers at a disadvantage relative to competition.

Automation isn’t just for machines either. Mechanical automation does eliminate a great deal of human labor, and the capabilities of modern technology (robotics and additive manufacturing, for example) allow a much broader spectrum of tasks to be automated. But there is another category of labor inefficiency which also benefits from automation: work processes. Think about all the lost time in paper-handling and manual data exchange (a human transferring information from one form of information technology into another). Think of processes such as project time tracking, new customer account setup, product data management, purchase requisitions, capital authorization requests, and other processes that keep an organization running. These processes are frequently manual, using paper forms, and require either routing through an internal mail system or (to expedite matters) having someone walk the form through the process steps. This kind of inefficiency impacts workers who are among an organization’s highest paid: engineers, managers, accountants, supervisors, directors, and senior executives. Fortunately, automation solutions for work processes are far less capital intensive than mechanical automation, and are well within reach of most manufacturing organizations.

The skills gap, technology adoption, and Smart Manufacturing; these trends will affect all manufacturers within the next decade. The marketplace will be the ultimate judge; organizations which respond strategically to these trends are likely to succeed. Those that don’t will struggle in the new competitive environment that is developing.

This blog post is an excerpt from “Bridging the Skills Gap with Automation”, presented to the Cleveland Engineering Society at their October 21st, 2015 Industrial and Manufacturing Conference at Case Western Reserve University in Cleveland, Ohio. This was co-presented by Patrick Weber of Integrated Automation Consulting, Jim Schindler of Litzler Automation, and Mark Orzen of Clear Process Solutions.

Are your operations ready for the next wave of technical innovation? Find out! Register on Integrated Automation Consulting’s website and receive your free copy of “Seven Warning Signs that Your Manufacturing Operations are Becoming Obsolete”.




Friday, October 2, 2015

What Keeps Manufacturing Executives Up at Night?


October is manufacturing month in Ohio, and here in the Northeastern part of the state that means a broad variety of conferences and seminars specifically targeting manufacturers. Kicking things off this year was the Crain’s Cleveland Business/MAGNET “[M]Power Manufacturing Assembly”. One session at this event was a panel discussion entitled “What Keeps Northeast Ohio Manufacturers Up at Night?”, featuring three area CEOs.
The responses given by these executives reflect the concerns of many manufacturers: attracting and retaining the “best and the brightest”, the economic climate, the effects of government regulation, capital resources, and “losing our mojo” (is culture scalable with growth?). They touched on two areas which caught my attention: losing the high-tech edge and dealing with the skills gap.


“What has happened to all the tool and die guys?”, asked Steve Peplin, CEO of Talan Industries. “With all the downsizing going on you would think there would be plenty of them available, but we’re just not making them – as a country. We’re kind of forced into having to build some of our own.”


“It’s not short-term”, added Ramzi Hermiz, CEO of Shiloh Industries, “It takes a long time [to internally train the skills].”


The tool and die making profession is just one example where the skills gap is hitting manufacturing. At the publication of a 2012 Congressional Research Service report[1], the average tool and die maker was 52 years old (which puts a very large percentage in the “near retirement” category), and few replacements were available in the labor pool (this is still true in 2015). International competition, new technologies, and two recessions had forced closure of over one third of all the U.S. tool and die shops by 2010. The skills needed for this trade have also changed considerably; the market now requires an understanding of CNC programming, CAD modeling, and product lifecycle management (PLM) or product data management (PDM) systems, skills which many older workers don’t possess.


“The crisis we face is in STEM (science, technology, engineering, and mathematics) education…I would argue that if we look at technological game-changers like additive manufacturing and the Internet of Things, the whole work force is going to have to become numerically literate. We’re going to have to make sure the craft workforce as well as the college workforce have numerical literacy”, stated Dr. Michael Heil, CEO of Ohio Aerospace Institute.


Dr. Heil’s comment shows how closely bound the fear of losing a high-tech edge is to managing the skills gap. One of the major trends in manufacturing is digitization. The first generation of digital automation – isolated PLCs, CNCs and other devices – is being replaced by networked versions which are more tightly integrated into the organization. These devices can interact with higher-level systems such as ERP, MES, and PLM as well as collaborating with each other, creating new capabilities which has sparked initiatives such as Smart Manufacturing here in the U.S. and Industrie 4.0 in Germany, as well as an Industrial Internet of Things. But successfully utilizing these technologies will require that executive management also become more digitally savvy, for they will need to establish a vision, create strategies, and nurture a culture of innovation within their organizations.


Here in the northeast Ohio area, there are many educational institutions which are striving to meet the demands of manufacturing. I recently had the opportunity to tour the Cuyahoga Valley Career Center, and was impressed with what they are doing to prepare high school-level kids for careers in industry. They have a broad array of industrial robots, CNC machines, PLC programming, some 3D printing capabilities, engineering design, and networking – all skills which will be needed in a digital world. Local engineering schools also expand their curricula to include many of these skills as well. But I can’t help wondering what happens when these students get into the workforce and discover that the level of technical innovation within many manufacturing organizations lags far behind that which they experienced in their training. Is it any wonder manufacturing executives are losing sleep?



[1] “The Tool and Die Industry: Contribution to U.S. Manufacturing and Federal Policy Considerations”, Bill Canis, March 16, 2012

If you’re in the NE Ohio area on October 21st, why not join me at the Cleveland Engineering Society’s Industrial and Manufacturing Conference? I and co-presenters from Clear Process Solutions and Litzler Automation will be discussing “Bridging the Skills Gap with Automation”.

Are your operations ready for the next wave of technical innovation? Find out! Register on Integrated Automation Consulting’s website and receive your free copy of “Seven Warning Signs that Your Manufacturing Operations are Becoming Obsolete”.

Thursday, September 10, 2015

Innovate, Integrate, Motivate: The Cleveland Engineering Society

Recently I have been working with The Cleveland Engineering Society (www.cesnet.org) to develop its annual Industrial and Manufacturing Conference and Tradeshow (October 21st at the Case Western Reserve University’s Tinkham Veale Center). If you are a manufacturer in the Cleveland/Akron area, this is an event you will want to attend – here’s why:

·         The theme for this year’s event is “Innovate, Integrate, Motivate”, and the CES event planning committee has put a great deal of effort including each of these concepts into keynote and breakout presentations, with a specific focus on manufacturing. You will hear local thought leaders discuss topics related to innovation, quality, process efficiency, and resources.
·         You will have the opportunity to network with your peers from other manufacturing organizations. The information presented at the conference will provide good conversation starters, and will give participants the chance to share insights, opportunities, and concerns that they can use to help move their own organizations forward.
·         You can tour CWRU’s “think[box]” in its new space. Think[box] is a wonderful resource of which area manufacturers may not even be aware. CWRU provides access to 3D printers, computerized routers, a circuit board router, photo tables and more. This will be a great opportunity to learn how your organization can take advantage of this resource to help you innovate – without making investments in cutting-edge technology. See http://engineering.case.edu/thinkbox/ for more information.
·         You can meet representatives of several local engineering products and services providers – all in one place. The trade show typically draws suppliers of automation equipment, engineering consulting, specialty coatings, machine builders, and other vendors with a depth of experience in manufacturing.
·         Professional Engineers can earn 5 continuing professional development (CPD) hours for attending this conference, but other professionals can gain professional development credit as well. For example, project management professionals should be able to claim professional development units (PDUs) for self-directed learning for attending keynote and breakout sessions.
·         You will be supporting the Cleveland Engineering Society (CES). This organization has been part of the fabric of Cleveland and Northeast Ohio since 1880. You will be contributing to not only our local heritage, but to our future as well. Engineers are fundamental to the long-term success of manufacturing, and CES is a great resource for inspiring and developing engineers in our area.

The cost for this conference is very reasonable, and it is local! If one day is too long, you may choose to attend either the morning or afternoon session. If you are interested in exhibiting at and/or sponsoring the event, there are still opportunities available (better hurry though, spaces are going fast). You can register for the event on the CES website at http://cesnet.org/EventDetails/482. I will be there, and I hope to see you there as well!

Friday, August 21, 2015

Are Your Manufacturing Operations Obsolete?
























How can you determine if your manufacturing operations are no longer competitive?  There are telltale signs if you know how to look for them.  The following excerpt from “Seven Warning Signs That Your Manufacturing Operations Are Becoming Obsolete” gives one example:
□ Your operations cannot run without spreadsheets
If as an operations manager you walked onto a plant floor and saw equipment patched with duct tape, you’d probably read maintenance the riot act.  “Temporary” patches have a tendency to become more permanent than anyone intended, and soon a “we’ll just make do” attitude sets in. Just as with production equipment, your production work processes can get temporary patches which end up becoming permanent.  Excel is the duct tape of information technology; as with duct tape, there are times it is appropriate, but it should not become the primary solution for information sharing.  The preponderance of spreadsheets is evidence that your underlying systems are not meeting the needs of your organization.  Because your workers require the information, they will build work process patches using the tools they have on hand; typically this means spreadsheet software, but it may also encompass personal database tools such as Microsoft Access.  People creating these solutions are not in your IT department; they are your engineering, management, accounting, procurement, and logistics staff. The time they are spending developing these stop-gap work process solutions is time they are not spending engineering value-adding solutions, coaching your workers to improve productivity, speeding up the accounting workflow, reducing your purchasing costs, or finding better ways to get your product into the hands of your customers. 
It’s easy to dismiss correcting this problem; common arguments usually center around definable payback and “soft” savings versus “hard” savings. Without a thorough analysis, an organization cannot know the price it is paying for the inefficiencies of its work processes. In addition to downtime, idle time, waste and scrap, the work involved in ineffective information management has become part of what quality guru Armand Feigenbaum termed “the hidden plant”. Unfortunately, this is also an inefficiency that is almost never tracked, and it impacts an organization’s highest-paid workers.
Further reading: “How Many Spreadsheets Does It TakeTo Run A Fortune 500 Company?”
Want to learn about other ways to determine if your manufacturing operations are becoming obsolete? Sign up for Integrated Automation Consulting’s newsletter and download your free copy of “Seven Warning Signs That Your Manufacturing Operations Are Becoming Obsolete” today.

 MESA-Recognized Practitioner