May 24 2017

INTEGRATED ORGANIZATIONS: Working as one improves industrial-equipment makers’ competitiveness

With increasingly sophisticated products, supply chains and customer expectations, industrial-equipment manufacturers are experiencing intense pressure to deliver. Compass spoke with Cambashi founder Mike Evans about strategies to manage the industry’s growing complexity.


Cambashi founder Mike Evans

COMPASS:  What challenges are industrial-equipment makers facing?

MIKE EVANS:  Machine builders must accelerate time-to-market of new machines while reducing costs and ensuring greater safety and reliability. They must also comply with strict standards and stringent regulations.

Customers also demand that today’s machines do more than ever before, with advanced monitoring, sensors and automation bringing ever-increased functionality. This increased complexity is challenging to manage and makes it harder to compete effectively.

Like most businesses today, industrial-equipment makers also have to connect within and beyond their enterprises on a global scale. Many companies that internally managed sales, design, engineering and installation now outsource these specializations. But coordinating multiple streams of information is problematic. If these streams remain unconnected, labor and capital are wasted through repetition of work and errors in engineering and manufacturing.

How can industrial-equipment manufacturers manage complexity to deliver a better customer experience?

ME: Companies are moving to customer-centric teams where skills and tasks are organized around customers’ needs. On behalf of their customers, they have to make and install machines that have 100% operational uptime.

That’s a big order. What strategies can help manage it?

ME: It definitely requires an integrated working methodology that allows customers to see exactly what they are buying, often simulated in the context of their own operations before the machines are built. That leads to fewer mistakes and more satisfied customers. Within an integrated working methodology, all parts of the enterprise touch. Customer, supply chain, product data, mechatronics and software are all combined on one platform used by each and every stakeholder.

What are the commercial and technical advantages?

ME: Synchronizing requirements drives the efficiency, which allows more functionality to be incorporated into machines while delivering improved output. This virtuous circle is completed when improved profitability allows greater investment to replace labor with capital.

Technology is the enabler. Properly deployed, advanced and integrated technology leads to greater precision, remote monitoring and machines that can, for example, automatically compensate for wear to improve accuracy. These advances lead to more output from machines for the same or lower cost. Connecting the activities of the extended enterprise also eliminates waste. An engineer may be able to support more than one site, for example, because they can oversee and optimize machine operations and maintenance remotely.

Continue reading the rest of this story here, on COMPASS, the 3DEXPERIENCE Magazine

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May 17 2017

ADDITIVE MANUFACTURING – Business challenges drive aerospace companies to advance 3D printing technology

Additive manufacturing (AM) or 3D printing has moved well beyond prototyping. Today, most aerospace companies use it to improve the functionality of existing components and fabricate non-structural parts for commercial and general aviation aircraft.

AM enthusiasts envision the day when this revolutionary process will be used to “print” entire fuselages, wings and critical engine parts with complex geometries, including embedded sensors and other electronics. To achieve that disruptive vision, however, AM needs to overcome some difficult hurdles, according to Oak Ridge National Laboratory (ORNL), a US Department of Energy research facility in Tennessee. ORNL is collaborating with hundreds of companies across multiple industries to advance AM.

“In some applications, such as rapid prototyping or specific medical devices, where many parts have been printed, additive manufacturing is pretty mature, but for most applications it’s embryonic,” said Bill Peter, director of the US Department of Energy’s Manufacturing Demonstration Facility at ORNL.

Quality assurance with 3D printing

Each year, ORNL hosts more than 5,000 visitors representing about 700 organizations who want to discuss, among other technologies, additive manufacturing. Those visitors make clear, Peter said, that one of AM’s biggest hurdles is to achieve quality levels that instill as much confidence in AM-produced parts as in those made with traditional processes, including parts that are critical to the end product’s performance and safety.

“Their biggest concern is that there is no methodology for establishing the integrity of additively manufactured components,” he said.

Small modifications in process parameters and the resulting microstructures of the deposited material, such as powdered titanium or nickel, can drastically change how the end product behaves, Peter noted.

“Long term,” he added, “we’ll use a framework of data analytics and visualization systems to show how to repeatedly build a complex part with the level of quality that aerospace manufacturers require, but we are still a few years from reaching a full solution.”

Continue reading the rest of this story here, on COMPASS, the 3DEXPERIENCE Magazine

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May 10 2017

Collaborative Robots are Making Automation Possible for SMEs (Part 1)

This is the first of a 2-part series addressing the impact of adopting collaborative robots in the SME manufacturing environment. 

An industrial robot enclosed by fences. Photo credit: Julian Dowse

An industrial robot enclosed by fences. Photo credit: Julian Dowse

Although there is a lot of hype about robots taking jobs away from humans, the truth is today many industries still rely on human processes. According to the Boston Consulting Group, only 10% of tasks were performed by robots in 2015 across all manufacturing industries[1]. However, they expect this share of tasks to increase to 25% by 2025.

How will this happen? This will have to come from the largest sector of the manufacturing base:  the small and midsized enterprises (SMEs)[2]. And, the enabler will be so-called collaborative robots, which fit the needs of SMEs much better than traditional industrial robots. The market for such robots is expected to grow at a Compound Annual Growth rate of 60% over the 2017-2021 period[3], exceeding 1$ billion by 2020 with 40,000 units sold[4].

What are collaborative robots?

As their name indicates, collaborative robots, also called cobots, allow workers to work side-by-side with them, as opposed to traditional robots which must be located in a secured, closed area for safety reasons.

Rethink Robotics' Baxter, an innovative 2-arms cobot with 7 degrees of freedom per arm. The eyes in the computer screen move in the direction one of its arms is about to take. Photo credit: Steve Jurvetson

Rethink Robotics’ Baxter, an innovative 2-arms cobot with 7 degrees of freedom per arm. The eyes in the computer screen move in the direction one of its arms is about to take. Photo credit: Steve Jurvetson

Manufacturers of cobots include:

Pioneers such as Universal Robots, a leader in the cobots market, and Rethink Robotics whose innovative Baxter and Sawyer cobots have received a lot of attention.

Established industrial robot makers thathave recently introduced cobots to their catalog. From the big four of Industrial Robots, we have the LBR iiwa from KUKA, the dual-arm YuMi robot from ABB, the HC10 from Yaskama Motoman and the CR-35iA from FANUC (which is based on the existing M20iA/35M robot with added rubber skin and force sensors).

Cobots eliminate the need for costly fences, do not use valuable shop floor space nor reduce access to equipment.

But this alone would not be enough for adoption by SMEs.


Why are cobots a good fit for automation in SMEs?

Human safety

For SMEs that want to embrace automation, worker safety is a major concern.

Power and force-limited cobots are equipped with force sensors that make the robot stop whenever they encounter an obstacle, so that a human feels nothing more than a gentle nudge. Such cobots often carry a low payload[5] and work at a slow speed. They also often have round corners and a soft surface and are even shaped to avoid pinch points[6].


In faster and heavier applications, the cobot can use its sensors to slow down as people approach and ultimately stop when someone enters a defined perimeter.

In any case, a risk assessment of the whole robotic cell is needed. For example, a cobot with a sharp part at the end of its arm may pose a risk, even though it is designed to be “safe”. The recently-released (Feb. 2016) ISO/TS 15066 specification provides long-awaited safety guidelines for collaborative robots. This publication is expected to foster a wide adoption of cobots.

Ease of deployment

Industrial robots are robust and efficient but often require skilled robotic programmers, which are usually not available in SMEs.

On the other hand, cobots are usually trained by demonstration. An operator gets hold of a cobot’s arm and trains it by following the desired path of movement and executing the desired end-of-arm tool commands (such as grip or release) – see this demonstration with the LBR iiwa cobot from KUKA. A tablet may allow operators to fine tune the operation settings.

In addition, cobots come with out-of-the-box or optional devices which make them ready for use (e.g. hand cameras for object recognition, adaptive grippers or suction cups, etc.).

As a result, implementation time is significantly reduced. For example, Paradigm, a manufacturer of high performance loud speakers, needed to increase their production throughput. In one month only, they deployed a cobot that performed the first phase of polishing speakers. A previous implementation have taken five months with a cartesian type robot.


We are entering the era of mass-personalization, with high mix and low volume production. This is especially true for SMEs and cobots can help with this challenge:

  • They are lightweight devices. With no fencing required, they freely around the factory floor to the area where they are most needed.
  • They are easy to reprogram (see above) and can therefore quickly help workers on a new task to meet a changing demand.


According to a Barclays Equity Research report, the average selling price for cobots in 2015 is $28,177 per unit, with prices expected to decline 3-5% per year through to 2025.

This is much cheaper than industrial robots, whose prices range from $50,000 to $80,000 per unit according to RobotWorx, an integrator of industrial robots.

This allows a lot of SMEs to consider the usage of robots, which until now was believed to be unaffordable[7].


In this article we have seen that collaborative robots (cobots) are robots that can work hand-in-hand with workers in a shared workspace. Their ease of deployment, flexibility and affordability make them a good fit for SMEs.

Part 2 of this article will list some key applications of cobots, with examples from different industries. We will also discuss the expected impact of a wide adoption of cobots – for companies, for workers, for MOM systems[8] and for the society as a whole.


[1] It is also worth noting that 38% of the worldwide investments in industrial robots still came from the automotive industry alone (source: Work Robotics Industrial Robots report, 2016 – IFR Statistical Department)

[2] “Dramatic growth will come from the 90 percent of the market for robotics that isn’t yet automated. These are the small and midsized enterprises across the globe.” (The Business of Automation, Betting on Robots)

[3] According to a Research and Markets report.

[4]Source: ABI research

[5] Payload = carrying capacity

[6] See for example the convoluted shape of the KUKA LBR iiwa cobot.

[7] In case you wonder how cobots with advanced force-limited capabilities can be cheaper than industrial robots, the reasons are: a) Cobots are designed to have smaller payloads and are lighter, which reduces cost and b) Cobots have a lower accuracy and repeatability than industrial robots, which is acceptable since collaborative applications are usually less demanding. Cobots also have taken advantage of the decrease of sensor prices. For more information, see Why Are Collaborative Robots So Cheap?

[8] Manufacturing Operations Management systems

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Apr 19 2017

MANUFACTURING’S NEW MATH: CEOs juggle complex factors in calculating where to locate tomorrow’s factories

CEOs are rethinking their global manufacturing footprints, locating plants and R&D facilities as close as possible to major customers and preparing for a new wave of technologies that could transform the shop floor. To seize the future, they must persuade their organizations to experiment at a time when risk control is paramount.

Manufacturing1Twenty years ago, about a dozen publicly traded industrial metal-cutting companies were headquartered in the United States. Today, Kennametal is the last survivor. While others failed, Kennametal transformed itself into the prototype of the modern global manufacturer, leveraging a world-spanning network of factories and research facilities.

Under the leadership of CEO Carlos Cardoso, the 75-year-old Pennsylvania-based company does business in 60 countries and achieves slightly more than half of its US$3 billion annual revenues outside the United States. “We’ve done that not by standing still in the United States, but by growing the rest of the world at a faster pace,” Cardoso said.

The key to Kennametal’s success has been to follow large customers such as General Motors as they move into new markets. By being available where its customers are doing business – North America, Europe, China and India – Kennametal avoids losing them to local suppliers who then might emerge as global competitors.

Kennametal offshored, but not for offshoring’s sake. It remains a net exporter of high-technology, high margin products.Skill Increasingly Trumps Wages

Skill increasingly trumps wages

Like other best-in-class global manufacturers, Kennametal is engaged in a relentless push toward the high end of the technology food chain. It makes drill bits that operate 30,000 feet beneath the ocean’s surface and tools to cut the complex carbon fiber panels in the Boeing 787 Dreamliner.

“There are two types of manufacturing,” Cardoso argues. “There is the low-labor-cost, high-volume, low- margin type of business that requires low skills. Those jobs are the jobs that have been mostly outsourced and offshored. Then there are high- technology, highly innovative, highly skilled, high-margin jobs. Those have tended to stay in developed economies.”

Leaders in China, a major beneficiary of offshoring, have noticed the same trend, especially as low-skill manufacturing has begun moving to countries with even cheaper labor. “We know we can’t keep relying on a low-cost competitive advantage,” Commerce Ministry spokesman Shen Danyang said in January. “We need to accelerate the value-added upgrading of our products” (see related article “China’s Challenge“).

For years, many CEOs thought China’s low wages were the answer to all their pricing challenges. Many, like Apple and Dell, outsourced the manufacturing of their most sophisticated products to third parties such as Singapore’s Flextronics and Taiwan’s Hon Hai.

Today, although factories in China remain crucial to satisfying exploding demand in the region, the value and utility of relying on factories 12 time zones away to make sophisticated products for North American and European customers is being questioned as never before.

“The equation for deciding where to locate manufacturing on either side of the Pacific Ocean is shifting,” said Willy Shih, a professor of management practice at Harvard Business School and co-author of the book Producing Prosperity: Why America Needs a Manufacturing Renaissance (see related article “Global Shift“).

The downside of offshoring

Deep structural forces help explain the shift. China’s currency has racked up double-digit gains, making it more expensive to export made-in-China goods. Labor costs are exploding by 25% to 30% a year. The Boston Consulting Group estimates that the costs of manufacturing in China will reach US levels by 2015.

In addition, long supply chains are slow to respond. Entrusted to the wrong people, important intellectual property can “leak” from companies that are not careful, and even from those that are.

Focusing exclusively on cheap labor also ignores the costs of coordinating far-flung operations and supply chains. CEOs are discovering that the feedback loops among customers, R&D and manufacturing are crucial for sustained innovation, so locating manufacturing close to R&D can be advantageous.

For example, 40% of what Kennametal sells is customized for specific end users. Six hundred Ph.D.s and engineers in nine research and development centers worldwide work to devise new materials, including tungsten carbide and industrial diamonds (see related article “Super Substances“). CEOs achieve the greatest profits and largest gains in shareholder value at this high end of the manufacturing ladder.

Continue reading the rest of this story here, on COMPASS, the 3DEXPERIENCE Magazine

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Apr 12 2017

CENTER OF EXCELLENCE: Optimizing key step in realizing MES/MOM operational transformation

In a previous post, I wrote about the latest Gartner/MESA survey of manufacturers who have deployed MES across their enterprise. This survey is conducted annually by Gartner, a global technology firm, and the Manufacturing Enterprise Solutions Association, and it provides important insights into the experience of more than 100 MES-user companies.

What the survey revealed over the years is that manufacturers achieve rapid ROI from MES investments through basic improvements, but most miss out on the potential long-term benefits. Gartner writes, “Despite the strategic importance, organizations struggle to define suitable business cases and fail to recognize the full value that MES provides.”

The reason, as explained in my previous blog, is that manufacturers tend to treat MES as part of the ROI-funded IT portfolio, instead of as “a formal strategy based on business needs and future capabilities.”

This is a critical distinction, but what does it mean in practice?

The key step every manufacturer should take

Manufacturers have very diverse needs and goals. Is there is a common thread to be found among the companies that have reaped the greatest benefits from MES? The answer yes, and the common thread is the MES Center of Excellence (CoE).

In the MES world, the CoE is a means to universally deploy best practice processes, discover new ones, and continuously improve manufacturing operations everywhere. This is the very essence of Operational Transformation. A CoE is more than a centralized testing center. It is a means to manage the global manufacturing landscape from an enterprise point of view. Obviously, this requires a level of standardization and organizational structure across an organization.

As the Gartner analysis explains: “…integrating manufacturing activities with the supply chain requires some foundational work and best practices. To implement new technologies to bridge supply chain silos, there has to be common context and process. This may be a sobering truth, but the end results are worth the effort.”

The general approach to creating a CoE is to standardize on an enterprise MES that can be rolled out to all plants, monitored and updated remotely from a centralized system. The broader the activities covered by the MES, the greater will be the impact on the organization. For instance, integration with CAD modeling and the engineering bill of material (BOM) on the one hand, and Quality Control on the other multiplies the value well beyond a single plant. Thus, the MES solution should be able to see beyond the four walls of the plant to suppliers, customers, and upstream-downstream within the organization. It’s also important to have a system that allows for local variations such as language and regulations, and these local modifications must be easy to implement.

What the survey tells us

To return to the survey, we find that manufacturers that have implemented something like the above are reporting “significantly better results.” These companies enjoy the ROI of their more short-sighted competitors, and in addition, they set the stage for even greater organizational gains that are possible.

As Gartner states: “The sustainability of these quick wins is anchored by creating and maintaining an MES center of excellence (COE) and the expertise to govern activities across multiple plants. The more concerted the upfront effort in the creation of implementation templates, the better the end result.”

Specifically, organizations that achieved 75% or more of their MES objectives tended to focus on four business criteria, all of which are directly enabled by a Center of Excellence:
■ Enforcing standard processes/best practices across the manufacturing network
■ Increasing visibility across the manufacturing network
■ Improving quality
■ Improving employee decision making and competency

It would be difficult to predict the value of these criteria based on an ROI analysis, but they are clearly key competitive factors that are closely related to cost, performance, productivity, and brand—issues that should resonate with upper management.

The lesson of the survey seems clear: MES investments should be based on strategic and business improvement goals, not because they can be ROI-funded in an IT portfolio. And those goals are best achieved with “a highly empowered CoE.”

In my final blog in this series, I’ll discuss a few roadblocks to the CoE and preliminary steps of how manufacturers might structure their CoE. Hint there more than one way! In my final blog in this series, I will discuss how, using a formal process that focuses on business value and is proven to produce results, that both the short term and strategic benefits can be realized.

Related article:
The secret to MES success: Learn from experience

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