Since the days of Henry Ford, mass production has dictated the manufacture of standardized products. Having the right “speeds and feeds” has long been the name of the game for industrial equipment (IE) companies, winning business by excelling at improving production speeds and feed rates.
Those days are gone.
“Consumers are increasingly demanding more personalized products as they become more empowered, due to the advancement of digital technologies and the myriad of options available,” said Yen-Sze Soon, managing director at Accenture Digital, based in London. “IE manufacturers recognize that they must transform their businesses to meet customers’ changing expectations or risk being sidelined in the race for relevance.”
“Mass customization is becoming a reality,” said Matthew Littlefield, president at Boston-based analyst firm LNS Research. “Speeds and feeds are no longer enough for IE companies to win the deal. They must move to offering customer outcomes, which requires flexibility and agility.”
It’s a challenge that Rachel Lecrone, director of Manufacturing IT and Industrial Controls at Columbus-based engine manufacturer Cummins, knows only too well.
“We have always had a high demand for customized products, but it has accelerated in recent times,” she said. “How you situate an engine’s after-treatment system in a truck, for example, is very different to how it will fit in a generator or in a tractor for an agricultural system. The packaging, customer touchpoints and exhaust inlets and outlets are all unique.”
Darin Schmidt, central engineering manager for manufacturing operations at Kansas-based agricultural vehicle manufacturer AGCO, also feels the pressure to deliver more customized options to brands, including Challenger, Fendt, GSI, Massey Ferguson and Valtra.
“There’s a big drive towards autonomous vehicles at the moment,” he said. “But the application of these vehicles differs from one market region to another. Operations such as planting seeds, picking crops or applying pesticides create unique engineering challenges.”
A DIGITAL APPROACH
Successfully meeting the customization challenge can only be achieved through digital transformation, Soon said.
“Digital technology is changing beyond recognition, disrupting decades-old business habits, conventions and operating models,” she said. “It’s something that must be adopted by manufacturers if they are to evolve and compete. Doing this requires IE companies to fully embrace digital technologies. Industry X.0 is how we define the digital reinvention, where businesses use advanced digital technologies to transform their core operations, their worker and customer experiences and ultimately their business models.“
Those organizations that transform themselves through digital will realize remarkable benefits, Littlefield said.
“Digital services organizations need to bring together IT and operations to provide outcome-based transformational services for their customers,” he said. “Leaders are taking this a step further by creating ‘digital twins‘ of their equipment to help customers optimize the complete lifecycle of their assets. As a result of digital transformation, vendors benefit from increased access to data, increased customer intimacy and the ability to offer value-added services. Customers, meanwhile, can benefit from the ability to focus resources on what matters in their business.”
Recognizing this potential, Cummins is devoting significant time and resources to digitalization.
“Over the past 20-30 years, we have invested heavily in our manufacturing execution system (MES),” Lecrone said. “As a result, we now have the flexibility to meet unique needs when they arrive. It also gives us the traceability to know that, even if a customer is ordering a one-off product, we have built that product correctly and have all the data recorded to tell us how we managed the process, what parts we assembled in that particular product and any special quality checks that were made.”
ENTER NEW CHALLENGES
Quality control and audit histories are just the start of what Cummins wants to achieve.
“We want to explore all of the opportunities presented by digital transformation to work out what might work best for us,” Lecrone said. “We’re interested in how 3D simulations of processes might help us react faster to change, for example. But to start, we are trying to establish a digital thread from engineering through to manufacturing. We’ve always had links between product lifecycle management (PLM), enterprise resource planning (ERP) and MES systems, but we’re trying to strengthen those links as technology improves. It’s not a simple process.”
64%
of executives in a recent survey by LNS Research said that a failure to employ digital technologies to transform their core business and grow new ones will threaten their very period survival.
It’s a challenge felt by a majority of the industry. “According to one of our recent global surveys, about two in three executives (64%) admitted that a failure to employ digital technologies to both transform the core of their business and grow the new will mean a struggle for their very survival,” Soon said.
The biggest issue, Lecrone said, is sharing the right data, in context. “We want to not only share product structure information, but also product design requirements into manufacturing engineering, so that our process planning can become more sophisticated. We’re also trying to standardize the data we’re collecting across a lot of our different systems so that we can have a better view of how products are performing across plants. Sharing this information will help us solve problems with the standardized parts of the process. If we can have more consistent data views, we can also better solve some of the warranty issues across the field. Unfortunately, achieving a consistent view of data is something that we’ve struggled with. We have a huge amount of data stored in silos right now.“
The rise of the Internet of Things (IoT) is only exacerbating the situation. “One of the IoT’s selling points is that it enables companies to collect more and more information,” Lecrone said. “However, collecting the data has never been the problem. There are a lot of creative devices out there to collect data. The challenge lies in connecting the ‘people with the problems’ to the ‘people with the data.’ We’re figuring out how best to make that happen.”
A CONNECTED FUTURE
Schmidt said it’s important to know where to draw the line. “We’ve digitized the processes of around 80% of our new product lines – which is where the bulk of the customization happens,” he said. “But we’ve probably only made around 20% progress with our legacy products. While digital transformation has to happen in order to stay ahead in the future, it’s important to recognize that the costs outweigh the benefits for some processes.”
Lecrone, meanwhile, is certain that once Cummins achieves the data connectivity it is striving for, the benefits will be worth it.
“We have a great number of people working on the problem,” she said. “I’m certain that by embracing digital, we’ll not only shorten lead times but find creative new ways to engage and respond to customers. Digital transformation will enable us to exchange information seamlessly from function to function as we move through the product lifecycle chain. The more information we can leverage, the faster we can react to increasing customer needs for personalization.”
