From its namesake chocolate bars to the immensely popular Reese’s Cups, The Hershey Company has been a maker of beloved confections for many decades. But no matter which variety is your personal favorite, Hershey’s powerhouse combination of manufacturing, fulfillment and distribution keeps those famous brands coming to store shelves and to the consumers who love them, generation after generation.
Nearly 100 Manufacturing Leadership Council members took part in a tour encompassing two Hershey facilities: the West Hershey plant in Hershey, Pa., and their nearby Annville Fulfillment Center in Annville, Pa., which is also Hershey’s first fully digital facility.
As a $10 billion publicly traded company, Hershey is perhaps most famous for its chocolate brands and other confections, but it also has expansion goals to evolve into a leading snacking powerhouse. To that end, it has acquired several brands of salty snacks, including Skinny Pop Popcorn, Pirate’s Booty puffs and straws, and Dot’s Pretzels. Its nearly 4,000 SKU brand portfolio is carried out through 21 plants (14 in the United States, seven internationally), roughly 950 global ingredient and packaging suppliers, 60 contract manufacturing and contract packaging partners, 34 distribution centers, and 143 freight carriers.
One thing that leadership emphasized on the tour was Hershey’s move from “best in cost” to “best in class.” Fulfilling Hershey’s vision as a snacking powerhouse means focusing on people-first manufacturing, which includes skill development, career advancement and teambuilding; innovating through technology, including through its digital factory strategy; and a focus on reliability. But in addition to its future aspirations, Hershey also needed to respond to evolving market and operational conditions – the company saw more volume growth during the pandemic, but retirements meant that its mean labor tenure decreased significantly, while lead times for packaging and capital equipment lengthened. Those shifts means that the company was left with a need to respond faster.
Investment in transformation capabilities has been essential. The company has moved away from conventional lines with single-purpose assets and focused SKU portfolios with complex line changeover requirements to advanced technology lines that can handle diverse SKUs with faster cleaning and changeover capabilities. Overall, Hershey’s digital factory strategy is focused on four areas: data capture and analysis to facilitate rapid problem identification and resolution; physical automation; a digital backbone (encompassing universal data architecture), and digital quality to bring forth a paperless shop floor. The company performs mass customization at scale through robotics and digital integration.
During the visit to the West Hershey production plant, which originally opened in 1990, attendees got an inside look at some of the production lines in the world’s largest and most technologically advanced chocolate manufacturing plant (750,000 square feet). It takes 26,000 cows to supply the milk needed to produce the Hershey’s Kisses (70 million a day), chocolate bars and syrup made here – one million pounds each of milk chocolate and Hershey’s Syrup each day. There is no storage for intermediaries at this facility – as soon as products are made, they are put onto a truck.
The 800,000-square feet Annville Fulfillment Center started production in October 2021, going from its groundbreaking to operation in just 16 months. It includes 62 trucking bays and 18 packing cells with flexibility to handle packages anywhere between two ounces and six pounds. Some of its advanced features include a cloud-based technology stack, digital work instructions for operators, and environmentally friendly battery-powered forklifts. The company will continue to scale up operations there as they leverage the facility’s full capacity.
The Annville facility is a joint operation between Hershey and its logistics partner, DHL. While Hershey owns the facility and its capital equipment, the majority of the workforce there are DHL employees. The Annville leadership team says that the partnership capitalizes on the strengths of both organizations, such as Hershey’s digital production know-how and DHL’s warehousing and logistics expertise. The facility utilizes a flex labor setup with cross-training between machine operators, palletizing operators and other functions to ensure that operations are adequately staffed at all times.
During the tour’s panel discussion at the end of the day, leadership emphasized that one important aspect of Hershey’s success is the company culture, originated by founder Milton Hershey more than 100 years ago. Bringing the workforce on board has allowed them to accelerate past “pilot purgatory” for the company’s digital aspirations. Panelists described what they call “Hershey nice” – a mix of collaboration and consensus-building where everyone treats each other with respect. The culture is vested in the company’s success, which therefore means that there is passion to share success and continually strive for improvements.
For that reason and many more, the company behind “the sweetest place on earth” might also be one of the sweetest places to work, and why Hershey is positioned to grow successfully toward its future aspirations – starting on the factory floor and branching out to snack lovers everywhere.
About 100 Manufacturing Leadership Council members, associate members, guests, and staff descended on Lexington, Ky., in November for a tour of Schneider Electric’s smart factory – a 65-year-old brownfield facility that showcases artificial intelligence, augmented reality, remote monitoring, and predictive maintenance.
The factory was recognized in 2020 as a Fourth Industrial Revolution Advanced Lighthouse by the World Economic Forum (WEF) and later as a Sustainability Lighthouse, one of only ten globally and the first of two for Schneider Electric. It is one of several Schneider Electric factories to achieve this designation, and the company’s first on U.S. soil. Schneider Electric, a 180-year-old company, had E28.9 billion in revenues in its 2021 fiscal year. The company provides industrial automation and control, energy management, and building automation and control products and services.
What They Saw: During the 11-stop tour, participants experienced the complete breadth of Schneider Electric’s manufacturing process. The Lexington smart factory houses a complete, vertically integrated process including a typical assembly line, conveyance, fabrication center, paint room, and more – all connected through Schneider Electric’s Industrial Internet of Things-based (IIoT) EcoStruxure platform.
The tour showcased how Schneider Electric’s digital transformation increased energy efficiency and reduced downtime. AVEVA and Schneider Electric partner on integrated digital transformation solutions that bring together energy management and automation tools with industrial software. In Lexington, the company utilizes both its EcoStructure and AVEVA platforms throughout the facility. For example, at tour stop nine participants saw how the EcoStructure Lean Digitization System calculates true labor efficiency with e-performance and e-andon — digital data-sharing and production monitoring of performance and defects for immediate response. Meanwhile at stop seven in the paint room, the group learned how AVEVA Edge processes data and populates the company’s dashboards in real-time.
In a fascinating application of AI and machine learning, the company has set up a 5G networked camera to photograph and analyze every link in the mile-long conveyer chain. The photos are then automatically compared to thousands of images of broken and unbroken chain links, and the AI-powered system identifies broken and breaking links that need to be repaired and relays this information to the operator.
Insights from Digital Subject Matter Experts: Beyond the smart factory tour, participants joined breakout sessions where they heard directly from Schneider Electric experts about hardware and software tools used in the company’s digital transformation journey to help breakdown data silos and empower employees to make effective decisions at the gemba – the real place where they do their work. Breakout topics included Smart Factory Execution, EcoStruxure Deep Dive, EcoStruxure & Industry Automation, Cybersecurity and Operations, Advanced Analytics in Supply Chain, and Supply Chain Sustainability.
Unfettered Access to Company Leaders: The day ended with a discussion panel during which Schneider Electric leaders answered questions from both the audience and moderator, Jeff Puma, MLC’s Content Director. The panel featured Greg McManaway, Business Process Leader; Fabrice Meunier, Vice President, Industrial End User, System Integrator and Software Business; Anand Varahala, Environment and Sustainability Manager; and Bharat Virmani, Vice President, Supply Chain Performance and MTS/MTO Cluster. The panelists shared their insights on topics including the factory’s digital transformation journey, the WEF Lighthouse process, setting priorities, and scaling digital advances.
A Chance to Rub Elbows: In addition to witnessing the innovations and smart factory implementation at Schneider Electric’s Lexington facility, the tour offered an opportunity to interact with nearly 100 industry leaders in attendance including digital pioneers from both the host company and other MLC member companies. Like all MLC tours, the formal and informal networking opportunities allowed participants to ask questions, discuss hurdles, and seek solutions from other participants on the digital transformation journey. These relationships are invaluable to members’ efforts to expand their connections and Manufacturing 4.0 understanding.
All photos by Ian Wagreich; Copyright: capitolhillphoto.com
Members of the Manufacturing Leadership Council were given a glimpse of the future of factory connectivity at the Ericsson USA 5G Smart Factory in Lewisville, Texas and Imagine Studio Tour in Plano, Texas. Exploring the theme Effectively Managing 5G and IoT to Drive Smart Manufacturing, tour participants learned about a highly autonomous and sustainable operation that manufactures Ericsson’s portfolio of 5G products, including advanced antenna radios.
The Lewisville facility was recognized as both a Global Lighthouse and Sustainability Lighthouse by the World Economic Forum, just one of six factories worldwide to win both designations. The Smart Factory has more than 400 employees from 36 different countries.
5G is hailed for its promise in industrial settings due to its low latency and high reliability. It is considered critical infrastructure by the federal government, meaning it is considered so vital that it is designated for special protections and falls under national policy for maintaining its security, resiliency, and function. Additionally, an industrial 5G network requires fewer wires and fewer access points vs. advanced wifi networks. For example: In an 80,000-square foot area of the production facility, just two 5G radios are required for the network. The same connectivity on wifi would require 24 routers.
The plant utilizes automation, interconnected equipment, machine learning and real-time data enabled by IoT solutions and a private 5G network. Constructed in 2019, the facility was built in less than 180 days and delivered its first commercial 5G radio in July 2020. It produces a range of 5G radios for private networks and deployment by cellular carriers for their nationwide networks.
The surface mount assembly lines at the Ericsson USA factory are the longest in the United States at 271.6 feet. The factory layout can be described as a hub-and-spoke assembly system connected with automated mobile robots (AMRs). The equipment includes AMR docks, which allows the AMRs to move components through various stages of assembly. This allows operators to stay focused on production vs. tracking down necessary components.
The manufacturing team at Ericsson says they are focused on “sensible automation” as not everything makes sense to fully automate – for example, final assembly is done with human operators working with collaborative robots. In other areas where it is practical, faster and more efficient industrial robots are deployed instead. The plant runs on a private network separate from Ericsson’s corporate network, and all of its network solutions are hosted on-premises.
On the sustainability front, Ericsson is reaching for an ambitious Net Zero goal in all of its operations by 2030, with a goal of being Net Zero in its entire value chain by 2040. The Ericsson USA factory is 24% more energy efficient vs. comparable buildings, using renewable energy through 1,646 solar panels that generate 17% of the energy required for the factory. All of the energy the facility uses is from either wind or solar sources. It also has two 40,000-gallon tanks for collecting rainwater, which is used for maintaining its drought-resistant, native species landscape and in the facility’s restrooms.
After touring the production facility, attendees were taken to Ericsson’s Imagine Studio where they were given a deep dive into the performance differences between 5G and other previous generation wireless networks, the considerations necessary when planning for 4G/5G connectivity needs, an overview of private cellular networks, and identifying top 4G/5G-enabled use cases for the factory. Topics of discussion included how to align business goals with network deployment, how to select partners and system integrators, understanding risks, and how advanced networks can be deployed on both new and legacy production lines.
As for its future goals, the Ericsson team says that while product variability is currently a challenge from an automation perspective, they aim to control production with AI and machine learning for even greater autonomous operations; 5G will be a crucial component to handling the variability. They describe the process of adjusting their highly automated operations as a journey that is about learning as a team with production, network engineering, and product development. They are also actively pursuing a production digital twin.
Ericsson’s M4.0 philosophy would be good for any manufacturer to emulate: Continuously try new things and evaluate them. Be willing to fail. Aggressively chase production efficiency. Envision the type of company culture that is necessary to be innovative and to meet business goals. And most of all, imagine what is possible and set that as the highest goal.
See the full lineup of MLC’s upcoming plant tours at https://www.manufacturingleadershipcouncil.com/event/plant-tours/.
Lincoln Electric has a long and storied history since its 1895 founding in Cleveland, Ohio, as a manufacturer of electric motors. Today, it is a global industry leader in welding equipment and consumables, additive manufacturing, and automation solutions, and has expanded across 19 countries worldwide and serves customers in over 160. But how does Lincoln keep a connection with its origins through a continued spirit of innovation and learning?
Lincoln Electric first opened its welding school in 1917 and a century later launched its state-of-the-art Welding Technology & Training Center, in 2018. This 130,000-square foot facility includes training stations for virtual welding, where all students start their introduction to welding, and more than 150 training booths for learning on the real ‘arc’. There are classrooms to accommodate both live and online instruction.
Lincoln Electric’s welding training is given to its new employees and external welding students. In addition, Lincoln also offers both turnkey and custom welding training curriculums and courses for customers to help them upskill their professional welders to achieve specific business targets and goals. They also offer a “train the trainer” course for welding instructors to ensure today’s students are getting the most up-to-date instruction to be industry-ready.
MLC members were given a first-hand look at Lincoln Electric’s headquarters in Cleveland at a recent plant tour that included visits to the welding training center in addition to the company’s machine division, where it builds welding equipment and consumables, as well as its large-scale additive business (3D printing) and their automation solutions.
Lincoln Electric is proud to have a high-performance culture that recognizes and rewards success and provides employees with opportunities for growth and development. The company’s Incentive Management System (IMS) for the production workforce includes piece work pay to maximize personal earnings potential, an annual profit-sharing bonus, a no-layoff policy, and an open-door policy including an employee-represented advisory board, who regularly meet with management to discuss various HR and operational matters. The IMS has been studied by the Harvard Business School and is one of the school’s top-selling case studies.
Lincoln Electric’s state-of-the-art, large-scale metal 3D printing solution is an extension of its automation, software development and metallurgical expertise, which has been applied to an additive process. The company’s additive solutions center is the largest platform of its kind globally with 18 3D printing cells which are used primarily to print replacement parts, molds, tooling and prototypes that measure up to eight feet in length and weigh more than 8,000 pounds – and are printed in a variety of metals including mild steel, stainless steel, nickel alloys, bronze, and Inconel. The solution serves a variety of industries including automotive, aerospace, marine, and energy. Customers provide Lincoln with CAD files or their parts and functional requirements and can expect finished parts in weeks versus months when using traditional castings or forging.
The tour stop in the Automation Solutions Center demonstrated Lincoln Electric’s portfolio of automation solutions that are aimed at increasing productivity and addressing the industry’s skills gap. The technology offered includes automated arc welding products, collaborative robots, metal fabrication, and assembly line solutions. The company has seen increased demand for its collaborative robot solutions in particular as manufacturers attempt to shore up their workforce shortages.
So what lies ahead as Lincoln Electric’s biggest challenge? Like most manufacturers, company leadership says that the core focus must be on people – to continue to build a pipeline of talent and attract, develop, and grow the next generation of leaders.
Additionally, Lincoln will focus on expanding its additive manufacturing and automation businesses in line with current trends and demand from customers in a variety of industries. But the company also intends to keep a focus on having a robust product portfolio that feeds into its bread and butter: a comprehensive and vertically integrated welding business, recognized around the world.
When a factory tour begins with stops in the Today Room and Tomorrow Room, it’s clearly not a business-as-usual tour. That’s how many of the participants at the MLC’s latest factory tour started their experience when the capacity crowd visited The Smart Factory @ Wichita.
What they saw: Hosted by Deloitte and Infor, participants were shepherded through a tour of the showcase factory and visits with representatives from Amazon Web Services (AWS), Dragos, Infor, and Siemens. These sessions covered advanced manufacturing techniques, cybersecurity, cloud data analysis, Internet of Things, digital twins and more. Along the way, the tour group experienced a look at how Manufacturing 4.0 is shifting what is possible on a factory floor and in the control center.
The factory tour began with a visit to the Today Room where participants heard about and saw the history of manufacturing. The tour then transitioned to the Tomorrow Room where, like something out of an amusement park, participants were invited to interact with a display table that showed advancements that are coming soon. From there, visitors moved into the heart of the tour where they saw M4.0 technology in action, and perhaps made a quick pitstop for a coffee brewed by the Smart Factory’s robotic barista.
The last stop on the tour was a visit to the control center where real-time data is synthesized and displayed related to The Smart Factory operation and Deloitte’s other immersive manufacturing experiences in Kyoto, Japan and Dusseldorf, Germany. The control center also served as an opportunity to showcase various systems within The Smart Factory’s ecosystem and how they work together.
A fully functional factory showcase: The Smart Factory @ Wichita is located on the Wichita State University Innovation Campus, and provides visitors with a completely immersive experience that brings smart manufacturing applications to life. Housed in a net-zero building, The Smart Factory is powered by a smart grid and manufactures science, technology, engineering and math (STEM) kits that are made of 100% recycled PET (RPET). The STEM kits, called Smart Rovers, are created in collaboration between Deloitte, Elenco Electronics and AWS, and will be donated to schools across the U.S. with the goal of inspiring the next generation of innovators.
M4.0 Discussion: The event concluded with a discussion featuring panelists Jason Bergstrom (Deloitte), Dave Kang (Dragos), Ken Hall (Siemens), Clint Schneider (AWS), and John Shorter (Infor). Moderated by Penelope Brown, the MLC’s senior content director, panelists discussed customer value, cutting through the noise, strategies for implementing and scaling M4.0, upgrading brownfield facilities, lights-out manufacturing, and the importance of communication, culture, data, and integration across the entire business.
As used in this document, “Deloitte” means Deloitte Consulting LLP, a subsidiary of Deloitte LLP. Please see www.deloitte.com/us/about for a detailed description of the legal structure of Deloitte LLP and its subsidiaries.
For Intertape Polymer Group, a manufacturer of paper- and film-based packaging products, the last six years have been a time of significant growth – and change.
Revenue during that period doubled from $750 million to $1.5 billion at the end of 2021. With 10 companies brought into the fold through acquisition, as well as through greenfield plant expansion, IPG more than doubled its worldwide factory footprint. The company, with dual headquarters in Montreal, Canada, and Sarasota, Florida, now has operations in 34 locations, including 22 manufacturing facilities in North America, and approximately 4,000 employees.
But one of the most significant changes along the way, and one that will most certainly shape its future, is a digital transformation that began in 2018 that is now being rolled out in 10 of the facilities.
To see how IPG’s digital journey has played out in one of those facilities, approximately 70 members of the Manufacturing Leadership Council toured IPG’s Tremonton, Utah plant in April. Built in 1997, the plant makes shrink films such as StretchFLEX. MLC members saw how IPG uses data from plant floor equipment such as extruders to more rapidly identify and remediate problems; how it more effectively manages parts with an automated storage system called VIDIR; how it uses so-called “hackathons” and a digital-first mindset to problem-solve; and how it uses 3D printing to speed parts making.
In a briefing before the tour, Jai Sundararaman, IPG’s Vice President of Business Transformation, described why and how IPG undertook its digital transformation journey.
He said IPG was facing a set of issues as it contemplated its digital strategy – gains from lean manufacturing were plateauing, the workforce was ageing and retirements were underway, and the potential of new technologies was looming but not yet embraced. Moreover, digital was seen as a way to “homogenize” the company’s operating culture, an important requirement as a result of the acquisitions.
To prepare for the development of its digital transformation strategy, IPG undertook a series of explorations and activities, including studying 20 different technologies, attending more than 10 industry conferences, holding multiple technology summit with vendors, and engaging in more than 25 networking sessions with fellow MLC members, Sundararaman said.
The company then adopted a phased approach to digital transformation anchored on delivering business value.
Phase one of the digital transformation was designed to reinvent operational excellence for the digital era by, in particular, using its foundational Intertape Performance System (IPS) to closely align strategy and execution and “homogenize” the company’s operating culture.
“We have cracked the code in delivering bottom line results,” said Sundararaman, who is also a member of the MLC’s Board of Governors. “And we have uncovered three to five years of opportunities for driving sustained competitive advantage with operational excellence leveraging digital technologies and processes.
“So it was about raising the game to a higher level. I would characterize it as a ‘breaking the four-minute barrier’ moment. It was truly a watershed moment when the Tremonton team broke the yield numbers and sustained it for several months. Now, the records are starting to tumble down for other lines.”
Phase one also includes systematically up-skilling and retaining talent with digital and process knowledge. Phase two will be about driving revenue and margin growth by applying digital technologies at scale in other functions such as customer engagement, he said. And Phase three, which is probably a year away, will be about business model invention leveraging digital technologies.
One of the most significant changes had to do with how IPG thought about the process of problem-solving. Before its digital transformation, as it was explained during one of the tour stops, problem-solving was undertaken using a traditional sequence – hypothesis, questions, data, and answers.
The digital sequence, though, is different. It begins with big data, followed by exploration, correlations, and, finally, insights.
During an hour-long panel discussion following the tour, IPG plant officials answered questions from MLC members concerning data standards and analysis, measuring the return from M4.0, and how to get buy-in from employees and leadership teams for M4.0 initiatives, among others.
The panelists were also asked about the future possibility of achieving so-called light’s out status in a plant and the role of artificial intelligence in operations and continuous improvement.
“We have different camps with our own groups,” one panelist said. “However, we are very surprised at the tangible results we’ve seen in the initial stages of writing these algorithms and what’s possible with AI and how self-correction could become much more common.”
Wherever your company is on its Smart Manufacturing journey, one stubborn issue remains: reducing human error. Whether it’s insufficient operating practices and procedural follow-through, equipment operation failures, or inconsistencies in shifts due to capability issues, the human component is a key feature of any reliability strategy for forward-thinking manufacturers.
In a virtual factory tour held September 8, MLC members got an inside look at how BASF Chemical Intermediates is implementing Voovio Technologies US Inc.’s Enhanced Reality training software simulation system to move both new hire and refresher training into the digital age.
BASF Chemical Intermediates, a division of German multinational chemical manufacturer BASF, manufactures approximately 600 products — including butanediol and its derivatives, amines, organic acids, polyalchohols, life science intermediates, solvents and OASE gas treatment solutions — which are sold to chemicals and plastics, agriculture, energy and resources, consumer goods, and nutrition and health customers around the globe. With six Verbund sites and 241 additional production sites in more than 90 countries, BASF’s products provide the building blocks for everything from shoes and clothing to construction, medicine, and fertilizers used in agriculture.
As it continues to move along its digitization journey, BASF is using data and digital technologies — including digital simulation training — to create additional value for its customers by increasing the efficiency and effectiveness of its manufacturing processes. BASF Chemical Intermediates partnered with Voovio to design customized digital training simulators to ensure its front-line operations and maintenance personnel are engaged, fully trained, and able to deploy the digital tools the company needs on its journal to increased operational excellence.
MLC members on the tour learned about the three main components of the Voovio simulation system: the digital Plant replica, digital procedure simulators where trainees can learn and practice procedures, and the field execution tool, which assists operators in the field as they execute the procedures they’ve learned.
The digital plant replica is built using real photographs — not animations — to create an immersive, realistic, interactive, and navigable environment that can be accessed by individuals on a computer, and shared virtually using standard video conferencing tools. Trainees can see everything in the environment and select components such as valves, pumps, and control panels to get a detailed view of each component, which are tagged and ID’d, and behave as they would in the physical environment to replicate the real functionality of the equipment. They can digitally “grab” and manipulate the components with a mouse or finger as they search for them, or from a searchable index. The simulators also offer enhanced views where the operator can overlay process flows and click on any piece involved in that workflow to see how it fits into the process. This unambiguous representation of the actual plan is useful for onboarding new operators and refreshing the knowledge of current workers.
The system also includes guided, learn, refresh and test modules that provide the replica, the procedure, and an action checklist so operators can focus on one action at a time in the procedure’s sequence. The guided module is like a virtual subject matter expert (SME) that enables technicians to learn and practice various procedures by doing them virtually. Once the operator has completed one step successfully, they get instant feedback. The system also includes knowledge snippets, which could be in any multimedia format, that include text, videos, job plans, plant drawings, and other bits of critical knowledge that may not be a formal part of the step but are accumulated bits of tribal wisdom new operations or maintenance technicians can access to learn from those who came before. The test module uses the same basic setup but provides immediate feedback to confirm whether the operator completed the step correctly. The system generates a test performance report and detailed activity log and also captures testing analytics for each trainee.
The field execution tool enables operators to take the training out of the computer screen and onto the shop floor. Using a tablet or approved digital device, employees can do a test run on the fly to ensure they know what to do before they do it.
BASF’s goal for implementing the simulation system was to update its operator training model to be faster, more interactive, self-directed, and be more systematic about capturing and transferring organizational knowledge from experienced operators to newer employees. The VOOVIO system is designed to reduce the time spent on-boarding with SMEs during traditional orientation, job shadowing, field demonstrations and written tests, while increasing competency, learning, and productivity.
In addition to reducing the time its SMEs spent training others by half and greatly accelerating the learning process, BASF has used the simulations to reduce unplanned events and startup delays, improve equipment reliability, reduce downtime, increase safety, and maximize profitability.
Nexteer Automotive is on a mission to make driving a car safer, more fuel-efficient, and future-focused through its production of steering and driveline safety-critical car and truck electronic and hydraulic power products. In addition to electric and hydraulic power steering systems, steering columns, and driveline systems, the company manufactures advanced driver assistance systems (ADAS) and automated driving-enabling technologies for more than 60 customers in every major region of the world, including BMW, Ford, GM, Toyota, and Volkswagen. Nexteer’s products complete the connection from the steering wheel to the wheels on the road.
With software being a key component of most of Nexteer’s products, it’s no surprise that this multi-billion-dollar global business used a data-driven, holistic, and integrative approach to manage its complex global operations. Called the Digital Trace ManufacturingTM (DTM) System, it was created by Nexteer to provide a global architecture that connects and standardizes the thousands of data-producing components generated by its 27 manufacturing plants around the world.
In a virtual factory tour held on August 11, Manufacturing Leadership Council members got to see DTM in action. On the first stop on the tour, MLC members saw the production processes and traceability system at work at the company’s Plant 3 in its Saginaw, Mich., site, near the company’s headquarters in Auburn, Mich. The Saginaw facility, Nexteer’s largest, includes six manufacturing plants comprising 3.1 million square feet of manufacturing floor space where all the company’s core products are made. The site also houses a powerhouse and water treatment site, a global technical center, a test and validation center, and a test track. MLC members learned about the complexities involved in running a large-scale automotive component manufacturing plant, as well as how Nexteer has improved its manufacturing processes using the DTM system to connect data and maximize efficiency across the 150 operations required to manufacture its rack-and-pinion EPS products.
At the next stop, participants learned about how Nexteer uses data-acquisition tools to manage its business. Every time a new program is launched, a detailed process flow map is created for each step. This information is then shared with the equipment builders, so the machines are designed and programmed appropriately for the needed data processing, including what data will be sent to traceability and which processes use barcode scanners or other methods to track part serial numbers, such as RFID tags.
It’s one thing to have a large system collecting data — and it’s another to be able to use that data effectively. Nexteer uses intelligent manufacturing, big data, and local technology to collect, move, store, notify and summarize information for its global traceability system. The system, which is used in all the company’s plants to track information from thousands of machines daily, collects cycle time information. If there’s a fault, it collects and stores information including operation error codes and a description of all the pertinent information.
The data displays summary information for current station status directly on the floor on an hour-by-hour basis. It also makes historical information available for problem-solving purposes and provides automatically generated daily and weekly reports on all facets of the operation that are sent to cross-functional groups for awareness and problem-solving. Flawless materials control and delivery also is critical for production line efficiency, and Nexteer’s system can track material from receiving and shipping through the production line with single-box precision.
Not only does the system allow them to eliminate discrepancies by tracking the movement of each piece of material with high precision, it also eliminates the need for physical inventory processes. The ability to understand the manufacturing process outputs, and how these outputs affect your business goal, is extremely powerful. Nexteer uses its Center of Analysis (COFA) to communicate and correct any issues that arise.
Nexteer’s innovative approach to integrating design and manufacturing systems, from DTM to COFA, enables the company to deliver a dynamic, comprehensive view of its global manufacturing operations on a minute-by-minute basis — and benefits the company’s employees, customers, and shareholders.
IBM’s digital journey is keenly focused on building a cognitive enterprise that embraces an agile culture of innovation, combined with a client focus that leverages exponential technologies to deliver greater value. IBM executives on the MLC’s recent virtual tour of its high-end storage manufacturing plant in Vác, Hungary, described it as, “a mission of relentless reinvention.”
The April 2021 tour showed Manufacturing Leadership Council members how the company brings that mission to life to maximize its complex supply chain. And it is a complex one: IBM has an operational presence in more than 170 countries around the globe, with its manufacturing sites in strategic locations, serving hundreds of thousands of customers with hardware deliveries and service maintenance. To meet the high configurable product demand, the IBM supply chain operates in a hybrid model of build-to-plan and build-to-order. IBM also collaborates with suppliers across its global, multi-tier supplier network.
For IBM, the enterprise IT needed to drive rapid innovation is based on an Open, Hybrid Cloud and AI-embedded platform that incorporates the company’s own technology, including IBM’s Watson AI capability, to provide data insights as well as manage its supply chain on a daily basis. IBM AI technology has capabilities to co-create and manage business transformation through visual recognition technology, acoustic analytics, industrial augmented reality, IoT, blockchain, and digital twins, to power its infrastructure, elevate its automation capability, maximize equipment lifespan, and enable remote support.
But it also takes IBM’s team of passionate and committed supply chain professionals to apply these emerging technologies to operations with both speed and agility to achieve the company’s goal of relentless reinvention.
From piloting new technologies to becoming a more cognitive enterprise, automating core processes, and leveraging a multi-source more resilient supply chain, IBM is committed to the idea of innovating anywhere/use everywhere data insights to improve its processes, people, and technology.
Adopting Advanced Technology to Drive Digital Transformation
The Hungary plant tour exemplified how IBM combines collaboration and processes with automation, AR, AI, IoT, and data visibility to achieve a seamless, agile operation. Supported by the company’s Operations and Supply Chain Execution teams around the world, some of the key technologies IBM executives highlighted included:
Supply Chain Advisor: Being able to access forecast, order, supply, inventory, and engineer data in real time across all manufacturing geographies and functions is critical to the company’s decision-making process. IBM uses a platform powered by Watson and cognitive AI capabilities to provide instant data insights that its worldwide supply chain professionals can use to monitor and assess global and local supply and demand information, as well as parts numbers and component details. There are three main Advisor systems: Cognitive Supply Chain Advisor 360, Quality Advisor, and Test Advisor, which enables the IBM Supply Chain to mitigate potential issues before they reach critical mass and to adjust workflows as needed.
Collaborative Robots: The company also uses collaborative robots integrated with AI visual recognition to help maintain consistency in the quality inspection process, as well as precision in the assembly process. This allows employees to concentrate on more complex and higher value tasks.
Acoustic Insights: IBM infuses AI and automation into the acoustic arena as well. It trains AI models to recognize sounds that could indicate a potential machine failure so it can be mitigated before a failure occurs. Both of its visual and acoustic insight products were developed in house.
Augmented Remote Assistance: When the company had to minimize the physical interaction of employees due to COVID-19, it implemented an augmented remote assistance solution — a mobile app and web interface that workers can use to report problems to remote experts. The experts can then evaluate and provide step-by-step visual instructions through a live audio and video stream. This has streamlined response and repair times. Some manufacturing operations staff also are equipped with a tablet to facilitate collaboration and improve knowledge sharing through virtual interaction.
Blockchain: In the Hungary plant, IBM has used blockchain technology to track parts in collaboration with its suppliers throughout the lifecycle of a product. This makes it easy to track and screen for faulty parts, and that data can then be shared with suppliers. IBM also uses Blockchain for logistics tracking and customs clearance to share key documents and in-transit information across the network with suppliers and carriers to digitize the data and improve compliance and cycle time through customs.
Track & Trace IoT: A key technology to monitor shipments and possible incidents /in-transit delays. IBM is using Track & Trace IoT Smart Sensors and the Mechanical Tilt indicator attached to outbound and inbound shipments to provide real-time data on location, temperature, humidity, and shock alert.
The Human Factor
IBM also enables its operators to learn cross-functionally so they can move from one area to another, based on demand. The flexible workforce, combined with its flexible platforms, enabled IBM to deliver on customer demands quickly and successfully during the perfect storm of disruption that was COVID-19. The supply chain team, augmented by data insights, can better understand situations and receive recommendations. The interface’s use of natural language also made it quicker, easier, and more intuitive to collaborate.
Digitizing the assembly line with visual and acoustic insights through augmented reality and AI not only speeds up processes and allows support to be provided remotely, it also allows employees to concentrate on value-add tasks in their workflows, enhancing flexibility, agility, and a culture of innovation.
Yet IBM executives do not believe the company is anywhere near the end of its digital journey. As it continues to it use Watson’s AI capabilities to streamline its cognitive supply chain, increasing amounts of data available from IoT devices across the network will help further enable IBM’s AI capability to grow and scale in the future.
IBM is confident that this approach to digitally centered, continually improving processes, combined with its investment in training in both technical and soft skills, is preparing the company to act with greater speed and agility whenever and wherever the next disruption might occur.
More than 35% of cyber espionage attacks in the United States are targeted at manufacturers, more than any other business sector, according to a recent U.S. national defense industry association study.
To ward off today’s determined hackers, manufacturing companies of all sizes must now urgently analyze and protect both their internal operations, and their entire supply chain ecosystem, to prevent malicious disruption, the theft of intellectual property, data ransom attempts, or competitive denials of service.
As manufacturers accelerate the deployment of digital technologies to modernize and interconnect their facilities and supply chains, they also open up new risks for cyber-attacks, stressed Chandra Brown, CEO of MxD, during a recent virtual plant tour for Manufacturing Leadership Council members.
Smaller companies are especially at risk, Brown added. “Hackers are very aware that there may be more vulnerabilities in smaller companies, and their attack vectors on large companies can start with targeted attacks on the smaller companies within their supply chain.”
And a cyber-attack can be fatal: 60% of small companies go out of business within six months of an attack.
MxD, which was designated as the National Center for Cybersecurity in Manufacturing by the U.S. Department of Defense in 2018, took virtual plant tour participants through two cybersecurity demonstration areas within its 22,000-square-foot Innovation Center in Chicago to highlight what can be done.
Build a Cyber Wall
MxD’s framework for cyber security is designed to address the five major cyber security elements published by the National Institute of Standards and Technology (NIST): identify, protect, detect, respond, and recover.
First up on the tour was MxD’s Cyber Wall, which is configured to help manufacturers understand the vulnerabilities of, and required protection for, Operational Technology (OT) systems, which are vulnerable because they typically are based on microcontrollers or PCs that are increasingly connected to local area or wide area networks. As MxD demonstrated the Cyber Wall, they provided the following tips for meeting the first two NIST elements:
Identify: If you don’t know how many devices you have connected to your network, find out. There may be more than you think — the average could top 4,000 in a 100,000-square-foot factory. It’s also key to know what operating system you’re running, how often it’s updated, and if it has the most recent security patches.
Protect: The next brick in the cyber wall is installing software on each device that will keep you updated on whether it’s connected and, if so, if it’s running the latest, most secure software version.
To illustrate how the Cyber Wall works, MxD uses two identical PLC industrial control systems, each attached to a unique network of PCs, routers, switches, and firewalls. One is protected with “whitelisting,” or application control, while the other is not. Rather than trying to keep a list updated with malicious software that is constantly propagating, application control only allows software that is expressly approved. When a USB drive loaded with an unknown malicious executable file is loaded into each system, the protected system blocks the executable file since it is an unrecognized application, while the unprotected system allows it to start malicious activity.
All it takes is one person to plug in a suspect USB or click on a phishing email to set a hacker loose in the system. That’s where network segmentation comes in. The MxD protected system is contained within its own segmented network, with access controlled by a firewall that manages both internal and outside access, so if a hacker does break in, you can keep any damage from spreading to other areas within the facility.
Erect a Cyber Platform
To address the remaining three NIST cybersecurity framework segments — detect, respond, and recover — MxD demonstrated its Cyber Platform. Like the Cyber Wall, the demonstration was based on programmable logic controllers used to power the OT control system, in this case to operate an array of pumps and values to direct liquid through separate clean and wastewater pipe networks. It includes 20 sensors to monitor temperature, flow rates, pressures, and other factors.
Detect: Like most factories, the MxD cyber platform uses an intrusion detection system (IDS) to monitor network traffic and note an anomaly, such as when a hacker tries to take over the PLC. It then alerts appropriate personnel to investigate.
Respond: The most important thing is to have a plan, including official, easy-to-locate policies and procedures. These generally include 1) bringing the system to a safe halt; 2) disconnecting the affected system from the network to keep the corruption from spreading; 3) communicating the incident to the proper internal and, if appropriate, external personnel and law enforcement; 4) performing a root cause analysis to determine how the problem happened and how to mitigate similar incidents in the future.
Recover: While the details will vary across industries, a recovery plan generally should include 1) having a documented plan on how to bring the systems back online — manufacturers should have software backups of all systems, including OT, so they can revert to the last backup that happened before the hack; 2) review the root cause analysis to determine what corrective actions are needed; 3) bring the system back online. MxD engineers did a failure modes and effects analysis (FMEA) when designing the Cyber Platform to determine potential hacker targets and worst-case scenarios ahead of time so they could build recovery mechanisms into their systems. Even if you have an older legacy system, it’s worth doing an FMEA to help drive effective recovery plans, they said.
The goal of manufacturing security is “to operate securely, not to secure operations,” stressed the MxD panel at the end of the virtual tour. The goal always has to be to ensure continuous production, not to be 100% secure.
As cyber threats evolve, manufacturers must also evolve the tactics they use to thwart those threats. But don’t expect to ever be able to thwart them completely. The most important thing, concluded MxD, is to have a plan in place to get back up and running before too much damage is done.