Volume 2 Issue 8 July 2020
In this Issue
Welcome to Industree 4.0 for July 2020, exclusively sponsored by SAP. We lead off with another great article from Paul Barney of SAP. That is followed by regular columnists Pat Dixon and Jim Thompson. We'll wrap with other perspectives from around the industry.
By Paul Barney

Paper and Packaging Industry and Solution Expert, SAP
Four Keys to Finding Certainty in a Volatile Planning and Forecasting Environment
Mill Products companies, including manufacturers that produce paper, packaging, building materials or metals, often face many challenges, especially in the area of planning and forecasting demand. When the Danish window manufacturer VELUX began using a new integrated resource planning platform company-wide in late 2019, little did it know how quickly and how profoundly the system would be tested. Velux produces windows, a product that comes in many different sizes and surfaces – just like paper, or metal sheets or plastic foil. Those business working with products in an attribute-based environment are grouped into a segment we call Mill Products. All of those companies face similar issues around planning & forecasting demands.

Just as VELUX was getting comfortable with the digital platform, the Covid-19 pandemic took hold, jolting the company — and just about every business, industry, community, country and economy around the world, for that matter — out of its comfort zone. Customer demand in some markets (Spain and Italy, for example) dried up virtually overnight, while demand in other areas actually held or even increased. Things were just as volatile on the supply and logistics side of the equation, as certain suppliers went dark entirely or curtailed production, and reliable transportation in specific regions became an iffy proposition.

In a matter of just weeks, the monthly forecasting process that VELUX had been using was rendered “simply useless,” Philip Melchirs, the company’s senior director of global supply chain planning and logistics, explained in a recent webcast (Search “Velux planning covid disruption) . So the company quickly shifted to weekly and even daily “Corona” forecasts. Suddenly, having the ability to run flexible, dynamic forecasts and production plans on a condensed and fluid schedule, using current operational, demand-sensing and supply chain data, became not a luxury but an indispensable capability. 

Like other manufacturers that serve the Mill Products industry, VELUX has found a way to efficiently overcome disruptions and meet customer demand during a crisis of unprecedented proportions by relying heavily on digital planning and forecasting capabilities. This is also a big challenge pulp and paper manufacturers. Let’s look at a handful of capabilities that are proving particularly valuable to Mill Products manufacturers, even as the Covid-19 crisis persists.

1. Intelligent supply, demand and logistics. During events like the Covid-19 crisis, historical data loses much of its predictive relevance. Manufacturers thus need to rely on other capabilities to maintain a grip on their planning and forecasting, and to preserve the overall integrity of their supply chains.

Having a platform that provides real-time visibility into customer demand, supplier capacity and inventory, and transportation logistics is a good starting point. On the customer side, demand-sensing tools give manufacturers visibility into demand in individual markets, so they can plan production accordingly. Maintaining real-time communications with customers (about order timing and volumes, etc.) also helps to avert disruptions and enables manufacturers to efficiently prioritize production.

On the supply side, one outcome of the pandemic is that price will become secondary to resilience, reliability and risk-reduction along the supply chain. As a result, more manufacturers likely will re-shore production and increase reliance on local sources. The ability to easily integrate and digitally engage with multiple tiers of suppliers in real time provides the visibility that is critical during a crisis and otherwise. They can share data and collaboratively work through potential disruptions to maintain supply chain integrity. 

The same approach applies to transportation management. When manufacturers are connected digitally to their logistics partners, they can find alternative delivery pathways in a pinch and collaboratively troubleshoot when an issue arises. Is road, rail or sea the most reliable, timely and cost-effective way to get a particular product where it needs to go? What if trucking capacity into an area is constrained? Having robust transportation management tools that provide real-time visibility into multi-modal capacity gives manufacturers options. 

All this can be modeled within a digital representation of supply and logistics networks. Using predictive analytics, this “digital twin” can reveal risks, segment and prioritize suppliers and logistics providers, and test the viability of options to mitigate disruptions.

2. Intelligent manufacturing and assets. Now more than ever, manufacturers can ill-afford inefficiency in how they manage their factories and their assets. With an intelligent digital core to which their plants and operational assets (as well as the supply and demand chains) are connected, and through which data flows transparently across the enterprise, a company can optimize production processes to respond in real time to unexpected changes in demand and supply. The agility that comes from this end-to-end visibility serves a company well during a crisis and otherwise.

When assets inside the factory, at warehouses and across other parts of the operation are Internet of Things (IoT) sensor-equipped, connected to one another and networked with a central digital core, a manufacturer has the power to quickly gain insight from operational data and, using predictive tools, to dynamically maintain, simulate and optimize overall asset performance while minimizing operational disruption. 

These capabilities also enable a manufacturer to shift their production capabilities and their supply chains to new tasks and new products. During the Covid-19 crisis, paper and packaging companies were able to quickly retool and help with shortfalls in PPE and cleaning products for example.

3. Workforce safety.  The pandemic exacerbated a skilled labor shortage in the mill product industries — and underscored how critical the people who comprise a company’s workforce are to executing production plans in a highly unpredictable business environment.

Digital tools can help manufacturers keep a workforce safe and healthy, giving them the means to conduct health screenings, monitor compliance with social/physical distancing policies and track employee interactions in the workplace.

What’s more, by integrating a greater degree of automation into their factories, a manufacturer reduces risk of manual errors and keeps more workers out of harm’s way. Automation frees workers to focus on the higher-value work that ultimately drives the service and innovation that will enable manufacturers to remain viable in a challenging business environment.

4. Dynamic planning capability. During a crisis, having an elevated level of end-to-end transparency, data intelligence and connectedness up and down the supply chain enables a manufacturing company to conduct continuous, dynamic planning by synthesizing fresh supply, demand, logistics, workforce and capacity data. With a platform that digitally connects strategic and operational planning to real-time visibility and execution, they can ensure all aspects of their business are aligned to a forward-looking plan, with the ability to rapidly evaluate scenarios and adjust as conditions change.

Changing market conditions are one thing Mill Products manufacturers can count on as the pandemic continues to play out. With the right digital capabilities in place, they’ll be ready.
The Nucleus of Industry 4.0
By Pat Dixon, PE, PMP

President of 
www.DPAS-INC.com , offering project management and engineering for industrial automation projects.

(Continued from last month)

What appears to be happening is that there is a confusion between what attributes are and what lives in the new environment. The first 3 industrial eras follow the same approach taken as with our nuclear and geological analogy, but suddenly in Industry 4.0 there are many that think the attributes that define the era are the results and not the core distinguishing attributes. 

To me, this is like trying to define a baseball game as the experience of hot dogs, Cracker Jack, and the crowd. Yes, indeed these are part of a baseball game, but they are also part of many other games or activities. They don’t define the game.

Take for example faster computing. Is this really an attribute that distinguishes Industry 4.0 from Industry 3.0? A casual glance at Moore’s Law refutes that notion. Google “Moore’s Law” and look at the graph. Do you see any inflection points? From 1970 to the present you will see a rather linear curve, with the data points rather closely fitting the curve. I do not see the slope suddenly change in 2010, which is about when most people think Industry 4.0 began. All through Industry 3.0, which began around 1970 with the introduction of PLC/SCADA/DCS/QCS, Moore’s law kept chugging along. Did we begin a new industrial era every time Moore’s Law doubled the number of transistors per millimeter? If so, we would now be in the Industry 25 era.  

Therefore, the Industry 4.0 Lexicon team has consistently presented the following table to define the industrial eras:

Industry 0 (Muscle) Industry was powered by humans, animals, and water (gravity).

Industry 1 (Steam) The piston engines of Newcomen, Leopold, and Watt replaced muscle power with steam.
Industry 2 (Electricity) Edison and Tesla provided the means of harnessing electrical power for industrial use.

Industry 3 (Computers) Digital converters and processors enabled automation of human activities in industry (DCS, SCADA, etc.).

Industry 4 (Internet) A public network infrastructure for the entire planet enabled connectivity of industrial facilities with minimal effort and investment, which yields capabilities such as remote monitoring, cloud hosting of interconnected MES/ERP, enterprise wide optimization, etc.

In this table, it is made clear that the inflection point of Internet connectivity in industry leads to the new environment. It is this fundamental attribute which makes the environment; it is not the environment making the attribute.

So, if you were transported back in time to a paper mill of the past and had to figure out whether it was using Industry 4.0 capabilities, you would not be looking at the processors or the algorithms. You would find out if the process was connected to the outside world through the Internet. Regardless of the application in question, Internet connectivity makes it Industry 4.0.

At this point, some of you may be wondering why all the fuss? Who cares about wading through all of this to define what many have been talking about for a decade?

It might be a bit over dramatic, but I think many of you know that most industrial accidents and other disasters in our industry have a common denominator: communication. If we cannot understand each other, should we be surprised when things go horribly wrong?

An example is PID control. It predates Industry 3.0, since it was first implemented in analog form before digital processors. It is ubiquitous; you have hundreds if not thousands of PID loops in your mills. Yet, it is well known many of them are poorly tuned, if tuned at all. Even in cases where the derivative term might help you, many don’t dare touch it because they don’t understand it. Right now, I am working on the ISA 5.9 committee to resolve some of the confusing terminology for PID we have had in industry all these years. Isn’t it amazing that after all this time we are trying to get PID to perform in a way that helps instead of hurts, and that the inability to communicate is part of the problem?

I am also hearing some feedback from our Beta that this lexicon is making things worse by using these buzzwords. The sentiment seems to be that if we minimize the use of unhelpful buzzwords, the problems will go away. That won’t happen. We have heard these buzzwords for about a decade already and they aren’t going away. Every time someone uses IIoT, Digital Twin, Machine Learning, and the like without a common understanding, it makes things worse. If we are going to make sound investments, get the results we expect, and avoid disasters, we are going to have to be able to communicate.

The nuclear era is still with us. There is still nuclear waste that we haven’t figured out how to handle and warheads that could destroy the planet. Like the nuclear era, the Industry 4.0 has the promise of fantastic capability that can make our industry cleaner, safer, and more sustainable. While the Industry 4.0 challenges I present here may not be clear and present danger on the same magnitude as nuclear threats, unless we get to the nucleus of what Industry 4.0 is, this era may be very disappointing if not disastrous.
Could Industry 4.0 provide transparency for the recycled fiber markets?
 An age old problem in the recycled fiber business has been the lack of transparency in the pricing of recycled fiber. At least in the grade OCC (Old Corrugated Containers) there may be a glimmer of hope.

The problem with the recycled fiber business is that it depends on trained telephone questioners calling up buyers and sellers and asking them what is going on. Of course, this leads to distortions (sellers say prices are high, buyers say prices are low: sellers say inventory is tight, buyers say inventory is loose). Although it is a large market, it is not as large as, say, soybeans or wheat, and no trading market has ever been willing to sponsor a "pit" for it. Open buying and selling in the "pit" style would provide a transparent market.

But what if we looked at it a different way? Nearly all OCC has a unique UPC code which was identified on the box when it was filled with goods originally. That box travels from a manufacturer to a store, fulfillment center or a home. It is unique, it has its own name. So what if we make that UPC code do double duty? It identifies the contents but what if we think of it as identifying the box itself? Then from the box plant until it is emptied, we know everything about that box--how much fiber it contains, how much it weighs and so forth. If we continue to track it (and we are already doing a pretty good job, this just takes a few more sensors) we can continue to track it through the baler behind the grocery store, into the bale, and follow its path to a bale warehouse or to the recycling yard of a paper mill.

Let's stop losing track of it as soon as it is emptied (as we do now).

There is absolutely nothing new about any component in this system. Sensors, internet links and software gives us a system that knows where every box is in the system and its current status: in the box plant, in its original use containing goods, being baled, in a bale, on its way to a warehouse or paper mill.

We will know where every box is in the circular economy. We will know the true inventory of OCC and where it is located.

This system will reduce the unknowns, improve general inventory knowledge and improve the transparency of the business. Knowledge is power: it will take sloppiness out of the pricing system. Computing power is certainly available today to do this. It is an Industry 4.0 opportunity.
How "Smart Processes" fit into Industry 4.0
By Glenn Nausley

Promess Inc.
If Industry 3.0 is identified by the computerization of factory floor processes to make them “smart,” then Industry 4.0 can be understood as the expansion of the idea to include all of the non-factory floor inputs required to produce a quality product and a successful enterprise.
Using Video and IoT for Business Continuity and Intelligence
By ONVU Technologies

When it comes to information gathering, one constant remains: video is central to the goal of assembling and disseminating intelligence across the globe.
The IoT Trust Label: Benefits and Challenges to Implementation
By Roland Atoui

Roland Atoui is an expert in cybersecurity and the Internet of Things (IoT) having recognized achievements working for companies such as Gemalto and Oracle with a background in both research and industry. From smart cards to smartphones to IoT tec...
In acknowledging the apparent risks, the European Commission is looking into the possibility of creating an IoT “Trust Label” to strengthen IoT security and end-to-end personal data protection.
Top Five IoT Networking Challenges and How to Conquer Them
By Wolfgang Thieme

Chief Technology Officer and C-Founder, BeherTech
To ensure IoT success, it’s paramount to look beyond the immediate needs of the connected infrastructure to understand and plan for important technical requirements that might arise further down the road. An IoT initiative might start small, but it’s critical to think big and scale quickly when the time comes.
Industree 4.0 is exclusively sponsored by SAP