“Digital” or “smart” plants are at the core of the process industries’ pivot towards a digital future. But they’re also difficult to plan and build. A new reference blueprint and planning process helps executives to get it right the first time. Find out a seven step-process that can help finding the right way to plan the next digital facility.
By Franz-Josef Pohle, Ishita Biswas, Daniel Gaudencio Saraiva, Jonas Daberkow, Kai Jan Sun, and Philipp Ciolek, Accenture
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A better way to plan: Process industry executives need a structured way of planning digital plants and sites.
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Ask any manufacturing executive what a “digital plant” is, and you’ll get a clear-cut answer right away. But ask the same executive how, exactly, he’d plan a fully digitalized facility for their company, and you’ll likely have to wait—in some cases, for a while.
That’s because, while there might be clarity around the benefits and trappings of digital—or “smart”—chemical factories as concepts, the same can’t be said for specific, real-life assets. Which is why the experts tasked with planning, building, and running them often find themselves struggling:
- … to filter through an overwhelming mass of—fairly generic—digital plant blueprints, planning methods, and tech solutions.
- … to map what helpful information they can find to their company’s specific business strategy and operating model.
- … to come up with criteria for decisions around planning, buying, and building that facilitate focused execution over a three- to five-year project time frame.
A better way to plan?
So, finding the right way to plan—and answering the “how would you do it” question—is a challenge. But this challenge can be overcome—if executives work along a structured process designed to enable better decisions, lower risk, and an overall higher return on digital plant investments.
At Accenture, we’ve created a seven-step process for this purpose—and we’re using it to help some of the best plant operators in the industry plan their next digital facility.
7 steps to success: Accenture's process for specifying and planning digital plants. | Image: Accenture
Step 1: Figure out where to focus
The best way to start any planning effort is to define the scope, specifics, and priorities of the initiative itself—the planning group must be clear on what to plan, what not to plan, and where to focus.
The Accenture process begins with an introduction and review of the “planning canvas”—basically a pre-filled planning sheet based on Accenture’s reference model for digital chemical plants. The exercise helps planners think about which planning areas they should focus on, and gives them ideas for specific projects within each.
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According to the canvas, executives should focus on:
- “Guiding principles planning,” i.e., defining rules for shaping the vision for and objectives of the digital plant effort and the plant itself.
- “Digital core capabilities planning,” i.e., describing all core digital capabilities of the plant. Think of these as the most basic, must-have use case categories.
- “Process and use case planning,” i.e., describing all future plant processes and workflows. Includes the selection of process-specific use cases!
- “Organization planning,” i.e., planning the plant’s future organization. This includes charting out worker skill-building and the management of the ecosystem partners that will be working in- or with the plant.
- “Digital architecture planning,” i.e., specifying the plant’s IT Infrastructure, data flows, and application stack.
- “Execution planning,” i.e., defining the roles and responsibilities of the executives who will oversee the finalization and execution of the plan.
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A “canvas” to help with planning (simplified example): The Accenture digital plant planning canvas outlines the areas executives should focus on when planning a plant; it even features project examples. | Image: Accenture
Step 2: Put guiding principles in place
The canvas’ first area—principle planning—asks executives to specify the objectives, expectations, and priorities for their digital plant project. In other words: it forces them to answer the critical question: Why even build a digital site in the first place?
Finding an answer to this question is critical to both planning and execution success. In a recent Accenture survey, “Champion” companies that overcame challenges around strategic clarity drove returns on digital investments that were 8.4 percentage points higher than those of their peers.
To set themselves up for similar success, executives should strive to answer the “why” question as clearly as possible. Then, they should ensure both leadership and project group are in close alignment around it.
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Answering the “why” question - example:
To be successful, organization must be clear on why they build a digital plant. For a chemicals company, the answer to this question might be that their plant will:
- be highly carbon-efficient (min. 20 percent more than our current benchmark),
- reduce inventory by 20 percent, and
- increase overall equipment effectiveness from 90-96 percent, all while
- speeding up batch release time from 60 days to less than 48 hours.
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To set themselves up for similar success, chemical executives should strive to make their answer to the “why” question as specific and prescriptive as possible—and then ensure both leadership and project group alignment. If they've done this, they're ready for step three:
Step 3: List the plant’s digital core capabilities
Once the objectives for the digital plant have been defined, operations and IT experts can begin to list the key digital capabilities (or key use case categories) for the factory.
This can be a complex exercise—but it doesn’t have to be: Simple steps like defining critical areas of factory operations like “processing,” “production planning,” “procurement,” etc., and then brainstorming capabilities is usually enough to get the effort started; existing lists of “must have" capabilities like the one below can point the team into the right direction.
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Six "no regrets” capabilities to think about:
A quick way of building a list is to copy from someone else’s—like the one below from Eric Schaeffer’s book “Industry X Realizing Digital Value in Industrial Sectors":
- IIoT connectivity and embedded software are the cornerstone capabilities for every digital plant.
- Industrial clould and data analytics capabilities enable end-to-end visibility into all operations and are a crucial requirement for automation.
- Shop-floor-to-top-floor integration and automation increase both the plant’s productivity and flexibility.
- Ecosystem creation and management methods are a must-have for every company seeking to bring suppliers, contractors, vendors, and even customers into their digital service factory effort.
- ALM-PLM integration: linking Product- and Application- or Software Life-Cycle-Management is the key to the effective orchestration of connected products and digital services (highly relevant in discrete manufacturing!).
- Product-as-a-Service capabilities: a must-have for businesses seeking to build recurring revenue streams and service-driven business models.
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Once the group has created an initial long list, it should establish selection criteria for shortening it. These criteria should tie back into the principles from step #1, and reflect typical constraints like potential benefits, cost, feasibility, and time-to-value. Planners can then either “score” use cases against these criteria based on their experience, bring in benchmark data, or do both to select which ones to build into their plan.
Step 4: Plan how work will work
Since a factory can only be as productive as the processes, work- and data flows within it, planners should focus on defining these next.
Process design best practices can help with this step; defining the high-level processes first and then detailing them in iterations can be an excellent way of driving this exercise. Important: During the “detailing” step, operations and IT experts should decide which processes will be enabled digitally, and define the necessary, specific use cases.
Said use case planning should follow a structured and rigorous selection process based on the guiding principles to avoid “use case overload.” Only use cases that offer exceptional value and come with a high chance of success should be selected.
Planners should also go beyond merely defining operations processes and use cases within the plant. They should think about how these will be integrated into the company’s broader supply- and distribution networks. Plus, they might draft some processes for the ongoing tracking, testing, and implementation of new digital technologies into the factory, too. It’s the best way to ensure that the digital plant can be “updated” continuously.
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When in doubt, choose the case with stronger sponsorship
Accenture project data clearly shows: Use cases which have strong business sponsorship, and mediocre benefit potential tend to drive much better results than cases which offer much higher potential but aren’t supported by the business. This implies that, when in doubt, executives should choose projects with strong support over others.
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Step 5: Chart the organization
With processes and use cases sketched out, the planning group has everything it needs to begin drawing the digital plant’s org charts, job descriptions, and training (or reskilling) plans. They can also draw up specifications for solutions around digital worker enablement like tracking and tracing, mobile computing, context-based task- and instruction data, etc.
As the processes, the organization should also be prepared to handle future changes to the factory’s digital capabilities.
Step 6: Plan the plant's digital foundation
Finally, it’s time to focus on the factory’s digital capabilities, specifically: it’s IT- and OT infrastructure, data capture-, storage-, and processing-equipment, and software apps.
The planning group can start by drafting a high-level “digital foundations plan,” which is then detailed through multiple iterations that follow the guiding principles and (of course) use case selections. Key considerations include required data flows, system interfaces, existing software that needs to be integrated, and the readiness for future enhancements.
Creating an IT-OT-Architecture: This example shows a simplified, high-level IT-OT architecture for a chemicals plant. | Image: Accenture
Step 7: Ensure excellence in execution
Now that all major “building blocks” of the factory have been planned out, the group can take the final planning step to prepare the next phase—putting together and executing projects—and create a digital plant management system.
Accenture has seen extraordinary success for several clients with the “Digital Operations Excellence” blueprint—an organizational structure for digital change management made up of four key roles and responsibilities:
- A digital advisor who’s responsible for the plant’s overall digital strategy and concept,
- a digital program manager who oversees all key digital projects,
- a process and organizational expert handling process redesign and change management,
- and a technical solution provider, who selects and implements the required digital solutions:
Four roles for “OPEX”: The Accenture digital plant operating excellence model. | Image: Accenture
The bottom line
Most manufacturing executives are familiar with the concept of a “digital plant” but struggle to plan specific sites. By following a structured and holistic planning process, they can take the guesswork out of site planning, and ensure that your digital plant will deliver the expected returns on investment.
Franz-Josef Pohle, Ishita Biswas, Daniel Gaudencio Saraiva, Jonas Daberkow, Kai Jan Sun, and Philipp Ciolek
Franz-Josef Pohle is a Managing Director within Accenture’s Industry X, Dynamic Manufacturing & Operations practice. Both an experienced strategy consultant and industry executive (he served as Director of Corporate Development at ThyssenKrupp), Franz-Josef specializes in helping clients first shape, and then execute strategies for the digital transformation of manufacturing operations. His current emphasis is on creating concepts for the next generation of large-scale, fully-digitized industrial factories (or “greenfield” projects).
For more from Franz-Josef, reach out to him on LinkedIn.
Ishita Biswas is a Manager within Accenture’s Industry X, Digital Manufacturing practice. She specializes in manufacturing industry expertise with experience on the shop floor of manufacturing companies in the field of Operations and Process Engineering.
For more from Ishita, reach out to her on LinkedIn.
Daniel G. Saraiva is a Manager within Accenture’s Chemicals and Industry X practice. He is an experienced consultant with industry experience (he served in the technical expertise area at a chemical company), and specializes in supporting clients to shape and execute strategies for the digital transformation of capital projects, as well as maintenance and manufacturing operations.
For more from Daniel, reach out to him on LinkedIn.
Jonas Daberkow is a Strategy Manager within Accenture‘s Industry X Operations Strategy practice. He specializes in end-to-end digital transformation strategy and transformation of manufacturing operations.
For more from Jonas, reach out to him on LinkedIn.
Kai Jan Sun is a Strategy Consultant at Accenture’s Industry X, Supply Chain & Operations practice. He specializes in digital strategy, IoT, and the digitalization of manufacturing operations.
For more from Kai, reach out to him on LinkedIn.
Philipp Ciolek is a Manager within Accenture's Strategy & Consulting practice for Chemicals and Natural Resources Industry with a focus on Business & Technology Integration. He has experiences in process analysis and design in the area of Warehouse Management.
For more from Philipp, reach out to him on LinkedIn.