Manufacturing in America 2018: Achieving Operational Excellence with Digitalization

  • April 03, 2018
  • Siemens
  • Feature
Manufacturing in America 2018: Achieving Operational Excellence with Digitalization
Manufacturing in America 2018: Achieving Operational Excellence with Digitalization

By Bill Lydon, Editor,

Digitalization and education were once again at the forefront of the 11th annual Manufacturing in America.  Held March 14-15 at Ford Field in Detroit, MI, the summit also saw discussions on the role of blockchain technology, and also provided ideas and solutions to help manufacturing companies to achieve operational excellence. 


Will the Digital Factor Attract Talent?

Much of the discussion amongst thought leaders at the annual Manufacturing in America Summit surrounded how digitalization is shaping the future of manufacturing to be competitive and as a means to close the skills gap. 

One such leader, Siemens Digital Factory USA President Raj Batra, described how the manufacturing industry is hungry for talent.  “This is the number one concern cited by manufacturing companies,” shared Batra. In response, he cited an MIT survey sharing that people of all ages want to work for digitally enabled companies.  This led Batra to assert that the time is right to embrace digitalization and is important for manufacturers to big competitive.  He further emphasized this push, by citing analysis by McKinsey and Company, “How digital reinventors are pulling away from the pack”. He used this to help illustrate how companies embracing digital technologies have increased revenue and profit growth. The highest performing group, termed “Digital Natives”, were characterized by companies such as Uber and Airbnb and were then followed by those who adopted digital, but weren’t necessarily born in it..

Batra then described how the Siemens’ Digital Enterprise portfolio is facilitating all the elements of digitalization including product design, production planning, production engineering, production execution, and services.  Siemens currently has 170,000 PLM customers and has made $10 billion in automation and software acquisitions, since 2007, while investing over $5 billion annually on research and development and its 38,000 R&D employees.

To illustrate the push for digitalization, Batra shared a specific story of Siemens’ relationship with German sporting goods company Adidas, to create the Speedfactory.  With the Speedfactory, Adidas aims to enhance the production of sporting goods so that the company will be able to react quickly to individual customer requests. For example, the first Adidas plant in Ansbach Germany, is set to incorporate the series production of sports shoes from 3D printers. Yet another Adidas Speedfactory is currently being established in Atlanta.  These speed factories are helping Adidas to replace cheap labor in Asia with highly automated manufacturing  in its home markets.


Siemens’ Continued Push for Technical Education

In further efforts to help manufacturers close the skills gap, Siemens also has made a strong commitment to support technical education in many ways. The Student Zone at Manufacturing America was one such example.   In Ford Field’s Gridiron Club, the Student Zone brought in 9th through 12th grade students from Oakland, Macomb, and Wayne counties to participate in educational and hands-on workshops with manufacturing equipment.  The students got first-hand experience with the application of technology in digitalization and manufacturing and also had the opportunity to apply for a 1-day internship with local manufacturers.


The Widespread Benefits of Digitalization

Siemens was not the only company loudly lauding the benefits of digitalization at the event. KUKA’s Greg LaMay also described how their efforts to digitize the company.  KUKA’s move to digitalization was supported from the beginning by top management, which LaMay believed was essential for success.  LaMay, the Director of Global PLM Implementation for KUKA North America, described the company’s inefficiencies in a wide range of areas before digitizing operations. Previously, KUKA companies had been globally operated on disconnected drives and organizations in the company were using different PLM in PDM systems.  The result were several problems that KUKA had to solve, including:

  • The difficulty of collaboration and reuse of existing solutions, due to the disconnected systems between the KUKA companies and divisions.
  • A concurrent need to replace and aging PLM which was creating risk for the organization.
  • Inefficient exchange of information amongst several groups including project management, engineering, planning, and manufacturing.  This was even further complicated considering the different companies within the Kuka organization.


5 Components of Digitalization

Digitalization helped KUKA overcome these problems, and LaMay was quick to share how it could help other organizations as well. He described the five key components to building the holistic digitalization platform:

  1. Marketing – Building relationships and enthusiasm with organizational leadership.
  2. Development – Creating new processes to optimize departmental efficiency.
  3. Organizational Change Management (OCM)- New technologies create efficiency. Efficiency drives new business processes
  4. Training – Educate the organization on the new business processes defined in the PLM system.
  5. Production – Face-to-Face support in production is required for the new processes. Training is not enough.

LaMay concluded with an interesting comment regarding the hesitancy of some companies to embrace digitalization.  In a business that is running profitably, changes are less welcome because the employees don’t understand the need for change.  Yet businesses who are experiencing tough times, may find more natural transition because employees understand the need for change to survive. The key to digitalization is to get everyone on the same page.


The Role of Blockchain

Of the many digitalization technologies and trends discussed at Manufacturing in America, one conversation of particular interest revolved around the Blockchain. John Greaves, “Doctor Blockchain” from Lowry Solutions discussed this new technology.  As an IOT, RF and Blockchain Solutions Architect with many years of experience in technology, Greaves described how Blockchain was first deployed mainly for financial transactions and cryptocurrencies, and is now being explored for potential Industrial Internet of Things (IIoT) applications as well.  Already, current applications for blockchain go beyond financial transactions and the technology has been widely used for its ability to securely and accurately document and reliably communicate any type of transaction.  Further, Greaves discussed the resiliency of the blockchain sharing how it can and has survived technical and/or organizational failure.  Blockchain today is deployed for traceability, transparency, accountability, and responsibility.  In addition to a wide variety of startups, the technology is increasingly being used by organizations including Walmart, Kroger, Wegman, Procter & Gamble, and others.  Walmart, for example, has a blockchain pilot focused on making China’s pork market safer.


About the Manufacturing in America Summit

In all, the 11th annual Manufacturing in America event included over 100 technical seminars, over 50 exhibits, Tech Zone, and Student Zone and attracted over 3,000 attendees.  The Tech Zone allowed attendees to get hands-on experience using the latest Factory Automation, Motion Control, Control Products, Industrial Networking, and Mindsphere cloud. As the event city, Detroit, MI, claims to have the second largest concentration of engineers in the country, only behind Silicon Valley, Manufacturing in America always delivers great insights into the latest trends and technology in manufacturing. 

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