Three concurrent trends — converged voice and data capabilities, wireless communications, and network-enabled machinery — are changing the basic infrastructure and interactions of people and manufacturing machinery.
While you may think it would be daunting to tackle just one of these opportunities and challenges, experts say manufacturers can tackle all three at once.
Statistics show that manufacturers are moving forward on all fronts. Research from ARC Advisory Group shows that interest in network-enabled machinery is surging. Total shipments of industrial Ethernet nodes will increase from 840,000 nodes in 2004 to 6.7 million nodes by 2009, the research firm predicts. And with wireless networking capabilities now built into most laptops and some smart phones, demand for remote access to production and operations data is surging as well.
The same applies to IP telephony trends, which include the much-talked-about voice over IP, or VoIP. According to Forrester Research's most recent survey, 45% of enterprises either have deployed or are deploying IP telephony, with another 30% evaluating or piloting the technology. Among all respondents, around half planned to increase their IP telephony spending in 2006.
Arguably, the benefits of so-called converged IP networks (which accommodate voice, data, and wireless communications) apply across many industries. Nonetheless, there are specific potential benefits for the manufacturing industry. Though it is still nascent there, the what, why, and how of converged IP networks reveal a future of increased efficiency and productivity for the globally focused manufacturer.
Converging Benefits
So what are the manufacturing benefits of deploying IP-based telephony, whether wired or wireless? In the latter case, a factory where wiring may be difficult or dangerous to string can utilize wireless capabilities and place equipment wherever it is needed. The only caveat, notes Harry Forbes, senior analyst at ARC Advisory Group, is that manufacturers must be disciplined enough to ensure that network equipment and wireless equipment aren't using the same part of the radio spectrum.
On the wired side, the benefits are even more tangible. Many companies use their IP-based telephone systems — VoIP — for what's known as "toll bypass," transmitting voice communications over an Internet-based network and thus avoiding toll charges for long-distance calls.
"When you're calling state to state, toll bypass isn't that big a deal," says Mark Gregory, a senior consultant for INS, an IT infrastructure consulting firm that recently completed an IP telephony design review for a plant in Costa Rica. "But in foreign countries like China, where toll rates can be 40 cents a minute, you're going to see big cost savings."
Additionally, if a single IP-based network is used for both voice and data traffic, that's one less network the IT department has to manage, which translates into savings on staff resources, time, and monitoring equipment. Ethernet-ready machinery connected to the same network means even more consolidated monitoring capabilities. Gregory estimates the payback period for installing an IP-based network at less than two years.
But all the aforementioned issues relate solely to a company's infrastructure. Also newly available are applications designed for a consolidated IP network that improve both collaboration and productivity. Generally known as unified messaging or unified communications, these applications take advantage of the fact that communications that used to run on separate networks now run on the same one.
For instance, because of this consolidated network, employees can now receive voicemail, e-mail, and faxes in the same electronic in-box. That means they no longer need to check three different places for communications. And because messages appear on a screen, the way e-mail does now, employees can see and access urgent voicemail messages without having to listen to them sequentially, the way they do now.
Other aspects of an IP-based telephone system can boost efficiency in manufacturing, too. For instance, there are now time-clock-based applications that run over IP-based telephones. Workers can clock in via the telephone when they get to their workstations, which provides a more accurate representation of when they're actually working, since the time it takes them to walk from a central time clock across the factory floor isn't registered.
A more precise accounting of working hours is not the primary benefit of this technology, however. Instead, the real gain comes from a more accurate understanding of the location of maintenance staff.
"Getting visibility into who's working in the process plant or on the factory floor, wherever they may be doing maintenance, will be very important," says Forbes of ARC. Anyone who's spent an hour trying to find a technician, with a downed machine costing thousands of dollars per minute, can understand the return on investment of such a system.
Another IP-based system with its own intrinsic payback: the medical first-responders that Forbes says many factories now have. IP-based systems can pinpoint the location of any injured parties and responders and bring them together quickly.
Even when there isn't an emergency, it's easier to find people with an IP-based network. On a traditional system, a user looking to program call forwarding needs to be at his or her primary phone. On an IP-based network, however, all the phones are simply devices plugged into that network, and users can forward their extension to any other extension from anywhere they might be. This means that when an assembly line stops running, a machine stops working, or a medical emergency occurs, employees can reach repair personnel and medical staff as well as supervisors no matter where they might be on the premises.
It's also an advantage for global firms. Tony Salerno is director of information systems at Wescast Industries Inc., a Brantford, Ontario, manufacturer of exhaust manifolds and turbocharger housings for the auto industry, with offices in Canada, Hungary, and Germany. The company has all of its Ontario facilities on the same phone network, which means that everyone is accessible through a four-digit telephone extension. "Your extension follows you around the globe. It gives people the ability to find you even when they don't know where you are," says Salerno, noting that when he travels to the office in Hungary, his kids can still dial his extension in Brantford to reach him.
Looking Ahead
Manufacturers such as Wescast acknowledge that they've only begun to scratch the surface of what IP-based networks can do for them. Indeed, many of the advantages of IP-based networking for manufacturers should be filed under "P" for potential.
Because IP-based networks support video along with voice and data, the following scenarios are likely in the near future:
- An employee who can play Web-based training videos on a laptop right next to a machine that must be fixed
- Video-based security systems that can relay images from networked (or wireless) cameras to a central location
- Trained personnel who can view and diagnose damaged equipment in areas that may not be safe to enter
Several features are now ready for deployment or in development. Among them: using a concept called presence, users can register themselves on the network and identify their accessibility — such as, "I'm in a meeting; only interrupt if it's an emergency". Imagine the boost in productivity if employees in a factory in South America could discern through the network that an expert in a certain piece of machinery was available for consultation, even though he or she might be having dinner in China at the time.
Consider, too, the possibility of being able to monitor Ethernet-connected equipment remotely. In the event of a problem, it wouldn't be necessary to send an expensive technician on a trip halfway around the world for diagnostics.
Collaborative product design also becomes easier when engineers can explain mechanical and physical concepts visually rather than just over a telephone connection.
Combined Challenges
This may all sound too good to be true. And the fact is, all these advantages do come with a price. Remember, installing an IP-based network means jettisoning the company's traditional telephone network and buying or upgrading data network equipment to accommodate the new capabilities. As a result, most firms wait until there's a so-called "trigger event" that inspires the shift — the addition of a new branch or a move to a new building, for instance. (IP-based networks in one location can integrate smoothly with traditional telephone networks in another, though some of the aforementioned communication capabilities may not be possible unless everyone has the same equipment.)
When Birmingham, AL-based O'Neal Steel, which distributes metals and other components, installed an IP-based VPN (virtual private network) from AT&T, it did so in response to two trigger events, according to technology manager Kenny McCrary. The change was necessary not only to take advantage of newer applications, but also because, in response to competitive pressures, the company had doubled in size through acquisition since 2004.
"If we acquired a company that had a good IT infrastructure in place, we left it intact," McCrary says. "But some business units didn't have a good infrastructure, so we needed to add them into ours."
IP-based networks are most popular among small and mid-size businesses, because they can upgrade to such capabilities when they expand or move to new facilities. In the manufacturing industry — where once a factory is built, it tends to remain for years — a trigger event is more likely to be the expiration of the lease on a company's PBX system, which manages traditional voice communications. Most manufacturers find that the cost of renewing PBX leases compares unfavorably with the cost of upgrading the network to IP capability when the other monitoring and application advantages are factored in.
Another aspect to consider when moving to a converged IP-based network: Voice traffic not only requires more bandwidth than data traffic, but employees are more likely to notice transmission delays — known as latency — in a voice conversation; no one notices if an e-mail arrives 30 seconds later than it could have. If it wants to avoid latency, a company thinking about adding voice capabilities to its data network must consider expanding bandwidth — probably by more than double. A stringent network analysis to determine how much traffic the network currently handles and to estimate what might come by adding voice (and video, if the firm is forward-thinking), is crucial. Quality-of-service parameters can be set up with the chosen telecommunications vendor to ensure reliability.
When dealing with wireless, it's also important to consider the issue of potential interference. Some wireless systems use unlicensed spectrum, which may contribute to degradation of signals. ARC's Forbes says that management of such systems simply requires discipline. "It has to be an enterprise-level decision because there may be a lot of different users," he says.
Finally, beyond technical issues, there may be obstacles related to bringing to the factory floor communications technologies that are typically overseen by the IT department. In some manufacturing firms, after all, IT doesn't get involved with machinery.
"Control engineers are still really wary of their IT departments, and that's a problem," says Scott Westlake, director of industry solutions marketing at Cisco Systems. "The control engineers understand the plant, and the IT department understands large-scale applications. The two sides have started to come together, but it's not happening quickly enough."
Of course, there are exceptions to that attitude. Wescast's Salerno notes that one of his company's goals in deploying its IP network was the ability to have it maintained by the IT department, "rather than by a phone guy walking in from the street with a toolbelt on."
Competitive Advantage
Though the leap forward to take advantage of multiple networking trends may initially sound daunting, the fact is that facing the pain now may mean greater gain later on.
"On the plant floor, budgets are getting squeezed," says Alan Stanfill, manager of the industrial data group at Applied Technologies, a unit of manufacturing consulting firm ATCI, Inc. "There are fewer people to do more work. Companies are looking at IP communications more and more. It lets you use fewer engineering staff and fewer maintenance staff to respond to problems," he says.
With globalization affecting manufacturing more than most industries, deploying networks and applications that make business as frictionless as possible makes sense. Wescast, for instance, has a number of IP phones deployed at its European facilities and will be expanding its IP network to China next year. "Our network is global now," says Jamie Shedden, a technical analyst at the company. "That makes it easier to transition into new countries without having to build a new network."
Thus, the ability to communicate and collaborate smoothly and easily, no matter where partners and suppliers may be, becomes a solid competitive advantage. As O'Neal Steel's McCrary says, "Our new network lets us react more quickly. We always want to be in a position where we're not taken by surprise. Although for a long time we put technology on the back burner, now we think it's better to be ahead of the curve."
Howard Baldwin is a Silicon Valley-based freelancer who writes frequently on both IP telephony and supply chain issues.