This article was originally posted on Manufacturing Business Technology.
Significant improvements can be demonstrated in updating automation in either independent machine controls or an entire facility. More and more manufacturers are upgrading control systems primarily to fight the battle of equipment obsolescence, rather than taking the opportunity to invest in upgrades, in order to gain more productive years out of major capital assets.
There has been a noticeable trend in projects that are successful in achieving just hardware replacement, and those projects that leave the manufacturing process with more intelligence, flexibility, and improvements in production goals.
MISTAKE 1: FOCUSING ON THE PROBLEM, NOT STRATEGIC OBJECTIVES
The most common mistake made in automation projects is one we all make in our personal lives or in business decisions — we spend too much time dealing with the issues that are counter-productive to our goals and strategic objectives. The Boston Matrix model (BCG Matrix) demonstrates how we categorize everything we do — including the projects we fund — into one of four groups. We typically spend time and money in capital improvement projects, specifically automation enhancements that are:
- Important and urgent (cash cows)
- Important but not urgent (rising stars)
- Not important and urgent (question marks)
- Not important and not urgent (dogs)
It goes without saying that we shouldn’t be spending much of our limited resources on the things that are neither important nor urgent, but it may be counter intuitive to say that only 20 percent of our resources should be spent with issues that are important with critical timing constants as that is reactive only, and 80 percent of our resources on areas of importance without critical time constraints as these are the areas that drive strategic plans. All too often automation systems are upgraded only when the need to replace them forces the issue into immediate replacement, or because the decision to replace with project scope of “functional equivalent replacement” was made in haste. If an organization is spending 80 percent of resources on item 1 above (cash cows), which is the world most of us live in today, we are significantly limiting our ability to grow the organization in terms of productivity and quality. We all should be spending the vast majority of efforts in “rising star” aspects of the production environment.
MISTAKE 2: FAILING TO INCLUDE ALL ASPECTS OF BUSINESS IN PROJECT
Many organizations put initiatives in place to optimize manufacturing operations in order to gain efficiency or reduce costs. One popular area has been in efficiency gains that reduce energy due to the environmental focus of our cultural initiatives. More importantly for those of us in manufacturing, upgrades in this area can qualify for rebates provided by efficiency programs from utility companies to offset capital expenditures.
Rather than upgrading automation systems with “like in kind” replacement strategy funded by maintenance or capital appropriations, a case can be made to fund automation upgrades through a number of other benefits that can yield dividends to an organization, such as:
- Examining automation strategies to take advantage of current technology building greater intelligence within automatic controls
- Implementing new modern technologies to include improvements in record keeping and preventative maintenance programs
- Taking advantage of automation objectives in both internal and external organization promotions
MISTAKE 3: FOCUS ON RETURN ON INVESTMENT (ROI) RATHER THAN NET PRESENT VALUE (NPV)
Historically, capital expenditures have always had one key metric for the invest-or-save decision — return on investment calculation. Years ago, automation projects could yield under a one year ROI, primarily due to the level, or lack thereof, in automation deployed. Returns were computed based upon increased production. Today, this method can prove to be difficult to gain funding of capital expenditures on production increases, quality improvements, or scrap rates alone due to the accounting constraints on expected return on investment. We can argue that today’s modern automation hardware/software, when properly maintained, can sustain for a significantly longer period of time than the return on cost target that our financial professionals set forth.
We have been involved with updating automation systems that were first installed in the 1980s and earlier. Some organizations have seen the benefits of implementing proper automation for more than 30 years. A new automation strategy will yield benefits continually for years to come long after the investment has paid for itself — especially in today’s energy conservation climate — and organizations will see energy dollars saved on overhead cost for years to come. Energy savings projects are driving automation improvements down to the smallest potential project.
MISTAKE 4: CHOOSING THE WRONG PARTNER
Unfortunately, we have seen this error occur all too often. Manufacturing organizations have made the choice to use a consulting engineering firm or system integrator to spearhead the effort for upgrading their automation system.
Selection of the right consulting engineering/project management firm is more important than choosing what hardware to use or what software to deploy. We wouldn’t recommend that someone in our family be seen by the least expensive doctor if it meant sacrificing quality and we wouldn’t visit a doctor who doesn’t have extensive experience in a required specialty. Find the right partner by using the same criteria as you would when choosing a doctor.
CRITERIA 1: PREFERENCE
Select a partner that puts your needs first, focusing on your problems. This partner should be someone that your organization feels comfortable with, discussing needs and concerns unfiltered. Your partner should be able to find the root causes of issues, provide the necessary technical knowledge, and have a spirit that enables your organization as a “client” and not a “customer.”
CRITERIA 2: EXPERIENCE
As you evaluate your potential automation provider partner, investigate their published experience and inquire with their existing clientele. Ask for resumes of key personnel that will be working on your project and ensure that you are comfortable with entrusting the safety and reliability of your organization.
CRITERIA 3: INTEGRITY
It’s obvious that you want to do business with a firm that is going to stand behind their work in addition to conducting their business in an ethical manner. Look for an organization that offers warranty not for just hardware and software (supplied by vendors), but also offers warranty for intellectual property that is the running automation created by your partner. A hallmark for finding a partner that demonstrates this is someone willing to provide 24/7 emergency response to issues and extended maintenance support contracts. Top tier organizations exhibit these characteristics and demonstrate this by participating in groups focused in their area of expertise, or a professional organization such as the Control System Integrators Association (CSIA).
Synergy Systems, Inc. of Lisle, Ill., is a control system integration company specializing in automation design with a focus on throughput increases, cost reduction, and process optimization for the steel production, power generation, chemical and food processing industries. For more, visit www.synsysinc.com.
Synergy Systems is a member of the Control System Integrators Association (CSIA), a global non-profit professional association that seeks to advance the industry of control system integration for the success of members and their clients. For more information, visit www.controlsys.org.