ERP Mobility and Smart Manufacturing

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ERP Mobility and Smart Manufacturing

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Male: Aerospace and defense manufacturing.
 
Female: Machines and automation.
 
Male: Additive manufacturing.
 
Female: Smart manufacturing.
 
Male: The global manufacturing economy.
 
Female: Welcome to Advanced Manufacturing Now, the podcast for manufacturing professionals. From the design screen to the shop floor, to final assembly. We drive the conversation for making manufacturing smarter. Powered by SME, connecting people who are passionate about manufacturing. Visit us at advancedmanufacturing.org.
 
Female: Today's episode is sponsored by our guest.
 
James: Hi, and welcome to another Advanced Manufacturing Media Podcast. I'm James Sawyer, the Editor and Chief of "Manufacturing Engineering Magazine." Today's presentation is sponsored by Plex Systems and if you're not familiar with Plex, they offer cloud manufacturing ERP software to approve ROI across an enterprise. The genesis of today's podcast actually occurred earlier this year when Plex took part in a webinar that SME did and that was called Smart Manufacturing And The Connected Enterprise. And out of that webinar grew a survey that was intended to determine how companies are leveraging their mobile data and communications technologies. It was a fairly short survey of six questions and was meant to be qualitative more than quantitative. And what we will do today is discuss the results of that survey with Dave Morfas who is Director of Product Marketing for Plex Systems. Dave, welcome.
 
Dave: Thanks, great to be. Appreciate it.
 
James: Well, we have a series of questions here from the survey, and I think the best thing to do would just be to go right down the list and talk a little bit. First ask the question as the respondents were and then look at the results that we got from the audience who took part in this. So our first question is, which of the following individual systems does your enterprise use today? And the choices were ERP, CRM, SCM, MES, or MOM, and PLM. Not surprisingly ERP was the system chosen most by respondents almost 73% which was more than double the second place finisher which was CRM or Custom Relationship Management. Dave, what is the importance or the impact of this result?
 
Dave: Well, I think what it shows is that oftentimes ERP is sort of the overarching system and within ERP there can be other models what are inclusive of these here. And so if I flip that argument around, what I could I say is you basically have, you know, five systems here and it actually highlights in some cases one of the problems with what we see with Legacy manufacturing software. And that is that oftentimes customer's will have to employ any or all of these systems uniquely. They could be all different systems from different vendors for example. And even if they're from the same vendor, say you have an MES or CRM or SCM from the same vendor, Oftentimes, there are modules that are, or have been acquired from different companies over the years. So they weren't designed really to work together, they're really separate silos.
 
So what manufacturers run into is they have a patchwork with these mismatch systems and what's needed is consultant time dollars to sort of stitch them together. Kind of like, you know, putting together aftermarket puts on a car, features on a car. It wasn't meant to be that way but you can make it work, it's just not sort of integrated. I think the number that you see at the top, going back the higher number of people using ERP. One, you almost have to have an ERP today. But two, I think those that are using an integrated ERP have within that ERP the rest of these four systems oftentimes integrated with them, at least the best ones do. So no surprise that ERP is a big number but I think also the fact that there are five systems here that a good number of people have that may be disparate. Kind of highlights one of the problems that we see in the industry.
 
James: Okay, so ERP, at least the good ones can provide a comprehensive solution for businesses then?
 
Dave: Yeah, and most of them are comprehensive. It's a question of how that comes to be. Is it a number of bolt-on solutions that are sort of patched together as I mentioned, or is it integrated? And that's really a real key discussion that's happening today in the software market and in the manufacturing market is, how to get that integrative set of solutions that is one ecosystem, if you will, versus the multiple modules. But yes, you're absolutely correct.
 
James: So the integrated system allows a company to tap into the full benefits of the software that they have?
 
Dave: Exactly. What it is, is you're not having to try and connect all or parts or portions of each of these five things, but rather you're pulling from one database all of the information that can be used for CRM or for sales purposes, for example. Or could be used for manufacturing information down at the plant floor, which is what MES production information. But rather than pulling that and figuring out where that's data is coming from, it fits in one system, the interaction, the user experience in pulling that data is seamless. It's not having to pull from different silos and then put that data together in the hopes that you have one consolidated set of data. If it's integrated it is already one consolidated set of data. And that's a lot harder and I would tell you more infrequent than you might think in the industry today.
 
James: One of the questions in the survey was, how connected is your enterprise? And the 187 respondents to this and a wide range of answers. One was disconnected, that there were data silos all over the place. Another loosely connected. In other words, there was some connectivity between some systems. The third was well-connected, manual connections are built between all systems, or fully connected, one database automated or integrated connectivity and a single source of "truth" for the entire company. Interestingly, the loosely connected was the category in which the majority or the most respondent felt, not necessarily, the majority. And second was well connected but still, that leaves almost 30% who were either at the top of the food chain if you will or at the very bottom. What's the sense that we can take away from this, Dave?
 
Dave: Right, so from the five systems that we talked about just a second ago, I think this dovetails nicely into that which is that this data tells you that systems aren't well integrated. Loosely connected could mean anything. It could mean partial functionality, occasional data sharing, but loosely connected could mean a lot of things to different people. It could mean that you have to sort of manually take spreadsheets from one place for example and send them to another and try and extrapolate data from that, it could very well mean a lot of things. But well-connected manual to your point, the third one here, 27.32%. You know, well-connected manual means you need to build those connections, and that's okay. That's how things have been done in the past. One of the problems, however, is that as systems get upgraded, particularly, when you have different systems call it ERP and CRM and the different things that we talked about, or any systems for that matter. Those connections often break when those upgrades happen and so you're back to having to again, manually connect the systems back up and generally, that involves consultant time, that could involve outage time and so it's impactful, even the well-connected manual.
 
So really you've got as you talked about percentages just a second ago. You've got roughly, boy, I don't know, 70% I think you said. Yeah, between the two that are loosely or well connected manual, they're still very, very problematic. And then when you get to the fully connected systems, you only have 15% of the industry that says that. And really to us, in a modern environment in a modern industry, there's no reason, at least in our mind that that number shouldn't be closer to 100% because it's 2016 going into 2017 and we just don't need to live in these siloed environments any longer. You should have a fully connected system. There's just simply too much data, things move too fast to have to deal with loosely connected systems, to have to deal with the manually connected systems of the past. And unfortunately, a lot of companies are still stuck in that paradigm as well.
 
James: If I'm understanding what you're saying then, Dave. As things evolve and evolve at a rapid pace, a fully connected system is one that is more adaptable to those conditions than even the well-connected system.
 
Dave: Sure, in particularly Cloud systems because you've got a single source of truth, you've got one connection or one rather...any changes that happen in one place happen across the enterprise and so it's a lot easier to affect change across the enterprise, so any connectivities enterprise live versus at a factory or at an individual level, it sort of eliminates and flattens that data silo mentality. And so as we move forward and as you get into, you know, more advanced data analysis and as you get into more complexity in the manufacturing environment rather than layering those new capabilities that come out. Rather than layering those on and connecting them manually or you're loosely connecting them, if they're integrated into one system that's sharing one set of data, that just simplifies the operation and lets manufacturers do what they do best, and that's make great products.
 
James: You mention doing things manually there, and that brings us to the third question that was on the survey, which was how does your company use data to manage the enterprise? And frankly, I am quite shocked at the response here because nearly half, exactly 48.65% of respondents say that they produce reports manually, and no other category really comes close. The next one would be we have automated dashboards at 27.03%. It seems like a waste of time and a lot of computing power that exists within companies.
 
Dave: Yeah. What you often hear when we talk to people is they'll actually say, "We probably use less than 1% of all the data that we gather." Right? Some store it and hope to get to it later which is sort your second category here. They've collected, store it for later use. Whether or not they get to it, maybe, maybe not. But that middle category producing reports, they'll produce reports and dashboards. The problem there is it's oftentimes past [inaudible 00:11:04]. You're looking in your rear view mirror. So for example, an executive, and we run into this all the time. An executive may feel like they're our reports very easily, very simply because they don't see the work that goes on behind getting those reports. In the meantime, there's a team scrambling in the background trying to put data together, stitch it together to produce those reports, to produce those dashboards for those executives. They're oftentimes not real time. And so those reports, those dashboards, again kind of looking in the rear view mirror, maybe days, maybe weeks old. So you've lost time and money along the way and the fact there are problems rather than addressing the problem at the manufacturing moment in real-time.
 
And what's also happened is solutions really haven't kept up with data growth. Meaning, if you can balance both things out, the data analytic solutions in one hand and the amount of data growth in the other hand, data growth and big data is growing much faster than those other tools, there's sort of an imbalance. Not to say that there aren't good analytics out with good capabilities, but the amount of data growth is just staggering today. And so it doesn't surprise me necessarily that we see the big data in analytics at the 5% level because a lot of people just haven't come around to employing those. And I would say too that it still, though they've been around a long time, the advancements being made are being made real-time, it's not a solution where there's an end game. But I think they're catching up to the amount of data growth and the needs that people have. Another thing that's interesting here along with the data is that, and this is something we're seeing. Is when you look at the industry and you look at a position that are being created in IT and you look at the highest [inaudible 00:12:34] position whether that's companies they can't hire enough of them or consequently, their compensation levels.
 
We're seeing a shift towards a huge need for data analysts, data scientists, those kinds of people because manufacturing is becoming an increasingly data-driven industry, if you will. And so what's also happening along with all this data being collected is really a fundamental need to shift IT skill sets toward data analysis. And one of the ways in which companies are doing that is companies that have moved to the Cloud, for example, are able to pivot those IT resources that you used to deal with: Software, maintenance, and infrastructure maintenance and pivot them towards more of a data analysis capability. And so they then have the advantage not only with having the same amount of head count but doing different things, but they also have the people that are focused then on using big data and analytic solutions to drive real value. And so if you look at those companies I think you'll see the bottom bar here would certainly be further to the right. And they're the companies that are going to...that are able to and are going to be able to show more real-time data to their executives. That isn't outdated data and that is more sort of real-time and on the fly dashboards versus looking in the past, looking at what's happened dashboards.
 
James: Very interesting stuff. I guess you can't use data unless you collect it and make sense of it?
 
Dave: That's right. That's right. And that's the big problem I think a lot of people have these data lakes, whatever you want to call them where they collect it just like we do at home, we collect a lot of things in the attic and promise we're going to get back to it and then we, you know, throw it out five years later or stick it in a garage sale. I think that's what happens, know that's what happens with a lot of companies. The storage is fairly inexpensive and so let's store it and get to it later and hope there's a magic silver bullet that helps us go through that information. And there are tools that do that but those that understand that data will continue to grow and if you don't address this now, it's going to be an issue. Those that believe that and see that, who put the tools and the systems in place to take care of that now are far better suited and are today, seeing a real-time data down to the plant floor that others are hoping to see somewhere down the line.
 
James: To this point, Dave, we've talked about connectivity and data gathering and usage within a company, but companies don't exist in isolation, they have to deal with a supply chain. And one of the questions in the survey asked, how do you collaborate with your supply chain? And the responses that were available were phone, fax, and email, real-time messaging, social tools and applications, customer portal website and supplier portal website. And again, it looks like the Stone Age wins. 88.65% phone, fax, and email. What sense do you make of this?
 
Dave: Well, it's one of those that's shocking but not surprising, I suppose. But what's interesting is when you think about then as you mention the Stone Age almost 90% of people are using these most common set of tools which are also the most inefficient set of tools. And so that's a little bit of a challenge. I think as you then go down the list a little bit we start to see, you know, the 20% and 30% around customer-supplier portal websites, we're big believers, and we certainly believe that allowing customers and suppliers and partners of any sort for that example, to access data real-time is a good thing now. They're not going to see the same exact amount of data that an employee might see, but to have them access again that same single version of truth, I think is a good thing, we believe is a good thing. Our customers certainly leverage that so that their suppliers, their employees, their partners are all seeing from the same handbook, if you will, and seeing the same data.
 
So we're big believers of those last two areas. And I'm going to get into social tools and applications as well as real-time messaging. Also, believers in that because again, not only should everybody have information about those, but they should be able to be notified when something changes, when an inventory's low, those types of things so that they can address those needs. Look, there's always going to be...I won't say it for fax but there'll always be phone and email happening in usage in the industry and that's never going to go away, but we would like to see those numbers for the larger industry, for the other four things. Real-time messaging, applications, whether it's a smartphone or otherwise. Customer portal, supplier portal at least access to the real-time system, we'd certainly like to see those numbers go up from an industry perspective. That's what our customers at least have benefited from and we hope to see that for the rest of the industry, as well.
 
James: Do you think that some companies feel that if they let a customer of even a supplier too far inside the IT system, that it opens up some vulnerabilities?
 
Dave: There's no question that some people feel that way, and then I think it gets back to who the solution vendor is, and that has to be proven out in, you know, the sales cycle as well as the implementation cycle. But usually, presale's how do you address security? Because security is the number one thing kind of in terms of system availability and [inaudible 00:18:03] access to the system. So very early on in the business is process. That needs to be pulled out and shown and demonstrated and you'll probably find varying results but one of the things, you know, from a Cloud perspective everybody is concerned about security in the Cloud, and what most people perhaps overlook or don't think about is since most vendors in the software space are going to loud and I can speak from the standpoint of a vendor that is 100% loud. The number one thing that we think about is security, and that's not the number one thing that a lot of manufacturers think about because they're thinking about, rightfully so, making products.
 
And so for example, if the manufacturer has a server or a server closet and they have to manage those servers, they have to manage the security by which their customer's and by which their supplies live versus having a leading technology vendor that focuses all of its effort on security and software, managing that for them. So that's one of the advantages as people start to look at Cloud is that the mentality shift that, "I don't really trust my stuff on the Cloud." But a lot of customers find out that it's way more secure on the Cloud than it was on the server closet. And so that's starting to shift a bit but to your direct point, should people be concerned about it? Yes. They have to address up front with their vendor before they go to a software system.
 
James: Software is one thing and it's been evolving very quickly but hardware has as well. What is the situation with mobile devices? We went from big mainframe computers to desktop, a laptop, and now we have all sorts of pads and phones that are smarter than what sent Man to the moon. What sort of usage are we seeing among companies of these mobile devices?
 
Dave: As your data demonstrates, almost 40% not using any mobile devices is a bit of a shock to me, to be honest with you. That one surprises me. Mobility in the way that we view mobility is that it has to a part of, it must be a part of your ecosystem whether it's phone as you mentioned a second ago, most people who think mobility, they think phones. But it's also plant floor equipment. Plant floor equipment is becoming increasingly connected, and while a lot of that is sort of I'll call it landline connected or physically connected, it's increasingly becoming more WiFi enabled, more Bluetooth enabled. And so we see that shift happening, we're really moving towards what I would consider a more efficient, and what we call an untethered workforce, that's always on. The reality is companies that see the benefit of, and some of them do, we have, what? Almost 42% that says company managed cellphones. I believe that those companies are right and doing that of course, because in getting people the tools to do their job in an untethered fashion outside the four walls of the company, I think is hugely valuable.
 
None of us work, at least few of us work anyway that are on a time [inaudible 00:20:54] for example, work a 40-hour week. We're always available and that's a benefit to the company when you have employees, you know, to whom you give these devices. I think too though is one of the numbers up here is the last one at the bottom. We can control the production systems from phone tablets and browsers. So your point beyond the phone is less than 10% here are able to control production from mobile or browsers. Again, I think that's a legacy number, what I call a legacy number. Meaning, not that it's not true, it just means that we've been trained or manufacturers have been trained throughout the years that that's just the way it is. You have to be physically in the plant or on some thick client or something like, the login of the system, the VPN to control your system. 
 
That number should change over time because we just fundamentally believe and our customers certainly have full control of the system, of the manufacturing system from any device and any browser anywhere in the world. And our customers take advantage of that in a very positive way. They don't have to be tethered to the plant, they don't have to be tethered to a certain VPN. There are certainly a mountain of security behind the logging in but our customers enjoy and most modern software companies have mobile applications either on the device, on the mobile phone, the Android or the Apple phone, whichever device that is, any kind of tablet. And/or full browser agnostic, right? Any browser, any login you can get in and security then is taken care on the back end. But you can get in and manipulate your system and control your production system and that again, creates that untethered workforce, that 9.019% [SP] number just has to change.
 
James: Our final question in the survey dealt with connected devices in the manufacturing environment itself on the shop floor. And the available answers were the use of IP-enabled tools and machines. Bluetooth enabled plant floor devices, RFID scanners, smart devices such as thermostats and lighting controls, and facility and security webcams. And surprisingly, and I think this strikes me as a high number but maybe it isn't. Fifty-six, virtually 56% of the respondents said that they dealt with IP-enabled tools and machines. Next highest was facility and security webcams and everyone else was below. Each of the other three answers were below 30%. So it seems like, on one hand, they're using very basic security technology, and IP-enabled tools and machines but the middle there is really sort of lacking from taking full advantage of technology today.
 
Dave: Yeah. I was surprised as you were, pleasantly surprised that I thought there's a good number there for IP-enabled tools and machines. That's a good thing that indicates to me an evolution of what we call the industrial Internet [SP] phase, the IIOT IP connected capabilities and so forth. And I would say security and webcams certainly falls into that as well. The middle area, things like Bluetooth is shown here, things like eye beacons, not specifically shown here but those are Bluetooth-enabled devices generally or IP-enabled devices. Sensors, smart devices, wearables, those kinds of the things. It doesn't surprise me necessarily that they're below 30% here, but I think what you're going to see is like anything, as the hardware becomes commoditized, the prices go down, the business cases then go up. These numbers if you took this two years from now I think will be quite a bit different. A lot of customers that we're talking to are using both RFID and Bluetooth quite a bit now because again, the availability of the hardware is that much more today than it was yesterday.
 
I also think the smart devices, the thermostats, those kinds of things, smart lighting. That has its place and again, I think it's more of a price play than anything else. If you have the ability to and/or if you're building a new factory and you're starting from scratch, if you have the ability to put that kind of lighting, those kind of smart thermostats then I think you're going to because going forward again that's going to be your option, I think that's going to become more of the norm, more of the standard and the price differential isn't going to be that significant. And what you get in terms of return I think is significant in that a lot of customers will use smart lighting, for example, or smart thermostats for different areas of the plant to turn up or turn down heater AC or also turn up and turn down light based on activity in the given work cell. So if the cells not... If 60% of your plant is running 24/7 and the other 40% isn't running on the off hour, then why light that area up?
 
And so from a cost saving perspective, those things just make more sense. I really think though for all these things it gets back to the availability and those things being readily available and affordable. And again, like anything else, a lot of computing and commoditization will prove out that these things are going to go in the next few years. The biggest thing to me that pushes all of this stuff, we've talked about connectivity, but that is the biggest thing and that is they connect all this stuff, that's great that it's available but you can't do anything with it if it's all difficult to use then it's going to discourage usage, right? It's going to discourage implementation. So I think the combination of the integrated systems that we talked about earlier and the availability of these types of devices are going to improve significantly over the next few years.
 
James: Well, we've been through all the questions from the survey, Dave. Is there anything more that you saw in the results that stands out and that our listeners should know about?
 
Dave: You know, I think I pulled back from this a little bit and I think a couple of things. One, I think that if you're a manufacturer, you have to kind of look at the current day in age and think about, recognize that perhaps what are your problems, what are your needs? You have to recognize the problem first. What are the challenges that you're facing? That sounds very fundamental but beyond just that problem, maybe the more important thing is this conjunction with that which is, look beyond one need. A lot of manufacturers want to consolidate systems, and that is absolutely the right thing to do. And so they're looking for, "Okay, what is one system or can I get to one or two systems instead of eight different systems that I have today?" That's good and that's a start but are you addressing the next problem?
 
We've proven here that big data is coming down the pipe and it's going to continue coming through [inaudible 00:27:18] people are taking advantage about our position. Is there an analytics path with the vendor that you select? Are you vetting them for analytics, can they produce the real time data? What about mobile as we talked about it here? Is it an afterthought or is it a module or is it just sort of ingrained? It better be ingrained because going forward, mobile is just part of the system. Think about Cloud, there's no question. The jury has spoken, the industry has spoken. No matter what anybody says, the numbers are there, the companies are all headed toward Cloud So are you moving towards a Cloud-enabled system for your ERP, for other systems? Because you need to be if that's what you're selecting today because that's where everybody's headed and by the way, that's where all the Legacy vendors [inaudible 00:28:01] on-premise systems, they're all headed towards Cloud.
 
We talked about IOT a little bit. So there are all these things, all these capabilities, tools coming down the pipe and I guess my encouragement or my takeaway from this is look to the next thing too, don't just look to the one little gap that you're trying to fill today. Look beyond that and do a holistic look at your company and think five years down the road because these are big decisions that you're making and you can't make them lightly. So think with the future in mind and make sure to the degree that you can, you're sort of future proofreading yourself but also enabling the capabilities that everybody else is taking advantage of.
 
James: Future proofing is good advice and we thank you for that. We've been talking today on our Advanced Manufacturing Media Podcast with Dave Morfas, the Director of Product Marketing at Plex Systems. And our topic has been smart manufacturing in the connected enterprise. I'm sure, Dave, we will be back with Plex in the future because this is a growing and evolving area of manufacturing. I'd like to thank you and all our listeners today and we'll catch you next time.
 
Female: Thank you for listening to this episode of Advanced Manufacturing Now. If you liked what you heard, feel free to share the show and head over to iTunes where you can write a review and subscribe to keep up with future episodes. Don't forget, you can join the conversation and learn more at advancedmanufacturing.org.

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