Manufacturing Global – December 2018

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DE CE MB E R 2 0 18

Technology transformation and the future of manufacturing

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DIGITAL TRANSFORMATION THROUGH INDUSTRY CTO TILAK MITRA ON HOW THE TECH GIANT IS CHANGING THE DIGITAL LANDSCAPE

TRENDS FOR 2019

X.0

Achieving operational excellence with a digital factory of the future

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FOREWORD

I

n our lead feature this month, Accenture’s CTO Manufacturing (Industry and Industry X.0), Tilak Mitra, talks us through how the company is changing the digital landscape with its new Industry X.0 framework, which will allow organisations to leverage advanced digital technologies and transform their operations.

“It is important to develop products with a mindset that is not product first but instead is value-driven end-user experiences,” advises Mitra.

We also look to the UK where manufacturing makes up 44% of all exports, 70% of business R&D investment and employs over two million people.

Speaking exclusively to Manufacturing Global, Allan Graham, Managing Director of Duff & Phelps, showcases how technology will remain a key

player as the industry well and truly enters the digital age.

We also caught up with SSG Insight CMS Ian Dowd to discuss the rise of the smart factory. Delivering key insights across the manufacturing sector, smart technology enables businesses to make smart planning decisions and unlock value.

We also collaborated with Joanne Phoenix, Business Development Lead at Sensor City, to distill some of the key sector trends for 2019.

Don’t forget to check out our company profiles on Aerojet Rocketdyne, OSRAM and more!

Enjoy the issue!

Catherine Sturman catherine.sturman@bizclikmedia.com

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05

CONTENTS

10 Accenture

38

48

60

CONTENTS

78 OSRAM

96 Aerojet Rocketdyne

110

122

Sigmapoint

Walbar

138 Prometeon Tyre Group

10

ACCENTURE ­— DIGITAL TRANSFORMATION THROUGH INDUSTRY X.0 WRIT TEN BY

TIL A K MITR A

PRODUCED BY

ANDY TURNER

DECEMBER 2018

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ACCENTURE

ACCENTURE IS CHANGING THE DIGITAL LANDSCAPE WITH INDUSTRY X.0; A FRAMEWORK THAT UNDERPINS THE DIGITAL REINVENTION OF INDUSTRY, THROUGH WHICH ORGANIZATIONS LEVERAGE ADVANCED DIGITAL TECHNOLOGIES TO TRANSFORM THEIR CORE BUSINESS OPERATIONS…

T

hese are unprecedented and exciting times, an era in which the very fabric of human living is being reimagined and redefined every day by the

ways in which humans now get to interact with the ‘things’ 12

around them. The ‘things’ have been injected with life; life in the form of software-defined intelligence that can not only make the things ‘think’ and act smartly, but also connect and collaborate with other things and more importantly, with humans. Our social network is not just defined by our friends and relatives any more – there is a new class of friends, in the form of the ‘living things’ all around us.

Connectedness has been redefined – it is not only confined to just the 7bn+ humans anymore but is extended to include the 8bn+ ‘smart and living things’ that exist today.

Coexistence with smart living things has evolved into embodied cognition – our smartphones and cars are extensions of our character and profile and they seamlessly transfer the extensions when moving away from one and entering into the space of the other. The rate at which things are getting smarter and connected is staggering.

Gartner projects there will be in excess of 20bn smart DECEMBER 2018

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w w w.ma nufa c t uri nggl o b a l. com

ACCENTURE

and connected things by 2020. There

centered worker and end-user experi-

has to be a structured and methodical

ences, and ultimately to drive innovation

approach to manage this exponential

and growth. New levels of operational

growth of our connected ecosystem

efficiencies are harnessed – in the core

such that the inclusion of the new class

business operations of research and

of ‘smart and living things’ into day-to-

development (R&D), engineering,

day life, is focused on increasing human

product design and manufacturing,

productivity and efficiency, and ultimate-

by leveraging advanced sensors and

ly improving our lifestyle. A framework

networks, and by embedding software-

is imperative to making this connected

enabled intelligence into integrated

ecosystem work for us.

products and services. Workers and

At Accenture, Industry X.0 is defined 14

customer experiences are reimagined

as such a framework that underpins

and redesigned through immersive

the digital reinvention of the industries,

and AR/VR technologies. Innovation

through which organizations leverage

and growth is accelerated – new

advanced digital technologies to

business models are formulated and

transform their core business opera-

revenue streams generated by unlock-

tions in order to reimagine human-

ing and harnessing the value trapped inside the ecosystem that is developed through connectedness.

One of the fundamental philosophies of Industry X.0 is to transform the core business systems and processes.

By introducing modern architecture patterns and principles, legacy systems can be modularized and modernized which then opens opportunities to

Accenture Industry X.0 experts spent the day talking to visitors about real use cases with industry examples at ITAP 2018

DECEMBER 2018

introduce digital technologies into legacy systems. The digital technologies (e.g. microservices, analytics and immersive

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CLICK TO WATCH : ‘ACCENTURE — REINVENT POSSIBILITY WITH INDUSTRY X.0’ 15 user experiences) introduce layers of

1. Transform the core – invest in

utilities that unlock the trapped value

digitization along with horizontal

from such systems and processes.

and vertical integration of enterprise

The value realization and operational

systems in core business operations

efficiency gains naturally lead to more

around R&D, product engineering &

viable cost economics. The savings

design, and manufacturing operations.

obtained can be subsequently appor-

2. Focus on experiences and

tioned to invest in rotating the business

outcomes – shift the business strategy,

strategy and innovation to the ‘new’ –

innovation focus, and core competency

an absolute imperative to sustain and

away from product centricity and into

thrive amidst the systematic digital

a needs-first true experiential platform.

transformation of everything. To

3. Rearchitect the ecosystem – to

consolidate, there are six foundational

identify, assemble and liaise with the

capabilities that should underpin the

right ecosystem partners to drive

digital business strategy to systemati-

innovation and differentiated capabilities.

cally rotate to a new digital business:

4. Innovate new business models – w w w.ma nufa c t uri nggl o b a l. com

MindSphere lets you speak with the Internet of Things Every machine holds a wealth of data.

MindSphere – the cloud-based, open IoT operating system – leverages this data and makes it available for advanced analytics.

siemens.com/mindsphere

Siemens’ MindSphere: Empowering the Industrial IoT revolution and digital enterprise Industry 4.0 is here

End-to-end digital twin

Around the globe, industries are searching for new ways to optimize operations, improve products, increase sales, and reduce costs and risk. Automation, digitalization and the adoption of the Industrial Internet of Things (IIoT) are key requirements for companies that are embracing Industry 4.0, as they seek to lower costs, drive new efficiencies, and find new business opportunities.

The ability to simulate, predict and optimize products, processes, and services before investing and deploying is now a reality with performance data and insights from MindSphere. Creating digital replicas of physical assets, processes and systems, by using data from multiple sources, allows near-real-time representation of how IIoT devices operate throughout their lifecycle.

During the race toward IIoT, however, some have struggled to unify disparate assets that lack standards or a universal method of connection. Enterprises are faced with proprietary and legacy applications, on-premises infrastructure, and piecemeal solutions that can be barriers to transforming and reinventing their business.

With Siemens’ portfolio of solutions to deliver a complete end-to-end digital twin, rapid and efficient prototyping and accurate modeling empower closed-loop feedback and continuous optimization of new products, production, and performance—at minimal cost.

Enter MindSphere MindSphere is a cloud-based, open IoT operating system developed by Siemens, that enables industries to easily connect machines, devices, and physical infrastructure to the digital world. With extensive device and enterprise connectivity, MindSphere enables powerful industry solutions with advanced analytics, as well as complete digital twin methodologies and tools throughout the value chain.

Transforming big data into smart data The MindSphere operating system allows you to quickly connect, bring data into our operating system, and then build applications that can turn that data into business value.

“The MindSphere team at Siemens is very excited to be working with Accenture as a MindSphere Platinum Partner. The Accenture Industry X.O vision fits perfectly with the transformative business opportunities of introducing Siemens’ MindSphere IoT operating system into client environments.

Partnering with Accenture gives Siemens the ability to leverage MindSphere with Accenture’s outstanding integration abilities and deep industry knowledge, to help enable our clients’ digital transformation journeys.”

Paul Kaeley Senior Vice President Global Partner Ecosystem Siemens PLM Software

Applications

Accelerate digital transformation With an end-to-end IIoT digitalization approach you gain: – – – – –

End-to-end IoT security Managed service platform Extensive connectivity options Open platform-as-a-service Multiple IaaS in public, private, hybrid cloud and on-premises – Advanced analytics – Global scalability

MindSphere Connect

Companies connecting physical assets and IT systems to the digital world are already reaping the benefits, sharpening their competitive edge, and realizing greater performance and profitability. It’s never too late to begin or accelerate your digital transformation journey, and MindSphere can help you harness a new world of IIoT potential.

siemens.com/mindsphere mindsphere.io/partner Note: MindSphere is a registered trademark of Siemens AG.

ACCENTURE

by offering consumer experiences,

more than a moment; what is 4.0 today

leveraging industrial consumerism

is quickly going to progress to 5.0, to

patterns to disintermediate and reach

then 6.0, and counting. The framework

the end consumers, while innovating

for digital transformations hence needs

new revenue streams and models.

to be constantly assessed, analyzed

5. Build the workforce – in a commensurate capacity by new skilling, re-skilling, and upskilling the next generation talent.

6. Manage the wise pivot – balance the investment, workforce, and funds

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“ THE ESSENCE OF INDUSTRY 4.0 IS BASED PRIMARILY ON HARNESSING OPERATIONAL EFFICIENCIES IN MANUFACTURING OPERATIONS”

and refreshed to take advantage of the rapid advancements.

Secondly, it is important to acknowledge that the essence of Industry 4.0 is based primarily on harnessing operational efficiencies in manufacturing operations by leveraging technology to increase the Overall Equipment Effectiveness (OEE) which is typically defined as the product of Availability,

— Tilak Mitra, CTO Industrial, Managing Director, Accenture

Productivity and Quality metrics.

allocation between transforming the

increasingly favoring innovation around

core and rotating to the new.

the generation of new revenue streams

The term X.0, in Industry X.0, is neither

However, digital transformation is truly much more than just the operational efficiency gains. Business value is

that is not only driven by innovative

coined in error, nor it is a misrepresen-

As-A-Service business models but

tation of 4.0 (as in Industry 4.0): it has

also through hyper personalization of

a purpose and rationale. To begin with,

consumerism that is driving micro

the term X.0 is in recognition and

segmentation and hence an exponen-

acknowledgement of the fact that digital

tial expansion of the addressable

technologies are advancing at such

consumer base. Industry X.0 addresses

a rapid pace that the technology staging

not only the cost economics driven by

posts can no longer be pinned down for

traditional operational efficiencies of

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Industry 4.0 but also the generation of

tions are only possible when they are

new consumer centric business models

not just episodic in nature, but strongly

and hence new revenue streams.

encouraged by their inculcation into the

X.0 signifies the exponential pace of

fabric of the enterprise. At Accenture,

progression in digitization.

Industry X.0 is one of the firm’s strategic

Digital transformations are technology enabled but business led. Bold innova-

growth areas and has aligned focus, investment, capabilities and expertise

E X E C U T I V E P R OF IL E

Tilak Mitra is the CTO of Industrial Manufacturing applied to the broad industry sector of Industrial. In his role, Tilak develops and drives global thought leadership and innovation around digital transformations, for Accenture’s truly world-class capabilities, solutions, and offerings, in Industrial and Industry X.0. He is responsible for combining his technology expertise and foresight with deep industry domain knowledge, in Automotive, Industrial Equipment, EPC and Freight & Logistics, to develop truly transformative solutions for a diverse set of clients.

He also scales true lateral innovation by leveraging and combining his experience, insights and successes in adjacent industries like Oil & Gas, Chemicals & Petroleum, Aerospace and Electronics.

Tilak is a master at abstracting and packaging deep technology landscapes into true business drivers, value propositions, and business models, and empower the C-suite to shape and drive their organization’s next generation transformations and innovations.

He is also a prolific writer, having authored and co-authored three books and many journal publications.

He blogs his ideas, thoughts and vision and firmly believes in scaled information sharing. w w w.ma nufa c t uri nggl o b a l. com

19

IF YOU DON’T MAKE WHAT YOUR CUSTOMER WANTS, THERE’S ONLY ONE THING LEFT TO DO. MAKE IT.

STREAMLINE YOUR SUPPLY CHAIN WITH SAP. With SAP’s solutions for the digital supply chain, you can design flexible, modular products that your clientele can customize effortlessly. So you can build to order. Delight any customer at any time. And transform your business just as fast. sap.com/scm

© 2018 SAP SE or an SAP affiliate company. All rights reserved.

THE QUEST TO CONNECT DIGITALLY TO PERFECT REALITY. In a world fraught with economic, political and social uncertainty from tariffs to trade, regime changes and civil unrest to an increasing social influence on markets, businesses must reinvent themselves to stay competitive and survive.

These pressures and those brought forth by the digital economy is turning industries upside down. Companies are relying heavily on the formation of highly agile supply chains to quickly capitalize on new opportunities and to break down old barriers.

B:303 mm T:297 mm S:291 mm

Companies of all kinds are moving into industry sectors and markets previously shut off to them and competing for market share in completely new ways.

The days of mass production are yielding to customer expectations for mass customization as companies move away from a wholesale model to a more customer centric approach.

Intelligence in the supply chain with smart products that can sense consumption and predict replacement needs are becoming the norm and customers are making purchase decisions based on an entirely new basis. Companies are expected to tailor their products to the unique needs of their customers in a highly variable configuration and fluctuating demand environment.

And, on top of that, they expect this to be done at low cost, with the highest measure of quality, delivered in record time!

A few years ago, in a meeting at Nike, I was witness to the marketing team announcing their intent to provide a uniquely designed shoe for every consumer. The supply chain,

design and manufacturing representatives were looking uncomfortable to say the least. How could they support such a seemingly crazy idea? Yet, they did it by creatively redefining and digitizing their supply chain processes from initial design definition to manufacturing and logistics. By taking advantage of this, my son, who is an aspiring MLB player now wears fully customized cleats bought for a mere 15% premium and delivered within a two-week window – an amazing “feet”.

At SAP, we are helping our customers adapt to the ever-increasing demands of the digital economy by connecting their processes digitally across the entire supply chain. This enables a digital supply chain that transitions their go to market approach from cost savings and efficiency to a strategy that drives competitiveness and differentiation. We call this initiative Connect Digitally to Perfect Reality and while the subject touches on so many aspects of a company’s business, it ultimately gives the customer the perfect reality of their requirements – the perfect baseball cleats.

Robert Merlo VP Marketing SAP Digital Supply Chain

ACCENTURE

“ THERE IS AN X FACTOR IN ACCENTURE’S INDUSTRY X.0 THAT CONTINUES TO DIFFERENTIATE OUR CLIENTS AS THEY INITIATE, ACCELERATE, INDUSTRIALIZE, AND VALUE REALIZE THEIR DIGITAL TRANSFORMATION JOURNEYS”

22

strategy from building products to delivering outcomes through digital services and human-centered experiences around the physical product or an ecosystem of products – there is a palpable shift in strategic innovation away from product centricity to building true experiential platforms. Connected Products has a pathway that typically follows the progression from Products, to Products & Services, to Products

— Tilak Mitra, CTO Industrial, Managing Director, Accenture

& Differentiated Services, and ultimately

to be commensurate with the industry

potentially more exponential, uptake

direction and demands. Accenture

path. While the first wave of maturity of

continuously refreshes, refines and

connected products enhances products

leverages the Industry X.0 framework

and the spare parts sales, the second

to not only help its clients build a strategic

wave of Products & Services introduces

business case and roadmap for digital

value through offering customized

transformation but also help them

after-sales plans and hence increased

initiate, prototype, demonstrate value,

customer touchpoints and engagements.

and then industrialize and sustain their

Products & Differentiated Services

digital journey.

opens channels for upselling more

Innovation in Industry X.0 broadly

to Products As A Service. The benefits and value realization follow a similar, but

premium services fostered by increased

touches the disciplines of Connected

maturity and sophistication of the

Products, Connected Operations,

product and its overall performance.

Connected Worker and the Connected

Products As A Service opens entirely

Enterprise. Across all the disciplines

new opportunities for different economic

there is a resonating shift in business

models like risk-and-reward based

DECEMBER 2018

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CLICK TO WATCH : ‘WEF 18 — ACCENTURE — INDUSTRY X.0: DIGITAL REINVENTION OF INDUSTRY’ 23 revenue sharing, ‘pay for what you

transformations resulting in:

consume’, as well as other innovative

1. Autonomous robots – which

consumption-based payment models.

are enabling smart, connected and

The value progression not only increases

intelligent machines to collaborate

the number of touchpoints along the

alongside humans in transforming

consumer’s interaction with the product

business processes.

but also increases the addressable

2. Horizontal and vertical integra-

customer base. It is the layers of utility

tion – of the enterprise and business

that are innovatively engineered into

ecosystems (think of partners and

the connected product that fosters the

suppliers) to develop real-time integrat-

exponential uptake; a few of which go

ed views of data and networks across

on to disrupt the market.

the value chain.

From a technology standpoint,

3. AR/VR – that is reimaging

a set of digital technologies are settling

assisted diagnostics, support and

down to form the foundation of digital

maintenance. w w w.ma nufa c t uri nggl o b a l. com

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4. Additive manufacturing – where technologies like 3D (and most recently 4D) printing are used for production of small batches of highly customized and programmable products.

5. Cloud – that has helped in commoditizing the compute, storage and network consumption among other well-known advantages of scale and the sharing economy.

6. Simulation – providing the ability to digitally simulate entire production assembly lines for rapid prototyping and innovation before even the

from the cyber threat vectors that

physical construction has started.

are continuously on the rise as more

Think digital twins!

systems gets interconnected.

7. Big Data & Analytics – that is truly

The Industry X.0 framework fosters

enabling massive scale data processing

the convergence of both strategy-led

and insight generation targeted at

as well as technology-led initiatives

timely decision making across the key

with the methodical and systematic

business processes.

focus of helping organizations formu-

8. IIoT – i.e. the Industrial Internet

late an innovation driven strategy and

of Things that is enabling the infusion

pathway for digital transformation that

of intelligence into products, process-

is underpinned by both quantitative

es, and services that communicate

and qualitative business value.

with each other and humans over a global network.

An example of a qualitative lever is a business strategy around industrial

9. Cybersecurity – ensuring that

consumerism. For example, the essential

the enterprise assets, both physical

philosophies of industrial consumerism

and IT infrastructure, are truly secured

are based on the tenets that: w w w.ma nufa c t uri nggl o b a l. com

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ACCENTURE

“ IT IS IMPORTANT TO DEVELOP PRODUCTS WITH A MINDSET THAT IS NOT PRODUCT FIRST BUT INSTEAD IS DRIVEN BY VALUEDRIVEN END-USER EXPERIENCES” — Tilak Mitra, CTO Industrial, Managing Director, Accenture

1. The loci of power have shifted out 26

is more collaborative, and ultimately more co-creative, than the current consumption driven mindset.

Innovations that are driven by such mindsets are proven to open up new opportunities and hence revenue streams.

Examples of quantitative value levers are often use-case driven. In boosting operational efficiencies, untapped or unrealized value is more often than not related to availability,

of the organizations and into the hands

productivity and quality of not only

of the consumer. The ubiquity of choices

the operational processes but also of

is leading consumers down the path of

the final product that is built. Some

intolerance to anything that is medio-

of the use cases seen as very common

cre; they have multiple choices to shift

across a wide diversity of industries

to other brands.

are around:

2. Since the choice and control are now in the hands of the consumers, it is important to develop products with a mindset that is not product first but instead is driven by value-driven end-user experiences. This will be

• Optimized asset utilization.

• Asset downtime prediction and reduction.

• Production throughput and yield optimization.

• Reduction of total maintenance

imperative for some organizations, e.g.

cost – proactive reduction of

industrial manufacturers and retailers,

repair and fix cycles.

so as to leverage the increased number

• Early detection and

of consumer touch points (with the

mitigation of operator related

connected products) and convert them

productivity losses.

favorably into a consumer behavior that DECEMBER 2018

• End to end supply chain visibility.

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• Q uality early warning on both process and product quality parameters.

Another dimension of quantitative value lever is delivered through executing on laser focused initiatives targeted at cost take outs across the various operating business units.

Applying the proven framework of Zero-Based Budgeting (ZBB) into manufacturing processes and operations has proven dividends on significant cost take outs. Accenture uses the framework called ZBx where it applies its uniquely tailored techniques of Zero-Based budgeting to spend (ZBs), to supply chain (ZBSC), among other pertinent dimensions. Applying ZeroBased Spend (ZBs) and Zero-Based Supply Chain (ZBSC) techniques and methods to the Cost of Goods Sold (COGS) brings a unique dimension to optimizing operational efficiencies in manufacturing and is leveraged as a part of the Industry X.0 framework.

In order to make Industry X.0 real for our clients, it is important to have an implementation and execution engine – one of Accenture’s flagship differentiators in Industry X.0, as it pertains to w w w.ma nufa c t uri nggl o b a l. com

27

IFWE unlock the value of the virtual Can we make our future more sustainable?

Today’s manufacturing organizations are in the midst of a global Industry Renaissance. This renaissance extends beyond delivering digitalization and personalized solutions. The emergence of new businesses and new categories of solutions, processes and services prioritize sustainable innovation and experiences over productivity gains. Digital experience platforms are the infrastructure of this industry renaissance.

To keep up, businesses must be faster, more integrated and more agile than ever. Those leading the way are the ones that create value through networks to deliver new products that are both sustainable and innovative. A talented workforce that is agile and committed to constant learning of new ways to deliver new products, services and solutions in a combined virtual and real way will win the race for new customers.

Discover more at: www.3ds.com

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the implementation of digital transformations, is called the Digital Services Factory (DSF). DSF is an execution framework that packages a continuously refreshed set of processes, tools, skills, advanced digital technologies and operating models that are carefully designed and packaged to accelerate the clients’ digital transformation journeys.

The primary challenge it addresses is time to market – not only does it takes an enormous effort to bring innovation to market but also some laser focused discipline to pivot on a shifted business

“ A VISIT TO ONE OF THE ACCENTURE INNOVATION CENTERS IS OFTEN A STEPPING STONE TO SHOWCASE THE ART OF THE POSSIBLE IN ADVANCED DIGITAL TECHNOLOGIES AND INDUCE CONVERGENT THINKING TO FORMULATE OUR CLIENT’S DIGITAL AGENDA” — Tilak Mitra, CTO Industrial, Managing Director, Accenture

strategy, thinking, and core competency

with the client, bringing in not only the

that is away from a products-first and into

best capabilities of Accenture, but also

a needs-first, outcome-driven innovation

that of the ecosystem’s partners and

model. DSF works by offering an end-

alliances, to collaborate and co-create

to-end innovation service: from ideation

along with the client’s best minds. The

to prototyping, industrializing, scaling,

customized outcomes are then quite

and finally operating the digital business

easily fabricated into the client’s unique

– a combination that is hard to aggre-

ecosystem. Clients are encouraged to

gate and harmonize. The framework is

first try using the execution engine

customized to suit every client’s unique

before they buy fully into it. Once used

requirements as well as their current

and implemented, and once the value

maturity vis-à-vis their desired state in

realization benefits are obtained through

their digital transformation journey. One

DSF, the clients gain an innovation

of the core principles of using the DSF

engine and a well-established factory

is that it is executed as a joint venture

for building, hardening, and offering w w w.ma nufa c t uri nggl o b a l. com

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ACCENTURE

“ NOTHING SUCCEEDS LIKE SUCCESS AND LEVERAGING THE INDUSTRY X.0 FRAMEWORK FOR DIFFERENTIATED ADVANTAGES – OF INNOVATION, AGILITY, AND TIME TO VALUE, IS NO DIFFERENT!” 30

— Tilak Mitra, CTO Industrial, Managing Director, Accenture

digital services to their end customers.

of innovation, agility and time to value

There are way too many organizations

– is no different. Although there is

who have already dipped their feet

a significantly growing number of case

into innovation through a series of

studies that exemplifies the true value

prototypes and proof-of-concepts.

of leveraging the Industry X.0 frame-

However, and as is often seen, it is not

work, two which best illustrate this are

until the time comes to industrialize

Schneider Electric and Biesse Group.

a service or a product or an offering that the true value of DSF comes to

SCHNEIDER ELECTRIC

the advantage – in terms of scaling an

Schneider Electric is a French multina-

innovation fast and accelerating an

tional corporation that specializes in

offering to market, DSF is the answer.

energy management and automation

Nothing succeeds like success,

solutions spanning hardware, software

and leveraging the Industry X.0 frame-

and services. Schneider wanted an

work for differentiated advantages –

asset monitoring solution to monitor

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and together they developed and piloted their digital transformation program leveraging the DSF. By collecting data and applying AI and deep learning algorithms, Accenture helped to not only develop and industrialize the service offering but also an operating model to operate it at scale.

The service offering helped to not only prevent critical asset failure but also prevent power grid downtime. The true value came when Schneider Electric realized its time horizons from ideation to field enablement were cut from its typical three-year timelines down to the heat and humidity of its electrical

a whopping eight-month cycle. The

distribution assets. They wanted to use

true power of Industry X.0 and DSF

small wireless thermal sensor technol-

was realized.

ogy for sensing, coupled with the LORA wireless protocol for communication.

BIESSE GROUP

Monitoring the heat signature of its

Biesse Group is a global leader in

critical assets is extremely important

technologies for processing wood,

to Schneider not only to extend their

glass, stone, plastic and metal. It

lifetime but also from a safety stand-

designs, manufactures and distributes

point. This was a very important

machines, integrated systems and

program for Schneider – important

software for manufacturers of furniture,

enough that it could not wait for their

door/window frames and components

typical three-year timelines to take an

for the construction, shipbuilding and

innovation from ideation to the field.

aerospace industries. Based on

Schneider teamed up with Accenture

customer research and the company’s w w w.ma nufa c t uri nggl o b a l. com

31

ACCENTURE

strategy to develop true experiential

using the Accenture Connected

platforms with new digital capabilities,

Platforms as a Service (CPaaS) IoT

Biesse Group wanted to improve

platform deployed on Microsoft Azure.

operational efficiencies, reduce costs

32

The platform’s flexible architecture

and open up new revenue streams

and preconfigured IoT services enabled

such as machine usage analysis and

the team to reduce the overall program

production process optimization, much

complexity and duration using pre-built

beyond just machinery production.

and pre-configured architectures,

As part of the roadmap, Biesse Group

technologies and APIs. This enabled

customers would be able to choose

Biesse Group to start piloting a solution

from different subscription levels that

to clients in only five months. The solution

offer an extensive range of features

was piloted across eight machines at

from remote diagnostics, warnings and

a subset of customers with services

alerts to more sophisticated production

like preventive maintenance alerts,

process optimization capabilities that

machine management and manufac-

help improve overall business produc-

turing events analysis. The pilot helped

tivity and customer satisfaction. They

Biesse improve customer service and

collaborated with Accenture to build the

loyalty, reduce warranty and mainte-

business case, an operating model, and

nance costs and obtain real-time

a cloud-based pilot and roadmap, for

customer data and alerts. The insights

a connected asset management solution

from the field helped Biesse to improve product development, adding features that would be beneficial to the customer.

These insights also enabled the company to develop closer customer relationships by providing suggestions on how to get the most productivity and efficiencies from its machines. For customers, the flexible menu of services helps to improve machine productivity and

DECEMBER 2018

NORTH AMERICA

33 customer satisfaction by minimizing

continuous exploration, looking for new

machine outages through predictive

breakthrough thinking and adopting

maintenance and in-depth analytics.

a culture that fosters an innovation

Based on the pilot’s success, the Beisse

engine. In order to keep up, the rate of

Group planned to roll out services

innovation must also be exponential.

encompassing 20,000 machines; the

Organizations need to be bold enough

progression from pilot to industrializa-

to encourage continuous exploration of

tion and accelerated scale out is where

innovative ideas to stay relevant in the

the value of leveraging the DSF execu-

digitally disruptive market. Business

tion framework became paramount.

leaders must not only embrace but also

To reiterate, it is important to acknowl-

foster a business culture that encour-

edge that true innovation cannot be

ages bold innovations. At Accenture it is

sustained through episodic attempts.

seen as important for even the smartest

Innovation should be a continuum,

of business and technology leaders to

embracing an embedded fabric of

get away from their daily business w w w.ma nufa c t uri nggl o b a l. com

ACCENTURE

routine; quite frequently the best ideas are triggered when leaders and executives are taken out of their daily grind and immersed into an environment that not only fosters high impact disruptive thinking but also provides an opportunity to experience the art

34

“ ACCENTURE BELIEVES IN BRINGING ITS CLIENTS INTO ITS GLOBAL INNOVATION CENTERS THAT ARE TRUE SHOWCASES OF DIGITAL TRANSFORMATIONS IN THE FIELD OF INDUSTRY X.0!”

— Tilak Mitra, CTO Industrial, Managing Director, Accenture

$34bn Approximate revenue

Dublin Company HQ

449,000

Approximate number of employees

relevance. While some demonstrations focus on operational efficiency gains some others demonstrate the art of

of the possible that may be applicable

the possible in hyper personalization,

to their business.

industrial consumerism and generating

Accenture believes in bringing its

new revenue streams. Client leaders

clients into its global innovation centers

brought into such centers are allowed

that are true showcases of digital

to explore the true art of the possible

transformations in the field of Industry

in technology-led digital disruptions.

X.0. These innovation centers are set up

This induces their creative ideas as they

in true manufacturing like facilities that

get to touch, feel, and play around with

showcase a diverse display of advanced

the solutions on display. More often

digital technologies with industry

than not, there is at least one solution

DECEMBER 2018

NORTH AMERICA

and make their own. Seeding innovation through such client visits at Accenture’s Innovation Centers have shown startling results for clients and continues to be one of the key innovation entry points for Industry X.0. One of the most recent additions is the Detroit IIoT Innovation Center that was opened earlier this year.

Clients are highly encouraged to come visit one of the centers and experience how Accenture can truly help them in their digital transformation journey.

Industry X.0 is truly transformative and is one of the strategic areas of priority as Accenture aligns itself to client needs, demands and expectations. In the current era of digital industrialization, it is Accenture’s idea that sparks their interest; clients

structured, systematic, and outcome-

are encouraged to explore further. In

driven way of encouraging its clients

the subsequent session client leaders

to approach us with a problem or an

are taken through a very focused design

idea, and take away with them an

thinking workshop, organized at the

innovation that helps them accelerate

Innovation Center, that is facilitated by

to market and get into a position of

a highly trained and specialized team,

competitive differentiation.

and in which the areas of interest are

There is an ‘X factor’ in Accenture’s

aligned to their own business process-

Industry X.0. Come and experience it to

es. The outcome of such a few hours of

drive differentiation for your business.

high-octane workshops results in the ideation of the most innovative ideas that our client leaders get to take away w w w.ma nufa c t uri nggl o b a l. com

35

Covering every angle in the digital age The Business Chief platforms offer insight on the trends influencing C and V-level executives, telling the stories that matter CLICK TO SUBSCRIBE FOR FREE

w w w.bu si nessch ief.com

LEADERSHIP SHOWCASE

38

DECEMBER 2018

TECHNOLOGY, GOVERNANCE AND RISK:

Navigating the ever-evolving challenges of the manufacturing industry Allan Graham, Managing Director of Duff & Phelps, explores the challenges facing the UK’s manufacturing industry today and tomorrow and how the company works to solve them WRITTEN BY

M ARÍA COBANO-CONDE

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LEADERSHIP SHOWCASE

T

he ever-changing manufacturing industry requires flexibility and an open mind to face both the current challenges and those that

the future brings. With the uncertainty of Brexit, this becomes more apparent as companies must reassess their to financial management and adoption of digital technologies.

To this end, national and international manufacturers can benefit greatly from premier restructuring, global valuation and corporate finance advisory on disputes and investigations, real estate, regulations and compliance.

Allan Graham, Managing Director at Duff & Phelps’

40

London office, has been working on the corporate recovery market for over 25 years now. Notably, he worked for one of the ‘Big Four’ accounting firms for 19 years as a Restructuring Partner prior to joining Duff & Phelps, where he acquired a vast knowledge of the manufacturing base in the Midlands.

Currently, he works to assist mid-market corporates and provides advisory support to manufacturing, recruitment, printing and packaging businesses.

“UK manufacturing is thriving, it’s the world’s eighth largest industrial nation,” starts Graham, “some projections indicate that by 2021, we could very well be in the top five, which is staggering. Its contribution to the UK economy is equally impressive, as it makes up 44% of all UK exports, 70% of business R&D investment and directly employs 2.6mn people”.

DECEMBER 2018

41

“ UK manufacturing is thriving, it’s the world’s eighth largest industrial nation — by 2021, we could very well be in the top five” — Allan Graham, Managing Director, Duff & Phelps London

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LEADERSHIP SHOWCASE

Graham has good reason to support this belief. “According to the Office for National Statistics (ONS), that means the UK’s industrial sector has grown 1.4% year-on-year since 1948,” he says. “The ONS itself puts that down to a better-skilled workforce, a shift in production from low to high productivity goods, improvements in technology and increased investment in R&D”.

For Graham, this idyllic picture is counterbalanced by the forward-looking and inter-related challenges manufacturers face in today’s market. “The UK manufacturing sector is not as productive as some of our competitors. On every measurement,

12

the UK productivity levels have been a consistent challenge over the past decade, and this is not just in the manufacturing sector, but

“ Manufacturing in the 21st century is no longer about mass-production,it involves the constant monitoring and modification of the production process” — Allan Graham, Managing Director, Duff & Phelps London

services too. In recent months, this does appear to be reversing but it remains a major challenge all the same”.

Competitiveness is at the core of this issue, as manufacturing in the UK is “no longer predicated on producing huge sheets of steel at the lowest possible price” but, rather, how to better implement technology and talent to produce better products for the world.

“There is no doubt that there is a skills gap – anyone in the manufacturing sector will say the same. The UK Government Office for Science reported last year that a larger working

DECEMBER 2018

CLICK TO WATCH : ‘MAST: MIFID II ANALYSER SOLUTION AND TRACKER’ 43 population with increased skills at the

The success of operational manufac-

core of the manufacturing industry will

turing processes is directly linked to how

increase the talent pool to help drive

manufacturers deploy their technology-

the sector forward, for the long-term

based strategies and implement

future of the UK manufacturing”.

innovation, which has a great impact on

Technology will be a key player in

the businesses’ finances. “Manufactur-

propelling the industry forward for its

ing in the 21st century is no longer about

survival, for which most manufacturers

mass-production. Instead, it involves

are realigning their operational strate-

the constant monitoring and modifica-

gies through deploying interconnected

tion of the production process to make

and intelligent manufacturing systems.

a company as efficient as possible while

Nevertheless, Graham identifies the

delivering a premium service to the

success of these strategies in a compa-

consumer,” analyses Graham. “Making

ny’s ability to “distinguish between what

solid expenditure decisions based on

is new and what is useful”.

a combination of historical trends and w w w.ma nufa c t uri nggl o b a l. com

LEADERSHIP SHOWCASE

44

real-time information is vital, and here technology can play a critical role”.

This is one of Duff & Phelps’ core activities as a consultant, as “many of

For this, Graham identifies cash flow

the assignments we undertake for all

as a mission-critical aspect to forecast

types of businesses are to design and

and plan carefully. “It never fails to

implement cash flow procedures for

surprise me how many businesses we

companies experiencing stress or

encounter don’t put enough emphasis

distress,” highlights Graham.

on cash flow forecasting, both long

The company certainly has a lot

term and short term,” he observes.

to say on how to turn businesses in

“This basic financial control is too often

crisis around, helping them to recover

overlooked until a business is forced

and become solvent again based on

into it due to a crisis.”

years of experience. “We will always

DECEMBER 2018

28

Countries around the world

1932

Year founded

3,500

Approximate number of employees 45

strive to find the most innovative and

sible lenders and corporate recovery

practical solution to resolve issues

professionals. This means that we aim

affecting business performance –

to help our clients implement change

we have worked on some of the most

early enough to prevent their businesses

challenging turnaround and crisis

from having to face insolvency,” assures

management situations. Discrete and

Graham. “When it’s too late to restruc-

determined, we work with underper-

ture or rescue a business, we have

forming businesses to restructure

established relationships with a wide

them and maintain enterprise value,”

range of banks, asset based lender

summarises Graham.

and business angels through which we

“We are committed to supporting the

can source rescue funding to either

Rescue Culture adopted by all respon-

support the troubled business or find w w w.ma nufa c t uri nggl o b a l. com

LEADERSHIP SHOWCASE

a business under new ownership.”

The uncertainty of Brexit and how this will impact the industry will in turn have a huge influence on how Duff & Phelps works with its clients/or companies. “This uncertainty is causing anxiety across multiple sectors, not only in the UK, but across Europe,” states Graham.

“What certainties do we have? Well, I would argue that UK manufacturers will see an increase in demand from the so-called BRIC countries (Brazil, Russia, India and China), that the US and the 46

EU will remain our major export markets, and that our hi-tech and high-value products will continue to be our main export strength.”

For this, it is important to be proactive and take advantage of some of the market trends and opportunities this will bring and how it could change the way goods are manufactured. “With a growing world population and increased demand for materials, water, energy and land, supply chains will become much more volatile and manufacturing closer to home will make the country more resilient to these effects,” explains Graham.

DECEMBER 2018

“ By reshoring production, it is now much easier for Britain to compete with lower cost locations on quality, delivery speed and customisation” — Allan Graham, Managing Director, Duff & Phelps London

“Reshoring production – manufacturers who had previously moved their production overseas bring it back to this country – is already a reality and it is now much easier for Britain to compete with lower cost locations on quality, delivery speed and customisation”.

With regards to technology and the important role it will play in the Industry, Graham sees individuality as a key characteristic. “Mass personalisation of low-cost products by methods such as 3D printing will enable everyone to become their own manufacturer and, increasingly, manufacturing will become more urbanised and less based around large factories with many workers.”

This will be embedded in a strategy where technology becomes customercentric: “Companies that do well will be those that make use of ‘big data’ to learn more about their customers and use it to their advantage, to improve their products and enhance their competitiveness”, concludes Graham.

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TECHNOLOGY

48

The rise of the intelligent factory We speak to SSG Insight’s CMO Ian Dowd on the importance of the smart factory...

WRITTEN BY

DECEMBER 2018

M AT T HIGH

49

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TECHNOLOGY

Could you please begin by giving me a little background information to SSG Insight, telling me more about the business and its products, particularly in relation to the manufacturing, risk management and ‘smart’ processes.

SSG Insight started in 1983 with an ambition and an excitement about how the desktop PC could change workflow.

35 years later, with our Computerised Maintenance Management Software products, we have built knowledge and experience unrivalled in the industry.

And we realise our success relies on us 50

being one step ahead.

DECEMBER 2018

Facing new challenges, we adapt our company to focus on delivering key value and insight – guiding our customers to make intelligent decisions. Agility is a maintenance management solution for forward-thinking organisations, so you can quickly respond to change and make better-informed decisions on the spot, saving time and valuable resources.

AUTOagility is an end-to-end work management solution that incorporates a clever, structured question-based approach to capturing details of work and an automatic deployment feature to remove the manual decision-making included in finding the best member of your team to do the job. Our most recent software release, AgilityBI, gives you a deeper understanding of your operation including trend data over time, so you can make faster, smarter decisions to improve your business performance.

So, we can understand more about ‘Agility’ can you give us more detail about the drivers behind developing such a solution, what the key considerations were in terms of making it a market-leading product and how versatile its application field is?

Our 35 years’ experience gives us insight into the requirements of key industries. Flexibility and versatility were two of the key drivers.

Our vision for Agility is to be “the most user w w w.ma nufa c t uri nggl o b a l. com

51

TECHNOLOGY

friendly, insightful and futureproof solution for managing assets, processes and people”.

Agility is used in global industries as diverse as manufacturing, distribution, transport and infrastructure and healthcare.

Let’s focus more on the idea of so-called ‘smart’ or ‘digital’ factories and manufacturing processes, can you give some context as to how these have developed and why they are of such benefit to manufacturers, corporations and employees?

Smart or digital factories have their roots 52

in the SCADA (Supervisory Control and Data Acquisition) technologies, which was a forerunner to IoT and 5G technology. Like IoT in a domestic setting, it’s about linking equipment so that it can intelligently communicate to automate action, optimise processes and result in better outcomes.

Customers that adopt smart and connected technology in a production setting can: • Reduce downtime of key assets and equipment • Reduce unscheduled maintenance • Reduce stock held, administration and costs • Improve the reliability of equipment and rate of work orders completed on time • Make more efficient use of employee time DECEMBER 2018

“ Agility allows you to reduce breakdowns and downtime by up to 32%, improve response times by 53%, reduce stick held by 19% and reduce administration by 60%” — Ian Dowd, CMO at SSG Insight

Can you simplify the technology and process so we can give an overview of just ‘how’ the smart factory works compared to traditional technology?

In a traditional factory you have to wait for something to break before you fix it. Or schedule periodic equipment checks.

In a smart factory you can fix it before it breaks because the equipment will tell you when it’s feeling poorly. As a comparison, rather than waiting until you run out of milk or just buying it once a week, your fridge will tell you when you are running low and need to buy more. The principle is similar in a factory setting.

CLICK TO WATCH : ‘AGILITY CMMS/EAM SOLUTIONS FOR MANUFACTURING’

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TECHNOLOGY

How essential is a product such as Agility in achieving a true smart manufacturing process?

Agility is an essential part of the smart factory landscape. Advanced scheduling and resource management capabilities allow the smart factory to deploy the correct resources to intelligently correct issues before they cause downtime. It means that the process runs continuously and doesn’t have to stop because of unplanned downtime.

54

Obviously, such a factory or manufacturing process requires a complex IoT – what role does Agility play in such a network in terms of overall operational process?

actionable insight. Based on the

Can you tell me more about how that interconnected actual process works, and what role humans have in it?

health or otherwise of equipment,

The equipment will indicate how healthy

maintenance work can be scheduled

it is based on certain parameters. When

and completed. A record of each

a certain threshold is reached Agility will

piece of work is automatically

trigger agility to create the most appropri-

recorded along with other key

ate remedial action. That will most often

information to produce trend data

be a work order directing a qualified

that can be used to make smart

human maintenance engineer to carry

planning decisions.

out some activity.

Agility takes the sensory readings from key equipment and turns it into

DECEMBER 2018

“ Self-healing factories will see components able to proactively fix themselves, before a problem arises with continuous production the norm” — Ian Dowd, CMO at SSG Insight

In a factory or manufacturing context, what are the main parameters that Agility monitors? vibration, noise, electric current, smell

Presumably a large part of developing a product for such a complex task is to reduce that complexity so it can be easily managed – how has that been achieved?

etc. It will often depend on the nature

Agility is designed to do the complex

of the operation and customer. With

work in the background, making things

AgilityBI you can make sense of the

simple and easy for the individual

myriad of data points to create intelli-

users. The user experience delivers

gent insight, tracking trends over time

the optimum display of information for

and unlocking the value in IoT data.

that user, based on their job profile and

Common parameters are temperature,

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TECHNOLOGY

workload, minimising screen views, fields, clicks and saving time. Individual user personas can be configured to deliver just the right functionality and data at the right time, on a mobile device, laptop or PC.

What benefits does the use of Agility and other smart technologies bring to manufacturers, and their assets? How has it had such a marked impact on lessening downtime, for example?

Based on an analysis of our customer data, Agility allows you to reduce breakdowns and downtime by up to 32%, improve response 56

times by 53%, reduce stick held by 19% and reduce administration by 60%.

I understand there are health and safety benefits too, can you elaborate?

The health and safety aspects are critical and multifaceted. Maintaining health and safety equipment such as fire alarms, sprinklers, extinguishers etc. is part of it, plus ensuring people allocated to carry out any type of work are qualified, trained and have the necessary background and operating instructions for the relevant equipment.

One of the main objectives of Health and Safety Management is to protect people from harm. Identifying who could be harmed because of potential hazards is a key part DECEMBER 2018

of driving the risk assessments and risk management. Certain individuals may have factors which increase their risk of harm. For example, new and young workers, migrant workers, new or expectant mothers, people with disabilities, temporary workers, contractors, homeworkers and lone workers.

Often the risk is controlled by education, and therefore training and certification with regular review and renewal plays a vital role in the Agility system and serves to ensure that suitably trained personnel are commissioned to carry out particular tasks, or work on certain equipment.

Non-permanent staff such as visitors, contractors and third-party maintenance workers are identified through Agility. These workers need particular training to ensure they are aware of risks which they may not be familiar with.

Where do you see Agility developing in the future and are you looking to develop other products for similar applications? If so what are your areas of focus?

Our vision for Agility is to be “the most userfriendly, insightful and futureproof solution for managing assets, processes and people�.

Areas of focus for future development are Smart Action, Intelligent Insight and evolving the smart workplace management solution. w w w.ma nufa c t uri nggl o b a l. com

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TECHNOLOGY

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“ Often the risk is controlled by education, and therefore training and certification with regular review and renewal plays a vital role in the Agility system and serves to ensure that suitably trained personnel are commissioned to carry out particular tasks,or work on certain equipment” — Ian Dowd, CMO at SSG Insight

DECEMBER 2018

Areas of planned investment include machine learning and artificial intelligence, creating even richer insight and better real-time decision making.

Where do you see the concept of Industry 4.0 and smart factories heading over the coming years?

Various technologies will combine to create a multiplier effect. Nano technology, 3D printing, cloud connected automated factories will lead to lower costs, increased efficiency, but intense global competition. Less need for traditional manufacturing equipment and scale, replaced by new tech, will bring geographic democratisation, as barriers to entry are lowered, new entrants will enter the market and drive further innovation.

Economies of scale and physically connected supply chains will become less important, as customisation will become more cost effective, leading to less need for uniformity and standard products based on minimum unit costs. It will ultimately be possible to produce customised finished product in units of one, for a similar unit cost to large quantities of standard product.

Self-healing factories will see components able to proactively fix themselves, before a problem arises with continuous production the norm. It will be driven through automation and AI with even less need for human intervention in all but the most strategic tasks.

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T O P 10

Top 10 Manufacturing trends for

2019

60

Many factors are critical to the transformation of the manufacturing processes and here, Joanne Phoenix, Business Development Lead at Sensor City, delivers the trends that will lead the Manufacturing Industry in 2019 JOANNE PHOENIX EDITED BY MARĂ?A COBANO-CONDE WRITTEN BY

DECEMBER 2018

61

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T O P 10

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Investment / funding for SMEs As established enterprises wrestle with becoming more innovative and agile, ‘buying in’ that mindset and approach will be an increasingly attractive option. For start-ups and SMEs, the benefit is being able to access funding and support from a wide range of sources and being able to tap into the much wider resources of larger organisations, without necessarily compromising their independence.

Whether through financial investment, accessing IP or simply agreeing a mutual sharing of resources, 2019 will see increased partnerships and collaborations between established manufacturers and smaller operators.

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63

Better diversity 2018 saw the continuation of a major conversation and focus on diversity across all levels of society. From a manufacturing perspective, the business case is clear – an organisation is likely to perform better financially if its workforce is more diverse. Diversity is going to continue to be top of the agenda for many years to come, and with greater public awareness will come increased government scrutiny and tougher legislation.

Forward thinking businesses will pre-empt this by implementing more rigorous and impactful programmes to accelerate the diversification of their workforces.

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T O P 10

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Workforce of the future Digitalisation holds great promise for manufacturers, yet it is not an off the shelf solution. Any sort of transformation is as much about the people implementing it as it is about the technology. With digital skills a scarce resource, manufacturers need to be investing now to ensure that they are building a workforce of the future. 2019 will see increased investment in digital training, both internally and in partnership with centres of education, such as universities and accelerators.

Partnering with complementary businesses will also help bring knowledge into businesses in a cost-effective manner.

DECEMBER 2018

65

AI/Machine Learning The increased adoption of IoT will also see an increase in the amount of data that manufacturers produce. Data may be the crude oil of the 21st century, but without the ability to analyse and action based on tangible, accurate insights, it is simply taking up space. This is where artificial intelligence (AI) and machine learning comes in – having the ability to manage volumes of data, generate legible insights and proffer solutions will greatly increase manufacturers’ responsiveness, improving efficiency and helping identify new business opportunities.

2019 will see greater levels of importance attached to manufacturers’ ability to incorporate AI and machine learning into their operations.

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66

5G rollout 5G will deliver huge improvements in download speeds, latency reduction and the ability to remotely control a vast array of devices.

2019 will be the year that the groundwork and preparation for 5G rollout really picks up, with the potential for the beginning of a limited rollout by the end of the year.

For manufacturers looking to fully invest in IoT this will be a huge gamechanger, giving them true real-time control and insight which will result in being able to make faster, more impactful decisions.

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67

Blockchain boom Almost unheard of by anybody outside the cryptocurrency-sphere until 2017-18, blockchain is now taking the manufacturing world by storm. The coming year will see a direct impact of blockchain on financial operations, boosting speed, security and a cost-effective solution to transactions.

Looking at the supply chain, blockchain technologies will also influence different areas from management, tracking and transaction reporting.

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AR and VR enhancement The majority of manufacturers, or those working in the sector, have encountered some form of virtual or augmented reality in recent years.

Whether it is quirky start-ups or large-scale global brands, we are set to see more of this technology incorporated into existing processes and products to enhance overall experience.

We will continue to see new companies emerge, identifying innovative ways of adopting it, while established organisations will mine their business to uncover areas of improvement.

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69

Cyber security Cyber threats will continue to dominate technology spending. As companies become more digital, and increase their connected footprint, they will be increasingly exposed to cyber criminals. At the same time, they need to balance the need for security with the need to be able to innovate.

Businesses will need to develop new ways of securing their operations, with a growing realisation that the firewall approach isn’t fit for purpose, either in preventing breaches or allowing them to be more agile.

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IoT expansion It is widely accepted that the Internet of Things (IoT) market is growing at an exponential rate and becoming the norm for many, with 3.6bn connected devices used for daily tasks this year. In 2019, we can expect this growth to continue to spread.

Boosted by 5G connectivity and advances in sensor technology, the manufacturing industry will see more IoT devices than 70

ever before to drive forward the industrial revolution.

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DECEMBER 2018

73

Industry/university collaboration There has long been an understanding of the value of industry/university collaborations; however, until recently this was limited to a few select partnerships. In 2019, links between industry and academia will continue to strengthen as both sides seek to use the resources and expertise of the other to enhance their own offerings and increase their understanding of the theoretical and practical applications of new technologies.

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EVENTS & A S S O C I AT I O N S

The biggest industry events and conferences EDITED BY SEAN GALEA-PACE from around the world 13 FEBRUARY 2019

Manufacturing Robotics Summit [ BIRMINGHAM, UK ] Part of the summits organised by The Manufacturer publication, and a CPD (Continuing Professional Development) certified event, Manufacturing Robotics Summit is the UK’s largest gathering of manufacturing automation professionals from across the automotive, electronics, food and drink and FMCG industries.

The summit will analyse how to successfully expand the use of automation within manufacturing opera74

tions, around three conference streams: Robotics,

26–27 MARCH 2019

The American Manufacturing Summit [ CHICAGO, IL ]

Industrial and Sensors. The summit will have more

The American

than 80 attendees, offering lectures by more than

Manufacturing Summit

15 speakers in 12 discussion groups.

is definitely one to look

The organisers say: “Manufacturing Robotics

forward to in the new

Summit brings together Operations, Automation

year. The annual event

& Control and Manufacturing executives in an inter-

is a leadership-focused

active format that sits delegates alongside

meeting designed

some of the UK’s most experienced indus-

around improving plant

trial robotics and automation users, and

floor operations and

experts from world class solutions pro-

manufacturing strategy

viders – with an emphasis on expertly-led

worldwide. The 2019

small group discussions.”

Visit Website

summit provides an opportunity to explore key case studies in the industry.

Visit website DECEMBER 2018

75

10 APRIL 2019

The Industrial Data Summit [ LONDON, UK ] As the UK’s largest gathering of manu-

The organisers say: “For the last two

facturing data professionals with over

years, Industrial Data Summit has

120 data-minded executives coming

brought together CDOs, CIOs, CTOs

together, April’s event is one to keep an

and Heads of Operations, Manufactur-

eye on. The executives from the UK’s

ing, Engineering & Production in an

biggest automotive, aerospace,

interactive conference format that sits

defence, electronics, pharma, food and

them alongside some of the world’s

electronics manufacturers are set to

most sophisticated industrial users of

discuss the role of Big Data across

data – and experts from world class

their businesses. The event is also part

technology companies.”

of The Manufacturer’s summits and is

Visit website

a CPD-certified event. w w w.ma nufa c t uri nggl o b a l. com

EVENTS & A S S O C I AT I O N S

76

15 MAY 2019

The Manufacturing Finance Summit [ OXFORD, UK ] Another one of the summits offered by

revolving around three conference

The Manufacturer, May’s meeting sees

streams: Risk, Capital and Innovation.

the UK’s largest gathering of manufac-

The organisers say: “The role of the

turing finance professionals with 80

Finance Director in British industry is

like-minded finance executives attending

changing – in response to new appro-

to explore how the finance function is

aches to risk management, capital

evolving within UK manufacturers. The

investment and innovation. There are

executives come from a range of indus-

a number of key issues being addressed

tries such as automotive, aerospace,

at the UK’s biggest gathering of manu-

defence, electronics, food and drink

facturing finance executives – in a

and FMCG.

format that sits delegates alongside

With attendees given the option to

speakers to enable you to have con-

choose which speaker they listen to,

versations that matter most.”

the summit offers freedom of choice

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DECEMBER 2018

JULY 2019

The Global Manufacturing & Industrialisation Summit [ YEKATERINBURG, RUSSIA ]

19–22 JUNE 2019

Manufacturing Expo 2019

The Global Manufacturing and Industrialisation Summit focuses on innovation and Fourth Industrial Revolution technologies in the global manufacturing

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sector. In particular, the conference

Over 85,000 industrialists in the manu-

will look at the UN’s Sustainable

facturing and supporting industries

Development Goals and the role of

within the Association of Southeast

nature-inspired technologies in manu-

Asian Nations (ASEAN) are set to meet

facturing. This theme will be explored

with technology providers at the event

through interactive debates, sessions

in June.

and workshops.

The organisers say: “With Manufac-

The organisers say: “The GMIS is

turing Expo, over 85,000 industrialists

designed to create a universal consen-

in the manufacturing and supporting

sus by unifying governments, businesses

industries within ASEAN will meet with

and civil society to take a transformation

technology providers representing

approach towards reshaping the future

2,400 brands of plastic manufacturing

of manufacturing. GMIS aims to promote

technology, mold & dye, auto-parts

a roadmap for future development to

making machinery, automation &

echo the evolution in international trade

assembly technologies and surface

and global best practices.”

& coating solutions from 46 countries

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as well as International Pavilions.

Visit website w w w.ma nufa c t uri nggl o b a l. com

77

78

A S I A – PA C I F I C

INNOVATION ACROSS THE MALAYSIAN MANUFACTURING INDUSTRY WRIT TEN BY

CATHERINE S TURM AN PRODUCED BY

K RIS PA LMER

79

OSRAM OPTO SEMICONDUCTORS

OSRAM Opto Semiconductors is embracing digitalization in transforming its manufacturing operations. Director of Digital Manufacturing and Industrialization (DMI), Samivel Krishnamoorthy, speaks to Manufacturing Global

W

ith a history of over 110 years and based on more than 40 years of continuous innovation in opto semiconductors,

OSRAM has set world leading standards in the fields of illumination, visualization, treatment and sensor technology. Its product portfolio covers 80

mobility, increasing safety and security, creating connections, and enhancing health and wellbeing. Their mission is to improve people’s lives in almost all areas.

Commencing production in Malaysia in 1972 as Litronix before officially becoming OSRAM Opto Semiconductors (OSRAM OS) in 1999, the business has focused on transferring essential knowledge, building local talents and producing best-in-class products for the lighting market.

Joining OSRAM OS about 10 years ago, Director of Digital Manufacturing and Industrialization (DMI), Samivel Krishnamoorthy has been instrumental in its digitalization journey. “In 2009, I joined OSRAM Penang - the first semiconductor wafer fabrication plant (Fab) of OSRAM OS outside of Germany. I was tasked to help addDECEMBER 2018

A S I A – PA C I F I C

81

w w w.ma nufa c t uri nggl o b a l. com

To accelerate your ambitions, visit our website: dimensiondata.com

A S I A – PA C I F I C

ress quality related issues due to

tools to the host system and automat-

manual processes performed by the

ing them. The CIM experience I gained,

operators. This task eventually expa-

helped me realize that the factories of

nded to setting up dedicated teams

the future would progressively adopt

working on Computer Integrated Man-

CIM and Factory Integration.

ufacturing (CIM) and automation con-

“Coming from a semiconductor opera-

cepts throughout our Wafer Fab. In

tional perspective and background, it

2012 our Wafer fab achieved full CIM

helped me to identify and adapt to the

coverage. Now, we are extending this

differences of an integrated circuit (IC)

effort to our Assembly & Test facilities,”

Fab and Assembly & Test operations

he says.

vis-a-vis compound semiconductor.

“Starting out in 2004 as a CIM Engi-

The compound semiconductor industry,

neer in SilTerra Malaysia - a 200mm

including companies like ours were not

Wafer Fab, I got my grounding on CIM

in the same league with our DRAM,

and Factory Integration, connecting

NAND, Logic Fabs in terms of automa-

E X E C U T I V E P R OF IL E

Samivel Krishnamoorthy Samivel Krishnamoorthy joined OSRAM Opto Semiconductors in 2009 and was instrumental in engineering the transformation of Asia’s most advanced LED Wafer Fab Facility in Penang, the first of its kind for OSRAM. Following which, he is currently spearheading the digitalization initiatives of its Assembly & Test Plant.

He has championed the introduction and adoption of SEMI standards as de-facto factory integration standard within the organization globally while phasing out legacy data collection system within the organization.

w w w.ma nufa c t uri nggl o ba l .c o m

83

OSRAM OPTO SEMICONDUCTORS

tion capabilities. Even for me, it took some transitioning to adapt to 100mm and later 150mm Fab environment as opposed to the familiar 200mm Fab experience I came from.”

84

EMBRACING CHANGE From urbanization to digitalization, infrastructure to security, Internet of Things (IoT), digital communication, smart cities and buildings along with human centric lighting and horticulture – OSRAM has its footprint in the thick of the lighting action.

Mobility is also a significant area of focus, particularly in relation to autonomous driving.

“As these domains flourish and new ideas and innovations come to the fore, manufacturing operations need to be more flexible and scalable – meaning DECEMBER 2018

A S I A – PA C I F I C

CLICK TO WATCH : ‘LIGHT FROM CRYSTALS — OSRAM OPTO SEMICONDUCTORS’ 85 running multiple high mix low volume

them that there are more effective

operations in parallel,” notes Samivel.

ways of doing things by delivering proof

“We are becoming more customer

of concepts and moving people out of

centric and championing the ability to

their comfort zones.”

meet customers’ highest expectations.

This means, organizations that were

DRIVING OPERATIONAL EXCELLENCE

traditionally going for “high-volume”

In his role as Global Requirement

manufacturing models to meet their

Management Director for OSRAM

targets, may need to redefine their

OS, Samivel is establishing the OS

operational ideology to focus on “high

wide requirement management

value” manufacturing models. This

framework for the company’s Digital

inherently brings complexity that could

Manufacturing & Industrialization ini-

redefine existing factory physics targets.

tiatives. In addition to this, his CIM

“At OSRAM OS, we needed to change the mindset of the people and convince

department currently works to support the five main business divisions w w w.ma nufa c t uri nggl o b a l. com

OSRAM OPTO SEMICONDUCTORS

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A S I A – PA C I F I C

within its Penang facility - comprising its Front-End Wafer Fab and four of its Assembly & Test functions, along with all associated R&D activities.

Samivel represents OSRAM in various external organizations such as CREST (Collaborative Research in Engineering, Science and Technology) and TalentCorp to help develop Malaysia’s talent pool. In SEMI (Semiconductor Equipment and Materials International), he is a member of its Information & Control Technical Committee in reviewing and approving the Factory Integration related standards.

DIGITAL INVESTMENT

“ At OSRAM OS, we needed to change the mindset of the people and convince them that there are more effective ways of doing things by delivering proof of concepts and moving people out of their comfort zones” — Samivel Krishnamoorthy, Director of Digital Manufacturing and Industrialization (DMI)

Whilst Samivel remains a key figure

processes either before or while

in the transformation of OSRAM OS’

automating/digitizing our manufactur-

manufacturing facilities in Penang and

ing lines. Some processes in this

other locations, the business has look-

category involve operator decision

ed to anchor its goals to the digitaliza-

making, human intervention in running

tion levels achieved in the IC Fabs, and

equipment and transactional/logistical

implement a global roadmap utilizing

complexities,” he explains.

de facto semiconductor norms.

“The main challenge we faced was

“Secondly, it was imperative to keep our intent focused proceduralizing the

in creating a paradigm shift in moving

value-added processes by focusing

away from the old ways. Our branding

on a number of key things. These are

tagline for our initiative – ‘LESS is MORE’

monitorability, repeatability, controlla-

- serves as a catalyst to emphasise on

bility, flexibility – essentially keeping

the need to remove non-value-added

things simple.” w w w.ma nufa c t uri nggl o b a l. com

87

OSRAM OPTO SEMICONDUCTORS

OSRAM OPTO SEMICONDUCTORS ( M A L AY S I A)

€1.7bn Approximate revenue in 2017

1999

Year founded

88

7,000

Approximate number of employees

DECEMBER 2018

A S I A – PA C I F I C

Moving away from introducing multiple systems to close the digitalization gap, OSRAM OS has taken the more complex route of platforming its digitalization tools. This is to scale on connectivity and create the necessary gravity by establishing a consistent optimised data flow throughout its Fabs. By assessing its own capabilities which align with semiconductor best practices, the business has harvested low hanging fruits by ticking off topics which are easily addressed before looking at further complex areas.

“We needed sound solution providers to realise our vision. Partners like Vistrian, ATOS, Dimension Data, our equipment suppliers, and a long list of others are the cogs in our digitalization wheel in Penang. Once the baseline was established, we focused on completing system to system integration which was easiest to realise as those systems were under our direct control. Once the system to system integration was done, we coupled the system to equipment in our shop floor which was/and still is the more challenging part,” he continues.

“Our equipment suppliers were not known to support the compound semiconductor industry with the same integration capabilities offered to the semiconductor peers (in this case SEMI standards such as SECS/ GEM and E142). It took a lot of discussions, negotiations and re-negotiations – and in some cases even haggling – to get them to agree and deliver such integration possibilities. Once achieved, we moved to making the requirements mandatory in our equipment w w w.ma nufa c t uri nggl o b a l. com

89

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procurement strategies. This cycle

new blood into the organisation. Having

was also to repeat for our Assembly &

the demand from customers to bring

Test implementations when we started

Front End capabilities into our Back

later in 2014 and is still an ongoing pra-

End also helped give the necessary

ctice we adhere to.”

impetus for this initiative. We are curr-

Using the same platform for its Ass-

ently deploying the same concepts

embly & Test operations to capitalise

and implementations in two of our sites

on the possibility of operator mobility,

in Wuxi, China and Kulim, Malaysia.”

the plan was initially met with skepti-

Filtering into its transformation,

cism. “Achieving this for an IC Assem-

OSRAM lives from employees contribut-

bly & Test operation is relatively easier

ing to the company’s success with

as opposed to a compound semicon-

enthusiasm. Working in OSRAM means

ductor,” observes Samivel. “It took

experiencing a trust-based atmosphere

multiple tries within our teams along

alongside open and respectful interac-

with top down targets and bringing in

tion. Investing in both technical compe-

A S I A – PA C I F I C

91

“ The products need to have staying power — need to be of good quality — and a good data landscape with the right verifications and validations in place will help achieve that” — Samivel Krishnamoorthy, Director of Digital Manufacturing and Industrialization (DMI)

tency related training and emotional quotient development, the business has established the OSRAM Skills and Development Center (OSDC), a dedicated building to support training activities all year long. Since its inception, it has become the central physical entity that focuses on OSRAM’s formation and propagation of career, operational, technical, academic and leadership development, along with digitalization tool trainings and new employee orientation/integration programs. w w w.ma nufa c t uri nggl o b a l. com

OSRAM OPTO SEMICONDUCTORS

C OMPA N Y FA C T S

• The business has looked to anchor its goals to the digitalization levels achieved in the IC Fabs, and implement a global roadmap utilizing de facto semiconductor norms.

92

“Our Managing Director - Dr. Roland Mueller is a strong advocate and believer in investing in people development. Under the auspices of OSDC – we aim to achieve our missions of: • Providing equal development opportunities for all employees, in both personal and professional aspects.

• To develop the full potential of employees through both technical and management programs.

• To provide structured programs and infrastructure that will produce competent and highly skilled employees.

• To encourage a culture of daring where failure and learning are part of the process.”

DECEMBER 2018

• OSRAM OS has taken the more complex route of platforming its digitalization tools. This is to scale on connectivity and create the necessary gravity by establishing a consistent optimized data flow throughout its Fabs • The business has established the OSRAM Skills and Development Center (OSDC), a dedicated building to support training activities all year long

A S I A – PA C I F I C

CLICK TO WATCH : ‘KULIM - MOST MODERN PRODUCTION SITE OF CHIPS FOR LEDS ON 6 INCH WAFERS’ 93

INNOVATING FOR THE FUTURE

firms have been brought in to further

As we keep innovating and improving

explore its potential. Additionally, it has

our products and applications it will

sought to deploy a number of cloud-

become increasingly essential for

based solutions to support its produc-

OSRAM to acquire the right products

tivity tools in relation to its IT systems.

for each market, which can be further

“We have robotics running our major

analyzed through the adoption of

manufacturing processes, but we are

advanced data analytics.

also exploring possibilities of inter pro-

“The products need to have staying

cess logistical handling via the use of

power – needs to be of good quality

robotics – i.e. automated transport sys-

– and a good data landscape with the

tems and also manual process auto-

right verifications and validations in place

mation with COBOTS. However, we

will help achieve that,” says Samivel.

are still in the evaluation stage and are

In the adoption phase of big data at OSRAM, a number of consultancy

hoping to kick-start some of these initiatives soon once we have the right w w w.ma nufa c t uri nggl o b a l. com

OSRAM OPTO SEMICONDUCTORS

teams established to champion this,” he adds.

“We are also currently deploying Customer Relationship Management

mark, our standards need to raise along with it,” says Samivel.

“Our customer feedback has been

(CRM) solutions from Salesforce to

tremendously positive across all digit-

help with our forecasting topics and

alisation initiatives. Our hiring strate-

our customer relationship manage-

gies are going after the best in class

ment. This is another digitalization

talent pool who could work with these

topic that we are excited about and

operational demands in a continuous

that could also help us respond spee-

improvement frame of mind. Our tar-

dily to market demands,” he adds.

gets are continuously enhanced with

Housing a unique mission statement, to unlock the potential of light to imp94

“As we constantly raise the bench-

newer strategies to be the market leader in our domain.”

rove people’s lives, OSRAM’s diverse

“Samivel reminds organizations em-

portfolio will continue to deliver sign-

barking on any digitalization initiatives

ificant financial gains.

from throwing caution to the wind – as

DECEMBER 2018

A S I A – PA C I F I C

95

digital solutions alone will not solve all

fore, any such endeavors should start

inherent organisational flaws. If there

by investing in equipping the people

are inherent lack of manufacturing

who run those processes the necessary

competencies, even the best in class

core competencies� he ended.

solutions will fail to deliver the promised results. No amount of automation or artificial intelligence could compensate for the lack of operational understanding - and the investments might not yield the expected results. Therew w w.ma nufa c t uri nggl o b a l. com

96

DECEMBER 2018

NORTH AMERICA

perational excellence in the digital factory WRIT TEN BY

DA LE BENTON PRODUCED BY

TOM VENTURO

w w w.ma nufa c t uri nggl o b a l. com

97

AEROJET ROCKETDYNE

With an advanced manufacturing facility, providing the digital factory of the future, Aerospace Rocketdyne demonstrates operational excellence or over 70 years, Aerojet

and the industry has changed a lot

Rocketdyne has delivered

in the past decade,” he says. “With

innovative solutions to

Aerojet Rocketdyne today, I am

aerospace and defense market

managing a group of outsourcing

customers all over the world. The

partners that provide IT services to

company provides propulsion and

our company. I look at strategy and

energetics technologies to space,

technology development and then

missile defence, strategic, tactical

work out how we bring those

missile and armaments customers,

technologies to the operation side

and lives and dies by a simple

of things so that we can start

mission: to build a ‘brighter future

implementing those enhancements

for the next generations… who look

while adding business value to our

to new frontiers and advances in

internal customers.”

F 98

global technologies’.

As technology continues to

Working with customers across a market as delicate and important

disrupt and redefine industries and

as the defence and aerospace

markets all over the world, such

industries, where information and

a leading company as US-based

data are key, there is one conversa-

Aerojet Rocketdyne must evolve in

tion surrounding technology that

a changing landscape. This is

continues to grow even today.

something Chief Technology Officer

“There’s definitely a major focus

(CTO) Alan Avakian understands.

on cybersecurity, given the number

“Technology continues to leapfrog

of high-level security breaches that

DECEMBER 2018

NORTH AMERICA

99

“ WHAT DOES ‘DONE’ LOOK LIKE IN OUR WORLD? WE ARE CONSTANTLY FIGURING OUT HOW WE GET THERE, WHILE BEING ABLE TO MEASURE OURSELVES ACROSS THAT JOURNEY” — Alan Avakian, Chief Technology Officer (CTO) at Aerojet Rocketdyne

w w w.ma nufa c t uri nggl o b a l. com

AEROJET ROCKETDYNE

have happened over recent years

learning as well as robotic process

across the globe,” says Avakian. “Right

automation (RPA) which helps

now, it’s all about how we protect our

companies like Aerojet Rocketdyne

company assets and information, and

develop new opportunities and new

make sure it is maintained for competi-

markets that previously did not exist.

tive advantages. Then we look at how

Avakian points to Uber as an example.

we enable those critical business

“Nobody dreamed up Uber ten years

capabilities where we can focus in on

ago but here it is today and it’s a

digitisation, retire high-risk legacy

multi-billion-dollar company,” he says.

systems and look towards creating

“That’s what AI and robotic machine

intelligence out of that information.”

learning are providing us with: they’re

This, he feels, is where we see an industry-wide turn towards robotics, artificial intelligence (AI) and machine

creating new markets for companies that don’t even exist yet.”

The challenge, then, as Aerojet

100

“ WE’RE AT A VERY PIVOTAL POINT WITHIN THE WORLD RIGHT NOW WHERE THE ENVIRONMENT IS CHANGING RAPIDLY. IT’S DIFFERENT FROM WHAT IT WAS IN YEARS PAST AND INFORMATION APPEARS TO BE KING. SO, IT’S HOW DO WE USE THAT INFORMATION TO OUR ADVANTAGE AND CAPITALIZE ON IT GOING FORWARD?” — Alan Avakian, Chief Technology Officer (CTO) at Aerojet Rocketdyne

DECEMBER 2018

NORTH AMERICA

CLICK TO WATCH : ‘FUEL FOR THOUGHT – S1 E3 MARS INSIGHT’ 101 Rocketdyne moves into new markets

country, the challenge is accelerated.

and explores new opportunities

“Our customers are looking for that

through technology and innovation,

innovative solution that provides those

becomes one of catering to new and

technologies or competitive edges,

evolving customers. The customer of

but does so from an affordable

today requires cost-effectiveness

perspective where increased competi-

without compromising on quality.

tion is encouraged to get the best

Avakian recognises that the company

value proposition,” he says.

must be able to provide its market lead-

“So whenever I’m thinking of those

ing best practices, all the while doing

new things that are innovative and

so in a cost-effective way and main-

cutting edge, I’m always thinking about

taining a competitive advantage. When

how we can implement them in such

working with NASA to put satellites

a way that it is secure and meets our

into orbit and providing missiles and

customers’ requirements as well as

defence systems to protect the

enabling the business so that we can w w w.ma nufa c t uri nggl o b a l. com

AEROJET ROCKETDYNE

start accelerating things. It’s about getting to a point where we’re innovating and being able to provide IT using a services model versus building it in as an on-premise solution.”

As a testament to this understanding, Aerojet Rocketdyne has invested in the construction of an Advanced Manufacturing Facility in Huntsville, Alabama. This new facility represents complete technology enablement through the use of information, since Aerojet Rocketdyne prototyped a number of digital factory initiatives that utilise IT through automation, robotics and even 3-D printing equipment. “This facility and the innovation

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NORTH AMERICA

we are fostering there provides us with a competitive edge,” says Avakian. “We’re taking it to the next level where we implement more automation as it provides us with more information and creates markets that we didn’t have before.”

“IT brings it all together: our manufacturing execution system, our product lifecycle management system, our ERP system and our business intelligence systems all working together to bring information to our fingertips.

We can then start making better decisions based on that information.”

103

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AEROJET ROCKETDYNE

Building and operating an Advanced Manufacturing Facility places Aerojet Rocketdyne at the cutting-edge of technology and innovation, but, as noted above, modern customers demand a combination of innovation and cost-effectiveness. To this end, as Aerojet Rocketdyne moves into new markets and develops new technologies, it must continuously assess its own capabilities to do so. One such way in which the company is doing this is through its Competitive Improvement Program. The goal of this program is a simple one: to ensure that its products are more affordable across the enterprise and 104

bring that value back to its customers.

The Advanced Manufacturing Facility is but one part of this program as Aerojet Rocketdyne chose to consolidate its footprint; the next step is rationalisation across the entire enterprise. “It’s about our product affordability going back to our customers,” says Avakian, “and along with that we’re also reducing our administrative and overhead costs. In order to bring value back to our customers, it’s about making sure we’re using everything that we can from an efficiency and effectiveness perspective.”

A Continuous Improvement Program is all well and good, but much like the information provided through automation and machine learning, Aerojet Rocketdyne must extract DECEMBER 2018

NORTH AMERICA

105

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AEROJET ROCKETDYNE

the value from this information in order to ensure that it is achieving what it set out to achieve. To this end, Aerojet Rocketdyne uses service level agreements, metrics, key performance indicators (KPIs) and critical performance indicators (CPIs) as a means of measuring the company against its strategy and architecture. “What does ‘done’ look like in our world? We are constantly figuring out how we get there and measuring ourselves across that journey,” says Avakian.

“Using data to get there is very much 106

ingrained in our company so that we can ensure we’re making objective, quantifiable measurements to be able to evaluate if we did realise what we were trying to achieve in the beginning.”

In the technology space, the

nies are able to “spin up environments

measurement of success is crucial

and applications with the snap of a finger

both internally and externally and with

and a click of a mouse.”

technology and innovation evolving at

“Now we can bring technology to our

an increasing rate, communication

customers more quickly,” he explains.

proves key. Avakian is a firm believer

“They can touch it and feel it and that

in proof of concepts and providing real,

provides them with the confidence that

tangible examples of the returns on

we can invest in it and provide that to

investment (ROIs) that technology can

the masses,” he says. “That’s how

bring. He feels that in today’s digital

I think it’s changed the value proposi-

age, this is more vital than ever since

tion while being able to get something

software as a service (SaaS) compa-

to market so much more quickly than

DECEMBER 2018

NORTH AMERICA

we could in the past.�

scape, it shows no sign of slowing

Aerojet Rocketdyne has been a market

down. Through sound investment in

leading innovator for more than 70 years

its Advanced Manufacturing Facility

and as technology has continued to

as well as its Continuous Improvement

define and redefine the market land-

Program, the company has readied

E X E C U T I V E P R OF IL E

Alan Avakian Alan Avakian is the Chief Technology Officer of Aerojet Rocketdyne. In this role, he leads the organisation’s Technology Management function responsible for shared business service strategy and operations including Networking, Infrastructure, Applications, and End User Support services. He coordinates with line-of-business leaders to understand their needs (including anticipated technology and product changes) and works with IT outsourcing partners for execution.

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107

AEROJET ROCKETDYNE

“ WHAT IT DOES, IS BRING ALL THE DATA TOGETHER WHERE OUR MANUFACTURING EXECUTION SYSTEM, OUR PRODUCT LIFECYCLE MANAGEMENT SYSTEM, OUR ERP SYSTEM, AND OUR BUSINESS INTELLIGENCE SYSTEMS ALL WORK TOGETHER TO BRING THAT INFORMATION TO OUR FINGERTIPS SO WE CAN START MAKING BETTER DECISIONS” — Alan Avakian, Chief Technology Officer (CTO) at Aerojet Rocketdyne

108

CLICK TO WATCH : ‘WITHOUT LIMITS’

DECEMBER 2018

NORTH AMERICA

itself to cement its market leading position as it embraces the future of technology and innovation. Avakian recognises this and points to information as being the true enabler of technology, both today and tomorrow.

“We’re at a very pivotal point within the world right now where the environment is changing rapidly. It’s different from what it was in years past and information appears to be king – so it’s about how we use that information to our advantage and capitalize on it going forward,” he says.

“Staying in front of it will provide you with the ability to enable competitive advantages and things of that nature, as we successfully continue to do here at Aerojet Rocketdyne. We must share that information to be able to collaborate and get to these new things that weren’t even possible before.”

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109

110

The Dark WRIT TEN BY

JOHN O’HANLON PRODUCED BY

TOM VENTURO

DECEMBER 2018

NORTH AMERICA

111

State w w w.ma nufa c t uri nggl o b a l. com

SIGMAPOINT

SigmaPoint is poised to reinvigorate electronics manufacturing in North America.

The Canadian provider of electronics manufacturing services (EMS) has refined its lean manufacturing practices over a decade, and is now on a journey to a truly disruptive supply chain solution

W

ith increasing unease over the imposition of tariffs on goods and materials imported into the USA, manufacturers and design-

ers are concentrating their attention on the likely 112

effect of ever escalating disincentives to the offshoring model. There are plenty of other reasons to look anew at the advantages of bringing as much as possible of the value chain back, among them the reducing labor cost advantages and, as innovation takes a front seat, the need to protect and control IP. It’s against this background that the SigmaPoint Technologies has launched a five-year project that will seriously disrupt the traditional end-to-end supply chain and lead the electronics industry toward a much more highly automated model.

In just 19 years the Cornwall Ontario based company has grown from zero to nearly 300 employees, partnering with major OEMs such as General Dynamics and Kontron through its commitment to lean manufacturing and its triple focus on simplicity, velocity and value add. As DECEMBER 2018

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SIGMAPOINT

“When you get into the prescriptive and predictive portions of the AI interface … you’re actually starting to enter a future state where you’re able to look at the variables without any human interface” — Leah Slaughter, VP of Supply Chain, SigmaPoint Sylvain Duval, SigmaPoint’s Director of

bringing certain products back to

Customer Experience, says: “We have

North America. Being a Canadian

been able to demonstrate to our

entity, our customers are burdened by

customers the solid business case for

no tariffs whatever.” Thus, being

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MONTH 2018

NORTH AMERICA

CLICK TO WATCH : ‘MADE IN CORNWALL – EPISODE 1: SIGMAPOINT’ 115 Canada-based is just one of a number

Duval. “That is why SigmaPoint is trying

of market factors favoring Sig-

to build the EMS global supply chain of

maPoint’s growth – but the chief

the future. We are putting together the

advantage of this company lies in its

building blocks so that we can maintain

commitment to innovation.

our competitive advantage and enable

A key factor, currently and over the

our original equipment manufacturing

coming five years, is its leveraging of

(OEM) customers to bring back their

artificial intelligence (AI) and machine

projects from Asia to North America.”

learning (ML) when it comes to

The project proper had its birth in

competing with Asia. China will always

2017 at SigmaPoint’s facility within the

be able to undercut on labor so what

new privately-funded tech accelerator

more can SigmaPoint do? “We know

Catalyst137 at Kitchener. This focuses

that to be able to compete effectively

on NPI and fast prototyping, with an

we have to find ways of removing every

eye to volume production at the

bit of waste and inefficiency,” says

Cornwall factory. The government has w w w.ma nufa c t uri nggl o b a l. com

SIGMAPOINT

encouraged the creation of a ‘super-

Leah Slaughter based on a long

cluster’ of companies working together

acquaintance. “It is truly the most

to share IP and move toward next-gen-

flexible piece of software that I have

eration manufacturing, he explains.

ever found throughout my entire

“Catalyst137 spearheaded the creation

career,” she states. “With the amount

of our AI/ML project together with key

of intelligence that we are building into

customers, suppliers and our technical

the prescriptive interface, this was the

partner Kinaxis.”

only tool that could handle the

Kinaxis is the developer of Rapid

intricacies that I wanted to build into

Response, the software platform that

the AI/ML model.” Kinaxis is a key

was chosen by VP of Supply Chain

partner in the project, which brings in

E X E C U T I V E P R OF IL E 116

Leah Slaughter Leah has close to 20+ years of extensive experience in Supply Chain and redesigning end-to-end supply chains evaluating where supply chain resources are best deployed to maximize company revenue and improve customer delivery performance by using an assessment of strategic risk for the company through strategic sourcing, demand intake, supply chain management, procurement, materials management, manufacturing, logistics and customer service. Leah’s experience with component distribution, various multinational EMS providers, OEM’s as well as consulting for Supply Chain process and applications has allowed her to share her knowledge and manage teams of up to 150+ people. Graduating with honours and on the Dean’s List, Leah received Diploma’s in Materials Management & Distribution and Marketing & Business Administration from Sir Sandford Fleming College.

DECEMBER 2018

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117 manufacturers like ON Semiconductor,

the supply chain, with a platform that

distributors including Arrow Electron-

can plan its own way through and out

ics and Future Electronics and OEM

of exceptions and pitfalls that occur,

customers Miovision and L3 Wescam

leveraging deep and continuous

– all with connections to the Catalyst137

machine learning.”

facility. It places SigmaPoint right at the

The part that is not, and probably

center of a heavily populated hub of

never will be fully automated, she calls

start-ups and OEMs that are geared

the control tower. This is the human

toward IoT innovations.

interface that monitors the process,

The goal by 2022 is to comprehen-

constantly reprogramming the

sively automate the supply chain so

machine as exceptions are encoun-

that 90% of it is running in a ‘dark state’

tered. The jobs will not always be the

with processes continuously running

supply chain professional roles of

without human intervention. “Achieving

today, but might require a ‘control tower

this will bring us a huge competitive

architect,’ an ‘AI programmer’ or an ‘AI

advantage through risk mitigation in

profile exception specialist.’ w w w.ma nufa c t uri nggl o b a l. com

SIGMAPOINT

“ We have been able to demonstrate to our customers the solid business case for bringing certain products back to North America” — Sylvain Duval, Director of Customer Experience, Sigmapoint

118

DECEMBER 2018

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“Artificial intelligence and machine

re-programme the artificial interface to

learning on their own are really just a

ensure that the right things are being

process automation but it’s when you

learnt by the machine and that the next

get into the prescriptive and predictive

decision that it makes will be correct.”

portions of the AI interface, and into

AI and ML, then, have the potential

deep learning in the machine learning

to make existing practice efficient,

portion of it, that you’re actually

but even today supply chain is seen

starting to enter a future state where

as a very linear, end-to-end process.

you’re able to look at the variables

SigmaPoint looked for a holistic

without any human interface. The

model that would link each of the

control tower will always be a piece of

nodes direct to the digital core in real

the puzzle though, because we need

time. “The linear model introduces

intuition built-in to some of these

latency as it moves from node to

decisions. We need to regularly

node,” says Slaughter.

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E X E C U T I V E P R OF IL E

Sylvain Duval Sylvian has more than 27 years’ experience in New Production Introduction in the high-tech sector. He worked for 10 years at Nortel Networks as Test Engineering Director and Senior Product Line Manager. He then followed an entrepreneurship career path working as Test Engineering Director for Ceyba (Ultra Long Haul Optical networking startup) in early 2000, co funding his own startup Daito Test Services in 2003 and co-funding Jordale Technology in 2006. Sylvain went back in the EMS world as Customer Service Director at Varitron before joining SigmaPoint. He holds a Bachelor Degree in Electrical Engineering and a Masters Degree in Concurrent Engineering from Sherbrooke University.

w w w.ma nufa c t uri nggl o b a l. com

SIGMAPOINT

“When we looked at spanning eight internal nodes with seven external supply nodes, upstream and downstream to give a full and entire supply chain solution leading to the dark state, we knew we had to connect the OEMs, the EMS, the distributor and the 120

manufacturer.” Her vision is to transcend the nodes or links in the supply chain conflating them in a compressed ‘super node’, always turned on, always transparent, and all powered up by Kinaxis Rapid Response.

Collaboration across the nodes, from the outset, was the always the key, emphasizes Duval. “AI and ML are

“ Catalyst137 spearheaded the creation of our AI/ML project together with key customers, suppliers and our technical partner Kinaxis” — Sylvain Duval, Director of Customer Experience, SigmaPoint DECEMBER 2018

NORTH AMERICA

buzzwords in the supply chain world but we are different in that we involved our partners right from the beginning, asking them to identify the upstream or downstream issues we could help solve with this new approach.”

The project remains at this stage an active development between SigmaPoint and its partners, but its effect is already being felt in the vibrant digital nexus emerging in Ontario, with startups, innovators and established players supporting the next generation of IoT companies. It is due to be unveiled by Slaughter in Washington DC in October to a broader population of supply chain professionals at Kinexions 18 the annual conference of Kinaxis. “I think the AI/ML project will attract much attention and potentially, with the partners that we are involved with and leveraging right now, it will change the supply chain landscape over the next five years to what we hope will be a revolutionary state.”

w w w.ma nufa c t uri nggl o b a l. com

121

122

Walbar: an engine of growth and operational efficiency WRIT TEN BY

JOHN O’HANLON PRODUCED BY

TOM VENTURO

DECEMBER 2018

NORTH AMERICA

123

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WA L BA R E N G I N E C O M P O N E N T S

124

Walbar Engine Components has undergone a considerable transformation over the past two years: it has overcome delivery, supply chain, manufacturing and quality issues to become both a world-class and a low-cost partner to its aerospace clients

W

albar is a long-established manufacturing and engineering company, founded at

Tempe, Arizona in 1951. Though it’s not a household name, it is well known amongst engine manufacturers worldwide: Walbar’s components can be found in the hot section of turbine engines around the world. Its main products include blades, vanes and related components used in aircraft and industrial turbine engines. The company was acquired in 1986 by

DECEMBER 2018

NORTH AMERICA

partnered with Cornerstone Capital Holdings to acquire Walbar, LLC. It represented a great opportunity to get deeply involved with a troubled company that was either too small or too tarnished to catch the interest of conventional private equity firms or strategic buyers. The deal was closed in September 2016 and Mr. Grein assumed the role of President, assembling a small team of industry professionals to get the transformation started. For a supplier to an aero engine OEMs like Rolls Royce and Pratt & Whitney, Walbar was under performing: quality and delivery performance were faltering, and a climate of mistrust had grown between Coltec Industries, and later, in 1999 by

Walbar and its customers. It was

Goodrich. In the following year, they

difficult to understand, Grein recalls,

started a plan to relocate their labor-

how such an adversarial relationship

intensive manufacturing from several

had developed. “When your customer

US locations to the port city of Guaymas

is an adversary it is impossible to get

in Sonora, Mexico. Later, in 2012,

the kind of collaboration that is

Goodrich was taken over by United

required to improve things,” he says.

Technologies Aerospace Systems.

By 2016, Walbar had been struggling

One problem, he found, was that there was a disconnect between the

and was losing its competitiveness,

customer-facing commercial group

as an under-managed division of a

and the plant where the parts were

multi-billion-dollar industrial conglom-

made. Faunna Bartlett, Vice President

erate. It was then that Tim Grein

of Sales and Contracts stated, “before w w w.ma nufa c t uri nggl o b a l. com

125

WA L BA R E N G I N E C O M P O N E N T S

126

Walbar was independent, the team was

company, which was a complete

bidding for all available work, some-

unknown. “When we walked into

times at prices that did not reflect the

Walbar two years ago, we had not

company’s costs.” The first change,

previously had the chance to meet the

therefore, was to align the sales effort

Senior Management Team, and we

and the plant. Nothing can be signed

were not sure what we would find.”

off until it has passed the scrutiny of

Apart from himself, Mr. Grein teamed

engineering, operations and supply

up with two associates, James

chain in collaboration with sales. “From

Dickson, as VP of Operations, and

that point forward, when we win new

Faunna Bartlett, as VP of Contracts

work everybody understands what it

and IT, both of whom helped to initiate

involves and is ready to execute on it.”

the operational improvements,

One thing that worried the new owners was the leadership of the DECEMBER 2018

commercial strategy and customer relationships. Much to the relief of

NORTH AMERICA

“ When we win new work everybody understands what it involves and is ready to execute on it” — Timothy Grein President and CEO, Walbar Engine Components

opment they proved super solid, capable and extremely dedicated to Walbar’s success.”

Radical change is often difficult, but in this case, it was met with huge relief at the Mexico plant – at last, they were being heard. It produced the expected results: within six months the business was speaking the same language of profitability and cost, and working sideby-side to drive toward world class operational excellence. James Dickson, VP of Operations, observed “the Team

everyone involved, the team quickly

was desperate for collaboration and

meshed and proved to be highly

focus. As soon as we set clear objec-

capable and motivated to help drive the

tives and started communicating, we

company’s transformation. “The Senior

began to see immediate change and

Management Team remains nearly

transformation in nearly every aspect

unchanged, and I am proud to say that

of the operation.”

as soon as we engaged them in decision making and strategy devel-

The current scope of work was another challenge that needed to be

E X E C U T I V E P R OF IL E

Timothy Grein Timothy Grein is Walbar’s President and CEO. Tim brings an array of experience in aerospace manufacturing and management in private equity environments. A West Point graduate and United States Army veteran, Tim began his professional career at GE Power Systems before transitioning into operations and executive leadership.

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127

NORTH AMERICA

“ By having extra machining capability we could reorient some of our flowlines to create permanent setups” — Timothy Grein President and CEO, Walbar Engine Components

with the full co-operation of the OEMs. The transition away from UTAS was abrupt and a complete surprise to the entire workforce. On the first morning of the new ownership, his presentation to the workforce set the stage for the level of employee engagement that had been achieved. “It seemed like the Senior Management team and employees were not communicated how the business was doing. We started by making a commitment on three things: firstly that our people come first and that we would not implement any change that would

addressed. “I think part of being

compromise employee health, safety

successful in the aerospace world is

or happiness; secondly that Quality

focusing on what you’re good at and avoiding distractions outside of your core competencies,” asserts Mr. Grein.

“We quickly highlighted a few groups of parts that were either priced incorrectly or deemed to be not our core competency and we engaged our customers to make some changes.

The customers could see our quality and delivery improvements and they started to work with us to help us get out of those loss-making parts.” While it was a long road, by the end of 2018, Walbar will have exited all of these, w w w.ma nufa c t uri nggl o b a l. com

129

WA L BA R E N G I N E C O M P O N E N T S

“ All of our growth focus is on aerospace components so the expansion allows us to create space for these in our original 70,000 sq ft facility” — Timothy Grein President and CEO, Walbar Engine Components

130

was of paramount concern and that every employee needed to recognize that our products are critical to the safe operation of airplanes; and thirdly that we all needed to understand that Walbar acts as a direct extension to our customers’ assembly lines so on-time delivery is vital. We committed to the employees that we would make no changes for short term benefits if they would compromise these three Key Principles.”

With these principles establishing some basic ground rules, Mr. Grein openly shared information about the company’s recent financial performance, preceding Cornerstone’s acquisition. The company had recorded significant losses and declining sales for the previous four years. “But then, I went on to DECEMBER 2018

NORTH AMERICA

explain why I remained optimistic about being able to fix things as a team. If we focused on three simple things, we would quickly return to profitability: (1) operational expense control, (2) improvements in productivity and efficiency, and (3) scrap reduction. As a real-time example I showed them that if all we did was eliminate our scrap ($3.6mm worth of castings were wasted), we would return to profitability.” Before this message was conveyed, it seemed like the blame had been placed on poor contract pricing. But a new level of awareness and accountability spread throughout the enterprise as a whole, with spectacular results: in the first nine months scrap rates were cut by 50% while nearly every other operating metric similarly improved.

As the team reflects on the journey of the first two years, it became clear that changes in operational management and employee engagement were the key factors in the transformation, however, technology played its part too.

Within the first three months of ownership, they invested in and implemented QC-CALC, a software program that statistically tracks process capability in real time. The plant operates more than 25 coordinate measuring machines (CMMs) that make critical measurements on the components. This quickly gave better visibility into the areas where process improvement was needed.

James Dickson said, “We also invested in new machines to created dedicated flow lines. We found that certain machines did not have enough volume to be dedicated to a particular “family” of parts and we were doing too many change overs, which introduced unnecessary variation in our processes. By adding select extra machining w w w.ma nufa c t uri nggl o b a l. com

131

WA L BA R E N G I N E C O M P O N E N T S

132 capability we could reorient some of

equipment can be very effective if used

our flowlines to create permanent

for the optimal work statement. For

setups. As soon as we did that and

example, with more than thirty (30)

could show positive performance

five-axis Huffman grinding machines,

improvements, our customers re-

managed with careful process control,

sponded by giving us more volume.” It’s

Walbar is very effective at producing

a virtuous cycle, he says: with greater

state-of-the art high pressure nozzle

volumes, it’s easier to justify dedicated

guide vanes (NGVs) and seal segments

flowlines and permanent setups.

for large commercial aerospace

The machinery at the Guaymas

applications. And during the last two

factory is a combination of legacy and

years, Walbar has invested heavily in

modern equipment, resulting from the

new machinery to expand its capabili-

previous ownership’s relocation of

ties, including the purchase of multiple

unwanted equipment and programs

Blohm grinders that are currently being

that they no longer wanted to keep in

used to manufacture extremely high-

the USA. Nonetheless, most of the

volume turbine blades for a leading

DECEMBER 2018

NORTH AMERICA

commercial engine.

The company’s performance improvements emboldened Cornerstone Capital to support an aggressive plant expansion. In September, exactly two years after becoming an inde-

“ With a competitive cost structure in Mexico the opportunities are endless for us” — Timothy Grein President and CEO, Walbar Engine Components

pendent company, Walbar held its grand opening of a 35,000 sq. ft

Mr. Grein and the Walbar team

facility that will initially be dedicated to

continue to look forward, seeking ways

Walbar’s non-aerospace products,

to continue the transformation that is in

such as turbocharger assemblies for

process. At this time, they are begin-

the locomotive industry. This bold

ning to implement a software program

expansion represents a 50% increase

to help manage real-time operating

in manufacturing space and makes

performance at the machine-level. This

space for further manufacturing flow

is a move to create a digital and visual

optimization and aerospace growth.

factory that will help to identify unutilized w w w.ma nufa c t uri nggl o b a l. com

133

WA L BA R E N G I N E C O M P O N E N T S

capacity while creating an engagement tool to give operators a channel for communicating inefficiencies throughout the facility. They are in the early

70,000

Sq Ft of manufacturing area

stages of this implementation, but

1951

are optimistic about the possibilities it will create.

Walbar’s current customer base is

Year founded

very internationally diverse, with 85% of its customers located outside of the

200+

USA. While the original attraction for these customers was the low-cost

employees

location, these customers are increasingly viewing Walbar as a leading 134

manufacturer able to compete, from a quality and delivery perspective, against any manufacturer in the world

“ We solely look for OEM partnerships on engine components, and our customers really appreciate that” — Timothy Grein President and CEO, Walbar Engine Components

DECEMBER 2018

for similar components. “With our capabilities, combined with a competitive cost structure in Mexico, the opportunities for Walbar are tremendous,” says Mr. Grein. In fact, he fully supports the aspiration of Walbar’s Senior Management Team, expressed six months after the transformation started: that Walbar will grow to become one of the largest independent engine component manufacturers in the world.

NORTH AMERICA

135

One characteristic that differentiates

customers really appreciate that. I think

Walbar from its competitors is that

the fact that we are not a competitor in

it intentionally does compete with

the aftermarket positions us to start

its OEM customers for aerospace

growing with other leading engine OEMs.�

components in the aftermarket. Many

Currently, as an example, Walbar does

competitors that make parts for the

not have any business with GE Aviation,

engine OEMs also seek to sell higher-

nor Safran, whom together account for

margin products on the PMA (parts

more than 65% of the market for large

manufacturer approval) market Walbar

commercial aero engines – a clear

avoids that potential conflict of interest.

opportunity for growth.

“We solely look for OEM partnerships on engine components, and our

Another benefit of gaining customer trust and cooperation is demonstrated w w w.ma nufa c t uri nggl o b a l. com

Founded in 1986 in Hebron, KY, Ellison Surface Technologies is an expert provider of thermal spray coating and special processes to many of the world’s largest manufacturers of aircraft engine, structural, industrial gas turbine and industrial components.

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“ It is clear that there are going to be capacity constraints for turbo engine components” — Timothy Grein President and CEO, Walbar Engine Components

in Walbar’s supply chain transformation. When Walbar became independent in 2016, approximately 90% of all external processing, notably coating work, was done in the USA or elsewhere since no suppliers in Mexico were qualified. However, Ellison Surface Technologies had already made significant investments in Sonora and had both the capability and the capacity required, and they were eager to support an ambitious plan.

“You can’t switch suppliers for a critical operation, such as coatings, without the support of your customers. But

DECEMBER 2018

NORTH AMERICA

after we had started to develop good rapport with them, the customers saw the potential benefits of both cost and cycle times reductions and we started a process to complete the qualification process. By December 2017, we transitioned our highest volume blades into Ellison and the relationship has been a resounding success for all parties.” Parts that previously had to be shipped to Connecticut could now be trucked 400 yards across the industrial park to Ellison. With volumes in the order of 50,000 – 90,000 blades/year

137

now being processed in 2-3 days rather than three weeks.Now, as the end of 2018 approaches, 85% of Walbar’s coating requirements have been successfully transitioned to remain within Mexico.

Since Walbar has reestablished itself

this opportunity. Today, with our quality

as a high-performing company, the

and delivery performance exceeding

business fundamentals are all in favor

customer expectations, we are ready

of the company driven by unprec-

to capitalize on these opportunities.”

edented demand for new engines and airplanes. “There is a widely held consensus that there will be significant capacity constraints for turbine engine components. Two years ago, we set out to position Walbar to be prepared for w w w.ma nufa c t uri nggl o b a l. com

138

Prometeon Tyre G Manufacturing efficiency through operational excellence WRIT TEN BY

DA LE BENTON PRODUCED BY

JARROD K NIGHT S

DECEMBER 2018

EUROPE

Group

139

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PROMETEON TYRE GROUP

Through an efficiency transformation program, Prometeon Tyre Group delivers lean manufacturing excellence

D

rawing on Pirelli’s more than 100 years’ experience in delivering an entire range of products and

services to the automotive market, Prometeon Tyre Group has firmly established itself as a market leader. With a licensing agreement with Pirelli Tyre S.p.A to produce Pirelli 140

branded tyres, Prometeon has a commercial presence in over 160 countries. Looking ahead to the next 100 years, continuous improvement and evolution will be the key to building on this success.

Hervé Ghesquières heads the group’s global industrial engineering operations.

With experience in industrial engineering and manufacturing in a number of European Tier 1 companies, Ghesquières’ career has been built around creating and improving the operational efficiency of organisations.

“I also work on the industrial footprint of companies that have production facilities in order to improve the competitiveness, considering the product lines, the capacity and capabilities of the processes,” he says.

DECEMBER 2018

EUROPE

141

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PROMETEON TYRE GROUP

This experience saw Pirelli headhunt Ghesquières back in 2011 to join the company’s Milan headquarters. His mission? To create an organisation of industrial efficiency and increase the competitiveness of the company. He feels his career has provided him with the right insight to drive the group forward.

“My experience fits perfectly with companies like Prometeon, which have an endless need to improve value generation for their customers and shareholders,” he explains. “The truth is, improvement has no end and 142

neither does efficiency. In order to continue to deliver on this, we are involving all the operations functions to accelerate efficiency generation.

Production, R&D, Purchasing, Logistics, Quality, Technical Engineering, Maintenance, Energy Specialists, HR– everyone is involved and contributes to the turnaround of the company.”

Ghesquières’ first task was recruit new people, create new teams in each region and establish factories across the company’s footprint. In each of the factories, he defined the standards, put training programmes in place and defined reporting and communication channels which all formed part of the DECEMBER 2018

“ OUR MOST IMPORTANT ASSET AND KEY TO OUR SUCCESS IS OUR PEOPLE. THE EMPLOYEES, EACH AND EVERY ONE OF THEM, CREATE TRUE VALUE” — Hervé Ghesquières, Global Head of Industrial Engineering at Prometeon Tyre Group

EUROPE

CLICK TO WATCH : ‘DISCOVER PROMETEON MANAGEMENT SYSTEM’ 143 Pirelli Lean System. The Pirelli Lean System saw the creation of a number of best practices including the Kaizen Weeks, Blue Collar Trainer system, the Pirelli Productions Control System and innovation projects and automation (Industry 4.0).

“In order to improve the competitiveness of the company, I also defined the optimal size of a tyre plant, jointly the Operations team, balancing the many different constraints. We defined the best global footprint of the company and increased the volume in low cost countries at the level of the optimal size of w w w.ma nufa c t uri nggl o b a l. com

PROMETEON TYRE GROUP

144 the plant, while implementing automation

a unique manufacturing system to be

and working on efficiency increase at the

implemented in the Prometeon and

plants in high cost countries.”

Chemchina tyre factories, Ghesquières

This proved successful enough that

set out to improve and align

when Chemchina became Pirelli’s major

the products and their quality without

shareholder and Prometeon Tyre

compromising efficiency. “We had to

Group was created, into which the

look at a way of aligning quality, integrity

previous Pirelli Industrial Business Units

and standards of the products without

were converged, and some assistance

incurring additional costs or loss of

agreements were defined, Ghesquières

volume, and without increasing the

was asked to replicate the success he

headcount,” he says. “To achieve this,

had achieved with Pirelli and create an

we created a number of systems and

efficiency organisation plan for the

processes that will enable us to achieve

new nascent company.

seamless integration and greater

Through his mission of creating DECEMBER 2018

efficiencies throughout all of the plants.”

EUROPE

Ghesquières created an Efficiency

on to de-bottleneck the plants and

Improvement Team, which is also

improve the efficiency of the opera-

known as the company’s Industrial

tions while improving the quality of

Engineering Team. By creating an

the products.

efficiency and resources planning

“At first we had to create the

system from scratch, the team is

efficiency team, in order to have the

defined by its ‘training by doing’

workforce physically doing the job,

approach. This system allowed

training by doing,” he says. “Then, by

Ghesquières and his team to have

creating Industrial Engineering

a clear overview of plant capacities,

systems in order to have visibility on

identify bottlenecks and highlight

the capacities, the bottlenecks and

priority areas that needed working

the headcounts of the plants, we were

E X E C U T I V E P R OF IL E

Hervé Ghesquières

145

Hervé Ghesquières is the Global Head of Industrial Engineering and Lean Manufacturing of Prometeon, the ex-Pirelli Industrial Tyres. He has been working 17 years in the Tier 1 automotive industry of which 9 as an executive in industrial efficiency. Hervé has a strong experience in the management of the efficiency increase and the competitiveness improvement of operative organisations, involving the people, from the operators to the top managers. This is his passion.

These last years, drastic efficiency improvements have been consolidated, thanks to the optimisation of the industrial footprint reorganisation and the implementation of strong continuous improvement actions. And lately, as Hervé did for Pirelli, he created and set up, for Chemchina tyres division, who became the main shareholder of Pirelli in 2015, the Industrial Engineering organization in charge of the management of the efficiency and the competitiveness of its factories in China. This enables Pirelli’s new shareholder to be more competitive on the global market.

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PROMETEON TYRE GROUP

Your PROGRESSION is our OBSESSION Our history EFESO was born in the eighties as a consulting boutique, mainly for manufacturing clients with a focus on automotive industry. Our hundreds of multi-site operation performance improvement programmes have enabled many clients to be awarded the prestigious TPM Awards from JIPM.

146

Today as a global management consulting firm with over 400 consultants, operating from 26 offices, we work in tandem with clients to face the challenges of the new industrial revolution, Industry 4.0, using digital enablers to augment the progression along the value chain.

Partners for Progression Excellence In a world with great volatility and high velocity, we help accelerate the progression of our clients, enabling them to reach the pace of change required to survive and thrive.

what will make the difference in quality, functionality, experience and time to market.

• Flow Dynamics - Streamline flows to deliver the target value.

• Asset Dynamics - Ensure optimization of the lifecycle and value/cost ratio of key assets.

• Human Dynamics - Enhance the commitment, competence and culture of people, by applying adoption, anchoring and leadership expertise, while considering the organisation’s different populations.

We integrate technical methodologies with human change expertise, developing a virtuous cycle of hard and soft achievements.

Our progression approach enriches the classic strategic and specific interventions with a systemic dimension thus changing the DNA of a company in a structural way.

We help our clients hunt for the most tangible Progression Opportunities.

“Improving results today, securing results for tomorrow” is our motto and means we help Together we engineer a Progression Strategy achieve business results faster, while developing balancing the right progression rhythm with the the capabilities, leadership and culture to context of imperatives, constraints and risks. continue improving quicker than the competition.

We help you harvest results through supportive We combine continuous improvement, project participation, mentoring client teams transformation and disruption to yield the most to ensure a continuous transfer of capabilities effective and long lasting results. The 90% client and through personal progression. retention rate reflects our approach’s success.

More dynamic, systemic and integrative Our interventions address four basic dynamics: • Value Dynamics - Understand the changing patterns of value creation to focus on

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INFO.MARKETING@EFESO.COM

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shop floor with all of the different teams in order to foster collaboration able work on and execute an efficien-

and tackle challenges together in order

cy improvement strategy.”

to grow and succeed together. “This

Also, creating mixed and interfunction-

level of collaboration ensures that we

al teams that go from “success stories” to

as an organisation win together,” he

“success stories” and celebrating the

says. “Our most important asset and

collective successes, is essential in the

key to our success is our PEOPLE. The

process of creating a unique company

employees, each and every one of

and a common culture.

them, create true value and we need

In fact, celebrating collective successes generates an acceleration of team work, while celebrating

each of them to adopt and be involved in the change process” As a testament to the success of

individual successes generates bad

this methodology and collaborative

competition and frustration. This saw

approach, during the first quarter of

Ghesquières implement a number of

2018, the Industrial Engineering team

Kaizen (improvement) activities on the

was recognised twice by ChemChina w w w.ma nufa c t uri nggl o b a l. com

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PROMETEON TYRE GROUP

(the major shareholder of Prometeon Tyre Group) at the yearly awards ceremony for achieving outstanding results in efficiency and for implementing innovative methodologies. For Ghesquières, this recognition represents a solid foundation on which he and his teams can build as the company continues to grow.

While people are the most important resource to Prometeon’s efficiency journey, the impact of technology cannot be understated. Industry 4.0 has already played a key role in delivering efficiency and success for the group and Ghesquières firmly believes that it will only continue to unlock new opportunities in the future. The company has already significantly invested and implemented data analytics solutions, dynamic simulation technology designed for 148

resource planning, and online tools and platforms that enable seamless operations management from top management right down to the shop floor.

“Take Virtual Reality (VR) as an example,” says Ghesquières. “We can now simulate the issues we usually encounter during the production process without entering the process at all. This is something that can only be done thanks to a simulator. No other technology, neither augmented or mixed reality, nor the real machine itself can guarantee the same result. Thanks to this, we have already reduced the training time of the operators on this type of process by 25%.”

Through the use of data analytics, Prometeon can automatically collate information and data that would historically have been collected by hand, transforming the non-value adding data-crushing time in problem solving and value-added improvements.

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“ WE HAD TO LOOK AT A WAY OF ALIGNING QUALITY, INTEGRITY AND STANDARDS OF THE PRODUCTS WITHOUT INCURRING ADDITIONAL COSTS, LOSS OF VOLUME AND WITHOUT INCREASING THE HEADCOUNT” — Hervé Ghesquières, Global Head of Industrial Engineering at Prometeon Tyre Group

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PROMETEON TYRE GROUP

“ THE TRUTH IS, IMPROVEMENT HAS NO END AND NEITHER DOES EFFICIENCY. IN ORDER TO CONTINUE TO DELIVER ON THIS, WE ARE INVOLVING ALL THE BUSINESS FUNCTIONS TO ACCELERATE THE EFFICIENCY GENERATION”

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— Hervé Ghesquières, Global Head of Industrial Engineering at Prometeon Tyre Group

As Prometeon continues this journey of

contributed to Prometeon’s success

efficient transformation, Ghesquières

are EFESO Consulting and virtual shop

recognises that the successes he and

floor management company Staufen

his teams have achieved so far would

Italia. “EFESO has been working with

not have been possible without key

us since the beginning of our adven-

partnerships. He sees these partner-

ture, supporting us in defining the

ships as a little different from tradition-

roadmap and guidelines to design our

al client-supplier relationships; rather,

manufacturing transformation

they are real partnerships that develop

roadmap,” he says. “They clearly

solutions together and share ideas in

understood our business needs and

order to define a common solution to

helped defining a vision, set priorities

reach the goals.

and support us in structuring a

Two key partners that have really DECEMBER 2018

high-performance organisation.

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operations, but ultimately it is one that serves the end customer. Prometeon has a clear vision to be one of the leaders of the supplier for Tier 1 Original Equipment manufacturers (OEMs) in the truck, bus, agriculture and off-road automotive industry. In order to get there, Ghesquières believes that it must continue to grow and evolve to be efficient, and to increase the quality of the products and services offered to the customers.

“Our team will continue to play a key role in achieving this,” he says. “We will prepare the industrial footprint, continue to adapt the processes and machines for more premium products, continuously increase the knowledge With Reviathech, the company support-

and expertise of the teams and always

ed us on designing ad-hoc training

put our people at the core of our

systems, using virtual reality. Their

strategy, by always increase their

simulators were designed focusing on

involvement and motivation to deliver

the right added value, enabling to have

a higher standard for our company and

the maximum efficiency of the training,

our shareholders.”

with the lowest possible design costs.

They are certified as training company and their expertise on that field helped us a lot as well.”

This transformation has been centred around the quality of the product and the efficiency of the w w w.ma nufa c t uri nggl o b a l. com

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