Hugh on Energy, Manufacturing, and Solutions

Renewables Leading the Growth in the next 10 years

2011-10-05T05:59:00.000-07:00

It is really interesting when you begin to connect the dots. For example the ‘International Energy Outlook 2011’ ‒ published here by the U.S. Energy Information Administration (EIA) ‒ said renewable energy sources were the fastest growing sources of electricity generation globally. It predicted that from 2008 to 2035, world renewable energy use for electricity generation would grow an average of 3.1%pa, and the renewable share of world electricity generation would increase from 19% in 2008 to 23% in 2030. http://www.esi-africa.com/node/13590 and other dots from the The African Development Bank General Procurement Notices GPN's would clearly agree. Leads one to believe more readily.

2011-05-30T12:42:00.000-07:00

XBRL for business. Consider the following from Business Intelligence Blog...Everyone of us know that barcode shows data about the object to which it attaches. This optical machine-readable representation of data, has done wonders for various industry verticals right from production distribution, supply chain, retail, healthcare, etc. right from 1974 when the very first scanning of the now ubiquitous Universal Product Code (UPC) barcode was on a pack of Wrigley Company chewing gum.

XBRL (eXtensible Business Reporting Language) is all set to do similar wonders for business reporting. In Business Reporting Supply Chain, collaboration of data is the key whether its business operations, internal or external financial reporting and regulatory reporting. XBRL is a open global standard, freely available for exchanging business information....XBRL is all set to revolutionize business reporting through electronic communication of business and financial data.

Soon via the use of mobile apps your ebill will contain only the code which will allow the content to be secured at source.

source: http://blog.maia-intelligence.com/2011/05/09/xbrl-a-barcode-for-business-reporting/

Cloud Computing Impact Evidance

2011-05-16T06:14:00.000-07:00

In the past months I have had the opportunity to participate in public seminars, meet with leaders, loads of young entrepreneurs, and see much of the same as in the assessment posted by Jim Shepherd of Gartner.

Cloud-Based ERP May Be Approaching the Tipping Point from - First thing Monday morning news letter First Thing Monday

"One of the other things I noticed at the NetSuite conference was that the average age of the attendees was about 10 or 15 years younger than the people I see at SAP or Oracle user events. Most of them had business roles, but they were very knowledgeable about technology, and came armed with the usual assortment of mobile devices to stay in constant communication with both their work and personal lives. Having grown up with the Internet, their general view seemed to be that applications in the cloud were completely logical, and they had none of the usual concerns about security, data privacy, reliability or integration .... As I think about the pace of today's business environment and listen to the attitudes of the people who will be making application decisions in the next few years, I'm convinced that we're finally at the point where cloud-based applications may begin to rapidly take market share from on-premises applications".

Digital Marketing, mobility, digital natives

2010-10-15T07:57:00.000-07:00

I was recently asked to be a guest speaker to a group of first year digital marketing students at a local University. The topic was to use real world business cases of digital marketing from the perspective of someone in the industry. Easy to argue that I am not a digital marketer with a media agency, however I work for a software company using and selling software for digital marketing.

One of the limitations I discovered was that the text books the students were using were fairly old and really did not cover digital media well. This is a little funny because the students, as a group, are called “digital natives”. My conversation with them was to emphasize the fundamentals and broaden the conversation on how rapidly the space is changing and forcing a sort of nimble adaptability on marketing organizations that has never been seen before. Where marketing organizations had cozy relationships with management and would cautiously act out their strategy, today’s media savvy teams need to be very cozy with technology in a proactive way and be willing to act fast.

Not surprisingly, almost everyone in the room had a Facebook account; was using LinkedIn, and was very comfortable with consuming mobile media. What was a little surprising was the very limited understanding of the strategies used by companies to leverage social media. To highlight the need, we used the Utilities and Telecommunications market as an example from the perspective of a utilities company in a deregulated market place like Europe, a customer as an asset and the cost of net new customers versus keeping existing ones happy. What tools, methods, and approaches are working well? Where are some disasters? What are some fascinating successes?

In planning for the session; chatting with colleagues, going through news events, and following twitter feeds there were meaningful examples of some recent and stunning events. What has became apparent is that the speed of social media is causing some companies to be more exposed to a larger base of their customers with good and bad news faster than ever before. Consequently, today’s marketing departments need to be empowered proactively to solve issues. To highlight the reality, one example we used was of a major bank that had an outage. The twitter feed was brutal and fast, while the institution was hardly aware of the reaction. Competitors on the other hand, were all too happy to use the event as an opportunity to poach customers. All of this happened in a matter of days. Was it someone asleep at the switch, or a completely vacant strategy? Another example involves a proactive marketing move regarding a parking job and a free car.

Overall, we recognized that the old yesterday approach of relying on a few channels to market a company and its products is insufficient. A multidimensional approach that requires a working knowledge of the tools of the trade as well as the technology is what is needed most. It also means an opportunity to think outside the box on with the ability and authority to react. I expect that for large organizations to do this well, they would need to practice and allow for snap decisions instead of having much larger and embarrassing fire drills to deal with problems.

Cloud Computing

2010-10-15T07:54:00.000-07:00

Recently I was asked, along with a colleague, to host a group of specialists participating in an international trade mission. Needless to say, stakes were high. In this case the trade mission group was from Taiwan, and the topic was Cloud Computing. Our plan was to begin with a high level overview of Cloud Computing; show a few examples of the software, then build out a few business cases that highlight the applicability and value. The very full room, with very smart and informed people with a common interest generated some fascinating conversations.

From my perspective, talking about Cloud Computing from an industry perspective made me realize a few things. What I realized is that the opportunity that cloud computing offers in a number of industry segments, if set correctly, can represent a huge value. First is the value of collaboration to any organization working on any project. The limitations around time zones and practical problems of transferring files are minimized. This also means that by bringing people to the content as opposed to moving content to people audit trails and governance needs are more controlled. The second is the ability to build a backbone that would support any project based activity where diverse applications, people, and requirements can be leveraged and scaled rapidly. Make the right tools available, and it can be a game changer.

A couple of examples came to mind that are simple, but very relevant if you have a capital project, a building, a bridge, an oil refinery, a project of significance in terms of cost and people involved. Cloud Computing could open the opportunity for participants to collaborate more readily, to distribute content following a process, in some cases simplifying the process. Today when an engineering firm has drawings, calculations, specifications, etc for their customer (typically the entity that has commissioned the capital project) they send a transmittal. A transmittal management solution assures a legal transmission of the content from one brick and mortar business (B&M)to another B&M. In a cloud environment you are bringing the supplier and customer to the information. All that is left to do is to define that presents the content to the right user at the right time. Behind the scenes, audit, security, and business processes are tracking the event, recording the legal delivery aspects of the process.

The fundamental thinking is that Cloud Computing brings the people to the content. There may be examples and problems where solutions for CAD or other drawing needs must be dealt with. . Ultimately the value of using cloud simplifies how information is shared, how it is passed from one group of users or stakeholders to another as the project progresses. Longer term, by bringing people to the information, those people are adding to the content and collectively when the process is over, the shared content is accurate content. In the case of an oil refinery being built, the set of drawings, procedures, work instructions, asset information and so on that are handed over are accurate right. The old way has proven ultimately to be the costly and burdensome way. This translates more often than not to be a case where the customer that commissioned the bridge, the building, the oil refinery must recreate information for their purposes, instead of reusing.

I think we all know that Cloud Computing is not a one size fits all solution, and requires blends of various models, where some information, especially really sensitive information, needs to reside in very secure places. That does not mean that if you have projects where large groups of people in multiple organizations should not all work together to collaborate, share information, and speed up how we create content, while drop the cost of those pesky mistakes or recreation of content. The trade mission team was super to work with and enabled me to open my thinking even further to the possibilities. I look forward to more of that.

Do More With Less: Three Sure-Fire Strategies for Manufacturers – Enterprise Content Management

2009-05-15T14:02:00.000-07:00

This is the third segment of my “doing more with less issue” and it deals with enterprise content management (ECM).

Companies generally invest in ECM solutions to address specific business problems dealing with email and electronic records management, collaboration, search, reporting and analytics, and ad-hoc or structured workflow—all essential tools that enable an administrative framework to bloom. These are also the tools required to begin capturing, preserving, and re-using the intellectual knowledge that flourishes across the enterprise.

Using an ECM strategy to support an information governance program helps to manage problems with content-loss risks and knowledge leaks before the business is adversely affected. Managed repositories of corporate content, that are accessible across business units or geographies, serve critical channels of information distribution, even after the originating author leaves the organization. An ECM deployment ensures that content is securely controlled in the context of its business function. ECM can also serve as the cornerstone for content collection and protection initiatives for e-discovery and regulatory needs.

Although manufacturing productivity has been greatly improved by ERP systems, which do reduce inventory times and increase quality, there is still a great deal more to be done. By embedding ECM within an organization’s ERP application, business transformation is enhanced. An integrated ECM-ERP application allows an organization to build a unified environment for their business users, reducing duplication of effort, and providing a flexible environment for collaboration. It also provides interoperability between content that was once disconnected by applications, allowing for faster process-associated decisions to be made organization-wide. Manufacturing departments can further benefit when they adopt ECM solutions to efficiently document the many steps in the manufacturing process, which aids with the adherence to regulatory requirements.

In The Deep Art of Enterprise Content Management, Jim Murphy says: “Rather than existing separately from established systems, like ERP, content management acts as an extension of them allowing for exceptions to the repeatable processes governed by ERP, as well as recognizing and capturing processes and data that should be managed in those systems.”

Capturing the Value of Information

With the administrative framework acting as a backbone, and information about assets optimized, the day-to-day interactions between people, process, and information becomes much more efficient and effective. To take full advantage of this connection, an unobstructed view into all sources of related information is essential.

Inherent to manufacturing companies is the need to anticipate problems, modify fixed assets (for tasks like de-bottlenecking), and to meet technological and business changes. In essence, an enterprise must plan for change, manage change, track change, and resolve the problems that change causes. Managing change, especially where hazardous materials are involved, is one of the largest business processes for a facility. If not done properly, change mismanagement proves costly and problematic for any organization.

Regardless of one’s role or discipline, managing a problem becomes significantly more difficult if correct, current information is unavailable. The need to search for diversified information about a fixed asset, such as drawings, procedures, contracts, and other vital documents, becomes ever so critical when planning for change. Decisions based on poor or missing information, or outdated versions of documents, compound mistakes and augment costs. But information visibility, through the integration of an ECM Suite with an ERP system, exposes all transactional data to ensure accuracy, speed, and utmost value.

Do More With Less: Three Sure-Fire Strategies for Manufacturers – Dealing with the Administrative Framework

2009-05-13T12:56:00.000-07:00

Every business today competes in two worlds: the physical world of resources and the virtual world of information. Executives must pay close attention to how their companies create value from both of these, as the means for accomplishment are different for each. It can go without saying that managers who understand how to master both physical resources and information resources will have a distinct advantage.

In Exploiting the Virtual Value Chain, Jeffrey F. Rayport and John J. Sviokla, talk about this extensively: “Creating value in any stage of a virtual value chain involves a sequence of five activities: gathering, organizing, selecting, synthesizing, and distributing information. Just as a company takes raw material and refines it into something useful…a manager today collects raw information and adds value through these steps.”

The infrastructure of an organization depends on how people and processes work together, and how information is shared between those individuals, processes, and departments—ultimately the entire enterprise. Recognizing that there is a process flow related to how tasks are completed and information is shared, and that each process is different, there are some core aspects to consider when defining the administrative framework.

People
The first aspect of the administrative framework addresses the people that are involved in the process. How easy is the process to manage? Is the information supplied by the previous person about the task-at-hand adequate enough to move the process forward? Is the output from the previous person in the process adequate enough to enable the next person to complete their task?

Process
The second aspect of the administrative framework relates to governance issues, which is where authority and risk are delegated. Process includes checks and balances, levels of automation, and business rules.

Information
Information completes this trilogy. Do people have to research additional information to complete their step in the process? Are they re-entering information? Do they have access to the most accurate or current version of the information?

All three of these components are critical: people, process, and information. For example, consider the complexity of executing a process where engineers, finance, purchasing, and legal all work together on a daily basis to solve business problems vital to the operation of the organization; each player with different information needs, procedures, and processes to follow. Situations like this occur when starting new projects, dealing with contracts, application for expenditure (AFE), or management of change in Occupational Health and Safety Administration (OHSA) regulated businesses. There is no question that companies are effective in solving these problems, but are they efficient?

People, process, and information are the conduit through which a business interacts, from one end of the value chain to the other. Apply too much control and operational demise occurs. Retain silos of information and you’ll isolate functional steps that force information replication, opening the door to data that is rife with mistakes.

Next time I’ll discuss the importance of a good enterprise content management system to tie it all together.

Do More With Less: Three Sure-Fire Strategies for Manufacturers – Fixed Assets

2009-05-08T11:48:00.000-07:00

Yesterday I talked a bit about the project I’m working on that will help manufacturing orgs “do more with less”. I outlined three specific areas where I believe organizations can direct their attention to realize cost savings and improved operating margins.

Today I’m going to talk about Fixed Assets.

Within manufacturing organizations, it’s a struggle to continually monitor the location, condition, and status of tangible infrastructure items, like physical property and equipment assets, used in the manufacturing process. In complex facilities, the volume of fixed assets number in the thousands, and each item requires proper tracking and maintenance. Often, the lack of information about fixed assets causes considerable problems that compound over time, bringing about unplanned down-time and unexpected costs. Asset management is often regarded as the responsibility of the maintenance department, but the responsibility extends well beyond maintenance to safety, environmental, and facility management functions. Consider, for a moment, the information required about a fixed asset to effectively operate a piece of equipment. The following list details the information required for every asset:

Equipment data sheet
Asset Hierarchy Master or Register
Fixed Asset Tag number
Maintenance information and records
Reliability information
Maintenance activity lists or job routines
Consolidated Bills of Material
Standard Operating Procedures (SOP)’s and safety procedures
Training manuals
Update drawings
Management of Change (MOC)

With the continued pressure to run facilities more effectively—with fewer safety related incidents, operational failures, and resources—companies are feeling challenged by the expectations of increasing production turns and higher quality products. Asset Information Management (AIM) has become a strategic tool for asset-intensive organizations. AIM improves decision-making capabilities related to operational planning (production and maintenance) and execution. Organizations that have adopted an AIM strategy are also able to gain competitive advantage when it comes to addressing efficiencies and without it, the ability to manage change, deal with emergencies, or make informed decisions is significantly diminished.

Yet many disconnections still exist between the various pieces of a fixed asset’s information. Quite often, this information is siloed in multiple, unrelated systems, causing duplication, errors, and omissions; costly mistakes that frequently go unnoticed.

Consider the following as an example. Asset information is maintained solely by Purchasing and Maintenance, but every department relies on their own version of the information. When Purchasing makes a decision about buying spare parts it is entirely possible that they will continue to purchase components for a previously decommissioned asset. This seemingly inconceivable problem is a very real issue that becomes costly when repeated over a number of assets and for an extended time.

Operational Readiness
The road to operational readiness is complex. The importance of building a solid AIM strategy upfront can’t be understated. Leveraging AIM as a foundational element of this strategy will help ensure effective operation of the facility and will minimize overall lifecycle costs. It is critical to set expectations for standards, structure, and workflow upfront to gain buy-in from engineering, design, and construction groups. It is also imperative to lay out expectations about the type of data to be collected, and when and how it will be passed off, to ensure that engineering, safety, and maintenance specifications are met. This information provides the critical insight and intelligence needed to establish operational readiness on the shop floor.

Adopting AIM is a collaborative process that requires individuals and groups to freely share the tools and information that are used to complete tasks and achieve departmental goals. Asset Management personnel need the flexibility to conduct routines that ensure equipment is optimized, maintained, and operationally effective. When the inherent value of equipment is maintained, and access to information about those assets permitted, disparate data is amalgamated across the enterprise. Predictive maintenance programs, the capture of critical information on an ongoing basis, and the establishment of best practices become achievable tasks. But in order to make this happen, information traditionally kept in a maintenance system should connect to the organization’s Enterprise Content Management (ECM) system by utilizing individual assets as common bonds. Consequently, when anyone needs to find the information required to maintain an asset, or to make a decision about that asset, all the information is centrally available and highly accurate.

Manufacturing organizations can deduce tremendous value and cost savings when optimizing asset information from multiple sources in one, central repository. A solid asset management strategy can lead to organizational gain in terms of reduced operational risk, reduced financial risk, increased workforce productivity, ease and speed of access to critical, decision-making information, decreased wrench time, and decreased equipment downtime. Therefore, an effective asset management strategy enables an organization to manage and function collaboratively in an efficient and intelligent manner.

Next week, I’ll discuss the second part to this which is dealing with the administrative framework.

Do More With Less: Three Sure-Fire Strategies for Manufacturers

2009-05-07T12:04:00.000-07:00

Yesterday I told you that I was working on a project that will help manufacturers “do more with less”. I wrote about this in a whitepaper and more recently an article (to be featured soon) but I thought I’d give you a taste of both of these over the next few posts. You can also listen to a podcast I recorded recently where I delve into the topic a bit more.

The gist is that many industries are feeling the effects of our current economic situation, but few as strongly as manufacturing. With market uncertainty, heightened global competition, increasingly stringent environmental regulations, and customer demand for higher quality products at a lower cost, manufacturers are facing a daunting challenge when it comes to maintaining margins and profitability.

Although business models, methods of operation, and products produced by process and discrete manufacturing companies vary, there are several common challenges for organizations of all sizes and locations:

Manufacturers are highly dependent on fixed assets to produce their products.
Organizations are heavily impacted by fluctuations in raw material costs.
All companies are under significant pressure to lower costs wherever possible, especially with a downturn in the market.

Finding opportunities for savings—where fixed assets and raw material costs are a constant—is difficult. To survive, it is critical for manufacturers to understand how to do more with less while remaining both effective and efficient.

The manufacturing sector’s senior management uses many levers to control and direct company goals, both short and long term. Management will guide the strategic path of the organization by focusing on initiatives that improve cycle times; increase organizational agility; innovate in process or product; enhance quality; control costs; examine potential effectiveness of planned projects; or implement and enforce compliance to standards. On the path to achieving these short and long term goals, there are some core business fundamentals that must not be overlooked.

The task of guiding an organization’s future will become significantly more complicated with the economic stresses we are presently experiencing. Companies that manage day-to-day operations in a reactionary way, without concern for undermining efficiency, will be at a serious disadvantage. And companies that are continuously “putting out fires,” as a cultural norm, are unready for the serious challenges that this competitive landscape yields. All in all, companies will no longer be able to abuse speed and resources to operate in a reactionary manner. On the other hand, companies that build strategies that focus on leveraging operational efficiency and effectiveness will move to the forefront where they will be better positioned to compete globally.

But where is the untapped opportunity for efficiency and effectiveness? There are three specific areas where I believe organizations can direct their attention to realize cost savings and improved operating margins:

Fixed Assets, with emphasis on asset knowledge and the complete asset lifecycle.
Administrative Framework, an often overlooked and undernourished aspect of the manufacturing business. The Administrative Framework underpins almost every function within the business, and it is around the Administrative Framework that the value chain of an organization carries out day-to-day decision making.
Enterprise Content Management (ECM) and how it impels information visibility across the enterprise.

These three areas of focus form the backbone of an organization’s ability to make day-to-day business decisions that directly impact the variable costs and overhead of an enterprise. I’ll dive into fixed assets tomorrow.

Welcome to Hugh on Energy and Manufacturing!

2009-05-06T13:25:00.000-07:00

I’m Hugh and I thought I’d jump onto the bandwagon to start my own blog… so without further ado welcome to Hugh on Energy and Manufacturing!

First off, some discretion: I’m an industry manager at Open Text, but the issues and topics I discuss here in this blog do not reflect or represent the thoughts or feelings of the company in any way.

I’m pretty eager to be writing this blog, mostly because I have hundreds of thoughts running through my head at any given time and this blog will serve as a great forum for spewing them out to anyone who cares to read them.

In this blog you’ll get a little bit of everything when it comes to discussing topics and issues on the Energy and Manufacturing industry: I’ll be writing about general issues of interest primarily focused on areas of research that I bump into. I'll touch on real world business problems that customers are dealing with that can be solved with sometimes unconventional solutions. I’ll also cover new regulations that are coming out. Who knows, you might even find a post or two about sailing thrown in for good measure since it’s what I like to do most in the (too short Canadian) summer months.

Tomorrow I’ll be featuring a new campaign I’m working on that will help manufactures ‘do more with less’ because everyone knows that we all need help in that arena during these tough times.

Stay tuned!

-Hugh