Industrial and manufacturing groups have long been considered “behind the times” when it comes to digital transformation. There’s still some truth in this. Manufacturers tend to lag behind banking and retail in the adoption of technologies such as machine learning and data analytics.
But leaders in sectors such as the process industries are increasingly harnessing technologies to meet the challenges they face—both new and long-standing. Three factors in particular drive this adoption.
The first is the need to boost efficiency and competitiveness. Oil and gas operators are once again seeing historic lows in prices, ramping up pressure to reduce expenses. Demand to cut costs and do more with less, though, is long-standing.
Second are equally long-term challenges around skill gaps and an aging workforce. More than 70 percent of the energy industry workforce is over 50 years old, and many are nearing retirement, taking decades of experience with them. They will need to be replaced by a new generation with different expectations, different ways of learning, and with a reputation for job-hopping, increasing the costs of hiring and retention.
Finally, process industries, like everyone else, are contending with the upheaval caused by the present-day environment. Unlike others, it faces particular challenges in reducing on-site staff and switching to remote working, while still maintaining safe, effective operation of hazardous sites. Unplanned downtime has been among the most severe financial impacts, costing offshore oil and gas organizations, for example, an average of $49 million annually.
"Leaders in sectors such as the process industries are increasingly harnessing technologies to meet the challenges they face—both new and long-standing"
Making Sense of Data
These challenges are being met through a range of technologies. Three broad categories stand out.
The first is the Industrial Internet of things (IIoT) that is enabling a proliferation of wireless sensors and smart devices across facilities. These allow operators to take and monitor readings in remote or hazardous locations where traditional wired solutions are either impossible or impractical. Just as significantly, by drawing the data generated into the cloud, they make it securely accessible not only to those in facilities’ control rooms but by experts elsewhere.
Second is the data analytics and machine learning that turn the signals generated by these devices across the site to turn it into actionable intelligence.
The technology has a variety of applications. It’s used across oil fields, for example, to enable skeleton staff to monitor hundreds of well-heads through exception management. They help implement predictive maintenance strategies that eliminate unnecessary servicing while reducing the runs to failure that cause costly unplanned downtime. And it’s being used to analyze data from across the plant to assess people’s performance relative to standard benchmarks, helping drive up productivity.
A New Reality
The final key technology having a significant impact on the operations across process industries is virtual and augmented reality.
First, in training, virtual reality (VR) enables trainees to safely practice essential tasks on digital twins of the plant or equipment. VR solutions are even being combined with well-established operator training simulation to allow control room operators and field workers to train together.
The technology significantly reduces the time to competence compared to classroom learning. It meets plants’ requirements to develop new workers’ skills rapidly, so they see a return on their investment in hiring and training—while also fulfilling a new generation’s expectations for digital solutions in the workplace.
Second, for both training and productivity solution, augmented reality is proving a powerful field tool. Whether on phones, tablets, or wearable computers, augmented reality (AR) solutions can provide process information and guidance in the field. It can give users advice and even video tutorials they can access and play, hands-free, as they undertake unfamiliar or complex tasks, for example. Crucially, it can also put them in touch with colleagues elsewhere and share audio and video to enable collaboration and advice from remote experts.
Even before the present-day scenario, these technologies were helping the process industries capture knowledge and harness expertise from across their organizations. As well as accelerating training, they promote better use of existing resources and enable remote collaboration, reducing the need for skills onsite. They are also helping the industry to compete with other sectors for talent by providing the digitally enabled workplaces expected by a generation of digital natives.
Given the current environment, these technologies have moved from providing a competitive advantage to being an instrumental element in some businesses’ response: Enabling them to reduce staffing onsite and maintain physical distancing without jeopardizing the effectiveness or safety of operations.
Longterm, these technologies not only will improve performance and reduce costs, but they will also support entirely new operating models: Transferring offshore control onshore or enabling outsourced maintenance of plant assets, for example, using remote monitoring and service level agreements providing certain levels of uptime.
To the degree that the process industries adopt these technologies, the impact on their businesses will be substantial, bringing a step change to profitability as well as workforce productivity and safety. The time is now.