Globalization vs Continentalization, the world is shifting to Continentalization

Listening to a discussion on supply chain logistics panel, then follow the debate with some leading logistic thinkers and companies, and then stepping back you start to see a change to focusing from Global outlook to a Continental outlook, and networks of supply chain. When you listen to logistics thinkers, the cost of fuel, and changing climate conditions with increased storms, and the increased requirement for speed and reliability of delivery to end users is driving change in thinking to how to build efficient continental value networks.

Brand loyalty is decreasing, while convenience of consumption increases in buying behavior. The fact that I need to consume a product now and the ease buying, plus price will lead me to alternative products. In the 2000’s, we had a change to Globalization this is still happening in companies acquiring other companies and will increase, as people change to consume, buy online, but now comes the challenge of fulfillment in a timely and cost effective manner. Sourcing in low cost countries is becoming risky and costly due to transport costs, and distance, and since 2006 we continued to see a rise in transport costs, and environmental responsibility that adds to cost.

To address this, we seeing a move gradually to a continental value chain reducing distance some reducing time and uncertainly/ risk of delivery.  Also reducing cost through short distances, and fewer segment changes. These Value supply chains do cross borders.

Increasingly the complexity and value of the return of Global value delivers less value, vs a tighter and more agile continental value chain. New product integration can fit the market; changes in that market are absorbed and adjusted to faster. So information networks, and operational landscapes that enable transparent view and action across the continental chain, awareness of situation and state, the ability interact faster and adjust is key. Already in the smart grid discussions you starting to see the ASEAN Grid a distributed / collaborative grid for the nations of ASEAN.  In the food / CPG industries, primary production will happen centrally in one or few places in the continent, with packaging and final end product manufacturing happening locally servicing the language vs country. The Business System, Product Life Cycle Management, Asset management, and value chain planning and scheduling done across multi value sites in a logically ONE production landscape.

From an industrial / manufacturing system point of view this shift still a holistic view, where a set of value generating assets and their systems, assets and people will be interlinked across set of interconnected service buses to satisfy the needs within a continent. The uniqueness of each site, will be maintained, but the alignment will now exist through this “loosely coupled but aligned approach”, with operational management cross the borders and taking this continental view. The scope of the projects should be more contained than a global view. Combine this with the creation of dynamic operational community with cultural boundaries within the continent, the education requirement reducing “time to experience/ performance of staff can scope to the continent, which will reduce time zone miss alignment, as well.

The Biggest Transformational Opportunity for Industry is the “Distributed and Collaborative” architecture IoT

Over the last couple of months, people have me what is the biggest change to the future I see as the shift to a distributed yet collaborative world of interconnected devices, applications, people assets and system. Yes, this is referred to as the “internet of Things” IoT others call it the Internet of Everything”, but the key is smart devices providing information, be able to interact with each other.

Some people look at change since 1993 when the internet was introduced the biggest thing to happen, but I believe the value, and paradigm step in the way we work, and do things in the industrial world and at home as we move to Internet of Things concepts will be a far more dramatic transformation. Key is the world will be distributed in action; vs centralized, yet things will collaborate and interact for faster decisions, and awareness.

“ARC Advisory Group uses the term Industrial Internet of Things (IoT) to refer to the emerging practice of connecting intelligent physical entities, such as sensors, devices, machines, assets, and products, to each other, to internet services, and to applications. Industrial companies can use information from these connected devices to lower costs, optimize processes, and transform their applications, services, or business models.”

 To be honest, this is not a new idea I remember working on some R & D developments 12 years ago around putting web servers into instruments, the concept was to expose information easily and in a standard way. It was too early for the rest of the infrastructure was not there. Today that it is different, with wireless now a normal concept in an industrial plant, the advancement of cellular networks from a data point of view with 3G and 4G especially in geographically distributed, providing the backbone for ability of devices to realistically connect with enough bandwidth. Combine this with the SOA “service orientated architectures and applications, and the rise embedded intelligence within devices, and mobile devices the opportunity is here!

“But is it a matter of just exposing everything to the internet and we have changed the world?”

NO, the issues around security who can see, who can interact with your devices, is key, this is still maturing and evolving in techniques and practices, but reality is closer than most people seem to realize. The next is context, and intelligence, while smart devices and instruments are reality for new installations these do not apply to existing plants which is the majority of the world. So how do you “intelligence enable” existing devices, assets and processes in the industrial world?

We seeing people increasing use the PLCs and controllers to add intelligence around devices like motors and pumps, conveyors etc. But also there is work happening in what people call “stranded assets” where electronic manual rounds that managed and planned now bring back regular data from these stranded assets, as well intelligent platforms coming into play, putting a layer of intelligent objects that add intelligence and “self awareness” to unintelligent devices. The key is that information from a devices transforms to deliver increased value through context, validation, and “situational awareness”.

ARC is referring to this as CBM (Connected Device Management) platform I suspect their definition is more narrow than mine, as I believe the Internet of Things is no just about information, but the action as well, but never the less it provides a foundation.

“Connected Device Management (CDM) platforms are emerging as pivotal, value-added components of the Internet of Things (IoT) architecture. These software entities -- used to manage intelligent connected products, devices,machines, and other assets -- reside between connected products or devices and the Big Data, analytics, cloud platforms, and other applications that reside at higher levels of the IoT architecture. “

 

The Key is that there is a layer needed between the analysis applications, and larger business/ operational decision makers and applications, and the devices of the industrial world. This layer needs to take devices from just information to “exception based” notification, and “self aware” devices to avoid overwhelming the Enterprise applications. But it is not just up, it is also across devices, in order to make a “self ware” notification, and intelligent device will have to talk to another device or devices to understand the full context of process etc. This introduces the concept of Internet of Things not just applying to devices but all to operational processes and their state, as well.

I saw an interesting application of this concept in the “Smart Grid” world of power that we needed to model and has as “living things” such things as “storms, fires, tides etc” these living entities need generate alarms, notifications etc. So key to this platform is that these intelligent objects are not data structures they are "living" entities providing data context, intelligent alarm, events and notifications and awareness of state relative to situation and surroundings.

This is an exciting topic of distributed, but collaborative “things” enabling faster real time decisions and actions across assets, process and people will provide the next level of opportunity. Aligning with many of the concepts of the “Third Industrial Revolution” with distributed micro power generation, with the interconnected intelligence across consumption, supply, storage in an economic growing structure, it too is the Internet of things concepts applied to change the world we live in.

Food for thought, and a good thread of thought for a series of blogs.  

 

Focus on "Roles being more effective" provides a potential path forward towards 2020!!

Last week I was engaged with a number major customers, in different industries, all looking at the future, and determining the next approach, and talking technologies and how to apply them. The companies have invested and executed on the tradition alignment in a plant across process systems, and also evolved their SAP business system. What concerned me was the throwing of technologies around like cloud, wireless, and mobile, and looking for how, instead of stepping back and looking at what are they trying to achieve, and then applying technologies to that plan.

It is important to note that, in both cases, their automation layer is mature and well established and that their business side is also well thought through and well on the way to being established on the second generation business system.

Again the opportunity of significant improvement and gain in operational efficiency is at the operational layer across multiple facilities. Again the role of people and enabling decisions in real-time are key but not just decisions but a consistency in action in the operational control loop.

The question of where to start came up, and through the discussion the opportunity of stepping back and taking a look at the roles that an operational plant will require from the roles in 2020 to execute. These roles could be on site or off site, through the concept of the “flexible operational team”. Define the role, the day in the life of that role taking into account location, what decisions and actions that role is responsible for and who and what he will interact with through the day. Yes, switch into a “Facebook” thinking of friends, but friends maybe people, (other experts) Assets, Processes, even products. Once this map of a decisions and responsibilities during the day is defined, this drives what information, systems and people this role must interact with in a day. It will also determine what operational procedures (Operational Activities) the role will potentially engage.

This role map is key as now you have a starting point, as to driving consistency in a dynamically changing workforce. Combining these role map, composed of “operational activities” associated with the role, where the activity has the required notification, information, actions, community of expertise etc. and architectural landscape so these “operational activities” can compliment existing systems.

The architectural landscape should define the layers on top of existing systems, in a neutral way, where these operational activities (model driven approach) will reside, these could be local or remote hosting but will require clear governance and require models to defined in an environment that enables constant evolution of the practices but process experts locally and centrally as a “crowd development”, with governance control.

This focus on a role or set of key roles allows the company to focus on how the operational plant will run in 2020 and the key decisions that required, and start applying these now in an architecture that lives with the current systems, but starts to drive consistency and faster decisions across that same role over multiple plants. Notice I have not talked technologies, my assumption on mobile and cloud that the architecture is set up so these activities will be able to execute independently of the device, so the adoption of what devices are used on a plant are relative to plant and support they get, key is the devices no matter if desktop or mobile or web should be suited to efficiency of the role execution.

The clear opportunity is the linking of smart/ intelligent assets to people, and optimized process, and this is the essence of distributed industrial systems of the future on which “Internet of things’ / “Industrial internet” and the “third Industrial Revolution” are based. Key not getting overwhelmed with technology (it is here) it is the “job” or operational improvement that is the opportunity, and how to achieve this. A good starting point is understanding and achieving consistency in the key roles in the future vs the dynamically evolving workforce.

Is the day of I/O as the valid size measure of an Industrial Supervisory System coming to an end?

I would state "yes" to the end of I/O as a valid size of system between the controllers (DCS, PLCs smart devices) and the supervisory layer both operational control and information, historian.

No doubt some people are gasping when I say this, and this is a normal reaction from the tradition industrial market, but take a deep breath and step back and look at the modern world.

I/o is being commoditized by the fact that devices are becoming smarter, which means a factor increase in information coming from these devices to enable more effective operational management.

Examples:

·         Motor has gone from 5 to 10 I/O traditionally to now 100 +

·         Gas wells were a 2 years look at 50 points, I saw that same well logging 680 points

The list can go on, but in order to drive operational excellence devices will get smarter and more real time in context information is required. As we move into "Internet of things" in the industrial world where smart devices, processes etc. and linking into the system, talking to each other is key, again information is key.

So how can we say I/O is accurate or even a “ball park " metric for sizing a system. In many cases, companies are not increasing their assets that run their plants they are just increasing the amount information coming from existing assets.

So where is the value it is in the delivery of content, information, and enablement of effective decisions and actions to run the plant in the optimum way? Empowering system, people and applications to take a decision and action in a timely manner.

With the changing operational paradigm in from connected desktops to workers using a number of devices at once in the execution of the daily tasks where content can be displayed and interacted independently of the device. There is also a transformation in client applications e.g. traditional HMI (human man interface) to “Roles” and now the real shift to Operational Systems designed around "activities".

 

Yes, the world is changing and so must the industries metrics for licensing evolve to align with today's customer value indicators!

“Staying Evergreen” key to Cyber Security Strategy!!!

This week I spoke at SCADA Australia conference, where many of the leading companies in the SCADA, geographical industry, such as water, power distribution, rail etc. While the increased awareness of the empowering real-time analysis and decisions was discussed. The major discussions were around Cyber Security strategies and threats and virtualization. The surprise to me was the fact that the debates did not link these two discussions, and there was very gradual take up on virtualization.

This is very different to what we have seen elsewhere in the world especially North America and Western Europe where virtualization has become the default approach to the industrial architecture. People discussed the reason why people go to virtualization is a cost of servers, yes this is a factor but in most cases this is only a side benefit. The big advantage is the abstraction of the software application from the hardware and infrastructure.

Speaking with customers the linkage between Cyber Security and the need to stay current, not just patching etc, is becoming a main stay of their “sustaining” strategy. Many of the security fixes and improvements do not happen in patches,  but in point and major releases, this is with infrastructure software such as Operating Systems, and databases, as well as industrial software. So many leading companies are looking at architectures and deployments that enable their systems to stay “evergreen” eg on the current releases. The advantages happen in security but also in general cost of sustaining the system so you do not end up with major application jumps.

So I ask myself why you would not employ standard architectures on a virtualized platform, allowing hardware to evolved and for high availability architectures to allow upgrades of software and minimal time to switch over from the running version to new version, plus providing an environment for testing. Many of you will say that is what we doing, but within the last 6 weeks in eastern / central Europe, ASEAN and Australia I have seen a reluctance to adopt virtualization this I would understand if we turned back the clock 4 to 5 years ago, but the technology is very mature today, and well proven.

The other trend happening is the move away from customization and everything to configured, using standard tools and capability. This is key to enabling applications to stay evergreen, the advantage of customization vs cost to sustain is just not worth it. A solution architecture decision should not an event, it must be a journey, with the key consideration of operational continuity will be sustained which maintaining the systems in an “evergreen” state.