As part of the launch of the Business as Unusual book (click on badge on left to get to the Amazon page) by Thomas Saueressig and Peter Maier that we helped conduct interviews and research for, we will share excerpts from each of the 10 chapters/300 pages, and also give you a “behind the scenes” view by sharing snippets of some of the over 100 SAP, customer and partner video interviews that ended up in the book.
Here are some excerpts from the eighth Megatrend – Resilient Supply Networks.
In its heyday, Ringling Bros. and Barnum & Bailey Circus required more than 100 rail cars to ferry about 1,300 workers and performers, plus animals with their cages and equipment. The circus would travel up to 15,000 miles over an 8-month season and visit as many as 150 towns. These days, we build digital twins of physical objects, even circuses. The Tibbals model (on the campus of the Ringling Museum in Sarasota, FL) gives visitors a more visceral experience of the complex logistics circuses had to operate year after year without any of today’s technologies.
We appear to be lurching from one (supply chain) crisis to another. Shouldn’t our supply chains have become much more resilient in the century since the circus’s heyday, given all the planning and execution technology we now have? Many of these incidents are discrete and have varying points of failure, but with so many businesses blaming poor performance on COVID-19 or Brexit or the war in Ukraine, we are masking the root causes of these problems.
Martin Barkman, senior vice president of solution management for SAP’s digital solution management team, provided a historical perspective of how the modern supply chain has evolved over the last few decades and has faced various disruptions: “What used to be kind of linear, sequential supply chains where you make it over here and sell it over there, have now become much more intertwined and connected. Supply chains are more like networks than they are vertically integrated, linear, or sequential. That has created a whole new level of dependencies that never existed before.
He recommended employing a broad definition of supply chains—encompassing everything from design to operations—and a focus on four dimensions: agility, productivity, connectivity, and sustainability.
At Hannover Messe, SAP’s booth is an event fixture, and we use the trade fair to show off our solutions and many of our industrial partners’ robotics and other technologies. This year, SAP presented how digital technologies can be applied in the design-to-operate cycle for discrete manufacturing and for process manufacturing. Hannover Messe is an event for a few days, but customers visit us year-round, so we decided to place permanent Industry 4.0 showcases at our corporate headquarters in Walldorf and in major SAP locations around the globe. The showcases are great conversation starters, with digital technology working hand in hand with physical machines to make innovation tangible and spawn creative discussions.
Several discrete and process manufacturing tracks exist in the tour. The use cases on the discrete manufacturing track include the following:
- Digital logistics: Outbound delivery with transportation management
- Intelligent workers: Gesture-based interfaces
- Digital twins: As-manufactured twins of the final manufactured equipment
- Quality: Automated testing and quality management
- Intralogistics and the automation of production material flow: Automated warehouses, automated conveyors, robotics integration, dynamic routing, and modular manufacturing
- Intelligent factory: Final assembly of variants, 3D work instructions, digital product history, and labor certifications
- Manufacturing insights: Plant and overall equipment effectiveness (OEE) insights, global insights, and dashboard designers
The tour shows off the industrial partnerships SAP has formed that have matured over the last decade. The demo in Newtown Square featured xPlanar tiles from Beckhoff, which use magnetic levitation (maglev) technology to move products around like an automated guided vehicle (AGV) would. Daymon Thompson and Jeff Johnson at Beckhoff described how the push for flexible manufacturing and personalized products have popularized the concept of a “lot size of one” in the logistics space. This concept has led to an explosion in robot designs. According to Thompson, Beckhoff's customerbase includes numerous machine builders, so it has decades of experience providing advanced machine controls, servomotors, mechatronics, IoT solutions, and more. The machine builders work with end users to figure out how to deploy next-generation machine designs that are more flexible and provide more throughput.
Evonik, headquartered in Essen, Germany, is a global leader in specialty chemicals. Its tagline is “leading beyond chemistry,” and its vision is to make “towels fluffier, mattresses bouncier, animal feed healthier, medications more effective, and tires more fuel efficient.” Thomas Meinel, senior vice president and the head of indirect procurement at Evonik, talked about the evolution of business processes for Evonik’s business, with over 35,000 suppliers in some 100 countries….”We used to buy physical products like pumps. In the new world, we often buy digital products. In the past, I knew my supplier base and it didn’t change much. The world was pretty stable. Not anymore: we have many more crises, technology shifts, and so on. So, we need more than a Google search to find and qualify new suppliers, we need intelligent scouting capabilities. We also have a lot more data and need more automation.”
As senior director of corporate business development, Hari Ashvini leads SAP’s engagement with emerging partners. Ashvini ran through a gamut of supply chain ecosystem topics: on-demand warehousing, on-demand logistics, warehouse robots, and supply chain visibility. The common theme is that none of these services can be imagined without the extensive use of digital technologies and real-time integration between SAP systems, warehousing infrastructure, and robotics. Beyond more resilience and efficiency for individual components of the supply chain, networking between shippers, customers, and logistics providers with value-added services can make a big difference.
Jeff Howell, head of SAP’s high-tech industry business unit, Howell also talked about the work SAP is doing with its partner PDF Solutions to improve yield management (in the semiconductor sector). In this context, PDF stands for Probability Density Function, not for Adobe’s portable document format, and hints at the kind of analytical services this company provides. It looks at parametric data and tries to balance tolerance with desired yields: Overly restrictive tolerance thresholds mean lower yields, while overly relaxed tolerances result in more defects—a classic type I versus type II error tradeoff. For readers who like statistics, manufacturing the latest generation of computer chips takes 1,000 production steps and over 3 months. What is the required quality level per manufacturing step to get a 70% yield at the end?
These concerns illustrate two conflicting challenges in the food supply chain: the sheer quantity required to feed the world and the need for sustainable farming practices to produce food that qualifies as organic. Digital technologies can overcome this challenge. Satellites can provide near-time imagery of farms and fields to determine where fertilizer, irrigation, and crop protection are required—not too little, not too much. Satellite and sensor data digitally and remotely control farming equipment for the best quality and the highest productivity with the smallest possible environmental impact.
Barkman compared reactive with resilient (supply chain) organizations as follows:
A twin of this post will include video excerpts from conversations with many of these executives so you can put a face and voice to those in the book.
Other posts on the other chapters to come.
