Ten Ways Big Data Is Revolutionizing Manufacturing

McKinsey & Company recently published How Big Data Can Improve Manufacturing which provides insightful analysis of how big data and advanced analytics can streamline biopharmaceutical, chemical and discrete manufacturing.

The article highlights how manufacturers in process-based industries are using advanced analytics to increase yields and reduce costs. Manufacturers have an abundance of operational and shop floor data that is being used for tracking today.  The McKinsey article shows through several examples how big data and advanced analytics applications and platforms can deliver operational insights as well.

The following graphic from the article illustrates how big data and advanced analytics are streamlining manufacturing value chains by finding the core determinants of process performance, and then taking action to continually improve them:

Big Data’s Impact on Manufacturing Is Growing

In addition to the examples provided in the McKinsey article, there are ten ways big data is revolutionizing manufacturing:

• Increasing the accuracy, quality and yield of biopharmaceutical production.  It is common in biopharmaceutical production flows to monitor more than 200 variables to ensure the purity of the ingredients as well as the substances being made stay in compliance. One of the many factors that makes biopharmaceutical production so challenging is that yields can vary from 50 to 100% for no immediately discernible reason. Using advanced analytics, a manufacturer was able to track the nine parameters that most explained yield variation. Based on this insight they were able to increase the vaccine’s yield by 50%, worth between $5M to $10M in yearly savings for the single vaccine alone.

• Accelerating the integration of IT, manufacturing and operational systems making the vision of Industrie 4.0 a reality. Industrie 4.0 is a German government initiative that promotes automation of the manufacturing industry with the goal of developing Smart Factories. Big data is already being used for optimizing production schedules based on supplier, customer, machine availability and cost constraints. Manufacturing value chains in highly regulated industries that rely on German suppliers and manufacturers are making rapid strides with Industrie 4.0 today.  As this initiative serves as a catalyst to galvanize diverse multifunctional departments together, big data and advanced analytics will become critical to its success.

• Better forecasts of product demand and production (46%), understanding plant performance across multiple metrics (45%) and providing service and support to customers faster (39%) are the top three areas big data can improve manufacturing performance.   These findings are from a recent survey LNS Research and MESA Internationalcompleted to see where big data is delivering the greatest manufacturing performance improvements today. You can find the original blog post here.

• Integrating advanced analytics across the Six Sigma DMAIC (Define, Measure, Analyze, Improve and Control) framework to fuel continuous improvement.  Getting greater insights into how each phase of a DMAIC-driven improvement program is working, and how the efforts made impact all other areas of manufacturing performance is nascent today. This area shows great potential to make production workflows more customer-driven than ever before.

• Greater visibility into supplier quality levels, and greater accuracy in predicting supplier performance over time.  Using big data and advanced analytics, manufacturers are able to view product quality and delivery accuracy in real-time, making trade-offs on which suppliers receive the most time-sensitive orders.  Managing to quality metrics becomes the priority over measuring delivery schedule performance alone.

• Measuring compliance and traceability to the machine level becomes possible. Using sensors on all machinery in a production center provides operations managers with immediate visibility into how each is operating. Having advanced analytics can also show quality, performance and training variances by each machine and its operators.  This is invaluable in streamlining workflows in a production center, and is becoming increasingly commonplace.

• Selling only the most profitable customized or build-to-order configurations of products that impact production the least.  For many complex manufacturers, customized or build-to-order products deliver higher-than-average gross margins yet also costs exponentially more if production processes aren’t well planned.  Using advanced analytics, manufacturers are discovering which of the myriad of build-to-order configurations they can sell with the most minimal impact to existing production schedules to the machine scheduling, staffing and shop floor level.

• Breaking quality management and compliance systems out of their silos and making them a corporate priority.  It’s time for more manufacturers to take a more strategic view of quality and quit being satisfied with standalone, siloed quality management and compliance systems.  The McKinsey article and articles listed at the end of this post provide many examples of how big data and analytics are providing insights into which parameters matter most to quality management and compliance. The majority of these parameters are corporate-wide, not just limited to quality management or compliance departments alone.

• Quantify how daily production impacts financial performance with visibility to the machine level. Big data and advanced analytics are delivering the missing link that can unify daily production activity to the financial performance of a manufacturer.  Being able to know to the machine level if the factory floor is running efficiently, production planners and senior managementknow how best to scale operations.  By unifying daily production to financial metrics, manufacturers have a greater chance of profitably scaling their operations.

• Service becomes strategic and a contributor to customers’ goals by monitoring products and proactively providing preventative maintenance recommendations.  Manufacturers are starting to look at the more complex products they produce as needing an operating system to manage the sensors onboard. These sensors report back activity and can send alerts for preventative maintenance. Big data and analytics will make the level of recommendations contextual for the first time so customers can get greater value. General Electric is doing this today with its jet engines and drilling platforms for example.

Additional sources of information on Big Data in Manufacturing:

• Attitudes on How Big Data will Affect Manufacturing Performance. Posted by Greg Goodwin on Thu, Mar 06, 2014. LNS Research.http://blog.lnsresearch.com/blog/bid/194972/Attitudes-on-How-Big-Data-will-Affect-Manufacturing-Performance-DATA From Value to Vision: Reimagining the Possible with Data Analytics, David Kiron, Renee Boucher Ferguson and Pamela Kirk Prentice, MIT Sloan Management Review, March 2013.http://sloanreview.mit.edu/reports/analytics-innovation/introduction/
• Merck Optimizes Manufacturing With Big Data Analytics, Information Week, Doug Henschen. April 2, 2014. http://www.informationweek.com/strategic-cio/executive-insights-and-innovation/merck-optimizes-manufacturing-with-big-data-analytics/d/d-id/1127901
• Takeaways from the MIT/Accenture Big Data in Manufacturing Conference. Posted by Greg Goodwin on Wed, Nov 27, 2013.http://blog.lnsresearch.com/blog/bid/190482/Takeaways-from-the-MIT-Accenture-Big-Data-in-Manufacturing-Conference
• The Internet of Things and the future of manufacturing. McKinsey and Company.  Executives at Robert Bosch and McKinsey experts discuss the technology-driven changes that promise to trigger a new industrial revolution. June 2013 | by Markus Löffler and Andreas Tschiesner.http://www.mckinsey.com/insights/business_technology/the_internet_of_things_and_the_future_of_manufacturing
• The Rise of Industrial Big Data: Leveraging large time-series data sets to drive innovation, competitiveness and growth — capitalizing on the big data opportunity, GE Intelligent Platforms White Paper, April 2012. http://www.ge-ip.com/library/detail/13170
• When Big Data Meets Manufacturing. Stephen Chick, Serguei Netessine, INSEAD Professors of Technology and Operations Management and Arnd Huchzermeier, Chaired Professor of Production Management at WHU-Otto Beisheim School of Management  | April 16, 2014.http://knowledge.insead.edu/operations-management/when-big-data-meets-manufacturing-329

Courtesy – Louis Columbus

84% Of Enterprises See Big Data Analytics Changing Their Industries’ Competitive Landscapes In The Next Year

87% of enterprises believe Big Data analytics will redefine the competitive landscape of their industries within the next three years. 89% believe that companies that do not adopt a Big Data analytics strategy in the next year risk losing market share and momentum.

These and other key findings are from a Accenture and General Electric study published this month on how the combination of Big Data analytics and the Internet of Things (IoT) are redefining the competitive landscape of entire industries. Accenture and GE define the Industrial Internet as the use of sensor, software, machine-to-machine learning and other technologies to gather and analyze data from physical objects or other large data streams, and then use those analyses to manage operations and in some cases to offer new, valued-added services.

Big Data Analytics Now Seen As Essential For Competitive Growth

The Industrial Internet is projected to be worth $500B in worldwide spending by 2020, taking into account hardware, software and services sales according to Wikibon and previously published research from General Electric. This finding and others can be found on the home page of the Accenture and GE study here: How the Industrial Internet is Changing the Competitive Landscape of Industries.

The study also shows that many enterprises are investing the majority of their time in analysis (36%) and just 13% are using Big Data analytics to predict outcomes, and only 16% using their analytics applications to optimize processes and strategies. Moving beyond analysis to predictive analytics and optimization is the upside potential the majority of the C-level respondents see as essential to staying competitive in their industries in the future.

A summary of results and the methodology used are downloadable in PDF form (free, no opt in) from this link: Industrial Internet Insights Report For 2015.

Key take-aways from the study include the following:

• 73% of companies are already investing more than 20% of their overall technology budget on Big Data analytics, and just over two in ten are investing more than 30%. 76% of executives expect spending levels to increase. The following graphic illustrates these results:

• Big Data analytics has quickly become the highest priority for aviation (61%), wind (45%) and manufacturing (42%) companies.  The following graphic provides insights into the relative level of importance of Big Data analytics relative to other priorities in the enterprises interviewed in the study:

• 74% of enterprises say that their main competitors are already using Big Data analytics to successfully differentiate their competitive strengths with clients, the media, and investors. 93% of enterprises are seeing new competitors in their market using Big Data analytics as a key differentiation strategy.  The single greatest risk enterprises see from not implementing a Big Data strategy is that competitors will gain market share at their expense.  Please see the following graphic for a comparison of the risks of not implementing Big Data strategy.

• 65% of enterprises are focused on monitoring assets to identify operating issues for more proactive maintenance. 58% report having capabilities such as connecting equipment to collect operating data and analyzing the data to produce insights. The following graphic provides an overview of Big Data monitoring survey results:

• Increasing profitability (60%), gaining a competitive advantage (57%) and improving environmental safety and emissions compliance (55%) are the three highest industry priorities according to the survey. The following table provides an analysis of the top business priorities by industry for the next three years with the shaded areas indicating the highest-ranked priorities by industry:

• The top three challenges enterprises face in implementing Big Data initiatives include the following: system barriers between departments prevent collection and correlation of data for maximum impact (36%); security concerns are impacting enterprises’ ability to implement a wide-scale Big Data initiative (35%); and  consolidation of disparate data and being able to use the resulting data store (29%), third. The following graphic provides an overview of the top three challenges organizations face in implementing Big Data initiatives:

Courtesy – Louis Columbus

History of #Hastags

Stop thinking….Start Giving…..A Smile…{Weekend Writing}

I recently discovered the below two great piece of work on YouTube…

We….or at least I have always made an attempt to learn from my heroes or rather the “successful” heroes…Somehow I always managed to mix these two words quite unintentionally – “Success” and “Hero”…but never realized that there is no relevance between these two words. If there is any then it has to be only about how you can be successful in making a small difference for the better in someone’s life, years, months, day or that single moment.

There are many millions of heroes out there of which one may be living your next door, walking besides you, sitting next to you on the train or bus….but they all are anonymous….by bringing that small change I can discover the hero in me…Don’t worry just about how to change those big things in the world but if you can change the structure of someone’s face by bringing a SMILE I hope this weekend, you bring a smile to someone’s face.

Don’t worry if the videos are not in your native language…Even without the subtitle you will understand it…As mentioned in the second video, giving is the best communication….Enjoy the Video…and Keep Smiling….

Infographic – Why???

Recently I was researching about the growing importance of info-graphics for marketers…while it was encouraging to see many articulations to prove its importance, but I have to acknowledge that I was a bit underwhelmed by the actual use or embrace this strategic tool of communications…

While I may list its importance due to the mere fact that Studies have found that 90 percent of the information that we remember is based on visual impact. Include that tidbit with the fact that we live in an age where 1.5 billion pieces of content, 140 million tweets, and 2 million videos are created on a daily basis, and you can easily understand why a simple visual aid can make your brand stand out.

Therefore, even with the basis of the fact its still a tool for many reasons avoided by marketers….the primary reasons that seems to be popping up is expensive and lack of expert knowledge. Yes, a work of art cannot be cheap…..and not sure who told you that story telling can be done by someone who don’t understand it.

You need visualizer to draw and you need marketers to explain the story…..and the mashup is what you get in a good info graphic…..While its not necessary that you may want to go with what I am writing but you may want to read and see what people are claiming…One such is below and for the rest….simply Google it…

Embrace this communication tool…as its a perfect blend of what you want to tell and what your consumers want to see.

Gartner’s Top 10 Strategic Technology Trends For 2015

Gartner presented their top 10 strategic technology trends for 2015 at their annual Gartner Symposium/ITxpo 2014 held in Orlando earlier this month.  Computing Everywhere, the Internet of Things (IoT) and 3D Printing are projected to be the three most important strategic technology trends in 2015.

3D Printing Will Continue To Revolutionize Prototyping And Manufacturing 

3D printing is forecast to reach a tipping point in the next three years due to streamlined prototyping and short-run manufacturing. Improving time-to-market, ensuring greater accuracy of highly customized products, and reducing production costs over the long-term are three of the many benefits companies are adopting 3D printing for today.  Be sure to read Larry Dignan’s excellent post covering the conference and top ten strategic technology trends, 3D printing turns strategic in 2015, says Gartner.

Taking Analytics To The Next Level in 2015

Advanced, persuasive and invisible analytics, context-rich systems, and smart machines also are included in the top 10 strategic technology trends for 2015. Given how quickly analytics is maturing as a technology category, it’s understandable why Gartner ranked this area as the 4^th most strategic.  In 2015, analytics will move beyond providing dashboards with metrics and Key Performance Indicators (KPIs) to a more intuitive series of applications that give business analysts the flexibility to define models and test them in real-time. Alteryx and Tableau are interesting companies to watch in this area and Tableau Public is worth checking out and learning due to its advanced visualization features (free, opt-in).

Cloud Computing Becomes Part Of The New IT Reality

The last four technology trends Gartner mentions include cloud/client computing, software-defined applications and infrastructure, Web-scale IT and risk-based security and self-protection.

The following graphic provides an overview of the top 10 strategic technology trends for 2015.

Courtesy – Louis Columbus

Roundup Of 3D Printing Market Forecasts And Estimates, 2014

3D printing’s potential to revolutionize manufacturing is quickly becoming a reality.

From relatively simple make-to-stock to complex, engineer-to-order production strategies in aerospace, defense, discrete and industrial production, 3D printing technologies are redefining the manufacturing value chain.  Investors including venture capitalists, wealth management firms and nearly every market research firm covering high technology has published 3D printing forecasts or market estimates.

A summarized list of 3D printing market forecasts and estimates is provided below:

• Canalys predicts the global 3D printing market will grow from $2.5B in 2013 to $16.2B by 2018, attaining a CAGR of 45.7% in the forecast period. For additional information see 3D printing market to grow to US$16.2B in 2018. The following table compares 2013, 2014 and 2018 forecasts and relative market growth by 3D printers, services and materials.

• IBISWorld forecasts the U.S. market for 3D printer manufacturing in the U.S. will reach $1.4B in 2014, attaining a Compound Annual Growth Rate (CAGR) of 22.8% from 2009 to 2014.  The U.S. market will grow at a CAGR of 15.7% from 2014 to 2019.  IBISWorld’s report includes market shares, and shows 3D SystemsCorporation with 19.5% followed by Stratasys with 18.4%. You can read the IBISWorld report, 3D Printer Manufacturing in the US, February 2014 here(free, no opt-in).

• IDC predicts that worldwide 3D printer unit sales and installed base will grow at a combined compound annual growth rate of 59% through 2017, with the value of shipments attaining a 27% CAGR in the forecast period.  IDC’s excellent presentation titled 3D Printing – A Transformative Opportunity for Print and Manufacturingwritten by Robert Parker and Keith Kmetz was part of the IDC Directions 2014 briefing sessions earlier this year.  The following slide from the presentation compares 3D printer market units, installed base and value of shipments. IDC also predicts the Average Selling Value will also drop at a -19% CAGR through 2017.

• The 3D Systems Investor and Analyst Day presentation given June 10, 2014 includes a series of market forecasts and estimates, including an in-depth overview of how 3D Systems is evaluating market opportunities for 3D printing in healthcare. The following graphic is from the 3D Systems Investor and Analyst Day presentation available here:

• 3D printers will grow from a $288M market in 2012 to $5.7B in 2017, attaining an 81.9% CAGR in the forecast period according to research by Wells Fargo Wealth Management.  According to this firm’s compiled research, shipments of 3-D printers are expected to grow at a CAGR of 95% a year from 2012 to 2017 with revenue expected to grow at 82% in the same forecast period.  Well Fargo Wealth Management found that 3-D printing revenue is estimated to have achieved just 8% of its global market potential as of 2014, making the market opportunity worth $21–$28 billion by 2017.  Wells Fargo Wealth Management published the reportBeyond 2014: Evolving Opportunities in Technology providing these insights and the following charts showing the growth of 3D printing shipments and revenue:

• Equity analysts’ forecasts for additive manufacturing (AM) or 3D printing range from $7B by 2020 on an 18% CAGR, to aggressive market scenarios reaching $21.3B by 2020 on a 34% CAGR. Morgan Stanley’s forecast are among the most bullish there are.  Deloitte presented these figures at the 2014 Engineering & Construction Conference Bridging Innovation in the Industry Disruptive Technologies and their Impact on E&C. You can find the presentation here and a graphic below from the presentation comparing market forecasts.

• Gartner forecasts that 3D printer shipments will grow to 1.1M units by 2017 attaining a CAGR of 95%, and end user spending will grow to $5.7B, attaining a CAGR of 82% in the forecast period.  The presentation 3D Printing: The Hype, Reality and Opportunities – Today written by Pete Basiliere of Gartner is available on SlideShare.  A PDF of the presentation is available to Gartner clients here.

• The market for 3D printing products and services grew to $3.07B in 2013 attaining a compound annual growth rate (CAGR) of 34.9%, the highest in 17 years according to Wohlers Associates.According to industry expert Wohlers Associates the growth of worldwide revenues over the past 26 years has averaged 27%, with the CAGR for the past three years (2011–2013) reaching 32.3%.For additional information see the Wohlers Report 2014 Uncovers Annual Growth of 34.9% for 3D Printing and Additive Manufacturing Industry. Wohlers Associates is one of the most knowledgeable firms tracking 3D printing, they have involved in this market for decades.

• 67% of manufacturers surveyed are currently implementing 3D printing either in full production or pilot and 25% intend to adopt 3D printing in the future. A study by Price Waterhouse Cooper (PwC) of 3D printing adoption in the global aerospace industry’s MRO (maintenance, repair and overhaul) parts market estimates $3.4B annual savings in material and transportation costs alone. PWC’s recent report published in June, 3D Printing and the New Shape of Industrial Manufacturing, provides a wealth of insights into the adoption of 3D printing in manufacturing. The following graphic from the report compares adoption rates by small and large firms.

• PwC predicts that within three to five years 3D printing technologies will be used for producing military, commerical and complex weapon parts and system components.  In the recent research note 3D Printing: A Potential Game Changer for Aerospace and Defense, PwC provided a 3D printing adoption map, which is shown below.  PwC observes that “as quality and speed continue to improve, 3D printing will become a viable process for an  ever-increasing number of applications, including traditional production parts. No one  knows how rapidly the technology will take to mature, but most experts believe it will  make significant strides within the next five years.”

Courtesy – Louis Columbus