Tuesday, November 4, 2008

Keeping Manufacturing in Europe

Offshoring is not all success stories as Jan Snoeij of Logica points out - productivity is lower in lower wage countries; container transport costs are skyrocketing, and competition for labor in countries such as China is fierce, to labor costs are up and re-training costs are very high. Hidden costs for management travel, delivery issues, insufficient quality, cultural differences.
To produce in Europe, executives need to involve the plant floor personnel - get them to understand the new direction and what it means for them. Challenges in resources abound: materials & shortages of skilled people - also equipment, since Europe is competing for the latest & greatest with developing economies. Spend money on training people is a key for hidden champions. An important question is whether IT is flexible enough, integrated with the business. So maybe everyone here at the MESA EU conference can work to keep jobs here.

Volvo uses MES to Add to its Reliability

Did you know Volvo Group no longer includes cars, but is 66% trucks and other heavy vehicles (construction, buses, aerospace) and parts? The Volvo Production System - initiated in 2005 was "proudly stolen" concept from TPS. Created VPS Academy central team to build and promote the framework and maintain the momentum, including regular assessments. VPS is then implemented in MES to achieve real-time and global visibility. To drive instructions to employees and make devices do their job, you need high availability, fast MES. And it needs good infrastructure and maintenance. It's always evolving and paperless instructions are hard to get ergonomic - user acceptance and people are still a big issue.

Effectiveness of People is a Key Theme for MESA EU Conference

The SmartFactory demonstration appears to be nearly free of people. However, much of the discussion here has been about how to ensure that people can work effectively. Jan Baan of Cordys talks about the ability to use human intelligence effectively in business processes. Every employee as a decision-maker - what a great vision. Harks back to Grace's empowering message that everyone can be an entrepreneur or intrapreneur. The ability to change a rule the moment before a transaction happens truly enables people to keep the business dynamic. MESA as an organization is also so much about people connecting with each other, learning from each other.

Monday, November 3, 2008

Factories of the Future

Dr. Detlef Zuehlke talked about the Internet enabled everything - SmartHomes, SmartCars, a SmartHospital, and SmartOffice, and SmartFactory showing how to use newer technologies to become more agile. Complexity is a major challenge - but by making devices abstract and communications and power wireless, some of the complexity and sequential planning goes away. Now 22 partners and 10 sponsors have after a few years led to the SmartFactory. The SmartFactory is now fully tested and working for the past 3 weeks - making colored liquid soap. They also perform R&D projects and offer information panels on viz. RFID, wireless, safety & security. Check out the live webcam at: http://www.smartfactory.de/webcam.de.htm - may sometimes be a still picture due to German law. Over 30 companies are involved - so this could be moving into broader application soon!

Great first Day for MESA EU!

I'm about to retire for the night, but a few last thoughts. MESA brings together such a knowledgeable group of people that once you get to the event, you just want to be part of it. I have had several people offer to pitch in on current projects that we've discussed here. The type of enthusiasm we see is infectious - and I'm just delighted to be part of it. Strategic initiatives, Metrics research, and new topics for the conference are all getting more support by the day. Thanks to everyone for coming and contributing!

Over 1/2M Euro/year Savings!

Thales reports that a 90-user MES yielded savings for under 18 months ROI. This was not without challenges - identifying the right mix of skills for configuration and implementation in a core project team was one. Balancing trade-offs between strategic investments and low-risk implementation allowed the 2-month pilot period to lead to roll-out. People are critical - team skills but also ensuring quick operator training.

Inventory Reduction Opportunities Abound

In these tight economic times, surely everyone wants to reduced excess inventory and increase inventory turns for cash-to-cash improvements. However, Gary Goddard of IQS is showing a way to optimize inventory - eliminate excess with an inventory quality ratio. With tools to set targets and play what if, can change safety stock and cycle replenishment times - might improve 50% or more from today's average of 30-45% excess inventory cost on average. Carrier's conservative approach to gaining this visibility and their ability to write custom reports on this type of inventory issue have lead to doubling sales with the same inventory - and increasing inventory turns. Shortages are down by up to 75%.

Setting Manufacturing Footprint Strategy is Continuous

Why lean and offshoring are not enough is the first topic Paul Christodoulou of Cambridge University's Institute for Manufacturing is addressing. Problem is: manufacturing networks are inherited, not designed - M&A and other issues have created them. Can save 30-45% of landed cost by optimizing the manufacturing footprint - can also access growing markets. However, it's not easy to do - moving manufacturing often does not work (skills, supply chain, risk to IP and macroeconomics). What leaders are doing shows variety: some outsource production, some focus there - with or without offshoring. So single approach to footprint strategy from Cambridge from plant thinking to network thinking - simple 4 questions: Why, what, where and how. Working for companies in many industries. Need to check out the Sealed Air example on the web.

Embrace the Power of the Conference

Keynote speaker Grace Boldewijn encourages us all to use this conference to find the missing link - through networking, sharing and listening. Whether entrepreneur or intrapraneur, the keys to excellence are the same. Investing in people and closing the gap between board and operational personnel is part of that. (Builds trust and confidence.) Learn from the current financial crisis - the fight to survive will leave only those who are creative and innovative - to differentiate and think outside the box. Stay #1 by hiring and developing qualified people - invest in excellence, even if it's more expensive than the price-quality ratio. Must be flexible to react to changes - plant intelligence across the enterprise for B2B optimization.

MESA Europe Kicks Off!

John Dyck, MESA Chairman, has introduced the conference underlining pressures on innovation and the ways that manufacturers can innovate more powerfully - tying it into the MESA Strategic Initiatives and the guidebooks that are almost finished now. Wiki format to keep the guidebooks evolving and to enable new strategic initiatives. MESA Europe's second annual conference is getting off to a good start - some very enthusiastic people from manufacturers and solution providers. Information as the next Industrial Revolution is the main theme for John and MESA.

Sunday, November 2, 2008

MESA Europe P2E Conference Prague

Hello, just arrived in the Top Hotel in Prague. The hotel looks great, the food is great, the weather is grey, cloudy.
It's nice to meet all these enthousiastic MES(A) people. I'm looking forward to the Roundtable session that will start in 20 minutes, and the program for tomorrow and the day after. It is a great program.

I hope you all enjoy this conference!

Reinoud Visser
Co-Chair of MESA P2E Conference Europe 2008

Tuesday, September 23, 2008

Hail to the new MESA Chief - John Dyck wraps it up

What an information and networking-packed few days! The new Chairman of MESA International, John Dyck, reported on what we've heard and is asking everyone to participate. Growing membership and contributing to this association 2.0 - we're all about interaction and learning from each other!

SVP can see all 10 plants from his desk

Common data and measurements are everyone's goal - but Bay Valley appears to have really gotten it linked up all the way to the Senior VP's office. Coaching from plant management - not padding the metrics.

Point of maximum impact is not any level of management - but the operator where the problem is happening. Capture the rationale and way to avoid it from happening again AS IT HAPPENS.

Secret to low-cost producer status: People!

Bay Valley Foods has connected OEE to financial outcomes. Empowering operators in a private label food company, where rising costs are systemic, not cyclical. One day's run of an SKU can now impact whether or not a product is profitable that day. Getting to the root cause - which is mostly people and process, not equipment related.

Improving in small parts of the business does not lead to financial results. Rubber meets the road in taking action, not in measuring it. We know that, and this was a good example of actionable intelligence. Let workers take more control and gather the context from the operator rather than fully automated from the PLC -

Keep thinking about how to engage people to turn data into information.

Quality System Disconnect

MESA members recognize that their quality systems are disconnected from both MES and ERP. We would really benefit from having quality professionals involved - they see information in the metrics that many in manufacturing may miss.

Quality professionals, please come into the MESA fold!

Exceeding expectations

Networking is an important part of every MESA event. This year, because of the good food, we've been nourished by not just the great knowledge, but the great eats. The network opportunities make MESA a great place every year, and this year's event has lived up to expectations so far, with our major evening network event still to come at Sea World.

Metrics driving Continuous Improvement

Steve Kaplan of Murata, , a practitioner Member who has taken a leadership position, has led a diverse group of companies through a process of defining a diagnostic process, and sharing best practices on how to leverage metrics for that. It's great to see Steve present again - and this time, not only his experiences, but that of the entire group.

MESA's outputs point to pragmatic ways to improve businesses. How do we get more people involved in this work? Everyone has the issues - and working together can accelerate problem solving, as one of the team members illustrate. That's what MESA wants to do.

Innovation: Hot topic to the Core of the Organization

Innovation often easy with the right managers. How to bring that innovation to the core no matter who the leaders are? Peter Skarynski a consultant CEO talks about how to innovate when current performance and resources are not a predictor of future success.

Innovation because of not in spite of the organization - many companies not doing this yet. Systemically tap creativity of the people in the organizations. Brainstorm in the context of the business flow. This guy uses Dilbert to tell this story - LOVE it.

Will ERP go away?

Jan Baan says BPM will replace ERP - but shows ERP as a data source still. I think the latter is closer - we need to get beyond ERP and all of the other applications - and create workflows that do include people and systems on top. Future views that might allow information flows to keep up with business and our business processes.

Jan Baan's view of end of complexity

I once worked for the company named after Jan Baan - now hearing him talk about his 30 years and how ERP has gotten more complex - creating resource problems rather than planning.

Big mistake: moving from customer-driven to shareholder-driven. The customer focus has come up again and again in how to drive success for projects - or in this case, for a company.

Beyond ERP that is data driven, on to investing in TopTier and WebEx. And now to Cordys - business process focused. Referring back to last year's keynote by Peter Fingar. BPM for both systems and people. Less than 10% of processes can be totally automated. So this combo is key to moving forward.

MESA P2E Fun Continues

The reception and book signing by Jan Baan was very active last night. More great food - gotta be sure to get some exercise! The networking here is outstanding. I've met many first-time MESA attendees as well as many people I've known in this community for years. The discussions are wide-ranging.

Review of the growth of MESA and the great efforts of the Chairman for the past 2 years, Matt Bauer. Gave him not only a plaque, but cigars - which he'll really appreciate!

Monday, September 22, 2008

Cool work for visibility

Both Coca-Cola Bottling and General Mills have done some outstanding work in standardizing information and making it visible more broadly than in most companies. This is a direction MESA member companies will continue to go...

MESA's growth

To me it amazing to see the uptrend in Basic Manufacturing endusers over the last 2 year.
Creating the industry's leading guidebooks is an additional milestone in MESA's history.

Opening MESA

The MESA opening was completed in top style by Matt Bauer. He spoke clear and direct. Best of all, he had a great set of PowerPoint eye candy on the screen. This presentation in both visual and delivery was well receive as it was delivered!

Climate Change - Threat or Opportunity

What a wake-up call! Dr. Peter Williams of Big Green Innovations reports that experts at NOAH say there is a 1 in 5 chance that we'll extinguish all life on earth within the next few 100 years. Russian roulette odds. Unequivocal evidence that human activity is causing these risks.

40% population increase. Water, food, diseases, extinction of 30% of species, coastal sea level rise causing up to 30% lost of coastal wetlands. Every industrial sector has a responsibility for these problems.

5 companies use as much water as the entire world for daily personal needs!
Carbon cap & trade is going in Europe, likely here in the US. Water cap and trade might also happen. JP Morgan report "Watching Water" points out physical, regulation and brand risk.
Carbon risk is factoring into financial investment banks too. Affecting your stock price?

Lean helps make you greener. Next MSI guidebook might be on green or sustainability. Opportunities - many areas to think about for manufacturers. Changing world for utilities.
IBM Saved $291M of energy from 1990-2006. 100K of 380K IBMers work at home. I love working at home!

Opening address - scare us into action!

Globality is the topic - I didn't think it was a real word, but apparently it is. And it's causing change. MESA Chairman Matt Bauer points out the shortages in personnel for US and China - IT and production - with commodity price surge. Financial crisis hurting capital availability Gotta do something different! All of the inputs are challenged.

Coordinating resources in real-time - with new employee generation who expects something different. Information as the fuel for manufacturing innovation is the story of MESA.

Linking plant operations to strategic initiatives has been a cornerstone for this - the MESA Strategic Initiatives or MSIs we heard about yesterday. Plenty more to do! The Wiki format will allow easy contribution and refinement... Moving MESA into Web 2.0 in new ways.

Metrics Continues to Generate Buzz

The MESA Metrics working group dinner was a LONG table of 20+ folks interested in performance metrics. Obviously, we'll be working on some of the same and some new things next year. In addition to the current work on metrics for diagnostics, across plant and warehouse, linking operations to finance, and IT for performance metrics - some new ideas are:
* Linking quality into the diagnostic metrics
* Working with even more organizations beyond MHIA and WERC to create standard metrics
* Creating a framework for metrics to use in the strategic initiatives guidebooks
* Studying metrics for low-volume production
* Creating global metrics across dissimilar plants (different products, processes, volumes, mix, etc.) in one company
* Ensuring front-line supervisors and operators have appropriate metrics to drive action
* Lead-time and TOC metrics for lean environments
* Ensuring metrics link up between strategic and tactical levels and top to bottom
* Moving past metrics per manager
* Developing a short list of operational metrics that will help drive interest in MES into the C-level

Okay, who's ready to get moving?

Sunday, September 21, 2008

MESA P2E Off and Running

Having arrived at the Rosen Plaza, I'm just getting immersed in the MESA Strategic Initiatives (MSI). Leaders of each team are presenting what their group has developed so far in their guidebook development. A good roomful of us - some who participated in creating this material and others who are just understanding what's happening.

We're hearing about how the product engineering side is tying in to manufacturing - and the touch points are many! The PLM guidebook team has gathered lots of great information, and it's clear I need to get our company more involved in this activity. Great information from the MSI working group - also describing the process to define a PLM roadmap, which I think quite a few companies will need to undertake in the next few years. Lots more work to do that they have pointed to as well - beyond discrete and into specific areas of interest.

MESA MSI sessions alive, fruitful and interesting

The Sunday afternoon sessions for the MSI overviews have wrapped up and the session was full of lively discussion and great idea exchange. The MSI guidebooks will be available in wiki format soon for al members to contribute to- I am looking forward to seeing how the curent drafts will evolve over the next 2 months or so. If you attended the session and are not already on a committee, hopefully it will inspire you to contribute content, thought an case studies. I know I had to personally sit on my hands and keep from volunteering for too many initiatives. If you could not attend the session but are curious about all the fuss, be sure to check out the MSI pages on the MESA website. Me? I am off to talk to more vendors and rink some beers-- hope to see you tonight......

Real-time Enterprise MSI Spreads its Wings

The real-time enterprise MSI has actually created a concise 1-sentence definition! A breakthrough for such an abstract and underlying initiative. Not just speeding things up - but transforming work processes to flatten an organization and distribute decision-making.

This guidebook is about making information timely, intuitive (roles-based), trusted (as a foundation for business processes), in (business) context, integrated and related, normalized to enable comparisons, event-driven, aggregated & disaggregated to allow decision and action, actionable - where the value is delivered.

Another excellent piece of work for MESA. Now we're getting ready for food & drink - the reception!

Lean MSI Team Talks Process and IT

The Lean MSI team is clearly articulating that Lean grew up in a certain type of manufacturing (think Toyota and TPS) and that some of the particular practices may not suit every manufacturing style. The team leader points out that many major companies have developed their own production systems using techniques that fit - this aspect of the guidebook is an important starting point. If everyone understood that they need their own version for higher mix or other production styles, companies could be much further along in their success with lean.

Taking it head on - they are also talking about the role of technology. When the constraint is the supporting business processes like PLM, CAPA, maintenance staging, etc. (high mix) information flow needs more than visual cues. 21st century lean IT - creates a common library for BOM & work instructions across PLM and Manufacturing - workflow in the plant. Meta data model gets leaned out as the standard work for IT.

How to justify a lean project is not simple. Great work in explaining how to get CapEx for initiatives.

Early Registration Starts

I am sitting here in the Rosen Plaza Bar with my MSI teammates, prepping for the afternoon MSI session. Registration is starting to hop and get busy... with a little over 200 manufacturing folks registered expect some lines tomorrow morning unless you get in early. Premium members also get a very nifty travel bag bonus, which is looking very useful not just for picking up goodies in the exhibit hall, but as an overnight bag as well. If you have any interest at all in the current Manufacturing Strategic Initiatives, either to learn what they are about, give feedback or to volunteer for the continuing effort- be sure to get down to the Ballrooms for a while this afternoon.

Saturday, September 20, 2008


The weather is great here in Orlando, and the Rosen Plaza Hotel is beautiful. There is just a bit of wind, but from my 4th floor window, it makes the palm trees sway beautifully. I have not gone to check, but I am sure the MESA staff is all busy in their temporary office downstairs. Me? I am thinking a pre-conference nap might be a good idea to shake off the travel blur. I am looking forward to a great conference.

Wednesday, August 27, 2008

Conference Updates

Watch this space during the Mesa P2E North American conference for live blogs of sessions, conference stories and images. If you have requests of particular sessions to have live blogged, please comment below.