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Intel Corporation I All Rights Reserved FUTUREPROOFING YOUR BUSINESS Creating Lasting Value in the Age of AI + IoT FAITH MCCREARY I IRENE PETRICK December 2019 ACCELERATE INDUSTRIAL Production Area, EndManufacturer Area, Production 1 Faith McCreary & Irene Petrick | ACCELERATE – AI, IOT, and a New Beat for the Factory I © 2019 Intel Corporation I All rights reserved. Twin Spiral Cooling Tower, Food Production and Processing THIS REPORT The pace of technological change is accelerating. In factories this acceleration is coupled with a large installed base of legacy equipment and systems, supported by a workforce that is shrinking in size as workers retire and new entrants of younger workers are dwindling. In addition, the industrial sector is facing a skills gap as traditional workers cannot meet the needs of the new digital transformation sweeping factories. Ecosystem providers may not be dealing with their own large installed base of legacy equipment, but they are dealing with an ever-evolving IoT technology stack. They are facing stiff competition for limited AI and IoT savvy talent. Like their factory counterparts, ecosystem technologists struggle to keep their skills current to serve an everchanging digital world. Leaders and technologists struggle to identify best practices to futureproof their organization – how to keep their companies and themselves at the forefront of digital transformation. To better understand what was needed for future success, we distilled the data participating technologists provided into the key strategies that they believed had the greatest influence on their ability FutureproofingStrategies to futureproof their businesses, their operations and even careers. The futureproofing strategies presented in this report are a means to achieving your goals. To understand what strategies are most effective for your context, you first must have in mind what you are trying to achieve. Each strategy must be applied in a way that is unique to the context where you "My worst possible future is that we go too slow. <That> our commitment wish to apply them. There is no 1-size fits all solution to the challenge of has not been strong enough and some player who we have not anticipated futureproofing! Rather you must carefully consider the implications of these or who's already working on it, comes out and beats us at our own game. strategies in the setting where you wish to use them. I'm actually very worried about that, because I know we can go faster.” PRINCIPAL SYSTEM ARCHITECT ENGINEER, END MANUFACTUER 2 Faith McCreary & Irene Petrick | ACCELERATE – AI, IOT, and a New Beat for the Factory I © 2019 Intel Corporation I All rights reserved. Authors with Transcripts from Studies A LARGER BODY OF WORK Since 2018, Drs. Faith McCreary and Irene Petrick have been exploring the industrial landscape to better understand the changes that digital transformation will drive in factories and in the ecosystem companies that support them. This work includes 404 manufacturing and ecosystem company participants, including 193 technologists directly involved in creating and implementing smart technologies. It relied on mobile ethnography and interviews, resulting in nearly 19,000 pages of participant transcripts. Those many inches of transcripts shown to the left helped us understand what really matters when trying to accelerate on the journey to the intelligent factory. This two-phase study began with a look inside the factory and highlighted Industry 4.0 would require that workers co-evolve with manufacturing operations. The second phase extends and expands on Phase 1, but focuses more on how Artificial intelligence (AI) and the Internet-of-Things (IoT) are orchestrating new rhythms in manufacturing. Powered by big data, these emerging beats and rhythms are revamping work in the factory – requiring both manufacturers and providers to learn new moves. To paraphrase an African proverb, "When the music (technology) changes, so does the dance.” While the opportunities are tremendous, execution of these new moves often falls short of ambitions. Phase 2 delves into the specifics of the problems that the factory is expecting autonomous capabilities to solve. It also identifies critical vectors and inflection points as factories and providers seek to realize their smart ambitions. Such information is much needed if these new rhythms are to become a lasting reality in the factories. 2 Years, 2 Phases, 3 Studies Please note that each of the photos shown in this report were provided by 77 InchesofCustomerObsession 59 Research Topics participants as part of data gathering exercises. Similarly, the quotes used in 1089 Questions, 5805 Data Sets this report are verbatim participant comments with only minor editing for clarity. 96 Hours of Interviews Further percentages in this report are a measure of the relative strength of the 18997 Pages of Transcripts trend among participants, not a measure of statistical significance. 3 Faith McCreary & Irene Petrick | ACCELERATE – AI, IOT, and a New Beat for the Factory I © 2019 Intel Corporation I All rights reserved. The WHY behind this work in the words of a participant "How do we begin to take advantage of those things? How do you actually invite them in? I don't have an endless capital budget. I don't have endless resources to implement. How do I set the organization up to be best suited to take advantage Strategies of not only what is available today, but down the road? What Strategies does the organizational structure look like and what is my role as an executive leader? What type of talent may be needed? Service providers?” CHIEF OPERATIONS OFFICER, CUSTOM MANUFACTUER Plastic Injection Press , Plastics Manufacturer, PlasticsPress InjectionPlastic 4 Faith McCreary & Irene Petrick | ACCELERATE – AI, IOT, and a New Beat for the Factory I © 2019 Intel Corporation I All rights reserved. Accelerate Industrial Accelerate THE WISDOM OF TECHNOLOGISTS In phase 2 to better understand what was People like D. who is a consultant and needed to make the new rhythms of the strategist who is working with a client to factory reality, we distilled the data our use predictive analytics to improve technologists provided into a “We write most of our code here, reliability of drive shafts on Navy vessels. comprehensive 12 strategies develop our architectures and use a Or. A. who works in hardware framework – strategies participants lot of innovative technologies to manufacturing and used computer vision believed had the greatest influence on solve specific problems. Working on and machine learning to ensure the their ability to overcome challenges and boards are assembled correctly. accelerate on the journey to autonomous. a confined space monitoring project The strategies reflect the wisdom of the for individuals that work in crawl There’s also M. an innovator whose focus 193 technologists in both the factory and spaces, airplane fuel tanks, oil rig was to “rapidly prototype and test an idea the ecosystem. Each of the 193 was refineries, and the like using various to determine if it is production-worthy.” actively engaged in shaping the AI and sensors, wearable technology, and Or N. who works at a system integrator IoT technologies that are changing low-energy BLE to stream health on the forefront of blockchain uses in manufacturing today. Their ranks include industrial settings. manufacturing leaders such as CTOs, and safety data to cloud services ecosystem innovation directors, capability and that allows remote folks to keep These are just a few of the technologists architects, hands-on developers, field an eye on individuals working in behind the strategies in this report. The detailed demographics of participating service teams as well as factory these very dangerous spaces.” maintenance, and many more. technologists is shared on the next page. RESEARCH SCIENTIST, Accelerate Industrial Accelerate CONSULTANCY 5 Faith McCreary & Irene Petrick | ACCELERATE – AI, IOT, and a New Beat for the Factory I © 2019 Intel Corporation I All rights reserved. THE TECHNOLOGISTS AT A GLANCE Study 2 - 193 Participants,3388 Data Sets 81% 69% 83% AGE MALE > 50% SMART WORK AMERICAS EDUCATION LEVEL TOP AREAS OF TECHNICAL FOCUS TYPE OF COMPANY COMPANY SIZE 6 Faith McCreary & Irene Petrick | ACCELERATE – AI, IOT, and a New Beat for the Factory I © 2019 Intel Corporation I All rights reserved. The 12 strategies framework that represented the wisdom of the 193 technologists was organized in terms of the activities they supported during the shift to autonomous – STARTING strategies help companies get from enthusiasm for smart technologies to 12 Strategies actual doing, DRIVING ones help companies turn smart investments into smart reality, SCALING ones help companies leap the chasm of pilot purgatory to become mainstream, and FUTUREPROOFING ones help companies find lasting value in industrial IoT. The full Framework set of strategies is summarized below. This report focuses on the two futureproofing strategies (numbered 11 and 12) called out below. Other strategies will be detailed in future reports to be released in the coming months. (Really) Know Where You are Create Pull with Inclusive Be Realistic about the 01 Starting 02 Value 03 Journey STARTING STARTING STARTING 04 Go Slow to Go Fast 05 Grow Your Tribe 06 Be a Partner of Choice DRIVING DRIVING DRIVING Focus on Growing Belief and Think and Act Holistically Bridge the Gap Between IT 07 Trust 08 09 and OT DRIVING SCALING SCALING Accelerate with Frictionless Plan for the Future But Be in Build the Plane While Flying 10 11
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