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Manufacturing Enters the Next Information Age

Show Me The Money: With cloud computing starting to generate a lot of noise, Mike Riley sifts through the buzz to explore what all of this really means to manufacturers.


Show Me The Money: Cloud computing is starting to generate a lot of noise, but what does all of this new buzz really mean to you as a manufacturer?

Technology continues to bless metalworkers with new sets of tools that are, over time, fundamentally shifting almost every aspect of their manufacturing operation. Information technology in particular is incrementally changing how we do things in virtually every metalworking process – a broad evolution of progress that is literally changing the requirements of how a job shop can be competitive.

In fact, information technology is now changing so many different fronts in metalworking that the industry is beginning to re-evaluate some of its core elements of success. Think about it. Long gone are the days when employees were hired “for their spine, not their mind.” Most plants no longer require legions of trainable or less-skilled employees who simply push buttons and follow a routine on the shop floor that seldom varies. Today job shops and contract manufacturers alike compete with fewer employees using more information technology to make crucial decisions more quickly.

The modern supply chain of metalworking processes that follows raw material to a finished unit involves a complex assortment of computers, logistics equipment, machine tools and robotics – all driven by information they consume; all generating more information to be consumed somewhere else. This has radically transformed the typical metalworking plant into nothing less than a communications network, often composed of disparate islands of information, that transmits information to and from thousands of sensors – all driven by information they consume; all generating more information to be consumed somewhere else.

Here lies the value paradox of information: So much of it to use, so little time and money to use it. How much more of a competitive advantage can a job shop achieve if they could manage all of this information and actually apply the knowledge they gain from it to improve their operations? A truly deep well of opportunity and profits lies waiting to be tapped.



In the past, job shops and contract manufacturers tried to tap into this well by spending large amounts of money for computers to create and process the information, networks to move it around, hardware to store it, and overhead staff to maintain it. But according to Art Coviello, the executive chairman of RSA, a division of EMC Corporation (Hopkinton, MA), all of that is changing. “We are now at a point where we spend 60 to 70 percent of information technology budgets just to maintain those systems and infrastructures,” he warns. “No wonder progress in applying IT is so slow. This is the information technology equivalent of every organization in the world, big or small, investing the capital and human resources to build and operate their own electricity producing power plants.”

He’s right. Job shops are tired of buying servers and then learning they are only used an average of 8 to 15 percent of the time. They are tired of all the patching, upgrading, virus attacks and other issues they must deal with in running their own data center. They no longer have the time, money, or patience to worry about these sorts of system administration headaches.

Stop for a moment and consider how much your company currently spends in its budget for the information technology portion of your business. If you could significantly reduce the 60 to 70 percent of that portion spent on systems maintenance, what would that do for your cash flow? Your bottom line?

That’s not all. “Picture a world where software platforms are available online and easily customizable to any metalworking operation,” proposes Coviello. “Picture a world where computing power is generated off-site, available in quantities when and where the job shop needs it. Picture a world where information is safely stored, efficiently managed and accessible, when and where the employees need it.”

He is describing the infrastructures for cloud computing, the door into the next information age that offers economies of scale, flexibility and efficiency to job shops and contract manufacturers that will not only save them money on capital expenses and maintenance costs, but will also free them up to apply and use information to raise their productivity as they never have before.

All of this sounds exciting, but what about all of those “islands of information” inside and outside the plant that do not communicate with each other? Is that a barrier?

Not according to Doug Woods, the president of AMT – The Association for Manufacturing Technology (McLean, VA) that is spearheading the partnership between MTConnect and cloud computing for information technology used in manufacturing. He explains how MTConnect “connects the islands” by serving as a transmission linkage that enables manufacturing equipment to communicate with each other through the Internet.

“All of this can be difficult to comprehend and easily misunderstood, so let’s start by providing definitions and context,” explains Woods. “MTConnect is an open and royalty-free protocol that enables manufacturing equipment to speak to the outside world using proven and ubiquitous Internet protocols. This protocol can take proprietary data from a machine tool and translate it into a common format for any piece of software to read from.” From a software perspective, this means you can speak to an MTConnect-enabled machine tool as if it were a website on the Internet. Just as you can go to for your sports news, you can also go to for specific information about what that machine tool is doing.

“At that point, a software application takes that data and turns it into meaningful information through a monitoring program, such as, for example, integrating that data into an ERP system,” continues Woods. “This approach then makes it simple to gather data from an MTConnect-enabled machine tool that is spitting out gigabytes of data per hour.” So MTConnect enables a shop to gather and transmit volumes of disparate information across the Internet directly to and from the machine tools on the floor that control the process signature.

Where does all of this information go and how is it managed? Enter cloud computing. “When all of these machine tools start releasing huge amounts of process data each hour, it will make absolute business and technological sense to manage this information in the cloud,” states Woods. “Buying a bunch of hardware to do this locally at the plant makes almost no sense today when you can rent data space from a server farm on an as-needed basis. Cloud computing is important because it allows job shops to avoid the endless list of business and technical issues associated with running their own data centers. They save money by only paying for the computing resources when they need it, on a ‘pay-as-you-go’ model.”

Let’s summarize how all of this works. Along with customizable software applications, there are essentially three other pillars of technology behind cloud computing. The first one is fast bandwidth. “Instead of moving data that is equivalent to a paragraph per second like we did during the dark days of dial-up, now we can now move an entire book per second with broadband,” smiles Woods. “With these huge communication pipes, the entire planet just got a whole lot smaller.”

The other two are your ubiquitous web browser and large server farms, where brick-and-mortar facilities house giant clusters of computer servers in locations usually unknown to users (hence the term cloud). These facilities sell the available time on their servers to users across the world to offset their huge cost in running those hundreds of thousands of computers.

With a fast pipe for data, server farms are literally just a mouse click away from your browser. Software providers with these three pillars in place can offer their customizable software apps on these large server farms as a “service.” You then simply point your browser at the software in the cloud and off you go, paying for what you use, when you use it.


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