New World of Work will be center to Factory of the Future

Last week at a conference, a couple of my colleagues and I had the opportunity sit and debate the changing world order that will make the “factory of the future”. The three of us are involved in the major opportunities we see in the market and it provides us the real opportunity to engage with companies with transformation plans, and engage with thought leaders. We decided to approach the discussion of the future factory by approaching it from different industries, as well as markets.

Sure enough we ended up aligned on the core to the “factory of the future” will around what two companies labeled “New World of work”. I have mentioned this many times in this blog around “smart operational work”.

We were able group companies who looked at the future thru "new technologies" and how they could apply them, (I seem to visited a number of this type in the last month) vs those companies that we believe will be the leaders with the successful approach of “how they must operation, work” in the new world.

We defined the new world means the next 5 to 10 years with characteristics of:

•       Brand loyalty at customer reducing, so “Brand Promise” is key
•        Agility to satisfy is key
•        Shrinking mid tier market as the larger companies continue to consolidate to address the supply of new products and service markets. (especially in consumer products).
•        Dynamic workforce where workers rotate locations/ roles, experience in a role will be less than 2 years.
•        Supply chains with limited inventory requires transparent/ agile manufacturing across the sites.
•        “Constant Change” in assets, process, people, products is the natural state in the 2020.

The diagram below is an interesting on Agility:

The Sense of time shortening causing the decisions, lifetimes of products and lines and roles getting for ever shorter. The ability to rapidly introduce, change in not just product but also delivery, and supply is key in order to satisfy.

The fact that each of us engaging different industries such as oil and gas / process, to consumer manufacturing saw the core catalyst the leading companies have identified as the transformation in the way their company must react, capture and execute work. Shifting from isolated plants, and people to teams of plants and people that work as an aligned operational team to achieve a goal.

The “New world of Work” is fundamental built on :

• New ways of working with dynamic workers that share, collaborate and are connected but assume experience from the system, they trust the system
• New Processes around agility, new product  introduction that leverage the skills and approach of the “digital Native” collaborative worker, combined with new technologies to enable new processes and operational awareness. The ability to see situations early, continue to learn, and act fast to changing conditions is key.
• New technologies provide the opportunity to deliver these new ways of working, with new processes. The likes of leveraging the data, through “big data” to use the past to determine the future in a natural manner. The industrial internet of things (industry 4.0) will enable smart devices providing new levels of embedded autonomy in machines and processes, shifting workers to “exception based” management, but with greater responsibility.

The diagram below shows this shift, which will require different tools and approaches.

So as you look at your plans, are you stepping back and looking at the way you will work, then understanding the profile of operational team, how they will developing the processes to satisfy this work and required agility, and then looking at what technology you can leverage to accelerate the success in a sustainable and evolutionary way. This last comment is key as the natural state of the new world is one of “change” and the systems and culture must be able “master” naturally.

Accelerated Training is the only way to Deal with Dynamic Workforce Paradigm

As time period workers are in a role and especially a site, the systems and culture of learning, interacting and gaining knowledge must change. This happens with the knowledge and learning coming from this system as the worker requires and prepares for executing a task, vs tradition class / face to face sessions.

Operations teams in a broad range of manufacturing have discovered that the workforce, especially operators, are changing jobs more frequently.  This challenge has become more important than the “aging workforce”, although this also contributes to the acceleration of turnover.  There must be a strategy which effectively trains operators faster than their turnover.

One part of training best practices is to continue the training throughout the operators’ work term, such as summarized in the following diagrams:

The right-hand diagram summarizes some amount of acceleration in benefits, where OTJ is on-the-job training.  While this acceleration appears to be attractive, this acceleration isn’t enough – the time to profitability is still several years.  So an additional strategy is necessary, as shown in the following diagram:

The above diagram describes a strategy of acceleration: instead of focusing on the basics, the training focuses on the dynamic aspects.  This means that the operators are trained as early as possible on “advanced” topics.

The power generation industry has developed a measure of operator excellence called “error free”.  It is a measure where loss of production or damage to equipment was identified with operator errors.  During the last 7 years, power generation companies have demonstrated up to 6:1 acceleration in achieving “error free” status.

The technical change in the training simulators is focused on simulating the dynamic aspects such as weather, supply chain demand and changes in raw materials.

OT/IT Convergence “What does it mean in the Industrial World?”

The convergence of Operational Technology and Information Technology is nothing new, it has been front and center certainly since early 2000. Where the Y2K challenge brought awareness in many organizations, how much server, IT like capabilities reside in the industrial automation/ operational landscape. But in the last 3 months I must have been pulled into 10+ workshops, sessions with companies where OT/IT convergence has been the leading point of the discussion. Determining how they are developing strategies to adopt, leverage the opportunity.

The diagram below shows a high level approach to how to “bridge” the different objectives of the two cultures of IT/OT. The success is not one taking over the other but the merger to achieve the combined value and objective. 

It is important to note that it is not a trend it is an opportunity due to evolution of technologies from IT/and OT that synergies and alignments are possible to provide opportunities too:

• ·         Increase operational and business alignment in real time
• ·         To alignment business across multiple plants and value chain
• ·         To accommodate the empowerment of knowledge workers through a combination of connected and mobile devices.
• ·         To leverage IT and Operational efficiency through common services, capability
• ·         To address growing demand of Operational Management, that has out grown the tradition OT capabilities and methods. Only a step change by leveraging capabilities in IT, with existing OT/automation capabilities will the requirements be satisfied.

The companies I have seen successful have also understood that a new culture is required and have formed a “Product IT” team composed of IT and Automation/operational people. This brings the critical understanding and cross learning so the above “bridging” strategies are a combined experience strategy.

Companies that determine where they want to be understand the critical nature of multiple platforms at different levels of the architecture, but “loosely coupled, but tight alignment” between them is key. Platforms are key to a sustainable architecture that allows agility over different plants and different work forces and processes.  

I will continue this discussion in the coming weeks as this topic is becoming fundamental to success of traversing the “operational transformation”.

The Paradox of the Growing Trend of Increasing Complexity in Industrial/Operational Solutions

I was discussing with a customer this week their systems, solutions, what was being asked of his team, and how even on a medium sized business and mature production processes the solution complexity is growing. He talked about the continued pressure of audits, regulations to satisfy government and just the consumer, combined with an increasing rate of " new product introduction" (npi). Yet production agility, timely actionable decisions, demands real time transparency into production, and across the supply chain.

Over two pots of tea we mapped out a high level functional landscape, his comment what happened to traditional  solutions. His comment was valid as the traditional supervisory solutions of 10 years ago, had transformed on the paper in front of us to "operational management architecture". With now an architectural landscape that connects to:

1.       Multiple vendor controllers and smart devices from ever increasing intelligent process equipment

2.       The range of people with different roles is increasing, in this example we have 8 different roles interacting with the solution, and taking actionable decisions

3.       The location of these people has shifted from the control room to every where, eg in the control room, roaming the plant floor, roaming the office, working remote outside the plant.

4.       Multiple applications that the system interacts with, has gone from to 7 This is not a big system, yes it is a batch system, but now cyber security, data transformation to deliver the correct trusted information for a role is available.

So complexity is increasing but the outlook is this will not change that business  will continue to demand more interactive, real times, collaborative, and transparent solutions in order to maintain competitiveness.

As seen below from an interview in North America, note the % of skilled and highly skilled roles, and the future additions of roles is in this skilled and highly skilled area:

So the complexity grows at a time when we have a transition to a less experience workforce, that will be in constant state of learning, and dynamic nature. In the conversation we talked about the team on his site, that he now had 50+ experienced and a junior engineer in his 20s. Fully capable but different, and less experienced on a site and role.

The diagram below shows the same people when trying to fill these skilled and highly skilled roles.

This is the paradox of today's dilemma facing engineers and operations, combine this with the demand projects with shorter project time, and that the system will evolve.

Now the control on the prices systems has not dramatically increased this is well defined and mature, it is the ability to absorb change that is key.

As we concluded our second pot of tea, it was clear the need to shift away from customer, home built solutions, away from customer excel sheets, to "off the shelf" solutions products that interact, can be easily configured and provide intuitive use, and learning, on an architecture that absorbs evolution and change. The discussion shifted to how transform their internal resources from internal customer code creation, to configuration, and acceleration of a more expansive solution building on their skill and knowledge.

The key walk away from this conversation, and why I shared it, was the realization by the customer that his approach to projects, and direction of addressing demands from operations needed a rethink in their approach, and using of existing staff, especially with the key experienced staff, and development of new staff. This included looking outside their own industry to potential significant advancements in addressing common operational approaches. 

The Steps on the Operational Journey from Siloed to Optimized to achieve Operational Excellence

We have all seen the debate on how do we go from todays manufacturing to an effective operational landscape, across the full valued supply chain. The increased urgency of this debate has become  recent discussions, I have with different companies; people are trying understand how they going stay competitive delivering the correct products, to the correct markets, locations, in the correct time, at the correct price and margin. All this with increasing costs in labor, energy, transport and regulation compliance.  

The common thread across the discussions was:

·         Real time transparency across all sites, and “cogs” in the supply chain.

·         Shift from “traditional reporting” to “actionable decisions”

·         Shift from operators to “Operational Teams” that align operations, planning and expertise

·         Shift from Siloed process on a plant or across plants to optimized and aligned.

·         Shift from experience in people to experience in the system

·         Alignment and consistency across the operational decisions and action for a product no matter location. 

Providing the foundation for optimizing and continuous improvement, not just of assets but process, assets, product production, and workforce.

Operations Innovation & Transformation – Transformation from Plants to an Aligned Multi Plant Value Chain

Examples in refining with multiple refineries aligning from individual plants, to "mine to Port" in mining where assets / plants that traditionally ran in isolation are now being transformed into a an agile value chain to reduce the production runs, increase the agility to chain products proceed across the sites to satisfy the market. The move to integrated operational centers (IOC)s is just one step, where planning and operations come into same environment to increase communication. 

The 4 quadrants described in the article “Operations Innovation & Transformation – the 4 Types” positions the upper left quadrant as a strategy for using a “value chain” of physical assets in a new way.

In this quadrant, a group of similar industrial operations (2 or more) adapt their performance objectives, business processes and accompanying hiring and information strategies to optimize the “value chain”.  The move is to unifying the industrial enterprise over multiple sites (in groups or as a whole), with a more holistic view in terms of operating strategy and performance management.

This innovation can be limited by the dynamic and range flexibility of some of the operations, but several corporations have achieved success with this.  One example is seasonal competitiveness, where the “chain” collaborates to achieve maximum throughput during the high demand season and maximum efficiency during the low demand season (efficiency and throughput interact differently across different groups of industries).  Another example is short-term business continuity, where the “chain” collaborates to exploit a supply or demand opportunity, or they collaborate to minimize the business impact of a supply chain problem, such as a major customer unplanned outage.  They all adapt their operations to meet a shared performance objective, such as yield or efficiency.

A key method used to sustain this strategy is operations-level feed-forward and feedback, with workflow for collaboration.  This doesn’t violate or compete with established business processes for planning, scheduling or other elements of supply chain management – in fact these strategies and business processes must work closely together.

This is a significant step beyond scorecards, dashboards or rigid workflows.  The following 2 examples show how real-time performance measures (different from traditional KPI’s) and proactive procedural automation sustain this differentiation:

·         A “value chain” of related industrial operations (one of the operations provides fuel and raw material to another) have some dynamic and range flexibility to “pace” together.  When a downstream site must slow down, the upstream site adapts its throughput of the entire site or the affected products during the duration of the slowdown.  As soon as the slowdown has ended, both sites resume their scheduled throughput and yield targets.

• Coordinators (different industries have different names for this function) use workflows to negotiate short-term upcoming changes in demand and the operating shift and the coordinators use the same visual demand, using a “tram line” display.  Information to the right of the center dashed line is forecast and planned.

The benefits include significant reductions in energy (excess energy is required to restore the high pressures and temperatures) and reductions in rework or waste.  Conventional equipment protection strategies aren’t adaptive and they are designed to handle the most extreme conditions, which is focused on safe interruption of operations.  Value-chain management focuses on safe continuity – both are valuable and necessary.

•       A “value chain” of related industrial operations (one of the operations provides fuel and raw material to another) have some dynamic and range flexibility to optimize the processing and use of fuels and raw materials in the downstream operations, such as the following example in petrochemicals and specialty chemicals.