Smart Manufacturing: The Business Case (Part 2 of 6)

Posted by Ellen McKewen on Aug 11, 2015 11:16:00 AM

This post is the second installment in a six part series regarding the concept of Smart Manufacturing (SM). This series aims to inform manufacturers of SM’s components, how it affects business performance, economics and plans, its importance in the value chain, how it changes the workforce and the future of manufacturing overall. This series is written in conjunction with the Smart Manufacturing Leadership Coalition (SMLC).

Part 1 of this series detailed the definition of Smart Manufacturing, the benefits of SM, the concept of an open platform and a cloud-based Marketplace. Manufacturers are likely curious to know more business details before they start implementing SM in their organization. The main question a small or medium-sized manufacturer (SMM) may ask is: what’s in it for me and my organization?

And that’s where we’ll begin.

A meeting to discuss the business components of Smart Manufacturing

When talking about mastering the early phases and prototypes of Smart Manufacturing, Jim Wetzel (Director of Global Reliability at General Mills and Chairman of SMLC) recalled seeing results immediately.

And he expects anyone taking the Smart Manufacturing route to experience the same type of quick increase in efficiency and data collection. Let’s take a few steps back and analyze how Wetzel and General Mills were able to get to this point.

In a phone interview, Wetzel had this to say about the beginning stages of SM implementation: “It starts with culture. In a manufacturing world, knowing what’s going on in your organization from the plant manager to the factory floor is transformational.” Seeing results quickly with Smart Manufacturing is likely as its implementation allows you to capture, gather and analyze data that your company never had or wasn’t previously able to access and contextualize.

Even if your facility is operating fairly well, the proper use of SM works like a new pair of glasses. You’ll be able to see aspects of your business more clearly with quantitative and qualitative information that can lead to more confident business decisions.

What’s causing the quick display in results that had General Mills seeing progress immediately? Well, the culture of SM creates a huge shift in HOW your organization makes its decisions. If your facility shifts from having no smart technology to diving into the deep end of Smart Manufacturing, a newer, quicker and more data-heavy culture will inevitably be established.

As soon as you move the culture from managing based on an opinion to managing based on facts, you’ll have victories right at the beginning and so did we,” recalls Wetzel. “As soon as we started being connected we had insight and that began the transformation".

And this connection that Wetzel refers to is the synchronization of data-capturing devices and machines on the plant floor with an information system where your decision makers can act on quantitative data, rather than instinct.

For other determined manufacturers, Wetzel sees no reason why they shouldn’t see results immediately, too. Furthermore, he states that the ROI should exceed their internal financial hurdles and they should be expected to achieve anywhere from 20-30% ROI after effectively implementing Smart Manufacturing.

New techniques will need to be learned from manufacturers

Are SMMs Ready for SM Techniques? 

The reason why SMMs cannot dive in the deep end of Smart Manufacturing right now is due to the huge associated costs and risks that are barriers to even large companies. SMLC is in the process of developing an Open Platform that will be made accessible to small, medium and large companies alike.

For decision makers or executives who are looking to use the principles of Smart Manufacturing within their organizations, Wetzel encourages them to start by asking which employee will champion the SM integration. He also advises that they learn how to sustain the transition and begin investing in smarter workplace technology that can collect information.

As much as the concept of Smart Manufacturing is paired with technology, a successful SM implementation must be focused on the information extracted from this technology.

In the meantime, smaller manufacturers are losing value with outdated technology that may not collect information. And this is the first step for any organization waiting for the Open Platform: get the data. An SMM can do this by investing in devices, sensors and/or flow meters that can send data to your facility.

Several options are coming to the marketplace, but all that’s necessary at the moment is that your technology is ethernet-capable. “In the future, if you can’t network your device, it’s going to be more difficult to adapt to the new technology,” warns Wetzel.

SMLC is driven to create a seamless experience with the SM Platform that’s just as simple and intuitive as mobile phones and their operating system’s app stores. In fact, the Platform’s prototype is currently in development and is using real industry cases. This means small companies are welcome to participate now and learn more about the platform while it’s still in its initial stages.

Once a desired app is found, a manufacturer will be able to download it, apply it to a line in their factory, leverage cloud technology (eliminates the need to add computers) and then, all one has to do is select applications just like it’s done on smartphones today.

The Open Platform’s Next Steps

To keep what’s at stake in perspective, Wetzel offers this reminder:

“Smart Manufacturing isn’t your goal. Winning in business is your goal. Smart Manufacturing is the method you use to achieve that goal.”

Some large companies such as Praxair and General Dynamics are accessing the tools that are currently being developed in the Open Platform. These companies and collaborating SMLC members see unprecedented value in Smart Manufacturing and see it as a way to continue generating profit, innovation, competitiveness and productivity.

However, the goal is that companies of all sizes will reap the benefits of Smart Manufacturing. As SM’s components are tested, proven to be effective and affordable, small and medium-sized organizations will also see positive results – contributing to and collaborating on SM’s future.

Remember, SM is on the move now. SMMs don’t have to wait to get started. Besides readying your equipment base for network communication as mentioned above, SM Platform development and SM test bed deployments are occurring. One example is the SMLC $11 million grant to develop the nation’s first open platform for industrial applications under the Department of Energy at two industrial test beds.

The SMLC is currently in its second year of the three-year grant and is in the process of building several other test-bed demonstrations with interested companies. Companies of all sizes are able (and are encouraged) to take part and shape the platform development and engage in test beds.

Contributor to this blog post included an interview with Jim Wetzel, the Director of Global Reliability at General Mills and Chairman of SMLC.

 


CMTC's Guide to Smart Manufacturing White Paper Call to Action

Topics: Smart Manufacturing

Subscribe to Email Updates

Contact CMTC