Automa'on  in  Manufacturing  Simon Ellis

Wipro, June, 2015

2

Practice Director, Supply Chain Strategies & Technology-Oriented Value Chains

§  Global research program •  Process and discrete manufacturing industries •  Supply chain management

§  Industry experience •  CPG and High-Tech research experience •  Logistics and customer service •  Planning and forecasting •  Supply network design and procurement •  Finance •  Application of supply chain and enterprise IT

tools

Simon  Ellis  

Agenda  

§  Context for Automation §  The Past …. and Present §  The Future: Digital Transformation §  Concluding Thoughts

3

Context  

4

5

The  Produc'vity  Impera've  

§  2015 – 2020 – companies aspire to doubling of revenues and profits without increasing structural costs

§  How do we do this? §  Technology …… and automation!

What  Do  We  Mean  By  Automa'on?  

6

Automation, is the use of technology and control systems in manufacturing operations for the expressed purpose of improving productivity while reducing human intervention.

§  Infrastructure §  Software §  3rd Platform §  Digital Manufacturing

7

Complex, Dynamic Value

Chains

Transparency & Traceability

Converging Technologies

Truth in Data

Manufacturing Evolution

Emerging Markets

Key  Drivers  for  Worldwide  Manufacturing  

The  Past  …..  and  Present  

8

Network Design

Products

Planning

Assets

WMS

Supply Demand

Inventory Optimization

Scheduling Factories Logistics

Execution

TMS

Risk Management

SRM

CRM

Supplier Network Customer / Consumer Manufacturer / Brand Owner

Supply Signal

Repository

Demand Signal

Repository DATA

Manufacturing Execution Systems

Response Management

DATA

Manufacturing  Value  Chain  

Customers

B2B Commerce Backbone

Legacy applications

Packaged applications

Databases File systems

MANAGE

Partners

BUY SELL

B2B  Networks  

Source: IDC

11

In  the  Factory  

§  Manufacturing execution systems (MES)

§  Assembly/Factory line technology §  Robotics §  Mobile tools §  Additive manufacturing

Benefits include: labor cost reduction, quality improvements,

process/production speed, inventory efficiency, and safety.

12

In  the  Field  

§  Warehouse management §  Transportation and Fleet Management §  Sales and Store Engagement §  Sortation/Robotics §  Mobile tools §  Additive manufacturing/Postponement

Benefits include: labor cost reduction, quality improvements,

process/production speed, inventory efficiency, and safety.

The  Future  

13

The  IT  Industry's  3rd  PlaNorm  for  Innova'on  and  Growth  

Source: IDC

§  IDC also believes that there are key characteristics of the next era of the 3rd Platform : Immediacy, Abundance, New Buying Centers, Efficiency, Personalization & Future of Work

§  This movement of IT -- way beyond traditional boundaries of datacenters and IT departments --is the most dramatic aspect of the 3rd Platform. The end-goal is nothing less than the reinvention – and continuous transformation – of every industry on the planet.

§  At IDC, we believe the 3rd Platform is not just a technology platform, it is truly a Business Platform.

15

Digital  Transforma'on  is  Mul'  Faceted    and  Accelerated  

Leadership  Transforma0on  

Omni-­‐Experience  

Transforma0on  Informa0on  

Transforma0on  Opera0ng  Model  Transforma0on  

WorkSource  Transforma0on  

Managed  

Digital  Transformer  Opportunis0c  

Digital  Explorer  

Ad  Hoc  

Digital  Resister  

Repeatable  

Digital  Player  

Op0mized  

Digital  Disrupter  

16

Source: IDC, Digital Transformation Maturity Model, 2015

IDC’s  Digital  Transforma'on  MaturityScape  Digital  Transforma0on  is  the  approach  by  which  enterprises  drive  changes  in  their  business  models  and  ecosystems  by  leveraging  digital  competencies.    

Managed  

Digital  Transformer  Opportunistic  

Digital  Explorer  

Ad  Hoc  

Digital  Resister  

Repeatable  

Digital  Player  

Op0mized  

Digital  Disrupter  

Managed  

Digital  Transformer  Opportunistic  

Digital  Explorer  

Ad  Hoc  

Digital  Resister  

Repeatable  

Digital  Player  

Op0mized  

Digital  Disrupter  

65%  of  Organiza0ons  are  “Digital  Explorers”  or  “Digital  Players”  

14%  

32%   33%  

14%  8%  

Digital  Resister   Digital  Explorer   Digital  Player   Digital  Transformer   Digital  Disrupter  

17

Source: IDC, Digital Transformation Maturity Model Benchmark, 2015; n= 317 IT and LOB Executives, March, 2015

Most  Organiza'ons  Are  Just  Beginning  their    Digital  Transforma'on  Journey  

18

Lead  an  “outside  in”  business  driven  

environment  

1  

3  Ac'ons  We  Can  Take  to  Move    from  “Digital  Explorer”  to  “Digital  Transformer”  

Create  expecta0on-­‐

altering  customer  experiences  

2  

Innovate  with    the  ecosystem  

3  

19

Leading  an  “Outside-­‐In”  Business  Environment  

Empower  at  the    Edge  Mindset  

Culture  that  is  Not    Afraid  to  Fail  

Looking  Disrup0on    Straight  in  the  Eye  

20

Expecta'on-­‐Altering  CX  Innova'on  

Inspire  Customers  with  Personalized  Experience  

Shopping  journey  starts  in  any  channel  

Connected  glass  shopping  wall  

Triangulate  customer,  product,  and  employee  

Interac0ve  fiZng  rooms  

21

Communi0es  reduce  design  0mes  significantly  

Innova'ng  With  the  Ecosystem  

Communi0es  can  re-­‐invigorate  in  house  design  teams  

Internal  champion  that  thinks  beyond  tradi0onal  NPI  process  

Concluding  Thoughts  

22

Concluding  Thoughts  ….  

§  Technology/automation is the only way the manufacturing industry will meet its goal of doubling revenue and profits without a net increase in FTEs.

§  Hardware (machines) and software §  Automation/digital transformation will replace people, but we’re not quite obsolete yet

§  Most final assembly in the automotive industry, for example, is still performed by people

§  Automation requires servicing and people to setup and calibrate sensitive machines

§  Low cost manufacturing ‘labor arbitrage’ means that low labor rates are a counter-pressure to automation

§  Speed is the ‘big equalizer’ though. §  Change management and retraining is critical

….  and  a  Tremendous  Market  Opportunity  

§  Infrastructure §  Software Platforms §  Services But vendors must transform as well… §  Line of Business buyers §  New Shared Risk/Reward Delivery Models §  Marketing, Selling, Servicing §  Change management

24

Thank You