The 180-degree Shift in Thinking: An Uncomfortable but Productive Digital Transformation
By Gordon Quigley and Colette Munro
Some years ago, we worked with a plant manager who had a clear opinion on the role equipment suppliers should play in operational decision-making. The types of equipment in this context could be anything from across the mining supply chain such as mining haul trucks, pumps, conveyor systems, trains, or ship loaders.
“Give me reliable software analysis tools and my team will take it from there. Don’t keep telling me what I need to monitor,” was his blunt instruction. The plant would collect and analyze the data and make all operational decisions. After all, suppliers did not know enough about neither their own equipment nor his operations to be able to make key decisions. His experienced view was that only he and his team knew how the plant and equipment really operated.
In time, the plant demonstrated large gains in productivity. To learn more about these improvements, we invited the plant manager to share his experience with industrial clients from all over the world.
Today, he still has a clear opinion on the role of an equipment supplier. However, this opinion has shifted 180 degrees. The plant manager now believes that suppliers have the responsibility to work with his site experts to provide direction on what actions should or should not be taken with regard to their equipment and systems. He now accepts that suppliers must share in operational decision making.
He believes that his suppliers are - or should be - the experts. He does not want to invest his time or waste his team’s valuable energy trying to analyze operations to determine the optimal time to maintain equipment or improve system performance. That, he now believes, is the supplier’s role.
So, what changed to drive this 180-degree shift in thinking? What does this change mean for equipment suppliers? And, what new opportunities does this create?
We believe (because he told us...) that his new outlook is based on an evolution in the technological landscape. He now believes that:
- Leading suppliers should have the best data and best data science
- Leading suppliers should build an operational decision-making ecosystem
- Leading suppliers must know the system and equipment – after all, they designed and built it!
Suppliers should have the best data and the best data science
Like most transformations, the shift to increase the supplier’s role in operational decision making will be driven by better access to data and developing better data science. When the Internet of Things (IoT) emerged, it became easy for to access data that had been traditionally locked up in plant based control systems or plant historians. Additional sensors became cheap to deploy and the volume of data available increased dramatically. As the plant manager said when discussing the impact of greater data access through suppliers: “It is no good to give plants access to the 100’s or 1,000’s of instruments and data. What would we do with it? It would take us a lifetime to establish the meaningful data relationships required to improve reliability”.
Suppliers should build an operational decision-making ecosystem
The plant manager wanted suppliers to move beyond just providing data insights. He was already being bombarded with data and wanted actionable recommendations. Like most control system alarms, data insights were becoming so prolific that most – bar the most critical – are being ignored.
He needed his supplier to convert the data insights into recommendations. To do this, suppliers must build an operational decision-making ecosystem. This ecosystem community must include the talent, experience and judgement required to convert real-time data insights into operational decisions.
This ecosystem needed both functional expertise and deep domain expertise specific to the asset and customer segment. Few individual customers have the budget to build this team for each asset and system in their operation.
These decision-making ecosystems will provide economic advantages in reducing the cost-per-decision. Plus, these dedicated teams leverage the volume of decisions to create best practices and, combined with the best data science, will create innovation in plant performance. Leading suppliers will also invest with partners within innovative communities to improve the technologies and methods that can assess the performance of assets.
What this means for suppliers
Suppliers must shift how they see their role in their customer’s operational decision-making. Beyond designing and building equipment – suppliers need to see themselves as collaborators who move beyond data insights and take responsibility to optimise the performance of their customer’s plant.
What new opportunities does this create?
Equipment and system suppliers who successfully move across traditional decision boundaries to provide operational decision support will become true “Trusted Partners” to their clients.
For slow moving equipment and systems suppliers, independent service providers may fill this gap and pose a risk to incumbent suppliers.
Our plant manager associate built a successful career by managing and controlling operational data and making production decisions using proven methods. Embracing this new world of opportunities presented by the IoT will generate more innovative ways of working, drive digital transformation and deliver continued productivity gains across a broad range of industries.