Andy Chatha, ARC Advisory Group Founder and President, opening keynote presentation at ARC's annual World Industry Forum 2008 in Orlando, Florida.

1. Winning Through Peer Communities
Optimum
Performance
People | Processes
Andy Chatha
A d Ch th
President
Technology
ARC Advisory Group
achatha@arcweb.com
Information

2. We Have Listened to Your Ideas About This Forum
Your #1 Input was: Fewer Presentations, More Discussions
Most Breakout Sessions have 1 or 2 short presentations, last 20
presentations
minutes are reserved for Q&A and discussions
Three Tracks are planned to foster discussion in smaller groups
Our Customer Advisory Board (CAB) provided us with a list of
Hot Topics for the Breakout Sessions
ARC Prepared Best Practice Reports for the identified Hot Topics
with a goal to share the Results with you at this Forum
• Our Research Agenda is now closely tied with the Forum Agenda
You wanted to hear more from the major Suppliers: we have
invited them to share their Vision & Technology Roadmap
We will be recording most of the sessions, Podcasts will be
available on our website along with the presentations
Each session is a Peer Community Meeting
We encourage you to Participate in it!
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3. Adopt Platforms
to Simplify Technology Architecture
Enterprise Technology
gy
Platform
Content FIN
ERP HR
SCM CRM
Partners Customers
Enterprise Apps Platform
Services Services Services Services
Custom Integration
Eng. & Design Apps Operations Apps
Services
Platform Platform
Drawings Equipment Data EAM
PDM CPM/Automation
Models Specs PAM
P&IDs LIMS
Equipment
Technology Technology
Eng & Design Platform Operations Platform
Source: ARC Advisory Group
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4. Emerging Collaborative Technologies
will Further Fade Geographic Boundaries
Podcasts, Videocasts Aggregated Content
Blogs, Wikis Social Sites
Emerging Collaborative Culture Is a Powerful Phenomenon
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5. Peer Community Meetings at this Forum
Benchmarking Consortium
Plant Performance Benchmarking
SOA for Manufacturing
Life Sciences Benchmarking
Packaging Operations Benchmarking
P k i O i B h ki
Best Practice Benchmarking for Discrete Manufacturing
Application of S88 to Machine Control
pp
OMAC Session & Meetings
ISA100 Wireless Standards Committee
Each Breakout Session is a Peer Community Meeting
Peer Community Discussions is our #1 Goal at this Forum
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6. ARC Benchmarking Consortium
is A Rapidly Growing Peer Community
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7. ARC Best Practice Research Communities
Best Practice Reports Recently Published by ARC
Best Practices for the Intersection of Lean Manufacturing & MES
Best Practices for IT Governance in Manufacturing
Best Practices for Assembly Operations
Best Practices in Packaging Operations
Best Practices in Maintenance Management
Best Practices in Process Safety Culture
Best Practices in MRO Data Management
Best Practices in New Product Development & Introduction
Plant Asset Management Best Practices
Human Factors Best Practices
Best Practices for In-Plant Visibility
Best Practices for Management of Continuous Improvement
Programs
Many more are planned for 2008
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8. ARC Best Practice Research Methodology
1. Identify an Issue or Hot Topic of Interest to our Clients
2. Identify Business Practices used by Companies to perform the tasks
related to the Issue or Hot Topic
3. Identify Performance Measures used by Companies to determine
how well the tasks are being performed
4 Separate Business Practices into Four Categories: People
4. People,
Processes, Technology & Information
5. Launch a Web Survey & invite subject matter experts to take the
Survey
y
6. Conduct Telephone Interviews with a group of subject matter
experts to gain deeper understanding of the best practices used
7. Sort & Segment the Respondents into the following Performance
Groups:
• Ground Breakers (Top 5%, Optional), Leaders (Top 20 or 25%)
• Competitors (Middle 50%) & Followers (Bottom 25%)
8. Analyze B i
8 A l Business Practices within each Performance Groups to
P ti ithi hP f G t
Benchmark Best Practices
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9. Sample Data from Best Practices for the
Intersection of Lean Manufacturing & MES Report
How & When are Metrics Calculated?
Overall Equipment Effectiveness - OEE
When is OEE Calculated?
How is OEE Calculated?
OEE
Leaders OEE
Followers
Leaders
OEE Followers
OEE
Spreadsheet About 15 min. 23% 0%
23% 16%
Software
Manually Each hour 5% 3%
9% 13%
Calculated
MES 59% 6% By shift 5% 3%
ERP Daily 14% 3%
0% 3%
Automation Weekly 27% 6%
9% 0%
System Sum = 100% Sum = 38%
Monthly 18% 9%
0% 20% 40% 60% 0% 20% 40% 60%
Quarterly 0% 0%
0% 20% 40% 0% 20% 40%
Leaders Use More Metrics More Often
& They Use Software to Measure Performance
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10. Sample Data from Best Practices in NPDI Report:
Who are members of your NPDI Teams?
Product Development Engr.
Internal Marketing
Manufacturing Engr.
Production Management
g t
Sales, Pre-sales Support t
Post Sales Support t
Purchasing
Finance e
Product Training
Logistics
Leaders s
Followers
IT T
No internal teams
0% 20% 40% 60% 80% 100% 0% 20% 40% 60% 80% 100%
Portion of Respondents
Always: Over 75% Usually: 50% to 75%
End-user customers
External Parts supplier(s)
OEM
Distributors
Design services
Systems Integrator
Leaders Followers
Outsourced Mfg
Logistics
0% 10% 20% 30% 40% 50% 60% 0% 10% 20% 30% 40% 50% 60%
Leaders Involve More Internal and External People
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11. Sample Data from Best Practices in
Packaging Operations Management Report
On what percentage of packaging lines is overall
equipment effectiveness (OEE) measured?
None
35.7 % 1-25 Percent
26-50 Percent
17.9 % 51-75 Percent
76-100 Percent
10.7 %
28.6 %
7.1 %
Leaders Measure OEE on Most of their Packaging Lines
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12. Performance Maturity Matrix
for Assembly Operations – Worker Utilization
Leader Competitor Follower
Focus Many Teams, Some Mostly Individual Individual Workers
Knowledge Workers Workers, Some Teams
Worker Execute, Check, Execute, Check & Execute Assembly
responsibilities Rework, Maintain & Rework Tasks
Improve
Incentives Extensive – Team, Moderate – Some for Very Limited - Only
Knowledge & Company/Team Fixed Hourly Wages
Flexibility
Fl ibilit Performance
P f
Training Performance Task & Equipment On the Job Training
Oriented Training Training
Safety Monitored Power Electronic Safety Safety SOPs/Equip
(control reliable) Devices & Physical Safety
Systems Devices
Leaders Use Incentives & Encourage Team Work
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13. ARC Plans to Nurture & Grow
Many More Global Peer Communities
y
Ideas for Growing Global Peer Communities
Host Peer Community Meetings & Forums
Promote Peer Communities around the World through
Local Meetings & Forums
Provide On-line Support through Blogs, RSS Feeds,
Wikis, Webcasts, Podcasts, etc.
Conduct Community-driven Best Practice Research
y
Provide subject matter expertise where necessary
Our Goal is to Augment, not Duplicate, Efforts of Other
Groups & Communities
Plan to Use ARC Peer Communities
for Collaborative Problem Solving!
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14. ARC’s New Website is Designed to
Grow Global Peer Communities
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15. Participate in Peer Communities
to Improve Your Plant Performance
p
Measure Your Plant Performance
Participate in Benchmarking Consortiums to
Compare Your Plant Performance with Competitors’
Participate in Peer Communities to learn Best
p
Practices from the Leaders
Use Best Practices to improve your Business
Processes
Develop a Strategy for Continuous Improvement
You Can Win Through Peer Communities!
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16. Thank You
For more information, contact the author at
achatha@arcweb.com or visit our website at
www.arcweb.com
www arcweb com
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17. Acronyms Used in This Presentation
CMM Collaborative Mfg Management
DOM Design, Operate, Maintain
g p
IOp Interoperability
OpX Operational Excellence
P2B Production to Business
SOx Sarbanes Oxley Regulations
RPM Real-time Performance Management
KPI Key Performance Indicators
KPM Key Performance Measures
BPM Business Process Management
EAM Enterprise Asset Management
ERP Enterprise Resource Planning
SCM Supply Chain Management
SOA Service Oriented Architecture
A complete list is available on ARC’s Homepage: ARCweb.com
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18. Acronyms Used in This Presentation
KW Knowledge Worker
KM Knowledge Mgmt
l d
CPM Collaborative Production Management
MES Manufacturing Execution System
CAS Collaborative A t
C ll b ti Automation S t
ti Systems
CPS Collaborative Production Systems
HMI Human Machine Interface
DCS Distributed Control Systems
PLC Programmable Controllers
RFID Radio Frequency Identification
OPC Ole for Process Control
OMAC Open Modular Architecture Controller
A complete list is available on ARC’s Homepage: ARCweb.com
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