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2015 Manufacturing Industry Predictions

What’s new and trending for the industry? Well, predictions for the upcoming year as a motif is certainly not new but is definitely trending, considering the deluge of pundits concentrating their well-informed thoughts about which industry happenings will emerge through hyperbole and into reality. Amongst go-to industry resources I find myself perusing is LNS Research, who has chosen to break down their Top Three 2015 predictions by industry trend/topic: Industrial IoT; Industrial Energy Management; Environmental Health and Safety; and Asset Performance Management.

Another annual favorite that I’ve blogged about in the past—including commentary on Cisco relevance—is IDC Manufacturing Insights, who this year took on a refreshing, new format entitled IDC Futurescape: Worldwide Manufacturing 2015 Predictions. The team of IDC manufacturing practice analysts quantify and qualify their ten most critical imperatives to be addressed by global manufacturers in 2015 and beyond—based on the coalescence of technology and line of business interests—including a few that are very pertinent to Cisco’s Internet of Everything (IoE) initiatives:

  • In 2015, customer centricity requires higher standards for customer service excellence, efficient innovation, and responsive manufacturing, which motivates 75% of manufacturers to invest in customer-facing technologies.
  • By 2016, 70% of global discrete manufacturers will offer connected products, driving increased software content and the need for systems engineering and a product innovation platform.
  • By 2018, 40% of Top 100 discrete manufacturers and 20% of Top 100 process manufacturers will provide Product-as-a-Service platforms.
  • In 2015, 65% of companies with more than 10 plants will enable the factory floor to make better decisions through investments in operational intelligence.

Before the analyst predictions pushed their way onto my laptop screen, I was asked by Cisco’s press relations team to put forward my top 3 for the industry. So on All Saints Day, before heading out on weeks of travel to China, India, and several of the United States outside my home residence, I produced three ideas that didn’t make it to our PR megaphone. As part of this blog, I’ve decided to share these three predictions, with some relevant observations from my Nov-Dec travels and customer interactions …

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Get Ahead of the Curve in 2015: Invest in IoT

As the holiday season gets into full swing, executives like you are polishing off strategic and operational plans for the New Year. For many manufacturing companies, 2014 was a good year, for some outstanding, and most manufacturers are optimistic for more of the same in 2015. According to MAPI’s US Industrial Outlook, “manufacturing will continue to grow faster than the overall economy,” with 2015 growing at a higher rate than 2014.

Because manufacturers are looking to get ahead of this growth curve and set the stage for competitive differentiation and advantage in 2015, you are utilizing budgets remaining from 2014 to make smart investments now in new technologies, before the year comes to a close. With strategic investments in operations or R&D/engineering, companies position themselves to be more agile, productive and competitive while the economy slowly but surely continues to strengthen. In an Industry Week report, “Manufacturers are optimistic about their businesses as well as the economy as a whole, and are investing accordingly … Following a profitable growth strategy, they are controlling costs while introducing new products, increasing sales from existing customers, and leveraging data to make smarter business decisions.”

In recent conversations with a few of my Cisco colleagues who happen to be 20+yr Manufacturing / OT (Operations Technology) veterans, these industry gurus describe how they counsel manufacturing clients during the transitional holiday season. Steve Gansen points out that for many companies, budgets need to be expended this calendar year-end (‘use it or lose it’), which presents a great opportunity to change the prioritization for projects. “Many of my customers see this as an opportunity to reprioritize projects and drive budget to improve R&D or product engineering and offerings.” (His comments reminded me of the Sub-Zero’s innovative investments in their product development, NPI and processes.)

Jim Fledderjohn and Dwayne Edwards add that there are other considerations for a variety of Internet of Things (IoT) proof-of-concept (PoC) projects for production environments and engineering programs that present incremental, re-directional opportunities at year-end. From video surveillance to energy management, to factory wireless and plant virtualization, there are many compelling use cases that can be easily ‘piloted’ to deliver immediate business outcomes and measurable ROI. In fact, an option recently announced at Automation Fair is Cisco Services Factory Starter Kit, a fast-track, turnkey PoC package of wireless capabilities for your plant environments.

Jim further describes, “Piloting an IoT project on a small scale lets manufacturers test out a concept in their environment and puts them in a better position to win budget and additional investment in 2015.” Particularly in the US—where according to the latest ISM Report On Business for November, the manufacturing sector expanded for the 18th consecutive month—momentum in the industry just keeps building. And considering manufacturing technologies that include embedded intelligence and IoT, according to the Association for Manufacturing Technology (AMT), orders for 2014 are showing growth of >5%.

Are YOU planning end-of-the-year investments in IoT? Let us know what you think in the comment block below. Thanks for reading.

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From Local to Global: Extending Our IoE Innovation Strategy with openBerlin and TTTech

mfg Blog 110714There are people all over the world doing truly innovative acts to move the technology needle, but without proper support, many of these ideas fail to come to true fruition. We at Cisco are committed to doing our part by guiding these creators towards a path of success. With both internal and external programs to feed innovation – including the Cisco Internet of Things (IoT) Innovation Grand Challenge and the Technology Fund – we aim to nurture disruptive ideas.

In this light, we were pleased to announce in September the establishment of an IoE Innovation Center in Berlin, Germany – openBerlin. Scheduled to open the summer of 2015, openBerlin will focus on the rapid prototyping of solutions in the transportation and manufacturing verticals. openBerlin marks the sixth Innovation Center in Cisco’s portfolio and joins its successors in Rio, Brazil; Toronto, Canada; Songdo, South Korea; Barcelona, Spain; and London, UK. Read More »

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Field Support for New Workers with Mobile video Collaboration – Wherever They Are

Holding onto “Tribal Knowledge”

Recent data from the Department of Energy (DOE) indicates that approximately 60% of electric utility workers will be eligible for retirement in the next five years. The impending loss of the most skilled and knowledgeable workers in the industry has put many utility companies on red alert.  This potential workforce crisis means that companies have just a few years to transfer what’s often referred to as, “Tribal Knowledge” from those retiring to those who will have to fill their shoes.

Many utility workers hold positions within their companies for nearly 30 years, so one can easily imagine the amount of intangible knowledge and varying experiences that each worker has. What companies really need is a way to tap into the experienced worker’s knowledge while traveling in the field.  Better yet, they would like to find a way to limit travel in the field; traveling hundreds of miles to analyze and solve problems poses its own set of risks, from driving hazards to on the job injuries. When something goes wrong on the grid, lives are at risk.

Challenges in the Field

Much of the information and knowledge needed by today’s utility worker is stored in a computer or in the cloud, and is not accessible in the field by the organization’s workers. Because of this, institutional knowledge and expertise decreases. Many companies today are purchasing collaboration solutions, including web meeting software, video and Internet-based phone systems. This package is intended to upgrade collaboration across business units, address the issues of lost tribal knowledge, increase workforce effectiveness and manage company priorities arising from their aging workforce. Challenges faced include a slow, sub-optimal rollout plan, forced by lower company revenues. Analysis points to automation of capture and storage of knowledge, utilities could take advantage of their expert employee’s skills and leverage their knowledge for less experienced workers in the field, thereby giving a good return on investment for early deployment of mobile collaboration.

There are three immediate problems to resolve: access to Tribal Knowledge, better utilization of experts for training, and improving safety for the mobile workforce traveling in the field.  Companies remind us on a regular basis that training a utility lineman can take 10 years or more – and the average age of the current power lineman workforce is 47-years-old.  Utilities are also focusing on retention of younger employees, who are generally more technologically savvy and who expect work access to tools they use outside the workplace, like smart phones and other wireless technologies.  In fact, new or younger workers prefer to work in an area with new technology. Mobile devices such as smart phones and ruggedized tablets can be especially useful in the field where workers can get access to advice from experts in real-time or even start a meeting – all to create increase access to institutional knowledge.

One component of Cisco’s solution is expert locator software. Employees such as line workers and technicians would have the ability to be connected anytime or anywhere via a five-product Enterprise Collaboration solution: Expert Locator, IP call control with video IP phones, web meeting (Webex), an immersive video solution (TelePresence) and ruggedized mobile video (Librestream Onsight).

New technology can change the way utilities conduct business

Workers would use mobile video in the field to show details of problems to experts throughout the company, senior workers could provide advice and support for repair of damaged equipment in the field without having to travel to the field. Experts can also quickly convene and escalate meetings to resolve a problem via the web and Telepresence. If a worker is on-site and there are challenges with a device, the worker can start a meeting, have the ability to share and give/get advice in real-time. Because of this, repair times go down while safety goes up.

How can Cisco help your organization support new collaboration and create a mobile workforce? Find out more by visiting our solutions page and share your thoughts in the comments section below.

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Stay in the know about our Manufacturing solutions – Join our MFG Community of Interest!

Are you interested in keeping up with the latest innovative and transformative manufacturing solutions? Join the Cisco Connected Manufacturing Community!  By becoming a member, you’ll receive access to industry news, complimentary webcasts, case studies, and white papers for optimizing business processes for manufacturing.

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