Presentation Transcript

1. Chemical Industry Overview- A Look into the Future - A Roadmap for Cyber-Security

   Session Name: Chemicals Industry Forum Session ID #: INCH Donald Clark 11/9/11 Invensys proprietary & confidential
2. Agenda for Session Divided into two major sections: A look at the chemical industry: trends, drivers, pressures, the future Don Clark, Invensys Operations Management Roadmap for cyber-security for the chemical industry Mark Heard, Eastman Chemicals Terry Deo, Infineum Chemicals Operational Excellence Level 3 (Multi-plant/Multi-site) Environment And Safety People Level 2 (Plant Floor/Area) Asset Level 1 (Resource/Asset) Control
3. The Chemical IndustryAgenda Economics 101A The big picture of the industry Value of manufacturing operations Operations management Today’s operational challenges faced by the chemical industry Shrinking decision time constants What keeps plant managers up at night? Nexus of technologies for operational excellence It’s all about applications…working together Cyber security Driving operational excellence through automating the business control loop The business of Operations: what it means The future… Operational Excellence Level 3 (Multi-plant/Multi-site) Environment And Safety People Level 2 (Plant Floor/Area) Asset Level 1 (Resource/Asset) Control
4. R Goal: Maximize ratio Product Prices (absolute money) C Out of Business Production Costs (absolute money) It’s All Basic Economics 101A … Profit = Revenues - Costs Dollars Time – last half century
5. Challenges to the Chemical Industry’s Profit Performance Industry Drivers Global Competition Market volatility: Weather “War and rumors of war” Security issues, worldwide “Squeezed” between pressures: Raw material prices Operating expenses Competitive price-cuts Regulatory compliance Need to improve EBITDA through better utilization of existing asset Loss of brand or regional edge New, low-cost capacity Cyclical business Graying out of workforce Must grab the opportunities when they occur!
6. Strategic I/T Objectives/Common Themes Enhance the value of ERP investment Integration with supply chain optimization and execution Integration between manufacturing systems and ERP Operational excellence & accountability Visibility of performance of manufacturing assets/KPIs Business scorecards / operational cockpit Advanced control & real-time optimization Improved asset reliability Support for corporate Six Sigma initiatives Reduce manufacturing costs Improve asset reliability Improved people and asset productivity Selective investments being made in the MES space More frequent yield accounting Improved regulatory compliance
7. What to Make How to Make it How to Make it Profitably What to Make How to Make It How to Maximize Profits Product Chemistry R&D excellence Process Equipment Cost Management Optimized Operations Control Profit/Margin Management The Big Picture in Chemical Operations… Evolution of Chemical Industry Business Drivers… Driving or Major Issue/ in the Chemical Industries 1950 1975 2012
8. Enterprise Operations Integration Value Add In Chemical Manufacturing Asset Base Capital Deployed Labor Material/inventory Energy Intellectual Knowledge Information Value-Add $ Material Value EBIT ERP System Inbound Logistics Outbound Logistics Order Fulfillment Purchasing Manufacturing Outside of R&D, manufacturing is the only segment of a chemical company's supply chain where value is added. Manufacturing is the largest financial lever under a chemical company's control.
9. A New Perspective on Operations… In the “good old days” Situation Today… Time (“is money”) constant of plant decision making… …was shorter than the time constant of external events Our customers could survive…and even thrive Time constant of external events is shorter… …than the time constant of plant decision making How can they survive?...they might even die
10. What Keeps a Plant Manager Up at Night? Controlling Fixed and Variable Costs: Under-utilized assets presents a huge potential (the “hidden” plant) High inventory levels result of (i) lack of visibility and (ii) control resulting in under / over production Costs Quality Compliance Maintaining Product Quality and Consistency: Variations in raw material and equipment can dramatically impact overall product quality Variation in sticking to operating guidelines and procedures Regulatory Compliance: Reduction in up front and lifecycle validation costs Avoidance of fines and recalls
11. Years/Months Profit Loss Business Variables Handled by a Patchwork of Approaches TIME Quality Cost Operations Variables Up-Time % On-Spec Deliveries Reliability Yield Process Variables Pressure Temperature Flow Volume Torque Seconds Today Operations Decisions Are Handled Using a Patchwork of Approaches Vendorpoint solutions Excel spreadsheet solutions Handled byERP Systems (1990s) Corporate/Enterprise Systems Some SAP solutions Transactions-based Data base Highly deterministic Spanning: MES/MOM LIMS DCS MMS SCM Modeling, simulation, design Manual Methods Customers Suppliers Savvy in both domains Plant Control/Automation Systems Handled byDCS/PLC systems (1980s) Niche providers Home grown IT solutions Legacy IT solutions Real time-based Data flood Highly non-deterministic
12. Years/Months Profit Loss Business Variables Handled by a Patchwork of Approaches TIME Quality Cost Operations Variables Up-Time % On-Spec Deliveries Reliability Yield Process Variables Pressure Temperature Flow Volume Torque Seconds Production Operations Management Handled byERP Systems (1990s) Corporate/Enterprise Systems Production Operations Management (2000s) Customers Suppliers Design…Operate…Optimize Plant Control/Automation Systems Handled byDCS/PLC systems (1980s)
13. True Ops Mgt Means to be “Savvy in Both Domains…” Now, there’s the rub… A nexus is occurring that will accelerate the growth of this space: Technology evolution:main frames ► dist. computing ► central db ► C/S ► Internet (cached pub/sub) Commercial off-the-shelf technology (COTS): more and more services – business processes – available to allow apps developers to focus on application, not infrastructure Hardware Operating Systems/base infrastructure Ubiquitous high-speed networks Standards being developed across the this space to allow for greater interoperability/lower costs Wireless “wired” communities of interest ► mobility Increased attention on security across the entire spectrum Keys for process operations: Modular Integration A “software system” of modular operations functions… …Tailored to the industry need
14. ?? Cost/point I/O count/ratio/prop:state ?? I/O Paradox… Ever-escalating demand for: Higher I/O count Higher I/O ratio Higher property:state sensing Applications driven Installed cost must come down to flatten project costs Technology breakthroughs needed: Wireless to save the day: Field measurement and control Mobile worker fully enabled Whole new approaches to device and asset management and maintenance 1975 Time 2011
15. SystemSecurity SystemCapability ?? 1975 Time 20011 Security Paradox… Migration Patch management Revision levels firmware, hardware, software Velocity differences of COTS and ASV in developments COTS oblivious to absolute demands of process operating environment of real time, robustness/reliability/dual operating environments Built-in pervasive protections are missing in COTS Stakes are high: lives in the balance Standards emerging to tackle growing cross-purposes The IT trend over the last 20 years to “open” and COTS – all the advantages – but begins to introduce problems.
16. Internet XML Java Portals Hardware Performance Capacity Emerging Industrial Standards Operating Systems Increased services (SOA) Work flows Scorecarding Collaboration Delivers:Enterprise PerformanceExcellence Focus on product being made Shorter time constants: Better, real time decisions Whole new operating methods Human behavior OpEx Faster time-to-profit Heightened Security Dependence on: Person Location Time of day Asset Performance Optimization Visualization Ubiquitous Large surfaces 3- & 4-d representations Virtual placements Chemical process operations state-of-the-art Networks Ever higher speeds Ubiquitous Collapse of telephony Video Computing Voice input/output Sensors Dramatically lower costs Self identifying Property sensing Greatly increased I:O Wireless Freedom of movement Location independence ...And Enabled by this Nexus of Technologies… Operational Excellence Level 3 (Multi-plant/Multi-site) Environment And Safety People Level 2 (Plant Floor/Area) Asset Level 1 (Resource/Asset) Control
17. Implications Low-cost measurements will facilitate unprecedented growth in applications Disparate applications will leverage common infrastructure Previously infeasible applications will be implemented An application integration and management environment will be essential Decision support systems will become essential Cross-disciplinary collaboration will grow Use of remote expertise will compensate for local loss of key talent Plant operations may decentralize New human interface metaphors will emerge Data mining tools will improve access to all forms of data
18. Enterprise Business Systems (ERP, Customer Relationship Management) Automate Transactions Enterprise S-95 Model for MES Manufacturing Network Work Requirements Work Responses Work Definition Management ProductAnalysis (QA) Work Scheduling ProcessAnalysis Resource Management Work Tracking Automate Events Historical Data Management Work Dispatching Work Execution ProductionAnalysis Personnel, Equipment, Materials Plant Process Equipment Automate Equipment Process Control Systems (Continuous, Batch, Discrete, SCADA) Sensing and instrumentation The Next Opportunity is Between the Control Room and the Board Room Integrated Manufacturing Operations Operational Excellence
19. Automating the Business Control Loop Business Control Loop S 5 9 Enterprise / Supply Chain Optimization Performance Measures Set a rate Push a button Make the rate KPIs Forecasts EPS Calculator Earnings per Share Actual Executive Level Δ = Variance Gross Profit Calculator Gross Profit Asset Optimization Forecasts Actual Business Management Level Δ = Variance Throughput (Fixed Cost Contribution to Mfg. Cost) Energy Cost Contribution To Mfg. Cost Raw Mat’l Cost Contribution To Mfg. Cost Process Optimization SP PV PV PV SP SP Plant Management Level Δ = Deviation Δ = Deviation Regulatory & Advanced Process Control Column 301-D Reboiler Outlet Temp. Process Management Level PV SP Δ = Deviation
20. Cost and Quality Individualized, unique Product-Business Adapts unique needs to generic solutions PV’s SP’s Process The Manufacturing Challenge… OperationsManagement METHODOLOGY:Brief periods of thinking interrupted by long periods of data gathering and analysis Arcane “connections”:no “intuitive” relationship Between PV’s, SP’s, OP’s and the business variables of the product being made
21. S95-based IndustrySolutions Product-Business Frees the user to use his own comfort level product-based paradigms without having to conform or adapt them to the process paradigms Process The Role Standards Play… METHODOLOGY:Brief periods of data gathering and analysis interrupted by long periods of thinking OperationsManagement Views the process in the context of the business variables
22. Consider… Improving the ability to ask questions that elicit new knowledge: How many batches of 579-S have had fermentation times greater than 22 hours? Of those, how many had RM 2911-3 from vendor X? What do other plant's records show? Which batches used DI-2 water made between May 1 and 5? What was different about our DI-2 between those dates? What was CIP solvent lot used between lots 4413 and 4414? Walking through the plant from anywhere in the world
23. A Natural Progression: Visualization of Operations... MaintenanceShow me equipment with work orders that are due next week in RED InspectionShow me assets with highest corrosion rates EngineeringObtain accurate measurements and produce Isometric sketches OperationShow me steam system current temperature / pressure. EnvironmentalShow me the valves with the highest fugitive emissions. Financial Alert:“You are currently operating at a unit cost of $3.13/#, $0.2154/#over fcst, or 7.3%over plan. This because of increased waste levels (3.34 vs. 3.03), due to melt point shift, which is due to high cooling water temperature in reactor U255”
24. Provides to the Business of Operations The What– business variances right now The right information, to the right people, at the right time, in the right context The Why – root cause connections to variances Control/automate the routine Look forward/set most profitable pathway Provides a new way of doing business: Allows operations to make decisions based on profitability, not expediency Identify future profitability opportunities Faster time to profits Shrinks the “time constant” of operations
25. Strategic, Operational Focused Business Measurements
26. In the Future…Project Execution Project execution risk will be mitigated through a strict adherence and usage of standards-based best practice templates Automated workflows will eliminate execution work by 80% by today’s standard Acceptance testing will be automated and virtual Execution time will be drastically reduced
27. In the Future…Talent Availability Experienced knowledge workers in unique disciplines will be a rare resource and will be globally distributed Few people want to live where the new energy discoveries are made People don’t want to work in hazardous environments Bring the problem to the expert, not the expert to the problem
28. In the Future… Human Factors Humans will be physically separated from operations requiring new methods for human interaction Humans will interact with plant operations virtually New paradigms for visualizing complex data patterns will be prevalent Everything will be delivered through a universal interface
29. In the Future… Business Intelligence All facets of business intelligence around specific industries will provide decision makers experience based and model based guidance in real time, beyond a humans ability to process today Automated workflow will eliminate manual data processing and information reconciliation A decision maker will monitor market demand in real time,anticipate and react in real time
30. In the Future…How Information Flows in a Plant Digital sensors and more intelligence in the field will yield more information. Information will be critical, diagnostic or performancebased in nature A hybrid of media types will be used including wireless AND wired Fieldbus technology will consolidate, however a large legacy of multiple buses will remain Universal gateways for all bus technologies will be peer devices to traditional controls
31. In the Future… How Information is Treated Users can adaptively change access to information including who can execute control actions in an operating plant. Users can determine access levels based on, role, plant condition, time and location Seamless flow of information between plant and enterprise Common standards and platforms built around Service Oriented Architectures, focused on information not data Information pushed to the decision maker instead of decision makers hunting, selecting and analyzing
32. The Future… …it’s so bright, you’ll have to wear shades