IT Briefcase Exclusive Interview: Keeping Your (Manufacturing) Head in the CloudsJuly 27, 2017 No Comments
Cloud-based (manufacturing execution system) MES solutions can have a major impact for organizations. Specifically, they can reduce downtime when deployed in highly regulated manufacturing environments. According to LNS Research, only 20% of manufacturing facilities had an integrated MES solution installed in 2016, mainly because implementing a large scale MES solution has seemed daunting. Traditional on premise systems require organizations to specify and purchase server hardware, install an operating system, load application software, and test to make sure everything went as planned. An easy to deploy, cloud-based solution, with the right applications and shop floor connectivity for discrete manufacturing can help many to overcome the difficulties, and costs, of getting started.
So what are the differences between legacy, on-premise and cloud-based MES solutions and why does moving to the cloud provide competitive advantages in efficiency and cost?
Srivats Ramaswami, CTO and Vice President of IT at 42Q, takes a look.
- Q: Tell me a little bit about 42Q. What makes your solution stand out from the competition?
A: 42Q is a cloud-based manufacturing management solution. By leveraging our solution, customers can implement track and trace and see business value for their first manufacturing line in 6-8 weeks. By comparison, customers are looking at 6-9 months with legacy on premise solutions. Coupled with faster time to first value, our customers also spend only for the “part of the solution” they are using. In contrast, with an on premise solution, our customers have to spend millions of dollars for on–premise hardware, licensing for operating system, middleware technology, database technology and people required for installation and setup.
At 42Q, we know that our customers want to ensure that our software development lifecycle is robust. In order to deliver this confidence, 42Q has obtained GAMP5 certification by an external entity. This is significantly different from our competition who self certifies their own software development lifecycle for GAMP5.
If you look at scalability, 42Q is live at over 60 factories across the globe in over 15 countries. We are present in vast majority of the locations where manufacturing is prevalent. Looking at functionality, 42Q delivers the capabilities required by a factory in one integrated solution. Compared to traditional on-premise legacy solution providers, our customers get asset performance management, production scheduling, overall equipment efficiency management, ERP and PLM connectivity and extensible application with over 150 APIs in a “box”.
Our differentiation entails cloud presence, faster time to market – regulated and non-regulated, proven and mature solution, scalable and more “complete” solution for our customers to place their trust and run their manufacturing on our platform.
- Q: What are some of the key benefits of running MES in the cloud, rather than traditional legacy MES?
A: The key benefit of running MES in the cloud allows our customers to differentiate themselves against their competition by delivering a higher quality and throughput to their end customers. In addition, customers achieve a lower total cost of ownership. Let me explain.
The first and foremost benefit is “speed”. Speed here enables our customers to deploy MES capabilities sooner, whether be it new functionality that is released or setup of a new line or product. By deploying new capabilities, our customers deliver a higher quality product to their customers sooner.
42Q’s cloud solution delivers flexibility. In 2016, 42Q solution supported the introduction of over 120,000 new products to market. As you know, the product lifecycles are getting shorter and our customers are constantly challenged to keep introducing products and/or functionality to market. A flexible solution like 42Q allows the customers to keep on top of their customer demands and successfully deliver a higher quality product with richer capability to their customers.
42Q cloud solution delivers a low total cost of ownership and also delivers faster payback allowing the customers to re-invest and reduce their risk. The low total cost of ownership is achieved through a couple of avenues. First is the fact that on-premise legacy solutions require significant investment on the on-premise hardware, application software, operating system licenses, database licenses, labor required to maintain the infrastructure and more. The second is the “pay as you go”.
When you buy an on-premise solution, the customer is required to pay for the licenses required for the solution to be deployed over 3 or 5 years. Such customers also see deployment cycles anywhere between 9 months to 18 months. When deployment cycles are so long, it is not uncommon for customers to see “scope creep” and this further extends the deployment cycle. The result of such a process is that customers end up in deploying fewer capabilities than plan or spending more than budget for deployment. With 42Q, customers can start small, successfully deploy, see business benefits (while paying for only what is used) and expand.
Lastly, simplicity is a key benefit. As an example, if you are a manufacturer wanting a solution to manage your factory operation, why do you need to care about operating system and database management systems? If you review in detail a project plan for 42Q deployment, you will see that our customers sign up, connect scanners, printers etc and get started with configuring the line and operator data collection requirements.
- Q: Is it secure to run MES in the cloud?
A: The short answer is “YES”. We understand that our customers trust us with their sensitive data and protecting our customer’s data is of utmost importance to 42Q. In order to ensure that our customers feel secure, 42Q has implemented several architectural decisions and multiple layers of defense using our own systems, protection provided by tier 1 cloud platforms, and security service providers to create a well-rounded shield of protection.
The security issue for cloud manufacturing software is perhaps best summed up by this quote from LSN Research, a leading independent market research firm:
“By moving to the Cloud, security is usually enhanced rather than diminished as Cloud suppliers devote huge efforts to ensuring their underlying systems are as secure as possible and are constantly updated to react to potential threats. No individual manufacturer could devote such efforts, and they should focus on plant security working with their MES and plant software vendors to ensure maximum security and properly maintained systems. Do not get caught out by obsolete and vulnerable systems.”
- Q: I’ve heard the term “Industry 4.0” a lot lately. Why all the hype surrounding Industry 4.0? Why does Industry 4.0 have the potential to transform the manufacturing landscape?
A: Industry 4.0 is the crux of the fourth industrial revolution. I do not believe that it is hype. If you look at the first three industrial revolutions, each revolution by itself was a paradigm shift that changed the way the businesses and communities engage and operate. Industry 4.0 is no different. Paradigm shifts such as these tend to drive significant activity and hence perceived as hype. However if you look into Industry 4.0, you will recognize that its design principles are around Interoperability, Information transparency, pushing the boundaries of human assistance (or aid) and decentralized & autonomous operation. I do believe that Industry 4.0 has a huge potential to transform the manufacturing industry in many areas including, but not limited to the ones below:
- Information Technology / Operations Technology disconnect
- Machine to machine communications
- Enabling smarter decisions through machine learning & big data
- Supply chain connectivity
- Real time transparent operations
Manufacturing as a segment is a laggard in the adoption of cloud solutions. Due to this, on premise legacy solutions that are prevalent in the market are limited in their ability to successfully enable the foundational principles of Industry 4.0. As an example, if you are a manufacturer and are relying on a key contract manufacturer to produce a product for you, how can you get genealogy without having to put in an IT solution to move volumes of data? How can you scale your on-premise systems in a cost-effective manner to provide a rich training model and activity data for machine learning?
These are some fundamental areas where Industry 4.0 is really pushing the boundaries for manufacturers and transforming the landscape.
- Q: Can you give us a specific example of a 42Q deployment?
A: There are several case studies available in our website. These are all examples of our deployments. One case study titled “Flexible MES Cloud Solution Lowers Total Cost and Increase Manufacturing Velocity” was voted as a Smart Story by the MESA community. I have provided the link below to our case studies area where you can find this story and others.
- Q: What advice would you have for a business looking to move manufacturing to the cloud?
A: A move to manufacturing in the cloud should be seriously considered. As companies consider cloud solutions for manufacturing, they should be thinking security, networks, limited upfront investment and open architecture/APIs on top of speed, flexibility, total cost of ownership, proven and simplicity.
Security: Cloud security is stronger than on premise security. This is not claim made by 42Q. Industry analysts have confirmed the same.
Networks: Network needs to be managed. If you go back 10-15 years, redundancy in hardware environment was not common. In order to provide high availability, a redundant set of hardware was established. You can do the same with Networks. Same is the case with Latency.
Limited upfront investment: Very significant investment in infrastructure is no longer needed to start deployment of MES. In addition, with a cloud solution, you only pay for what you use. Lastly, be sure to measure payback before you increase your investment. Managing the MES is like compounding interest. Reinvesting value from your investment increases the value of your investment and significantly reduces your risk.
Open Architecture/APIs: The solution provider of choice should have an open architecture and rich library of APIs that can enable ease of machine connectivity, business systems connectivity and other systems integration. In addition, integration to 3rd party specialized applications should also be feasible and made easy. Leveraging this, customers can reduce the cycles to evaluate solutions. As an illustration, the traditional software evaluation methodology suggests that one should write a detailed requirements document considering all aspects of the factory end to end at the level of granularity that can take months to even develop the requirements document. Instead adopt an agile framework where the “low hanging fruits” are identified and documented at the significant detail and a directional strategy is established for other requirements. Ensure that you provider can support the detailed requirements for “low hanging fruits” and your directional strategy.
Your directional strategy can provide add on solutions from the solution provider of choice or alternative vendors as long as the core platform is built with principles from open architecture and has a rich library of APIs.
Srivats Ramaswami, CTO and Vice President of IT at 42Q, has worked at both OEM’s and contract manufacturers, most recently as vice president of IT Operations. His expertise includes the architecture and implementation of IT solutions, making the global supply chain visible and more efficient. Srivats is now responsible for customer acquisition and engagement, technology development and deployment for 42Q.
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