Industrial Internet Now

CIOs can help to integrate technology into decision-making

Integrating innovative thinking on all stages of company management requires a new level of technology-savvy capability. A CIO could be in the position to facilitate driving technology all the way to the board and upper management. Hunter Muller, President and CEO of the CIO network HMG Strategy, LLC, proposes that companies should open the doors for their CIOs to truly become CEOs of technology and lead companies towards the future.

Innovation in, for example, manufacturing companies usually takes place in product development and processes inside different business areas or units. Hunter Muller from HMG Strategy, LCC, firmly believes that managing progressive technologies should not only happen on this level, rather it should be relevant all the way up to the top of the company.

“Everyone can innovate, and moving forward does not always result in the development of a new shiny object. Innovation happens at the core of the company when people, chains and business units interact, and the role of the C-suite should be to elevate those core initiatives. In my view, it has to be driven by the CEO and the C-suite, because otherwise innovation can be continually intermediated, cut down or even cut off”, Muller argues.

Especially now during the emergence of the industrial internet, taking technological issues into consideration when making important decisions would be in the best interest of an industrial company. This requires the willingness to transform the company – and giving the CIO a bigger role in compiling the company’s overall strategy would not be a bad idea either.

“The CIO must become the CEO of technology in order to facilitate, lead and enable true innovation. The industrial internet and IoT are largely about innovation and including customers representing different fields and markets in the innovation process. Companies that find a CIO who is equipped with interpersonal skills and can think like a CEO are going to win today, tomorrow and in the future.”

In the people business

Muller emphasizes that in order to propel technology-savvy thinking to reach a company’s management, certain renovations must be made. This requires the right people and the CIO should have a key role in the process.

“To make changes to a company’s culture you need champions of innovation, but also virtual platforms and tools to ensure that new ideas can spread across the whole company.”

In Muller’s view, strategic personal interaction has a strong role in increasing the relevance of technology in the C-suite.

“It’s all about people, and if you are not invited to take part in the right strategic discussions it’s hard to place technology at the forefront. The CIO has to understand the markets and the culture of the C-suite. You have to dial into the company culture and see what works and what doesn’t, a view many CIO’s lack at the moment. Much of the strategy is handled by business executives, and the CIOs are usually more a part of the after plot.”

Many new qualities are required from a skillful CIO and enhancing their role in companies would most likely be very beneficial. According to Muller, however, some companies are finding it a challenge to enable this.

“Looking at the future of technology from the viewpoint of value-creation, competitive edge and leadership style, there has never been a brighter moment in the history of business.”

“The CIO must be confident in and conversant with the latest technologies in the context of what matters to the business. They have a unique view across the enterprise and are able to see where all of the data, processes and people are. The CEO would like nothing more than to see the CIO take care of a whole strategic piece to help drive innovation. However, things like sensor technology and IoT are likely beyond the CIO’s reach, because he or she is often just keeping things running in terms of the core business and transactional systems.”

New management approaches

In order for a CIO to succeed, they also need the right talent behind them, Hunter Muller argues.

“Industrial internet has huge implications towards talent recruitment and poses a big task for companies. Companies across the globe are searching for talent specializing in new technology. It’s a long and tough road ahead for a CIO if he doesn’t find the right kind of people.”

Even though Muller considers that there are still a few obstacles barring access for CIOs inside companies to harness their full potential, he has a positive view of the future.

“Looking at the future of technology from the viewpoint of value-creation, competitive edge and leadership style, there has never been a brighter moment in the history of business. It really comes down to the CEOs responsibility and allowing the CEO of technology to be a key executive. As I see it, at the end of the day, the dusty old automotive or insurance companies will eventually be technology companies.”

Hunter Muller is the President and CEO of HMG Strategy, LLC, the fastest growing provider of innovative thought leadership and networking events for CIOs and senior IT executives. Hunter is a globally respected IT strategist with more than 25 years of experience in IT leadership consulting and research.

HMG Strategy is the world’s foremost provider of pioneering networking events and thought leadership to support the 360-degree needs of the CIO/IT leader. The HMG Strategy global network of more than 80,000 senior IT executives, industry experts and world class thought leaders is the strongest and most trusted network of executives in the world.

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Interview w/ Hunter Muller

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Big data: a key factor at the beginning of the supply chain

Big data can create huge business benefits in process industries – but for this to happen, your organization needs to understand the impact and the transformation that is needed. Jacqui Taylor, CEO of FlyingBinary, explains why people are the key for the Internet of Things (IoT).

“Material handling is a key factor in process industries, such as steel or automotive, because it is at the beginning of the supply chain. In order to reap the benefits of IoT, you first have to plant the data seed”, Jacqui Taylor begins.

In order to make the best use of IoT in a sector like this, it is important to understand your organization and how ready it is to embrace IoT. In order to gain the value from IoT, it is important to understand data. How data literate is your organization? How mature are you at handling data and driving the value from data? These are important issues to consider.

“Data is a key resource, but having data doesn’t get you anywhere. Lots of companies will tell you that they’re drowning in data, but they have no information. What you’re doing with the data is the key”.

One component of that is sensor data and the immediacy it allows, for example by creating live data streams and basing key decisions on that data. This change is essential to reap the benefits for material handling and the transformation of the supply chain, because it helps in understanding the heartbeat of processes and contains the key to delivering the efficiencies of real-time data streams.

Big data technology can also deliver evidence of the challenges that are currently unknown in an organization, it will highlight the key areas of focus to gain maximum benefits for moving into this new arena. This allows a board to change strategy and to drive innovation, Taylor says.

Articulating the art of the possible

Big data also starts to transform the organization.

“People are the key. You have an organization that is set up to do one thing, and that legacy has set up the current supply chain, however people understand the inefficiencies of this and with data can use their domain knowledge to spot the opportunities for change, once they have the data. Ultimately sensors and the changes for IoT need to be embedded across the supply chain, but you can’t change all of this at once, but you can’t ignore it either, data allows you to select the best area of focus”, Taylor says.

To create the change that is needed, people need an understanding of which direction to take and why. This comes down to changing mindsets and being able to articulate what is possible to achieve, with the help of big data technology.

“Data is a key resource, but having data doesn’t get you anywhere. Lots of companies will tell you that they’re drowning in data, but they have no information. What you’re doing with the data is the key”

“You choose wisely where you start and what you do, and you do it with confidence. It’s not only about the process in the organization itself and what you’re creating with materials, but also your impact on the ongoing supply chain. The technology on its own is there, but the question is what can do with it and how you’re going to explain the impact and the transformation that is needed in the organization. So it’s a strategic approach more than something that is missing”.

Change can of course confuse or scare people. Therefore Taylor suggests starting with a pilot plan to create an understanding of what is possible. Looking at a specific project or proof of concept, the understanding then goes into the organization of the challenge that has been solved and the opportunity that exists.

“If you enable people to understand, then they will take those steps – not everybody, you do need the right people to make this transition. If we’re going to change something, you need to understand why. But if we don’t understand what the problem we’re solving is, change won’t be transformative”.

Moving towards results

If you understood what the possibilities were, and the competitive advantages this brings, organizations would rush to do them. To put this in context, Hollywood current invests in a movie with a return of x 3 for every dollar invested. Our clients have evidenced that for every £1 invested in this approach the return is between £2 and £40. Taylor explains.

“Officially, now we’re in a world where we have done digital, and the industrial internet is next. Those people who are going to lead this whole concept will rise above the competition in all sectors by having game changing access to and understanding of the data for the industrial internet. You can’t underestimate the importance material handling will have in this, because it is the beginning of the supply chain. The companies that are involved in this sector have a huge opportunity to make a difference”.

According to Taylor, using big data technology to construct the supply chain in a new way allows you to put your focus on the customer in a way that has never been possible before.

“For example, manufacturing is a global business, and with IoT and Big Data across the supply chain it is possible to understand the bottlenecks and opportunities which exist for any product being manufactured anywhere in the world. Using data from sensors through the production process would mean any delay in the delivery components or raw materials, or an extreme weather event would enable supply chain data to be re configured, allowing pre-production and production processes to be moved to new schedules, “inflight“.

“Whilst there is an opportunity to use big data across many sectors such as construction and advanced manufacturing the fact that you can say, as a material handler, what’s possible and what’s not, is because you’re at the beginning of the supply chain, the rest of the supply chain can’t do that. This makes a material handling business responsive, and it allows for big data to really start delivering on its promise for organizations ready to embrace this paradigm shift”.

The downside of this new approach is that it means using different technologies than those the organization is familiar with. This is not necessarily a problem – it just shows that there needs to be a shared understanding in the organization that in order to get to the benefits, you need big data technologies, Taylor says.

And this, again, brings the people into the spotlight.

Jacqui Taylor is the founder and CEO of FlyingBinary, a web science company that changes the world with data.

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Interview w/ Jacqui Taylor


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What industries need to understand about 3D printing

3D printing is slowly but surely revolutionizing how we think about manufacturing products and components in terms of availability and customizing. Jouni Partanen, Professor of Mechanical Engineering at Aalto University, Finland, considers that the main implications of 3D printing for the future are clear, and engineers should always keep them close to mind, when designing new products.

As one of the prominent future-now areas in industry, 3D printing gives wings to imagination, when thinking about material use in manufacturing. Jouni Partanen describes the current use of the technology in industry.

“R&D is a definitely a hotbed for 3D printing, and has been already since 15 years in for example automobile industry. It is possible to shorten the R&D process. This area makes up two thirds of the industrial use for the technology. One third is in manufacturing, mainly in producing lighter shapes”, Partanen states.

A famous case from China witnessed the printing of complete houses in a fairly short time. Partanen also mentions companies from California, who are looking for financing to develop printing of buildings on a commercial scale. He also weights in that despite the promising news – and the fact that 3D printing business is growing 50% yearly in some areas – the field is still relatively small.

“These types of exotic news are driving things forward at the moment, but 3D printing hardware is at a challenging phase in industry in my opinion. The business share of 3D is under a billion dollars worldwide at the moment, whereas the share of other forms of manufacturing is over ten to hundred times bigger. Development in the software side is incredibly fast, but the limits are on the hardware side. Many engineers, who are involved in product development, have still to grasp the full potential of 3D printing.”

To integrate the benefits of 3D printing better in industry, Partanen encourages engineers to keep three key aspects in mind: the possibility to optimize and customize material, short manufacturing runs and digital warehousing of spare parts and products.

“3D printing is already strong in different shapes and forms. Before this technology became available, strength and lightness were difficult to optimize. The principle is to remove material from all other places, except where it is needed. Conformal cooling is one of these applications, which are already working. Cooling conduits, which used to be straight, can be modelled and optimised according to purpose, made for example lighter. The shape is not limited to only, what some old drill can perform. This type of form optimization is still fairly expensive, but has been applied in for example jet engine design.”

To integrate the benefits of 3D printing better in industry, Partanen encourages engineers to keep three key aspects in mind: the possibility to optimize and customize material, short manufacturing runs and digital warehousing of spare parts and products.

In addition to optimising material composition in products to improve lightness, making it adapt better to different atmospheric conditions, or saving raw material, customizing is a proved advantage.

“Customizing is a broad field. For example personified hearing aids that are completely inside the ear, are currently produced completely by 3D printing, because the size of the run is basically always one, and when the object might be lost, it can be easily replaced by retrieving the custom specifications from a database and producing another one. The combination of the shortness of the run, customization and digital warehousing all come true in this case.”

At some point 3D printing might also make it possible to produce completely new materials by combining existing materials into new compounds. According to Partanen this is not yet a reality, but a realistic direction nevertheless.

“New material compositions are a very strong vision. Many actors on the field have started using the concept of digital material. An extension of this idea might be a tool, which has a firm surface, but a well conductive inner-side, allowing heat to exit quicker. This is one of the concepts, which are understood currently and estimated probable.”

Possibilities in the short run

In some cases there might be a limited amount of a certain machine in use in industry around the world. Using mass production methods for casting moulds and producing for example spare parts for a machine like this is not cost efficient, and Jouni Partanen brings in 3D printing as the natural way to go.

“In manufacturing small runs by traditional means, the costs of a tool or a mould can rise extremely high. In this situation 3D printing provides a better option. In practice, 3D printing is not used much in making spare parts, because the technology is still not on a suitable level. In the future, this will become relevant, since warehousing spare parts is definitely an issue for businesses. These new methods can make spare part warehouses completely digital, and production can be optimised completely by where and when the items are needed.”

By cutting corners in the manufacturing chain with 3D, the process will be quicker and it also allows products to be tested in use, while keeping expenses low at the same time.

“Getting products to the markets fast is key here. First run of a particular product can be printed, and after the business is understood better, a mould can be casted and the product can be put to mass production by conventional and cheaper means. This has come true in the case of a particular robotics company, which used 3D printed components in the start-up phase and after the product had been tested and proved suitable for the markets, they moved on to injection moulding.”

For some companies, 3D printing might be the only reasonable manufacturing method.

“A company, which produces 360 degree cameras for helicopters decided to adopt 3D printing as their primary manufacturing method, because the short runs made it sensible. For very small, but complicated objects, 3D printing might even become a viable mass production method in the future”, Partanen offers.

Jouni Partanen works as Professor of Advanced Production Methods at Aalto University

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Interview w/ Jouni Partanen

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Digital platform as a foundation for products and services

Integrating industrial processes, machines and devices even more in depth with intelligent software is an on-going effort in companies. With extensive experience in computer technology, Martti Mäntylä, a professor at Aalto University School of Science in Finland, knows his way around at the cross-section of ICT and industry. In his view machine intelligence shouldn’t just be added value, but the basis for product and service development.

At the moment sensors and data analysis are often an afterthought to improve efficiency and safety issues in existing products. But should the process of product development be thought over, so that data would have a fundamental role in it from the start? The industrial internet specialist Professor Martti Mäntylä sees this to be an appealing direction.

“Currently we usually have industrial products and devices, where ICT provides added value for the process, but more often solutions appear, where ICT has been the basis for building an industrial machine. The direction is definitely towards not applying intelligence to machines, but applying machines to intelligence. In this case a particular solution would be designed from the start with keeping a wider context or system in mind, so that data could be gathered, and connected with other data, analysed, and used to improve the operation of the whole system”, Mäntylä predicts.

There is also a different way to remodel businesses with ICT. Mäntylä highlights one success story, where a data analysis service component is built around an existing product, and designed to appeal to a critical need in the customer’s end.

“There is a case concerning a company in the welding system business. The company started providing better service to its customers by gathering and processing data from welding seams for certification purposes, an operation, which is mandatory but difficult for the client to do on their own. In addition the company is offering its service to customers, even if they are buying their welding systems from someone else. The customer’s crucial problem is solved, while also providing added value to the product itself.”

This type of service model is currently in the mind of several companies. Mäntylä wonders for example, if instead of selling a diesel engine for a power plant, the same company could take charge for operating the whole plant. This way the customer would buy in fact capacity for electricity production, not just a production tool.

“Remote operation is another direction, which could be based on ICT. Some industrial project might be in a tricky location, in the middle of desert for example. It might be difficult to get highly trained professionals to operate this type of system on site. Doing it remotely becomes appealing in this case. Offshore services can also be done with remote control. Why would you need personnel on a ship, when it’s at sea, other than at the harbour ends? This way the capacity of the ship could be used more efficiently for the primary function, which is shipping cargo. This may sound like science fiction, but the leading ship engine producer Rolls Royce has in fact published a concept for unmanned ships. To me it appears that the obstacles for realizing it are not so much in technology, but in regulation and business issues, such as the reaction of insurance companies.”

Early on, computer systems had their humble beginnings in close relations with industry from military systems to manufacturing. After the turn of the millennium ICT has taken accelerated steps forward bringing data and information to users worldwide in increased speeds and quantities.

“From an ICT point of view it is clear that there has been an evolution towards platforms, which has made technology more easily available, flexible, simpler, and cheaper. What was once thought of as rocket science, has somewhat transformed into something else”, Mäntylä argues and goes forward with discussing the current trends in ICT solutions.

“If there is interest to develop sensor technology, microprocessors or such, open source tools are available, and also widely in use. There is a complete ecosystem of specialists working on this field constantly. This phenomenon explains a major part of the contemporary start-up boom, much different from the dotcom boom ten years ago.”

It can be argued that the strength of the current ICT activity compared to the one before, is that it is founded on a much more concrete base of commodities and technologies. They are as Mäntylä views, also more easily accessible and smoother to operate.

Big data does not lead to a crowded bandwidth

Big data is estimated to generate increased amounts of traffic on the information highways. Mäntylä states that we shouldn’t be too worried about rising data transfer levels.

“There is already tons of data moving through the system, video streams accumulating the biggest quantities of data, with 4K video crowding the bandwidth. All things considered, sensory data is pretty compact.”

“There is already tons of data moving through the system, video streams accumulating the biggest quantities of data, with 4K video crowding the bandwidth. All things considered, sensory data is pretty compact. There are scenarios about world having a trillion sensors in the near future, which I deem is realistic, around a hundred per person.”

On the other hand, the question of latency should be addressed in the future, especially in industry related processes. For example a moving, remote controlled machine should have latency inside one millisecond, so that the proper operation of the control loop can be guaranteed. Mäntylä indicates that solutions are already in the pipeline.

“Next generation web technologies should solve these issues. 5G technology, which is currently under development, is partially designed to widen the applicability of new software solutions into industrial processes. Being a thousand times more powerful than the current solutions, it has the capacity to bring the industrial internet to the mainstream with increased bandwidth and decreased latency”, Mäntylä promises.

Martti Mäntylä works as Professor of Computer Science and Engineering at Aalto University School of Science

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Interview w/ Martti Mäntylä

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Industry 4.0 belongs on the CEO agenda

In a traditional business model, the manufacturer’s machines are self-contained. Software is used to automate individual machines, but the machines themselves are not connected. In a digital business model, all processes – including sales, production planning, production control, material planning, and service – are automated and linked to each other as well as to the customer. It’s a win-win situation: the customer benefits from a high amount of transparency and real-time information, and the manufacturer can optimize and change processes with ease. What’s more, automated processes lead to higher efficiency. Find out the three key reasons by Volkmar Koch, Partner at Strategy&, why the Industry 4.0 belongs on the CEO Agenda, in the Bosch ConnectedWorld Blog:

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Via Bosch ConnectedWorld

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