CESMII KickOff - Launch of CESMII - Ray Collett - CESMII

Smart Manufacturing Institute
Kick-off Meeting
Ray Collett, CESMII, CEO
February 2017
Accelerating
Your Smart Manufacturing Transformation

WELCOME to the CESMII Kick-off
THANK YOU everyone for your support

CESMII
The Journey is Just Beginning
It Starts with Industry Collaboration
4/13/2017CESMII Kick-Off Presentation – Los Angeles, CA 3

Vision
• Making Smart Manufacturing (sensors, controls, modelling, simulation, and platforms) accessible to all levels of the
value chain for US manufacturers through collaborative demonstrations, partnerships, & commercialization.
• Providing open tools that accelerate business decision making to identify & uncover opportunities in a faster, more
effective, with a less costly approach then ever before.
• Creating a sustainable ecosystem that allows technology users, providers, and developers to collaborate, test quickly,
iterate, and deliver results at a faster pace with the best trained, certified workforce on the planet.

Setting the Bar High
US Dept of Energy Goals
• Double energy productivity in US manufacturing every 10 years
• Halve the cost of deploying SM systems relative to state of the art
in 5 years
• Increase the SM workforce in US multi-fold in 10 years
• Double the SM supply chain rate of increase in value and
participation
• Reduce U.S. energy use in 10 years while increasing manufacturing
competitiveness
April 13, 2017 5CESMII Kick-Off Presentation – Los Angeles, CA

Strengths of the Institute
Achieving our Goals
April 13, 2017CESMII Kick-Off Presentation – Los Angeles, CA 6
People Network Technology Testbeds
R&D
Future

Smart Manufacturing
Integrated Eco-System for SUCCESS
 User Community – Asset Owners
 Provider Network:
 Sensors
 Controls
 Platforms
 Modeling for Smart Manufacturing
 Organizational & Workforce Development
 Academic Partners: development & education
 US Department of Energy

Focused Efforts
Key Markets
Energy Intensive Markets
• Petroleum Refining
• Chemicals, Plastics, Rubber
• Wood Pulp and Paper
• Primary Metals
• Food Processing
• Glass and Cement
Energy Dependent Markets:
• Solar PV, Carbon Fiber Composites, Light Emitting Diodes, Electro-
Chromic Coatings & Corrosion resistant alloys, Advanced textiles for
fashion, Exotic materials for space, Nano materials for healthcare,
Membranes, Computers & Electronics, EV Batteries, Multi-material
joining, Other Industries that have a 25% or greater cost of energy as
part of the total cost of manufacturing

Identifying Value for your Enterprise
Outside-In Input from Industry
• Market investigation & feedback
• Interviews
• Site Visits
• Industry Events
• Business, Technology, Workforce Development
Road-Mapping Sessions
• Testbeds, Demonstrations

Assembled a World Class Team
CESMII Headquarters

Regional Manufacturing Centers
We followed the data
MidWest
COMING SOON

Regional Manufacturing Center
Power of your local to national network
• Deep business & academic relationships locally
• Key market and domain expertise
• Connect you to CESMII resources NATIONALLY
• Certified Local Training resources for your teams
• Manage Testbeds & Research programs
• Accelerate Membership to identify industry needs

IoT vs Big Data vs SMART Manufacturing
What’s the difference?
Data
Information
Knowledge
Wisdom: Secure, actionable &
implementable steps
IoT
Big
Data
Smart
Accomplished through
• Open Architecture – Multi-Vendor
Compatible
• Open Access – low cost & easy to use
• Open Market Place – composable software
libraries & data
• Open Market Place - Innovation
• Trusted Data Broker

Sustainability
Building for the Future
• Sustainability Workshop
• Expand on testbed successes to data
• Road Mapping with industry input/participation
• Expand the institute & platform offering
• Tiered Membership to:
• Engage Companies at multiple levels of scale
• Stimulate smart manufacturing investment
• Shared participation/results/IP for participating members
• Educational development to benefit all
• Engaging with other organizations to accelerate the pace

https://twitter.com/SMCoalition
Facebook.com/SMLeadershipCoalition
http://www.linkedin.com /groups
/Smart-Manufacturing-Leadership-
Coalition
THANK YOU & QUESTIONS
Ray Collett
CEO
CESMII
Ray.collett@cesmii.org
419-707-1616
Accelerating

CESMII Overview & Working Discussion
Kick-off Meeting
Ray Collett, CESMII, CEO
Mike Rinker, VP Outreach
Peggy Hewitt, VP Membership
February 2017
Accelerating

Key Topics
Working Session
 Manufacturing USA Institutes
 Value of CESMII
 R&D Tax Credits
 Regional Manufacturing Centers and Resources
 Workforce Development
 Communications
 Smart Manufacturing Commercialization Planning
 Sustainability
 Membership
April 13, 2017CESMII Overview & Working Discussion Presentation – Los Angeles, CA 17

Manufacturing USA
US Department of Energy
Institute Sponsorship Background

Manufacturing USA
Why Technology Institutes ??
Source: https://www2.deloitte.com/content/dam/Deloitte/us/Documents/manufacturing/us-mfg-manufacturing-USA-program-and-process.pdf

Manufacturing USA
Consortium Style Institutes: 14 to date
• Advanced Tissue Biofabrication – NH
• Advanced Functional Fabrics of America – MA
• AIM Photonics – NY
• Additive Manufacturing – OH
• Advanced Robotics – PA
• Digital Mfg & Design – IL
• Advanced Composites – TN
Source: https://www2.deloitte.com/content/dam/Deloitte/us/Documents/manufacturing/us-mfg-manufacturing-USA-program-and-process.pdf
• Lightweight Materials – MI
• Flexible Hybrid Electronics - CA
• BioPharmiceutals – DE
• Semiconductors – NC
• Process Intesification – NY
• REMADE Sustainable Manufacturing & Re-Use - NY
• SMART Manufacturing - CA

Working with US & Global Companies
US Manufacturing Plan Requirements
• Focus is to Reduce Energy consumption, promoting competitiveness and innovation in
U.S. manufacturing
• Target industries are energy intensive/dependent companies
• First of a kind industry Testbed projects will be installed in U.S. based facilities
• Membership is expected to be with U.S. & multi-nationals with facilities in & out of US
Waiver’s Required from Institute & US Department of Energy:
• If multi-national organizations request to integrate SM at facilities O-US
• If products/technologies embodying Institute IP requested to be
implemented/manufactured O-US

Why CESMII ?
VALUE for YOUR Organization

Why CESMII?
Trusted 3rd Party
• A trusted data broker, yet we DO NOT want to own data
• Understand the process and problem first, develop solution options first, then implement
• Pursuing/Uncovering opportunities faster, more effective less costly approaches to your business
problems
• Maximize value:
• Extend existing asset value through real-time sensing, controls, platform and modeling
• Open Architecture & Innovative Marketplace for multi-vendor compatibility
• Reduce incremental investments:
• Solution acquisition vs on-demand
• Test new collaboration & business models using a dev/ops approach
• Access to skills/tools you cannot afford to have full time
• Accelerate implementation through shared learning
April 13, 2017 23CESMII Overview & Working Discussion Presentation – Los Angeles, CA

Validation of New Models & Capabilities
Business Acceleration though Industrial & RD&D Testbeds
• First Ever, Broad Scale Real World Demonstration Programs with US Manufacturing
Companies
• Merging IT with OT problem solving: Test fast, Fail/Succeed Fast, Iterate
• Addressing industry pull with new approaches to integrated advanced technology
solutions enabled by new sensor, control and SM Platform and Market Place

Value Proposition Development
There are commonalities but no standard
• This is the VALUE of the Local RMC Network working closely
with companies of all sizes
• Collaborate to develop a deep understanding of your Value
Chain elements / partners / processes
• Understand the current problems you have OR want solve
• Share our technology RoadMap, Platform, and partner offerings
• Share / Collaborate on example business models and challenges
to stimulate thought and develop ideas
• Refine together, Propose options, Test options
https://strategyzer.com/books/value-proposition-design

What else? Collaborative Benefits
Power of the CESMII Network
• Thought development circles: Vision, Exposure, Pull the Blinders off
for what good looks like perspective
• Shared knowledge & skills learning
• Exposure to challenges at other organizations
• Make manufacturing “cool again” by engaging students earlier to
testbeds, training, & skills
• Break the Paradigm of doing things the same way
• Certification of skills & resources; Workforce training at all levels for
successful talent acquisition
• Example: We want to participate, but we are not at the same
maturity level? Can we participate? How do we participate? Do we
have to fund a testbed equally?
April 13, 2017Edit in view > header and footer 26

Tax Credits
Scott Schmidt, Monetek LLC
Supporting Small & Medium Companies

Energize Your Bottom Line With
The R&D Tax Credit
Scott Schmidt
612-559-3388
scott@monetek.com
www.monetek.com

What is the R&D Tax Credit?
The R&D Tax Credit is a federal and state tax incentive designed to help companies
that invest in innovation or use some form of technology, such as engineering, to
develop their products, services or manufacturing skills.
Companies do not need patents or even an R&D department to qualify. In fact,
recent IRS legislation means even more companies can benefi t. T
The R&D Tax Credit | February 22,
©2017 | Monetek | Slide

Qualifying Activities
Develop new, improved or more reliable products,
processes, or formulas
Develop prototypes or pilot models
Develop new technology
Develop patentable technology
Develop or improve manufacturing processes
Experiment with new materials
• Develop new architecture, algorithms, and
programming code for software
• Develop firmware
• Design tools, jigs, molds, and dies
• Test new product designs
• Conduct testing of new concepts and
technology
• Automate / streamline production

You Are Doing R&D If……
To qualify as an R&D activity, the project must:
 Have a goal or permitted purpose
 Involve a process of experimentation
 Resolve technical uncertainties
 Be technological in nature
A process resulting in a new or improved product and/or process

This Is Cash To Your Bottom Line
Smaller companies with qualifying costs and activities are often minimally realizing
tens of thousands of dollars EACH YEAR from the R&D Tax Credit
If your company hasn’t claimed the R&D Tax Credit in the past, you have the
opportunity to go back and amend prior years tax returns

Huge Changes to the Rules Starting in 2016!!!
More Companies Now Can Benefit!!!
Protecting Americans from Tax Hikes (PATH) Act of 2015
Eligible small businesses (avg. sales less than $50 million over the prior three tax years) can use the
credits to offset Alternative Minimum Tax (AMT) for tax years beginning in 2016. (AMT has been a
huge roadblock for shareholders of S Corps/flow-through entities in the past!)
Certain qualified small businesses may now use the R&D credit to offset their FICA payroll tax liabilities
beginning in 2016. These companies must have sales of less than $5 million per year, and the credit is
limited to $250,000 for each eligible tax year for no more than 5 years.

Regional Manufacturing Centers

Regional Manufacturing Center Networks
Competency, Relationships, Partners
Northeast
R.P.I.
Craig Dory
Southeast
N.C.S.U.
Phil Westmoreland
GulfCoast
Texas A&M
Stratos Pistikopoulos
MidWest
COMING SOON
TBD
CA & Southwest
C.M.T.C.
Dale Turner
Northwest
George Muntean
PNNL

Power of your local to national network
• Deep business & academic relationships locally
• Key market and domain expertise
• Connect you to CESMII resources NATIONALLY
• Certified Local Training resources for your teams
• Manage Testbeds programs
• Accelerate Membership to identify industry needs

California
• 8th largest economy in the world
• Rich manufacturing cross-section
• Manufacturers encompass virtually all industries
• Over 96% of manufacturers are small and medium-
sized
• Strong technology industry presence
• Silicon Valley
• Silicon Beach
• Progressive energy state
• State policies
• Public support

Northwest
Strengths
 NWPowerPlanprovidesaguidetoregionalinvestmentsinindustrial
efficiencygoals
 Well-establishedenergymarket-clusters;robustsupply-chains
 High-qualityandskilledworkforcethatisadaptablebetweenhi-tech
manufacturingmarkets
 Proximitytoshippingports (coastal,rail,highway)
 Niche/start-upcompanieswillingtoacceptrisk
 Establishedlargecorporatebase
 Low-costpowerandnaturalresources
Challenges
 Lackofaskilledworkforcetomeetdemand;aging
workingforce
 InadequateregionalR&Dbudgets
 Nocommonopen-sourceplatforms
 Lackoftaxincentives,whichplayvitalroleingrowthof
sector
 Regulatoryissuesanddifferencesbetweenstateand
federal

Northeast
Region includes: NY, CT, ME, MA, NH, RI, VT, NJ, MD, DE,
Eastern PA, OH, Northern IN, and Southern MI
Headquartered at Rensselaer Polytechnic Institute in Troy, NY
Supports broad range of manufacturers:
With wide gamut of Domain Expertise and Industry Experience
 Research Universities, Industrial Resources
 MEP/IAC and Gov’t Agency Engagement
• Transportation
• Pharma
• Medical Devices
• Defense
• Food Processing
• Steel
• Ceramics/Glass
• Aerospace
• Clean Energy Products
• Pulp and Paper
• Industrial Products
• Materials Processing
• Chemical/Petro-Chemical/Plastics
• Semi-Conductor/Electronics
• Precision Manufacturing

Southeast
• Our region includes participants in NC, SC, VA, GA, TN, SC, KY; IN.
• Headquartered at North Carolina State University in Raleigh, NC,
next to the Research Triangle Park in NC, the “World Capital of
Analytics.”
• Manufacturing based on natural and agricultural resources has
expanded to polymers, pharmaceuticals, electronics, as well as
trucks, buses, cars, and their parts.
• Home of RD&D centers like Oak Ridge National Laboratory,
Savannah River National Laboratory, RTI International, the
Commonwealth Center for Advanced Manufacturing, and the
manufacturing institutes PowerAmerica, IACMI, and National
Institute for Innovation in Manufacturing Biopharmaceuticals
(NIIMBL).
• Strong industrial outreach through universities, community
colleges, and regional MEP and IAC networks.
Putting Manufacturing Analytics in Business

Gulf Coast
• Includes TX, LA, WV, and PA
• Partners support the chemical manufacturing (process) industry
 TAMU Energy Institute, UT Austin Energy Institute, Tulane Polymer Reaction Monitoring
Center
 Co-located with the Texas A&M Multi-scale Modeling and Simulation and the
RAPID Process Intensification Institute
 Home to one of the two SMLC DOE Smart Manufacturing Pilot Projects
• Domain expertise:
 Chemical Process Engineering/Process Optimization & Control and Modeling/Sensor
Development
 Manufacturing for Process and Energy Efficiency and Cyber Manufacturing Systems

Serving CESMII Member Needs
Skilled Workforce of the Future & Training
• ADOPTION of Smart Manufacturing requires knowledge across the enterprise
• Operators on the floor, Engineers, Plant Managers, and C-Suite
• Training & Certification of staff
• DEPLOYMENT of Workforce Training, Curriculum and Certification Nationally:
• Start with a common vocabulary
• Understanding the systems approach
• Tailored to the type of organization (Large or SMEs)
• Meet regional needs
• EASY ACCESS: Built on our RMC Networks and other professional organizations

California
 Partner training w/ CMTC Strong Emphasis on Small & Medium Enterprises (SME)
 Teaming with Universities, Economic Development Offices, and the Investment in Communities Manufacturing
Partnership (ICMP)
Gulf Coast
 Initial primary focus on chemical process industry
 Hands on training w/ SM Platform via Community Colleges
 Northeast
 Customers & SUNY public private partnership
 Manufacturing Technology Education Center (MTEC) for experiential learning and technical training
Tailored Delivery Solutions
RMC Offerings

Workforce Development
Iterative Process with Industry Participation
• Develop the Training & Curriculum framework and requirements
• Leverage resources from the RMCs and other associations
• Develop initial training and certification materials
• Engage with Industry & Academia to validate
• Novel Smart Manufacturing Curriculum to meet current/future needs
• Deliver, evaluate, and expand to meet the needs
• Initial training with the RMCs
• Certification pilot program
CESMII Overview & Working Discussion Presentation – Los Angeles, CA

Communications & Knowledge Management
Providing Rich Content to our Members
• Expanding CESMII communication with lessons learned from SMLC
• Communication at multiple levels:
• Internal – Across the Institute
• Institute membership
• Membership materials/value proposition package
• Latest information and sharing of successes and challenges within the Institute
• Webinars, meetings, and events
• External – local/state/federal, Manufacturing USA, Conferences, and Associations
• Marketplace and products
• Secure knowledge management system for information dissemination: internal content &
expanding with external content

Smart Manufacturing Commercialization and
Planning
CESMII Kickoff Meeting
February 23, 2017
Accelerating

Technology Roadmap
> 100 Industry Discussions

Standing Committees, Technology Work Groups &
Platform Advisory Committee
Business
 Business
opportunity
 Value
proposition
 Reusability
 Risks
50
Platform
 Engineering
 Cost/scale
 Tools
 Services
 Security
 Standards
Tech
 Integration
 Data
 Engineering
 Practice
 Skilss
WG1 Process
Controls
WG2 Sensors
WG3 Data analytics
& HPC
WG4 Toolkits
Architecture
WG5 Open
Standards
Outreach
 Training
 Content
 Format

Mechanics &
Operations
opportunity
problem concept
impact
Reusability
seams practice
technology
tech alignment
Value Proposition
business &
technology
practice
Reusability
Technology
data
Engineering
practice
training
Risks
organization
market
workforce
technology
SM™ Platform
tools services
mediation
practice
standards
security
SM™ Platform
Practice
engineering
cost/scale
data tools
revenue
Training
content
incumbent
pipeline
delivery
Vision
focus practice
projection
Metrics
Technology
Roadmap
Rollup
CESMII’s Industry-Driven Technology Roadmap Process
Technology
Standing
Committee
Platform Advisory
Committee
Session 2Session 1 Session 3 Session 4 Session 5
Business
Standing
Committee
Outreach
Standing
Committee
Technology
Standing Committee
Business
Standing
Committee
Kickoff February 28
Nexight Orchestrator
Mechanics &
Operations
opportunity
problem concept
impact
Reusability
seams practice
technology
tech alignment
Value Proposition
business &
technology
practice
Reusability
Technology
data
Engineering
practice
training
Risks
organization
market
workforce
technology
Technology
Opportunity
WG-1: Process/controls Technol.
WG-2: Sensor technologies
WG-3: Data Analytics and HPC WG-4: Toolkit
Architecture
WG-5: Open Standards
SM™ Platform
tools services
mediation
practice
standards
security
SM™ Platform
Practice
engineering
cost/scale
data tools
revenue
Vision
focus practice
projection
Metrics

Sustainability Workshop
Output of Actionable Items
1. Future – Reinforced CESMII’s strategic vision
and provided input across the six key areas of
strategy.
2. Sustainable CESMII - Provided depth on the
key value proposition(s) important to
sustaining membership.
3. Metrics - Evaluation of how to measure a
sustainable organization.
4. Priorities - Highlighted activities for sustaining
and accelerating growth of the Institute.
53
Hosted by NREL Golden, CO
September 26-27, 2017
• > 60 Participants
• SMLC Members
• Industry, Laboratories, Agencies,
Academic Institutions, Public and
Private Organizations

The Future
Key Strategic Areas
April 13, 2017 54
Key Areas 1-3 Years 4-7 Years 8-10+ Years
Providing
Breakthrough
Capability to Drive
Energy Reduction
• Easy to try new solutions
• Easy to measure
• Secure, interoperable
infrastructure
• Data to manage with clear
ROI
• Used by small, medium &
large
Be Industry Led &
Driven
• Documented Use Cases
• Engaged with Industry
Leaders for priorities
• Industry targets clearly
defined
• Matured ability to engage
small & medium
• Defined economic
benefits
• Org Knowledge base is
provided as a service
Service All
Manufacturing
Segments
• Broad reach & depth
• Subject Matter Experts
• Vibrant Regional structure
• Process to engage
emerging ideas
• Org Knowledge base
accelerates SM

Key Areas 1-3 Years 4-7 Years 8-10+ Years
Develop Workforce &
Create Jobs
• Define “Smart Worker”
• Engage academia in SM
• Measure training,
certifications, new jobs
from SM
• Workforce element
integral
• Certification extends to
process & workflow
• US Manuf. Attracts best
and brightest
Be Open to All Sizes of
Enterprises
• Multi access points for various membership
• Communication toolkit to attract diversity
• Building block solutions & services to address needs
Achieve Financial
Independence
• Clear strategy
• Understand differentiation
& value
• Multi year success
• Ease to reproduce results
• Scalability
• Constant benefit loop
• Clear & transparent
financials
55
The Future
Key Strategic Areas

People Technology Regions
• Thought Leadership
• Diverse
• Engaged with gov’t
• Transparent
• Strong & Effective
Communication
• Rich Marketplace
• Developer tools
• Secure interoperable
platform
• Repeatable, scalable
solutions
• Vibrant Service Value as
Revenue Source
• Regional concept drives local
connection
56
Sustainable CESMII
Value Propositions Critical to Success

Metrics for a Sustainable CESMII
Measurements
April 13, 2017 57
Diversity and Value of Revenue Stream
Membership Turnover, Retention and Diversity
New Promoter Score – How Likely to
Recommend Membership to Peers
Number of People/Companies Trained and
Certified
Efficient Operations

CESMII Priorities
Industry Input on Sustaining Institute Growth
April 13, 2017 58
Communication
• Recruitment
• Marketing
• Awareness
• Promotional
• Branding
• Case Studies
• Value Propositions
Technology
• Roadmaps & Plans
• Projects & Services
Execution
• Proof Points / Case
Studies
• Open to New Solutions
Education/Skills
• Develop Strategy
• Define Needs,
Audience, Curriculum,
Delivery Method &
Certification
• New Worker and
Retraining Plans
Revenue
• Diversifying Revenue
Streams outside of
Funding
• Begin planning how
Org. Knowledge might
be packaged as Rev.
Stream

Membership Types
Meeting your Smart Manufacturing Needs
Large
Company
Medium
Company
Small
Company
Academics,
Govt. Labs,
and Non-
profits
Vocational &
Community
Colleges, K-12
April 13, 2017 60
• Engage Companies at multiple levels of scale
• Stimulate Smart Manufacturing investment to insure
success & Accelerate Business Results
• Shared participation/results/IP for participating members

MEMBERSHIP VALUE MATRIX
April 13, 2017 61
Reduce Risk
Sustainability
Broker of
Partnerships
Testbeds
Knowledge &
Networking
Workforce &
Training
Marketplace of
Solutions
Research &
Development
Enabling
Infrastructure

Membership
The Strength of Collaboration to Accelerate YOUR Goals
• We are excited about the participation at
the Kick-Off
• 100 Industry: Small, Medium, Large
• 80 Academic & Associations
• CESMII is a unique framework that
allows all to play
• We look forward to speaking with you
regarding the membership that suits
your organizational needs

https://twitter.com/SMCoalition
Facebook.com/SMLeadershipCoalition
http://www.linkedin.com /groups
/Smart-Manufacturing-Leadership-
Coalition
THANK YOU & QUESTIONS
Ray Collett, Peggy Hewitt, Mike Rinker
CESMII
Accelerating

CESMII KickOff - Launch of CESMII - Ray Collett - CESMII

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