Tuesday, February 24, 2015

A Tale of Two Factories: Chapter 6 – The Great Divide

By Patrick Weber, MESA International Technical and Education Committee member


When management wants to make something happen, they change the structure of the organization. Whether its ad-hoc project teams to deliver a product or service, or departments developed around specific disciplines such as IT, engineering, procurement, or accounting, organizational structure provides the framework for business execution. It can also be a significant hurdle to successful change as people become entrenched within the practices of an established structure. How does this impact manufacturing and engineering technologies? This chapter examines how two organizations - Deuxieme Botte Manufacturing (DBM) and Premiere Chaussure Industries (PCI) – deal with the challenges of organizational boundaries.


The Divide at DCM

“I am not letting IT anywhere near my SCADA system!” Dave was adamant; he’d experienced the late-night calls when operating system updates caused batch processes to fail due to software incompatibilities. He’d read similar horror stories of network problems that took days to diagnose, of governance-gone-wild where IT was specifying hardware in shop floor panels, of IT-mandated anti-virus software interfering with historian performance. As more and more of his control processes were placed on the company network, Dave was increasingly feeling pressure to get IT involved with his systems.

“If you want those systems on the company network, you are going to need to comply with IT policies”, responded Ellen. Things were getting out of hand; Ellen remembered the time - not so long ago – when the only devices on the network were servers, office computers, and printers. Now there were three or four times as many non-office devices connected either via wire or wirelessly as there were traditional IT-managed devices. PLCs, CNCs, vision systems, remote I/O, barcode scanners, data capture devices – the list seemed endless, and it was growing. “There are a number of risks that we need to manage, and the only effective way to do that is through policy compliance!”

“Ellen, I recognize the need for standards, but these control processes are finely tuned. People who are not intimately familiar with them should not be accessing them – and that includes ‘IT professionals’!” Dave was choosing his words carefully; he knew several of the people in the IT department and didn’t want to make them seem inept. “There are just so many details to be aware of that one inadvertent change can stop production – for days!”

“I understand what you’re saying Dave, but it seems to leave us at an impasse. I don’t mean to tell you how to do your job, but I also can’t put the company’s IT assets at risk. Any suggestions on how we might resolve this situation?”

Dave had anticipated this question. “You said ‘if we want those systems on the company network’; what if we set up a separate network for our industrial control applications?”

“Not a bad idea”, Ellen said after a brief pause. “I’ve been to one or two IT conferences where this has been recommended as best practice. Would Engineering own this network?”

“Why not?” Dave replied. “We already manage the servers hosting our industrial automation software, OPC servers, and data historians. We’re also managing programming for the controllers and user interfaces, and all the software licensing associated with it. We’ve got our own little IT department going; including network management shouldn’t be too much added burden. It seems to me like the perfect solution – we don’t violate IT policy and we can do what’s necessary to make our engineering processes work.”

Ellen winced at the thought of a “little IT department”, but knew Dave was right. That ship had already sailed, and Ellen didn’t really have the staff to handle what Dave’s group was doing anyway.

The Divide at PCI
It was the first time in anyone’s memory that key representatives from finance, operations, quality, and engineering had been included in a meeting to discuss information technology.

“We are not going to have a ‘shadow IT’ within PCI!” Rob, CIO of Premiere Chaussure Industries, had spent most of his career in manufacturing. He was familiar with the importance of automation, quality, and engineering and had observed the growing reliance on information technology within these fields. He had also experienced the divisions between these functional groups and the organizational ineffectiveness caused by those divisions.

“To quote Honest Abe”, he continued, “‘A house divided against itself cannot stand.’ It’s both inefficient and counter-productive to the organization as a whole to have siloed pockets of technology based on specialized needs. Joe (VP of Operations) has been talking with the executive leadership team about creating a technology platform that embraces change. If we are going to be successful architecting such a platform, we – IT, Finance, Operations, and Engineering - are going to need to build bridges between our domains of expertise. Once we have this platform, we’ll be able to effectively tap into the real-time information our automation systems provide. We’ll have the capability to restructure our organization to benefit from product lifecycle management, manufacturing operations management, and business process management technologies in ways that make strategic sense for this company.”

Diane – lead Automation Engineer – spoke up. “How are we going to get these groups to work together? We’ve been talking about ‘bridging silos’” - she did the little air-quote sign with both hands – “for years, but never seem to make headway. It’s not like we don’t know how to work together, we just have different goals and objectives.”

Todd – head of Engineering Design – joined in. “We also respect each other’s turf. For example, I know the PLM tools we’re using could fundamentally change the way the quality guys manage specifications and implement SPC, but it’s not my place to tell them how to work.”

Rob held up his hands in surrender.

“You’re both right. That’s what this meeting is about. It’s been said that when management wants to make something happen, they change the structure of the organization. That’s just what we’re doing. We are creating a new team within PCI we call the Manufacturing Operations Center of Excellence, or MOCoE. This team will be cross-functional, with representatives from each of your disciplines. Its mission will be to help PCI align the capabilities of available technology with corporate strategy. This team will not report to any particular department, but will report directly to the executive management team. The MOCoE will be empowered to cross organizational boundaries to implement changes in the way we work.”

“Todd – your example is a good place to start. Product Lifecycle Management has the potential to radically change how we design and introduce new products, but has serious organizational implications as well. It is likely that it will change business processes not just in Engineering, but in Operations, Marketing, Finance, Procurement, Quality, and R&D. With such broad ramifications, it’s easy to see why no single department could accomplish the necessary changes. But without those changes, we may never gain the advantages the technology provides. That’s why the executive team believes so strongly that the MOCoE is needed.”

Two Worlds

One of the greatest challenges to gaining true business benefit from technology is bridging organizational silos. Initiatives such as MOM, BPM, or PLM often find their roots within groups such as engineering or operations. Unless such initiatives are embraced by the entire organization, the benefits are marginalized. In this chapter, DBM is maintaining - even strengthening – the boundaries between Engineering and IT. They recognize the waste associated with duplication of effort, practices, and skill development but have no means of eliminating this inefficiency. PCI is addressing the issue holistically through a center of excellence designed to supersede boundaries – allowing them to gain full benefit from the capabilities available within the technology in which they invest. Such centers of excellence are a recommended best practice as taught in MESA International’s global training programs.
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