ARC Advisory Group

Is IIoT a Justification for Automation Modernization

Blog Post created by ARC Advisory Group on May 2, 2017

Automation modernization remains one of the major issues faced by manufacturers.  ARC estimates that $65 billion worth of automation systems are nearing the end of their useful life. These estimates are even larger if one includes those installed systems that don’t meet the requirements for cybersecurity protection, or leveraging technologies, such as IIoT, cloud computing, advanced process control, mobile devices, social networks, advanced search engines, and big data analytics to create the information-driven enterprise.  Automation end users are primarily concerned with preserving their installed plant assets. Unfortunately, control systems and automation equipment are run much longer than IT and other non-manufacturing related assets.  At the same time, manufacturers have an enormous challenge with cost justifications.  Can IIoT help with automation modernization justification?

 

Arguments for automation modernization range in severity from being purely business decisions to critical issues that affect plant and worker safety.  An older system can hinder the adoption of available new technologies that provide real economic advantages, such as IIoT, cloud, software-as-a service, virtualization, analytics, IT/OT convergence, mobile devices, advanced process control, etc.  When it comes to providing maintenance the older systems can be burdened with a high volume of custom code and custom point–to-point integration that make long term support cost prohibitive. Older systems can have opportunity cost implications for the manufacturing plant as well.  This is the cost of a business opportunity that was missed because the system was not advanced, flexible, or functional enough to take advantage of a swiftly emerging or fleeting opportunity.  Having old or outdated systems installed can result in direct losses if the manufacturer lacks the visibility into plant operations that enables abnormal situation prevention and avoidance of supply chain disruptions.  However, the case for automation modernization is most urgent when the old system reaches the point where an impending plant shutdown or incident is a real possibility, causing unplanned downtime.  This is a case where IIoT connectivity to the old system may have been able to provide the data that would have predicting the impending plant shutdown and allowed pro-active actions to be taken to either avoid the shutdown or prepare for it.  Just avoiding a plant shutdown alone is a primary justification for IIoT.

 

Automation modernization projects are most likely to get approved if they can demonstrate direct support for any of the following four business drivers: plant efficiency, maintenance cost reduction, modifications and expansion, and safety and security.  Decision makers care about these business objectives because of their significant impact on the plant’s profitability. Automation modernization most often involves running operations where downtime translates directly into losses.  Good modernization strategies leverage tools, such as IIoT, and rely on solid project management to reduce downtime and minimize risk.

 

When a manufacturer decides to take a proactive stance regarding its aging control system, the project can quickly become overwhelming. When the installed base is audited it is easy to discover varying degrees of maturity as well as multiple generations of products and operating systems, all running on a single process.  Systems evolve over time with modifications, upgrades, expansions, etc. that may not be well documented by the users.  Standards and regulations also evolve over time and the multi-generation installed base may not be uniformly synchronized to meet today’s and tomorrows’ regulatory requirements.  Being able to provide methods to connect this multi-generational installed base to the IIoT, often with edge or gateway devices, helps the manufacturer best leverage the value of the data produced by the asset to the entire plant until such time as the asset is scheduled to be modernized or replaced.

 

The evaluation process needs to start with the desired end state in mind. Nobody is better qualified to discuss the future role of the manufacturing plant that is evaluating automation modernization than the plant management and operators.  Thanks to edge and gateway devices that can connect legacy assets to the IIoT, not all parts of a legacy control system need to be replaced, which provides flexibility in solutions that allow the manufacturer to preserve the assets worth keeping.  Over time, manufacturers have embedded intellectual knowledge into these systems through control configurations, integration with information management, historical data collection, and other applications to ensure that their automation systems performed the fundamental control job that it was purchased to do, and IIoT connectivity enables this embedded intellectual knowledge to be disseminated and leveraged throughout the enterprise.

 

In conclusion, manufacturers should view automation modernization in the same context as the selection process for a new system. The ideal system should enable focus on business objectives, continuous improvement, and operational excellence. Manufacturers today seek systems that have evolved to provide a single environment, spanning all realms of control disciplines from process to discrete automation and motion control, while also interacting with operations management applications.   Information must be provided in the right context, to the right person, at the right time, from any point in the system, and this can only occur by automation modernization.  However, automation modernization is not complete without the implementation of IIoT, which can help to, for example, pro-actively minimize or eliminate unscheduled downtime by monitoring asset health and indicate when service will be needed, when spare parts need to be ordered, or when the asset itself will need to be replaced.  IIoT provides manufacturers with greater asset flexibility, enable easier upgrades, and speed up integration between third-party products.  IIoT can also make it easier for manufacturers to gather data to better understand and monetize lifecycle upgrades of their automation assets and how they impact ROA over time, which will greatly help with the justification of automation modernization in the future.

 

“Reprinted with permission, original blog was posted here”. You may also visit here for more such insights on the digital transformation of industry.

 About ARC Advisory Group (www.arcweb.com): Founded in 1986, ARC Advisory Group is a Boston based leading technology research and advisory firm for industry and infrastructure.

For further information or to provide feedback on this article, please contact lkanickaraj@arcweb.com

 About the Author:

Craig Resnick
Vice President, Consulting

Craig is the primary analyst for many of ARC’s automation supplier and financial services clients.  Craig’s focus areas include production management, OEE, HMI software, automation platforms, and embedded systems. 

Craig has 35 years’ experience in sales, marketing, product development, and project management in the industrial market, gained with major suppliers of PLCs, process control systems, power transmission equipment, and field devices.  Craig has been with ARC for since 1999.

 

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