Smart Factory for Small to Mid-Size Manufacturers
Introduction / Executive Summary
The Smart Factory landscape for small to mid-size manufacturers shows there are many unique challenges for smaller companies.
This article will dive into more details on all these challenges.
Next will be a review of the smart factory solutions for small to mid-size manufacturers. We will look at the total solution space and what different options are available, with a deeper dive into solutions around machine monitoring, I-IoT and SCADA systems, and connected worker platforms.
Finally, we'll dive into implementation strategies within small companies. Smaller companies have some built-in advantages for driving adoption. We will look at some details behind that and how to get maximum benefit from the investments.
Unique Challenges for Small to Mid-Size Manufacturers
Problem Complexity
The general perception is often that small companies are less complex that they have less complex problems, but that is not necessarily true. In general, smaller companies have the same types of issues as larger companies. They still have problems around:
The overall scale of the problems may be smaller for these companies, but when you look at the scale of the problems on a per person or per plant basis it can be very similar.
Resource Challenges
But while the problems for smaller manufacturers may be very similar to the problems that larger companies face, the available resources to solve them are often much lower. In most cases, the corporate staff is much smaller for mid-sized companies. Corporate support staff for small manufacturers may not exist at all.
Smart factory implementations at large companies benefit from support staff across many departments, such as:
The support teams that do exist at smaller manufacturing companies are typically spread much thinner than their large company counterparts. This also means that the plant staffs are more heavily burdened, as well. This makes it very difficult to staff smart factory implementation projects. It can be very difficult to find slices of time from some of the staff, let alone dedicated resource commitments. I can also be hard to identify which people or groups will “own” the systems over the long-term to keep them fresh and continue to train users and drive adoption.
Process Challenges
There can also be process challenges associated with these implementations. Large organizations have developed the production systems such as the “Toyota Production System”. Many large companies have created comprehensive operational excellence programs that have clearly defined roles within the organization and processes for problem solving, root cause analysis, and many other activities that can utilize the information from smart manufacturing systems.
However, smaller organizations may not have well-defined production systems or improvement processes to take advantage of the new capabilities that the smart factory solutions provide.
Many smart manufacturing systems are like a Fitbit for the shop floor. They collect data from advanced sensors, pass that data to a cloud-based application, apply machine learning to translate that raw data into usable information and present it in pretty charts and graphs on your watch, phone, or computer. ?However, just like wearing a Fitbit doesn't automatically make you thin, putting these solutions in place doesn't automatically remove the waste from the shop floor. You need to do something with the data that they are providing in order to drive value.
If your company doesn't have a strong lean or operational excellence practice already in place, then you may not be able to get benefits as easily. This does not mean your company should not pursue smart factory systems, but it is something that needs to be considered for implementing the systems successfully.
Cash
The business case can be more challenging for smaller businesses, as well. Smart factory system investment can represent a much higher percentage of revenues for small companies. When revenues and costs are not as high, the potential payback from the investment is obviously smaller. Therefore, the investment needs to be scaled to the company size and payback potential.
The number of facilities is a key factor here. Revenues and costs on a per facility basis may be like larger companies. But larger companies have several advantages when purchasing these systems to be implemented across 50+ plants. First, software vendors will give large discount for these volume purchases, making the investment per plant much more palatable for big companies. Also, the implementation costs typically decrease over time as the systems are implemented across many facilities, which can also help to drive down the per-plant costs. Finally, there can also be hosting and other costs that can be spread across the plants equally.
All of these factors can make the top-of-market software solutions very expensive for small and mid-size companies. Next, we will take a look at some smart factory solutions that are a great fit within the market.
Smart Factory Solutions
Let’s start with a quick note about the solution space. Expensive solutions are not necessarily “better” solutions for your company. The pricier solutions are generally more feature rich (though this isn’t always true). But that doesn't mean that they're necessarily a better fit for your situation. The key is to understand what drives performance in your environment, then map those drivers to solutions that address those issues.
There are many different types of smart factory solutions. These solutions are designed to address different types of problems within your operation. Let's take a look at some of the common solutions categories next.
Machine Monitoring
Let's start with machine monitoring. These systems are provide the fundamental aspects of the smart factory. These solutions address a very well-defined problem. They look at the current state of the equipment – is it running, is it not running, how many pieces has it produced, and what are the different reasons for that performance.
There is a straightforward workflow to drive improvements using this information. The applications have well defined user interfaces out-of-the-box. ?There is also a reasonably straightforward way for users to use the information to identify what needs to change in the process. This means that you can drive significant improvements in manufacturing environments where machine availability constrains either the delivery or drives up the costs.
The good news in this category is that there are high quality solutions that are priced very aggressively. The implementation time for solutions in this category can also be very fast. This helps keep the cost of external services to implement the solution to a minimum. These systems also tend to be relatively low maintenance once they're installed, so that helps to reduce the future burden of external consulting time to maintain and extend these solutions. Finally, these solutions typically do not require much IT or development support.
I-IoT and SCADA Systems
Next are I-IoT and SCADA systems. I-IoT stands for the Industrial Internet of Things, and these are platforms that are like the machine monitoring solutions, but much more general purpose. They can connect to any type of device on the shop floor and collect most any type of data from the process. The system can then be programmed to orchestrate data flows, send alerts, and even control the process using that information. These platforms address a large variety of different problems on the shop floor. But because of their flexibility, they require considerably more expertise and external services to implement. There is a good fit in environments where there are shop floor data challenges beyond machine monitoring that provide a lot of value for the organization. SCADA systems are similar in nature, but with a slightly different feature set and focus.
Depending on the vendor in this category, the feature set of the solution and the cost for the solution can vary greatly. There are lower cost solutions such as Inductive Automation that are approachable for small and mid-size manufacturers. The solution space of potential applications can also vary greatly. Because the feature set of the solutions differs from vendor to vendor, the problem spaces that they address are also different. In addition to the initial implementation cost, another issue is that the system maintenance can be high. To expand the solution to cover additional machines or additional devices such as new sensors can require extensive development or configuration to accommodate that new device into the model. The systems also require significantly more IT support to get them up and running and then also over the long term.
Connected Worker Platforms & Video Analytics
The final category that we'll look at today are focused on manual operations. Connected worker platforms such as Tulip fall into this category. This set of solutions focus more on worker augmentation and worker activity instead of measuring machine performance. Another type of application that focuses on manual operations are video analytics systems such as Drishti. These types of solutions can be very valuable in environments with many manual operations, or where standard work is critical to the operations.
The features available and the pricing vary greatly based on the vendor and the capabilities of these systems. Also, the value that these systems generate depends greatly on adoption and usage. This is especially the case for solutions that focus on the connected worker, adherence to standard work, and work instruction delivery. These types of use cases may also require a great deal of inputs into the system – for example delivering work instructions out to the workers requires those work instructions to be input to the system in the first place.
Implementation Strategies
Next let's look at implementation strategies and how to use the smaller scale of your organization to your advantage.
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Redefine “Operational Excellence” Practices
One of the keys to driving value using smart factory solutions is to embed the capabilities of those solutions into the daily operational excellence practices. As mentioned earlier, implementing these systems (especially in the case of machine monitoring and IoT systems) is much like wearing a Fitbit. The waste on the shop floor does not magically disappear just because it is being measured. To eliminate the waste, you still must use the information from the systems to drive improvements.
Therefore, one of the steps in implementing these solutions is to adapt your operational excellence, lean manufacturing, or continuous improvement practices. I've done many other webinars and articles on this topic so I'm not going to dive into the details today, but just know that this needs to be performed to achieve the maximum value with most of these solutions.
Cultural Change and Solution Adoption
Next, let's talk about cultural change and solution adoption within the organization. The first note is that participation is a big key to each of the topics discussed in this section. One advantage of a smaller organization is that there are fewer people that need to adopt new practices to receive the value from the solution. It is a smaller ship to turn than a multinational company. It is easier to communicate to the necessary people and get consensus on the new work practices.
During any implementation, each of these four activities needs to be a key focus.
Next, I'm going to cover some additional details on getting adoption and having people to make improvements in the process. If you would like more details about these topics, I have other presentations that go through the details here. Or reach out to me and we can talk through a lot of the details for your situation.
Gain Ownership
The next facet of change management that must be addressed is getting ownership of the change from the team on the floor.
The main point here is one of philosophy. Most people I’ve talked to will say that they want the operators to feel ownership of implementing the change in the process. They want them to buy in and follow the new process like the change was their idea in the first place. Fewer of them say that they keep the operators involved throughout the improvement process. Even fewer treat the operators as if they really do “own” the process.
If the operators aren’t treated as if they own the process, why would they take ownership of the change?
At the very least, make certain that the primary operator is involved in the change process. Get their participation throughout – defining the problem, performing root cause analysis, generating solutions, and standardizing the change. Be sure to allow participation from other shifts and across rotations.
I will also point out that designing the change around the humans in the process will help gain ownership. If Human-Centered Design in manufacturing is an unfamiliar topic, I have done a couple of joint presentations with my partner at Sandalwood Engineering and Ergonomics. They are experts at human-centered design on the shop floor and can help your company design processes that work for the operators. When the people on the shop floor can see that the effort is being put in to make the workplace a good one for them, it helps to gain that ownership of the updated process.
Communicate
It is very hard to over-communicate, but it is terribly easy to under-communicate.
When the project is complete, everyone should understand their role and the way that the change is going to benefit them. If they do not get this communication, they will revert to running the process the way they are most comfortable.
I have seen many of these projects go sideways because people on the shop floor did not understand the motivations behind the change. For example, at one customer we implemented a change to track detailed information about the production process to eliminate various sources of variation that were causing quality problems. Because nobody had talked to the third shift operator about why the change was happening, the first thing they did each night was to turn off the data collection. They had assumed that management was trying to find reasons do dock their pay or write them up. Once it was explained to them what was being done and why, they were on board and participated fully in driving those quality improvements.
We just had to sit down and talk with him first!
Build Better Habits
I mentioned habits earlier, and my favorite theory of behavioral management is based on BJ Fogg's work out of Stanford. For those unfamiliar with BJ Fogg’s research into behavioral change, I highly recommend reading the book “Tiny Habits”. It’s a quick read and talks about how to establish new habits and break old ones.
The fundamental concept of the model is that Behavior = Motivation + Trigger. So, if you want to instill a new behavioral habit, you must understand the motivation for the behavior and then tie the initiation of the action to some sort of trigger.
For the motivation for the new behavior you are trying to install on the shop floor, you have to communicate to the workers how this will benefit them, the team, the company or some other motivating factor. This motivating factor could be an intrinsic reward of doing a better job or an extrinsic reward of hitting performance bonuses.
For the trigger, it depends on the behavior you are trying to create. The trigger should immediately precede the action that should be taken. The trigger could be at start of shift, or during a changeover, whenever there is downtime, or some other facet of normal events on the shop floor. It could also be prompted by technology when the time is right. An example of this could be a message that pops up for the operator when an autonomous maintenance task needs to be performed.
One more important factor in the behavioral change model - reinforce the new action with celebration!
“Lock In” Changes on the Shop Floor
The next big reason why the performance erosion occurs is that the change was not truly “locked in” while the team was still present.
This could be due to several factors. The first is that the new standard work may not have been clearly defined or communicated. One outcome of every improvement project should be updates to the standard work for that process. If this new SOP is not properly documented, communicated, and made visible to everyone involved with the process, then there will certainly be issues as a result. After all, people cannot be expected to follow a procedure they have not been trained upon.
Next is a lack of involvement of the operators during the improvement process. When engineering or the CI team creates a change without involving the people that run the process, they may not get buy-in to the solution being implemented. This can cause people to fall back to the old way of doing things as soon as the improvement team moves on to another project. Even when the “primary” operator is part of the improvement team, there could be many other people running that process that were not involved in the problem-solving process. It is important to make sure that everyone who runs that process has some opportunity to make their voice heard so that they will take some level of ownership of the solution and gain an understanding of what is being done.
Standardize and Control the Process
Finally, we come to the real heart of the matter. The final step in most problem-solving processes is to standardize the solution or put in controls for the process. This is the step where we are directly attempting to prevent performance entropy.
Several times earlier in the presentation we talked about a lack of standard work adoption being a major reason for performance erosion. This is where that standard work or SOP needs to get documented and communicated. The importance of having that standard work not only documented clearly, but highly available to anyone performing the process cannot be emphasized enough. The state of the art for this is utilizing hands-free augmented reality displays that show the operator the new work instructions right within the context of the task that they are performing. But even if you do not go that far, be sure to provide those work instructions in a highly visible and easily accessed way. Also make certain that everyone involved in the process is fully trained on the new SOP.
Every effort should also be made to make the process error-proof. This could mean utilizing standard poka yoke techniques. It may also mean providing automation or prescriptive solutions where possible so that there is no choice involved – the process will always be run the same way every time.
When it isn’t possible to error-proof the solution, be sure to “leave the lights on.” What I mean by this is to leave the data collection systems running when the project team leaves. The machine settings can be tracked to ensure the standard work is being followed. Performance can be tracked to ensure it remains at the newly expected levels. Any deviations that occur can be immediately identified and diagnosed. Where training reinforcement is needed, that can be provided.
Skill Up the Workforce
Implementing these systems will require new skills within the workforce. This can be done by training your existing staff, hiring people from outside the organization, or bringing in outside help. My strong recommendation for the implementation is to bring in some outside help to get things up and running in the first place. Work with a team that has “been there and done that” to get those initial successes under your belt. During this same time, have people that will own the system over the long-term work with that outside team to develop their ability to take ownership and run with the solution so that you do not have to pay the consultants forever.
Just as important as it is to skill up that core team, though, is to skill up the people that will use the information from the system. Don’t forget to use this opportunity to train the rest of your staff on how to use the data from these systems – and to use data in general – to improve problem-solving, root cause analysis, and more.
Summary
While small and midsize manufacturers face many unique challenges when compared to larger manufacturers, they also have some advantages in being able to ramp up quickly and consistently. There are many different smart factory solutions that are a great fit for small and mid-size manufacturers, and the selection it should be driven by the problems within the organization and the best fit for solving those issues. If you have questions, please do not hesitate to reach out to me and ask!
Helping America to be the "The Worlds Manufacturer"; one company at a time.
2 年Tim makes an excellent point about small and midsized manufacturers facing many of the same challenges as their larger brethren. More than 20 years ago, I built my home. One general contractor, myself, and my stepfather. We faced all the problems and challenges a large contracting company would face but had to go at it alone with three men, the contractor part-time. We had to be creative with finances, organization, and resources yet still meet the quality the building code and my pride demanded. Reflecting on this in my current professional role with a software company that serves the small to midsized manufacturing market, I am reminded how important it is to continually refine our solutions and provide creative, effective options to help our customers address their challenges. Excellent summary, Tim!