arla foods @ arc forum march 2016 - i4.0 & packml

This presentation is copyrighted by ARC Advisory Group (ARC). The information is proprietary to ARC and it may be not be reproduced without prior permission from ARC.

Industry 4.0 in the Supply Chain of Arla Foods - Current PackML case - and future opportunities

Speaker: Arne Svendsen, Head of Corporate MES/Automation

Partially based on input from Industry thought Leaders:

Carsten Nøkleby(DK), Gavan Hood(AUS), Keith Unger(US), Valentijn de Leeuw,ARC.

March 2-3, 2016

Mercure Hotel Amsterdam City, the Netherlands

2 © ARC Advisory Group

This presentation may be not be reproduced without prior permission from ARC.

Agenda

1. Arla Foods - Global Dairy Foods Manufacturer

2. Business environment & challenges

3. I4.0 overview

4. Mapping to Arla Foods’ Business needs

5. I4.0/Plug & Play - real world example of PackML

6. How I4.0 will become success - for all of us

7. Conclusions

8. Q&A



Storyline of this presentation

1. Arla Foods - Global Dairy Foods Manufacturer


3. I4.0 overview

4. Mapping to Arla Foods’ Business needs

5. I4.0/Plug&Play - real world example of PackML

6. How I4.0 will become success - for all of us



Arla Foods Introduction (1:2)

13,500+

FARMER

OWNERS

FROM

7 COUNTRIES

70 Production

Sites

(EU, US,CHN)

MILK INTAKE

12,5+

BILLION KILO

19,000+

COLLEAGUES 10 BILLION EURO

REVENUE

PRODUCTS

SOLD IN

100+ COUNTRIES

Our vision: Creating the future of dairy to bring health and inspiration to the world, naturally



Arla Foods Introduction (2:2)

Milk & cream Yoghurt

Butter & spreads Cheese

Cooking Nutritions Other beverages

1000’s of SKU’s - Arla Brands & Private Label



Business Environment (1:3) Cooperative business since 1880

Cooperative dairy business - 1880 -> 2016



Business Environment (2:3) A global supply chain today

• 70+ Production Sites, 50+ Distribution Centers

• Sales worldwide



Business Environment (3:3) Strategic Focus

• Networked supply chain, fast moving consumer goods/cool chain

• A history of Mergers & Acquisitions

• Organic growth is the strategy now

• Partnering in Manufacturing & Distribution

• Core business: Product Innovation, Supply Chain & Distribution

• Non-core: Partnering with specialised service-providers



3. I4.0 overview




Industry 4.0 - high level (1:3) One (of many) views

The 1st (Steam)

The 2nd (Ford T)

The 3rd (www)

The 4th Industrial Revolution

Internet of Things (IoT) ”DIGITAL” -

New Business Models

INDUSTRIAL Internet of Things (IIoT) Smart Manufacturing

INDUSTRY 4.0

The good old www: Internet (of People)



Industry 4.0 - high level (2:3) Technologies – and Connectedness

• (New) Technologies

• Connecting Anything

• => New Business Models

Connectedness & New Business Models



Industry 4.0 - high level (2:3) Technologies – and Connectedness

Source: Acatech Report 2015: Smart Service Welt



4. Mapping to Arla Food’s Business needs




Mapping to Arla Business needs (1:4) TODAY: Connected, yet still hard work.

Technologies: - Automation - RFID, scanners - Printers - Wireless LAN

- AGVs - Robots - Inline measure - Analytical dev.

ERP Business system

FACTORY

Factory

Factory

Factory

Dist. Center

Dist. Center

Dist. Center

Functions: - Prod.Orders - BOM/Recipes - Collect ”all” data

- Traceability - Quality - Reporting - Analytics

DATA

MES

- AGVs - Robots - Inline measure - Analytical dev.

Technologies: - Automation - RFID, scanners - Printers - Wireless LAN



Mapping to Arla Business needs (2:4) Arla Supply Chain needs:

We have Corporate standards for connecting ERP to MES to Shop Floor, so what’s next:

• Volatility in markets => Need Faster adapting the Supply Chain, the factories

• Utilise new technologies

• Optimise (IT) project implementations

• Move NON-core functions to external service providers



Mapping to Arla Business needs (3:4) In I4.0 terms, the solution is:

Functions: - Core Realtime (remain on site) - Core Non-Realtime -> Cloud - Non-Core function -> ext. Service

FACTORY

Technologies/Sensors/Devices

Arla Internal BIG Data

Arla Strategic Innovation Center

Energy Optim.

Equipment Optim.

IT-systems Support

NON-core Service

Offerings

ERP

<-Faster Connect



Mapping to Arla Business needs (4:4) What to consider, implementing I4.0

PARTIAL CONCLUSION:

• Decision: Which NON-core functions - to be bought as a service

• Cloud solutions: Costs move from CAPEX to OPEX

• INFORMATION strategy

• IT Security



5. I4.0/Plug & Play – real world ex of PackML




PackML - A real-world example (1:8) Build faster Packaging lines

ONE Business Solution

ERP

ONE Production Solution

MES/Manufacturing Operations Mgmt.

ONE Automation Solution

Process

Automation

Production

Automation

Packaging

Automation

• Adopted ISA95 in 2002 for SAP/MES integrations

• Corporate MES-solution, implemented on 50+ sites

• ISA88 Library in place for Process Automation

• Since 2013, focused on faster integration of production and packaging lines.



PackML - A real-world example (2:8) Cheese Production Line – example

ON THIS ONE CHEESE PACKAGING LINE: 9 units, from 7 suppliers, from 4 countries



PackML - A real-world example (3:8) The PackML ”USB” connector

• Arla has no large technology center. We build packaging lines, mainly by integrating standard units from our industry

• Challenge is to integrate units into a working line

• Faster, faster, faster

LINE Control

PackML

LINE Control

PackML PackML



PackML - A real-world example (4:8) Cheese Production Line – example

PackML as interface to Units

PackML PackML



PackML - A real-world example (5:8) Making it easy for the operators !



PackML - A real-world example (6:8) Business Value

Success items:

Specification (forward to contract) much faster

Works across all automation (PLC) platforms

Test suitcase for remote FAT testing

Data => Business information from day-1

Harmonised Operator interfaces!

OEE SEE also ARC article:



PackML - A real-world example (7:8) Business Value

Machine Project Time Cost Prod.Time

Specification -> Sign Contract ++ +

Integration tests (FAT & SAT) ++

Training (Operators & Maint.personnel) ++

Commisioning (”burn in”) +

Operations (5-8 years ?) Time Cost Prod.Time

Maintenance (time to repair) +

OEE / Optimisation +

Training (Operators & Maint.personnel) + +

Line changes/New units /New products + ++ ++



PackML - A real-world example (8:8) Gathering momentum for PackML

• P&G and Arla Foods offer their company standards documents on OMAC website for unrestricted use (based on OMAC membership)

• Company and platform-independent OMAC Best Practice Guide is in progress. For end-users and Machine builders to get started. Nestlé is actively supporting this as well.



6. How I4.0 will become success – for all of us




For Industry 4.0 to get success (1:6) Connectedness need Protocols

Send Mail

Write English

Prequisite: Agree language

Receive Mail

Read English

”The Internet takes care of the rest ...”



For Industry 4.0 to get success (2:6) What the Internet does for you...

An IP adress

Physical Infrastructure

WAN/LAN/ Wireless

IP Protocol

Mail protocol

Language

An IP adress

Physical Infrastructure

WAN/LAN/ Wireless

IP Protocol

Mail protocol

Language

The Internet



For Industry 4.0 to get success (3:6) PackML – showing the way !

Line Control

An IP adress

Machine unit

An IP adress

Physical Infrastructure WAN/LAN/Wireless

OMAC PackML

Physical Infrastructure WAN/LAN/Wireless

OPC UA OPC UA

OMAC PackML

PackML is a good example of a high level ”DOMAIN” Protocol of I4.0

• An agreed common language, and lower levels taken care of

IIoT OPEN Standard Protocols

PackML in this case



Mapping to Arla Business needs (4:6) OPC-UA – Basic I4.0 Protocol

Manufacturing Execution Processes/Functions ...

Milk Intake Area

Main Production Areas

Filling / Packaging Areas

Semi/Finish Goods Warehouse Areas

OPC UA Basic I 4.0 Protocol

OPC UA

SAP Business System

PackML PackML PackML

I4.0 I4.0 I4.0

Process Optimisation

OEE Detail Scheduling

Track & Tracing


OEE


OEE



For Industry 4.0 to get success (5:6) Some of Current initiatives

• OPC-UA: https://opcfoundation.org/

• ISA-95 work group on Process Centric Messaging

• Smart Manufacturing Leadership Coalition: https://smartmanufacturingcoalition.org

• Open Connectivity Foundation: http://openconnectivity.org/

• Industrial Internet Consortium: http://www.iiconsortium.org/

• Alliance for Internet of Things Innovation (EU): https://ec.europa.eu/digital-agenda/en/alliance-internet-things-innovation-aioti

• At VDE.DE find: Reference Architecture Model Industrie 4.0 (RAMI4.0)

• OMAC is the organisation for automation and manufacturing professionals that is dedicated to supporting the machine automation and operation needs of manufacturing. www.OMAC.org

https://opcfoundation.org/

https://opcfoundation.org/

https://smartmanufacturingcoalition.org/

https://smartmanufacturingcoalition.org/

http://openconnectivity.org/

http://openconnectivity.org/

http://www.iiconsortium.org/

http://www.iiconsortium.org/

https://ec.europa.eu/digital-agenda/en/alliance-internet-things-innovation-aioti













http://www.omac.org/



For Industry 4.0 to get success (6:6) End users requirements to I4.0

1. Standardisation bodies (and there are many) must cooperate closely to define generic, OPEN Standards.

2. The end user requirements are: ”any application” to “any device” communication



Wrap-up (1:2)




Wrap-up (2:2) Conclusions

• Industry 4.0 is less about (new) technologies and more about Connecting & New Business Models – and doing it fast, maintainable, upgradable

• PackML is a clear case of Standardisation Benefits Cost reduction, faster projects, harmonised interface, operator efficiency, higher uptime. Its ready – use it!

• A background for understanding the ”Protocol challenges” of I4.0 (We, the end users, do NOT want to get caught - having to choose between proprietary platform communities in the Manufacturing space)



Q&A

Your are always welcome to contact me at: [email protected]

www.Linkedin.com/in/ArneSvendsen

mailto:[email protected]

http://www.linkedin.com/in/ArneSvendsen

arla foods @ arc forum march 2016 - i4.0 & packml

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