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Insights, Challenges and Opportunities for CIOs in Capital Intensive Industries Kieran OConnor, SAP – Moderator Vivek Bapat, SAP Pat Kennedy, OSIsoft Paul.

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Presentation on theme: "Insights, Challenges and Opportunities for CIOs in Capital Intensive Industries Kieran OConnor, SAP – Moderator Vivek Bapat, SAP Pat Kennedy, OSIsoft Paul."— Presentation transcript:

1 Insights, Challenges and Opportunities for CIOs in Capital Intensive Industries Kieran OConnor, SAP – Moderator Vivek Bapat, SAP Pat Kennedy, OSIsoft Paul Kurchina, KurMeta

2 © SAP 2008 / Page 2 1.Introduction 2.Vision of the Perfect Plant 3.Energy Management 4.Asset Management 5.Closing 6.Q & A Agenda

3 © SAP 2007 / Page 3 / Kieran OConnor - Process Industries Collaborative Ecosystems Business Process Experts – BPX.SAP.com BPX allows ecosystem customers and partners to accelerate co-innovation Lowers costs to scale and manage partnerships and alliances Collaboration on projects and new solutions can span departments, companies, and industry boundaries

4 © SAP 2007 / Page 4 / Kieran OConnor - Process Industries Community Involvement Through BPX Corporate Social Responsibility - https://www.sdn.sap.com/irj/sdn/bpx-csr https://www.sdn.sap.com/irj/sdn/bpx-csr Governance Risk and Compliance - https://www.sdn.sap.com/irj/sdn/bpx-grc https://www.sdn.sap.com/irj/sdn/bpx-grc Manufacturing - https://www.sdn.sap.com/irj/sdn/bpx-manufacturing https://www.sdn.sap.com/irj/sdn/bpx-manufacturing Blogs + Forums + Articles – Perfect Plant Perfect Plant – In Pursuit of the Perfect Plant In Pursuit of the Perfect Plant – Sustainability Sustainability – Collaboration Workspace Collaboration Workspace – Energy Management Energy Management – Asset Management Asset Management

5 © SAP 2007 / Page 5 / Kieran OConnor - Process Industries BPX facilitates the cross-community communications essential in the quest for manufacturing excellence Communication Across Discussion Platforms

6 Introduction Perfect Plant Blogs BPX.SAP.com Book Information Perfect Plant Blogs BPX.SAP.com Book Information

7 Chapter Outline – In Pursuit of the Perfect Plant Book

8 Vision of the Perfect Plant Vivek Bapat Vision of the Perfect Plant Vivek Bapat

9 Static Business Models are challenged Supply Chains evolving to Supply Networks Globalization Demand Driven Supply InnovationDemand-Driven Contract Mfg Outsourcers Suppliers Customers Mfg New Customers 3PLs New Sales Channels New Suppliers Shared Services Co-Innovators New Products

10 Connect & Collaborate End-customer demand Chaos-Tolerant Responsiveness Deliver Efficiency and Responsiveness: Continuously Sense, Evaluate, & Respond to Network Dynamics From Chain Control & Command Intermediate customer order Chaos-Intolerant Efficiency To Network SENSE EVALUATERESPOND The 2010 organization will be more dependent on the flow of data between different locations inside and outside the boundaries of the organization Contract Mfg Outsourcers Suppliers Customers Mfg New Customers 3PLs New Sales Channels New Suppliers Shared Services Co-Innovators New Products Economist: Business 2010

11 Connect & Collaborate End-customer demand Chaos-Tolerant Responsiveness Deliver Efficiency and Responsiveness: Continuously Sense, Evaluate, & Respond to Network Dynamics From Chain Control & Command Intermediate customer order Chaos-Intolerant Efficiency To Network SENSE EVALUATERESPOND Whats Needed Processes: Flexible, Extendable Visibility: Network Wide Contract Mfg Outsourcers Suppliers Customers Mfg New Customers 3PLs New Sales Channels New Suppliers Shared Services Co-Innovators New Products

12 The Corporate IT Challenge: Bring together Processes and Information Supply Demand Stable Unstable Structured Unstructured Visibility Automate Build Responsiveness Information Collaborative Network Efficiency Process Coordinated Network Information + Process Collaborative Network Coordinated Network

13 Local Execution Source: Aberdeen, 2006 BIC All Others Reduce Inventory Costs Shorter Lead Times Required Increasing Demand Uncertainty Increasing Product Mix Shrinking Product Life Cycle Global Coordination Source: AMR Research, 2006 Number of Plants More than The Impact on Manufacturing: M&A, Heterogeneity, Fast Moving Products High supply network inventories Poor asset utilization Delayed product introductions Increasing defects, high WIP Poor compliance, recalls Missed customer due-dates OperationsProduction

14 Local Execution Source: Aberdeen, 2006 BIC All Others Reduce Inventory Costs Shorter Lead Times Required Increasing Demand Uncertainty Increasing Product Mix Shrinking Product Life Cycle Global Coordination Source: AMR Research, 2006 Number of Plants More than The Impact on Manufacturing: M&A, Heterogeneity, Fast Moving Products High supply network inventories Poor asset utilization Delayed product introductions Increasing defects, high WIP Poor compliance, recalls Missed customer due-dates + + Information & Process Source: MESA Metrics Survey, 2006 IT Functions or Software Applications in Use Spreadsheets ERP ISO and Document Mgmt. Labor/T&A EAM or CMMS Data Collection – Bar Coding Production Dispatching Product Track & Trace Work Instruction Delivery SPC/SQC Process Management MES Plant Dashboards Resource Allocation & Status CAPA and Workflow Advanced or Finite Scheduling PLM/PDM RFID High TCO- multiple systems Multi-plant deployment difficult Data redundancy and latency IT OperationsProduction

15 SAP Manufacturing Platform Delivers Information and Process Integration PLAN MAKE DELIVER Operations Production Responsiveness Efficiency MAKE IT Execution Coordination

16 SAP Manufacturing Platform Delivers Information and Process Integration PLAN MAKE DELIVER Operations Production Manufacturing Platform Responsiveness Efficiency MAKE IT Integration/Intelligence Mfg Composition Environment Reusable Components Execution Coordination

17 Inspection/ Equipment Testing Weigh Scales SCADA / DES HMI Plant Data Collection RFID Sensors PLC Device Integration Environmental Building Management Plant Historian Integration/Intelligence Mfg Composition Environment Reusable Component s ERP SCM PLM MII SAP Manufacturing Platform: 1. Network Wide Visibility Distributor Processes Supplier Processes LOB Devices Contract Manufacturer Enterprise

18 Inspection/ Equipment Testing Weigh Scales SCADA / DES HMI Plant Data Collection RFID Sensors PLC Device Integration Environmental Building Management Plant Historian Integration/Intelligence Reusable Component s SAP Platform: 2. Process Continuity Distributor Processes Supplier Processes Contract Manufacturer Mfg Composition Environment ERP SCM PLM MII business process platform

19 SCM ERP PLM MFG SAP Platform: 3. Process Composition Restart Production Redesign SKU Replenish and Replan Update BOMs Produce new revision of the SKU QA Identifies Lead in paint on a product Stop all production Notify Suppliers Notify Customers Check Warranty Compliance Notice Identify range of defective lots Hold defective lot(s) in warehouse Identify all shipments Recall all Shipments

20 SCM ERP PLM MFG SAP Platform: 3a. Design New Processes across silos Restart Production Redesign SKU Replenish and Replan Update BOMs Produce new revision of the SKU QA Identifies Lead in paint on a product Stop all production Notify Suppliers Notify Customers Check Warranty Compliance Notice Identify range of defective lots Hold defective lot(s) in warehouse Identify all shipments Recall all Shipments

21 SAP Platform: 3b. Save Process into Repository

22 SAP Platform: 3c. Re-use Process IT Integration Platform Mfg Composition Environment Reusable Components PLAN MAKE DELIVER Process Continuity Operations Manufacturing MAKE Lean Production

23 But, Platform is not enough: Planning, Execution, & Assets must be aligned Perfect Plant Components & Influencers The Perfect Plant Responsive Planning Adjustments are not driven primarily by unplanned events in manufacturing but rather by demand shifts and other factors. Manufacturing is able to mange these changes more rapidly and reliably. Operational Planning Efficient Execution is monitored and nearly event free due to proactive monitoring and automated event handling that is tightly coupled with EAM and the enterprise Manufacturing Execution Asset Performance and Utilization are monitored and events are triggered automatically. EAM processes are optimized and all asset content is available in a single source. EAM process are tightly linked to Manufacturing Processes Asset Performance

24 Your Perfect Plant with SAP: Efficiency combined with Responsiveness Shop Floor Process Control Connectivity, SCADA, HMI Execution Planning Coordination Asset Mgmt Enterprise SAP Business Suite Inside Plant (MOM) : APO, LPO, Visiprise Partners Inside Plant (Automation) : Partners

25 Your Perfect Plant with SAP: Efficiency combined with Responsiveness Shop Floor Process Control Connectivity, SCADA, HMI Execution Planning Coordination Asset Mgmt Integration/Intelligence Mfg Composition Environment Reusable Components

26 Your Perfect Plant with SAP: Efficiency combined with Responsiveness Shop Floor Process Control Connectivity, SCADA, HMI Execution Planning Coordination Asset Mgmt Co-Innovation Ecosystem Composites Equipment status visualization Order GANTT Chart Production Line Visualization Production Order Details xMII Integration Templates PP, QM, PPPI, IDOC Templates ISA 88, SP 95 Spec Sheets Sample Projects Integration/Intelligence Mfg Composition Environment Reusable Components

27 SAP Value: Orchestration, Composition, Execution Shop Floor Process Control Connectivity, SCADA, HMI Execution Planning Coordination Intelligence / Integration Manufacturing Data Services Business Logic Services Asset Mgmt 1 Operations Single Vendor Solution Connect End to End Processes Mergers and Acquisitions Design, Mfg, Build anywhere Compliance across value chain Enterprise Standardization IT 2 Standardization across plants Open, customizable applications Balance Central/Local Control Credible Solution to Plant Floor Empower Plant Personnel Production 3 Autonomous operation Integrated in ERP/Automation Reliable, 24x7 decoupled ops Flexibility with upgrades Orchestration Composition Execution

28 Energy Management Pat Kennedy Energy Management Pat Kennedy

29 Perfect Plant – A Definition Three Flows (Energy, Mass, Info) Emmanuel Savas (1965) Computer Control of Industrial Processes" Maintained, Monitored, Actionable Self Healing Future Proofed Plant Minimized Footprint Financial, Environmental, Profitable & Sustainable

30 Todays Energy Context Significant increase in energy prices in the recent years Petroleum 1, 30 to 40% in 3 years Natural gas 1, 20 to 30% in 5 years Coal 1, 5 to 10% in 2 years Electricity, 3 to 10% per year Direct effect on production costs Heating/Cooling operations Steam production Operation of heavy equipment and motors Material movements Cannot overcome laws of thermodynamics 1 Source - USA Energy Information Administration

31 Energy & Environment More energy = more emissions Outside US World (Kyoto): 6% reduction of the greenhouse gases between 2008 and 2012 Based on 1990 levels Carbon Credits Relate - Business – Energy – Environment Industrial greening is not business as usual Significant Unprecedented Global Business Opportunity to Perfect Plants

32 Energy Management In the Perfect Plant Kodak Case Study

33 Kodak Park Largest Manufacturing Sites Located in Rochester, New York Referred to as a City Within a City 1300 Acres (5,200,000 sq m) 150 Buildings Nearly 30 Miles of Roads 11,000 Employees Operates Its Own Fire Department, Railroad & Water and Waste Water Treatment Plants Operates Two Power Plants

34 Utilities Consumption 125 MW Electrical Demand 35,000 SCFM Compressed Air Load 80,000 Tons Refrigeration Capacity 2,000,000 lb/h Steam Load 30,000,000 g/day Process Water

35 Keeping Track of Consumption / Utilization 600 Electric Distribution Meters 600 Additional Distribution Meters for: Steam, Chilled Water, Brine, Compressed Air, Process Water, Nitrogen, Natural Gas, etc. Significant Metering Used within the Power Houses to Manage the Generation Side Measurement points 125 concurrent users/180 + views 27 Systems interfaced

36 Kodak Park – Data Sources BAS (Building Automation System) Rosemount - Fix 32 Siemens - Apogee Emerson - Delta V SQL Based Historians DCS (Distributed Control Systems) Fisher Provox Westinghouse WDPF Westinghouse Ovation Taylor Mod 300 Emerson DeltaV

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42 Harvest Time One Powerhouse for Kodak Park The Energy Information System (EIS) has been an essential tool to help us reach our goal of One Powerhouse for Kodak Park Collectively these efforts have yielded savings > $20 millions annually

43 We are identifying savings opportunities on a regular basis. OSIsoft products have exceeded our expectations. They are viewed as critical tools to help us assess and meet our very aggressive site energy reduction goals that amount to several million dollars annually James Breeze, Engineer and Project Leader, Eastman Kodak

44 Energy Management In the Perfect Plant How to pursue the Perfect Plant

45 Team Energy

46 Lessons Learned at Kodak Capital Spent on Faith No BIG BANG – 1000 little bangs Continuous Improvement Process Combined Capital and Intelligence Operation Infrastructure Approach Lowers the Cost of Curiosity Culture Change

47 Top Questions for Energy Management

48 Asset Management Paul Kurchina Asset Management Paul Kurchina

49 Plant Ecosystem Plant Personnel IT Personnel Business Personnel Production Execution Materials Management Asset Management Engineering and Design Technology Platform Business Systems Plant Operations Environment Health & Safety Energy Management Clean Safe Profitable Secure Operate Maintain

50 Plant Stakeholders and Values

51 Asset Management Challenges

52 52 Physical and Digital Plants Tools required to enable Hammers Wrenches Saws Welders Meters Etc. Tools required to enable Data historians Document Management Systems Maintenance systems Reliability-centered maintenance Mobile devices Etc. Digital PlantPhysical Plant

53 53 Plant User Experience and Integration Real Time Data Foundation Wireless Sensors RFID TagsWireless Warehouse Mobile Rounds MaintainenceA TM Enterprise Asset Management and Analytics Fleet-Wide Monitoring Monitoring and Diagnostics Centers Wireless Predictive Analytics

54 Journey to the Perfect Plant – Example Standards BOMS Data Historians WIFI Network Pilot Tests IT and Plant Collaboration Vision EAM Maintenance ATMs Wireless Sensors Predictive Analytics Wireless Warehouse Mobile Operator Rounds Tool Management RFID Dashboards Energy Management 3D Models Real Time KPIs Voice Activation Create the Desire Leverage Technology Dare to Dream Fix the Foundation

55 Plant to Fleet – Data Foundation Discrete data Limited value Actionable Information Distributed Control Systems (DCS) Distributed PI Historians Large Population of Data DCS, PLC & PI Bus Intelligence Reliability, 4-Block Outage & De-rate (UCF) Maintenance & Market Analysis Framework (PI, ProcessGuard, SAP, UCF, P3M, Predictive Monitoring, NeuCo, LIMS, Plant View..) KPIs Dashboards Fleet Optimization Process Costs, Asset Health, Operational Performance, Market Value, Fleet Optimization WEB Visualizing Plant Alarm, DCS Real-time WEB Graphics Easy Access to Information WEB Visualization System Dashboards Subject Matter Experts Engineering Applications PMAX, Digital Fuel Tracking, Fuel Cost Framework Process Discrete to Data PMAX, DFTS, eNote, Fuel Cost Framework, Alarm Management Expert Systems Predictive Monitoring, Optimization Equipment and Process Monitoring Closed Loop Process Optimization

56 Top Questions for Asset Management

57 Closing and Q&A Closing and Q&A

58 Conclusions The pursuit of the Perfect Plant is a Process, a Journey Solutions from SAP and the Partner Ecosystem are available today to enable the " Perfect Plant " People are the main actors in a Perfect Plant – Business and IT Perfect Plant is socially & environmentally Responsible Business Entity Perfect Plant knows it Performance in Real Time Resource Management requires Cultural Change including Business and IT as One Team

59 © SAP 2008 / Page 59 Questions ? Vivek Bapat - SAP Pat Kennedy – OSIsoft Paul Kurchina – KurMeta Business Process Experts Community BPX.SAP.com Vivek Bapat - SAP Pat Kennedy – OSIsoft Paul Kurchina – KurMeta Business Process Experts Community BPX.SAP.com

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