Digital Transformation Status and Progress in Process Industries

By Dick Hill

Category:
ARC Report Abstract

Overview

At the recent ARC Industry Forum in Orlando, Florida, many discussions revolved around the digital transformation status.  According to a presentation by Mike Williams, ARC Associate, although industry research indicates that there has been more than 75 percent of the process industry participating in Industry 4.0 technology evaluation or pilot projects, there is still less than 25 percent of the industry moving beyond the pilot phase.  It would appear that the process industries are lagging behind other industry segments, such as automotive and other discrete manufacturers.

According to Mr. Williams, “Many times pilot projects find technically viable solutions,” but come up short in creating a business case that would allow the CFOs and CEOs to demand more investment.  The question raised here is “why?”

Digital Transformation Status in the Process Industry

Mr. Williams in his presentation identified some of the top challenges facing early digital transformation implementation.  These include:

  • Lack of a concrete value proposition to justify investment
  • Islands of information prevalent in existing infrastructure
  • Lack of seamless integration between IoT and OT solutions
  • Reliability issues resulting in random periods of abnormal faulting in real time
  • Conflicting organization design issues between IT and OT‐ roles and responsibilities
  • Lost tribal knowledge - “How do we capture and digitize knowledge before it is gone?”
  • Cybersecurity issues resulting in  IP theft and/or denial of service 
  • Need to upgrade skills and human assistance tools to improve efficiency, enhance decision‐making, and higher employee engagement

Although the deployment of new Industry 4.0 technologies might improve asset utilization, one of the most pressing issues in the process industries, this alone does not make or save money for the enterprise.  The newly available capacity must be put to good use, such as by filling production orders for newly developed products.

The Digital Transformation Journey in BP Upstream

Steve Beamer, VP, Continuous Improvement, Systems and Transformation for BP Upstream pointed out the many challenges that resulted from the April 2010 Deepwater Horizon oil spill.   This disaster prompted BP to make a step change in process safety.

BP Upstream’s executive team recognized that it was hard to access data and information, resulting in lots of “manu-matic” work processes.  Massive amounts of data were disconnected from related data and from end users within BP’s operations.  Also, compartmentalized organization resulted in compartmentalized information.  The result, according to Mr. Beamer was they couldn’t make good decisions because they couldn’t get all the information needed.

According to Mr. Beamer, BP Upstream’s journey began in earnest in 2014 by starting to migrate data to a data lake to facilitate Big Data projects.  With a dedicated team and executive leadership, the company eliminated barriers to speed deployment.  In 2016, BP began collaborating with one of its suppliers to build a “Plant Operations Advisor.”  It took five full-time engineers six months to connect the data for the first asset’s 17,000 tags in the company’s OSIsoft PI historian to the BHGE data lake to support Predix analytics.

Working with partners, such as Element Analytics, BP has moved forward in its efforts to make the necessary data connectivity.  The company now has 33 assets about 60 percent complete using only one engineer, and reduced the time required to just four-to-six-weeks per asset.  Another 6,000 data sources will eventually be connected. With the data lake, the company can now align internal data sources across multiple systems.  About 30 million data points are connected to the cloud, which can now be accessed and analyzed quicker and with less effort. 

BP’s key learning is that there is no need to change core systems, which can help organizations maintain their earlier technology investments.  However, when the time does come to change these, it’s extremely important to select a modern architecture to support connectivity. According to Mr. Beamer, when selecting systems, “value connectivity over features.”  It’s also important, “to enable the data owners to curate and maintain the models in order to democratize the data.” 

BASF’s Experience with Digital Transformation in the Chemical Industry

Michael Krauss, Senior Expert, Control Systems Technology for BASF, began his presentation by acknowledging that requirements in the process industries, oil & gas and chemicals in particular, are different than in discrete manufacturing.  Many of the process industry value drivers are centered around improving work efficiency and avoiding incidents.  Mr. Krauss commented that for companies like BASF, revenue-per-employee has an important impact on the bottom line. “Energy and raw material are key factors in the early steps of the value chain, and safety is important above all.”

A BASF initiative that utilizes bar coding and mobile digital devices provides necessary information about every asset in the plant to operators, maintenance, turnaround personnel, and material managers.  Of course, this requires that key vendors must help make this information available digitally.  The vendor list includes the automation systems suppliers such as ABB, but also extends to other areas such as maintenance, engineering, and the enterprise.  Mr. Krauss provided some examples of where BASF has deployed digital technologies.  These include:

  • Using a drone to measure the thickness of a tank’s wall
  • Automatically scanning workers when they enter a facility to ensure that they are wearing the necessary protective clothing and other gear
  • Analyzing the welds on all control valves deployed
  • Utilizing advanced analytics with vibration monitoring and other sensors to monitor pumps
  • Performing predictive maintenance to avoid heat exchanger fouling and improving the reliability of pumps and compressors

BASF also produced a video to highlight two key technologies in what it refers to as “Maintenance 4.0.”  First, the use of Microsoft’s HoloLens technology to allow personnel on site to contact remote experts about problematic plant equipment.  Second, the use of additive manufacturing/3D printing to not only produce a part, but to allow the “freedom of design” to improve the part.

Mr. Krauss concluded that while the very different value drivers in discrete manufacturing make that sector a regular showcase for Industry 4.0 technologies, a digital transformation is nevertheless under way in the process industries.  Digital technologies such as those discussed in his presentation help address the major process industry-specific value drivers.  While effects from massively disruptive new technologies have not been observed so far, digital and non-digital concepts alike clearly are on the horizon for tomorrow in the process industry.  However, with limited resources (time, budget, and head count), only the most promising concepts that address the key value drivers can be realized.

Dow Chemical’s Digital Transformation Starts with MES

digital transformation status Dow%20Chemical%E2%80%99s%20Integrated%20Approach%20to%20MES%20and%20ERP%20Is%20Analogous%20to%20a%20Symphony%20Orchestra.JPGAngela Morris, MES Global Improvement Leader at Dow Chemical, used a symphony orchestra analogy to describe Dow’s history and progress in manufacturing execution systems (MES).  Dow began its digital transformation in 2008 addressing the need for vertical integration between the enterprise and the shop floor.  Early on in this journey, ARC Advisory Group’s consultants helped the company identify the value-creating use cases and define the functional requirements needed to address the operational technology (OT) gaps between the company’s new ERP solution and highly diverse shop-floor assets.  (Dow’s vertical integration project was a response to end-of-life issues with legacy MES systems, which were architecturally incompatible with the new ERP solution.)

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Keywords: Digital Transformation, Industry 4.0, IoT, Operational Technology, ARC Advisory Group.

 

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