Faced with an aging technical workforce battered by persistent staff reductions and an installed base of old equipment suffering from years of investment negligence, manufacturers will increasingly turn to a new breed of plant asset management (PAM) systems to proactively monitor production processes and prevent costly and unplanned factory shut downs, according to a study released yesterday by ARC Advisory Group.
Moreover, the double whammy of operational cost controls and requirements for continuous productivity improvements will fuel demand for PAM systems, primarily among process manufacturers. In fact, the worldwide PAM market is expected to grow at a compound annual growth rate approaching 10%, from $1.1 billion this year to over $1.8 billion by 2009, the Dedham, MA, research company predicts.
The study, "Plant Asset Management Systems Worldwide Outlook Study", revealed exploding demand for a broader set of solutions that monitor automation as well as production assets. It is this new breed of solution that will enable manufacturers to elevate their manufacturing intelligence to predict asset health, optimize maintenance and plant operations, increase production availability, and enable a predictive maintenance and operations strategy, noted Wil Chin, the ARC research director who authored the report.
For manufacturers struggling to replace retiring baby boomers on the factory floor, for instance, PAM systems can help increase plant-floor productivity by automating the data collection and analytical processes required to maintain and extend uptime and alert less skilled personnel of impending manufacturing glitches or outages. "Unexpected outages usually happen at the most inopportune time -- when you need to have 110% of capacity to fill an order," Chin said, in an interview. "Unplanned shutdowns can cause consequential damage to product in pipelines and vessels," he continued, which adds to product costs, since unfinished goods need to be disposed of, and leads to product delays, since production lines need to be restarted, which takes time.
Previous PAM solutions were designed to monitor automation assets or rotating and reciprocating equipment, commonly referred to as condition monitoring, Chin said. Today's PAM systems combine information from intelligent field devices, sensors, and process information that, if used properly, can help plant floor managers proactively identify problems and assess the health and performance of any asset, regardless of type.
New approaches to PAM are being deployed in new and old plants worldwide, particularly in heavy process industries, such as the oil & gas and chemical industries, Chin noted. With the steady retirement of baby boomers, some oil & gas companies Chin studied have gone from having 80 plant floor technicians to only three today. "The only solution is having the ability to aggregate ... and capture information to provide best practices for new people coming in."
Some oil & gas companies, he noted, are adopting wireless networks to extract intelligence from siloed systems. "Using wireless solutions means they do not have to break into the pipe or need to put in new instruments," Chin said. "They just have to create a conduit to pull information into [an asset management] package."
Other industries are now recognizing the benefits afforded by PAM systems, Chin pointed out. For instance, the pulp and paper industry remains a green field that could benefit from PAM systems adoption. Yet, a host of other issues (e.g., the rising cost of paper, oversupply and industry turmoil within industry) have prevented them from doing so, until recently. One driver: A new generation of workers not schooled in the pulp and paper field -- or working in new consolidated plants -- has created a wide knowledge gap, one that PAM systems could help overcome.
"There's big interest now as they realize that, for a small investment (less than $10,000), these solutions have the potential to deliver large gains," Chin said, particularly if they can prevent damage to business-critical, multi-hundred thousand dollar pieces of equipment.