Automation Lifecycle. Dave Carpenter. Insert Photo Here. Lonnie Morris. Process Services Manager. Lifecycle Services Manager

Automation Lifecycle Insert Photo Here Dave Carpenter Process Services Manager Lonnie Morris Lifecycle Services Manager Rockwell Automation Process Solutions User Group (PSUG) November 14-15, 2011 Chicago, IL McCormick Place West

Session Abstract This session will share recommendations as process automation systems approach the end of their expected life, the availability of parts and resources become more difficult to obtain, until the point one or both are exhausted. Learn how to proactively manage your automation system lifecycle to maximize uptime, prioritize migrations, and bridge to new technology. 2

Today s Agenda 1. Automation Lifecycle Perspective and Background 2. Quantifying Automation Lifecycle Risks 3. Mitigating Automation Lifecycle Risks 4. Eliminating Automation Lifecycle Risks 5. Summary and Q&A 3

Defining Automation Obsolescence Risk... What Is Automation Obsolescence Risk? The extended downtime risk automation users take (knowingly or unknowingly) using products that are no longer available for sale and have limited to no serviceability remaining. The goal is quite simple: Maintain on-going awareness of automation obsolescence and develop a strategy to mitigate and ultimately eliminate this risk 4

When is the optimal time to replace legacy (automation) equipment? No consistent replacement policies Survey Summary Capital constraints still present Fear of lost production is the #1 factor in deciding to upgrade Capital funding available to prevent a failure But you cannot buy too soon nor can you wait until it is too late Migrations to occur in phases vs. wholesale basis Conclusions / Recommendations: Conduct an assessment as far ahead of time as possible. It s the only way to be prepared for failure and catch failure at its earliest point and prevent extended downtime. You Cannot Start (Planning) Too Soon! 5

What is your obsolescence concern? What we hear... How do I better quantify my obsolescence risk to plant management? What options are available to reduce my obsolescence risk? I Must keep my equipment running I want to migrate on my timeline Help me identify what products are obsolete in my plant Economic uncertainty and rapidly advancing technologies are driving market focus towards the development of improved obsolescence mitigation strategies. 6

What is being asked of you? Automation users are being asked to Do More with Less Contain Costs Improve Productivity Reduce Risk While at the same time.. Assets are Aging & Obsolescence Risk is GROWING Nearly 3/4 of U.S. plants are more than 20 yrs. old (source: IndustryWeek/MPI) The installed base of legacy automation systems reaching the end of their useful life ~$65B Average Impact of Unscheduled Downtime: $20B or almost 5% of production in the process industry (source: ARC Advisory Group) 7

Increased Costs = Increased Pressure Lifecycle costs estimated Approximately 18% of a facility's operating cost can be attributed to its control system and associated maintenance. Recent surveys have also indicated that 80% of requested maintenance is unnecessary, and, if a problem occurs, only one-third of the time assigned to the repair is actually spent on the repair. The remaining two thirds of the maintenance time is spent in diagnosis. (ISA) 8

Increased Downtime Pressures As plant productivity improves, what happens to the cost of downtime? Industry Average Hourly Downtime Costs Energy (Including Oil & Gas) $2,817,846.00 Discrete Manufacturing (Including Auto) $1,610,654.00 Pharmaceuticals $1,082,252.00 Food/Beverage Processing $804,192.00 Consumer Products $785,719.00 Chemicals $704,101.00 Utilities (Power & Water) $643,250.00 Metals/Natural Resources $580,588.00 Package Shipping (Distribution) $28,000.00 Meta Group: Quantifying Performance and Loss 9

Increased Cost Pressures It s not easy trying to manage your automation lifecycle alone. Incremental Financial Performance Improvement Self-Maintenance Service Contract Total Usage per year 8,400 hours 8,400 hours Failures per year 6 2 MTBF 1,400 hours 4,200 hours MTFR 0.25 hours 0.25 hours MTTR 48.00 hours 4.00 hours Lost time per event 48.25 hours 4.25 hours Lost time per year 289.50 hours 8.50 hours Availability 8,110.50 hours 8,391.50 hours Availability% 96.55% 99.90% Production Production Rate 50 units per hour 50 units per hour Selling Price, each $285 $285 COGS $171 $171 Gross Profit $114 $114 Losses Lost Production 14475 units 425 units Lost Revenues $4,125,375 $121,125 Lost Gross Profits $1,650,150 $48,450 Figure 3 10

All these Pressures.What s the plan? In a 2010 study of process automation users, Automation Research Corporation (ARC) identified that 88% of these users confirmed the use of automation beyond the manufacturer s obsolescence date. In this same study, a clear majority of users acknowledge to having NO lifecycle plan. 11

How do you...? Quantify Obsolescence Risk Mitigate Obsolescence Risk Eliminate Obsolescence Risk Without impacting While Improving Product Quality Production Rates Plant Floor Safety Environment Plant Reliability MRO Management Budget Planning Data Convergence 12

Agenda 1. Automation Lifecycle Perspective and Background 2. Quantifying Automation Lifecycle Risks 3. Mitigating Automation Lifecycle Risks 4. Eliminating Automation Lifecycle Risks 5. Summary and Q&A 13

Quantifying Obsolescence Risk Identify Lifecycle Prioritize Research Accurately quantifying obsolescence risks is an evolving process that must be repeated as products progress through their lifecycle 14

Identify - Holistic Asset Criticality Assessment Step 1 - Gap Analysis Review of current operating conditions as compared to target performance Step 2 - Team Based Risk Assessment Equipment Criticality Review probability & consequence of failure for each asset and its impact on: Environment, Health & Safety Public Perception Operations Personnel IT Finance Formalize criticality ranking report (assets and equipment) Prioritize assets and equipment to take action Step 3 - Preventive and Predictive Maintenance Plan Development Develop actions that improve reliability of equipment with the highest criticality rankings Take actions that reduce risk to health & safety, the environment, public perception, and operations Develop standard operating procedures to incorporate into the PM system Assess Situation and Develop Strategy to Improve Reliability 15

Identify Installed Base Evaluation Locate and document automation inventory across entire facility Identify Define Goals Determine Scope Dedicate Qualified Resources Develop a Collection Strategy Safe collection and attention to detail are necessary for success 16

Research Compare collected data against manufacturers product availability Research Manufacturer s Web sites & Notifications Publications Distributors / Reps / Resellers Compare MRO spares vs. installed base Identify inventory gaps Identify inventory orphans Compare repair/replace activity Collect and document product lifecycle status Allen-Bradley Products www.ab.com/silver 17

Prioritize Develop hierarchical method to quantify obsolescence risk Prioritize Aggregate data to highlight areas of greatest obsolescence concern Design plan to accept, mitigate and eliminate obsolescence risk Develop process to obtain on-going lifecycle status changes for installed products Prioritize to maximize plant reliability 18

Example Spares Inventory Analysis from an Installed Base Evaluation Customer s Spare Part Inventory Valued at $238,728 List (140 Items) Excess-Active and Inactive Inventory represents 78% of Spare Part Inventory, or $185,978 (93 Items) Estimated Annual Carrying Cost of Excess-Active and Inactive Inventory based on List Price @ 12% - $22,317 $8,453 4% $177,525 74% Active Inventory Inactive $52,750 22% Excess Active Inventory reduction efforts MUST be driven through Formalized and Resource Focused program for consistency & documentation! 19

Recommended Spare Inventory Based on Customer s Installed Base, recommended inventory is valued at $266,872 (137 Items) Recommended Inventory Gap of $214,122 (90 Items), or 80% based on MTBF analysis Active Inventory that forms 22% of spares also represents 20% of total recommended inventory Lack of the correct inventory leads to: Longer Lead Times Higher Cost of downtime Decreased Equipment Reliability $214,122 80% Active Inventory $52,750 20% Insufficient Inventory Inventory Spare Parts gap widens as a reflection of recommended inventory levels. 20

Where do you go from here? Once your risk has been quantified, a critical decision must be made... Mitigate Risk How long do you intend to operate equipment? Is support readily available? Is capital funding available? Is there applicable new technology available? What are the migration implications (training, support, etc.)? Eliminate Risk 21

Product Risk Understanding and Mitigation Optimally, migration plans should be developed prior to product discontinuation The critical question to be answered for risk mitigation is this: For how much longer can you be assured that service support will be available???????? Product Announcement (Silver Period) Discontinued Product (Increased Risk) Discontinued Support (Critical Risk) Risk of product failure highest with infant mortality and EOL wear-out Risk increases when product is discontinued Need for service increases with time. Bathtub failure rate curve applies to all manufacturing equipment. Everything eventually wears out. Maintenance practices and spares stocking should be reevaluated to insure maximum product life can be achieved. Catastrophic failures can no longer be replaced with new. Risk becomes critical when component availability and expertise become limited Migration plans must be in place to insure against uninterrupted operation 22

Obsolescence Risk Mitigation Mitigating risk of irreplaceable, obsolete equipment requires a renewed level of attention...hyper-care Support 1. Preventive Maintenance Critical Actions 2. Access to Legacy Technical Support 3. Spare Replacement & Legacy Repair Support 4. On-Going Management of Obsolescence Status 24

Preventive Maintenance for Discontinued Products Are filters replaced regularly? How often are PM actions performed? Are programs/parameters backed up? When was battery last replaced? Was there a product notification on equipment? Are cooling fans operational and clear of obstructions? Does the equipment possess the last firmware update? When was power last checked? Is current operating environment within OEM specifications? When is the last time grounding was checked? Do you have an updated logbook documenting inspections of obsolete equipment? Legacy Products DEMAND adherence to consistent Preventive Maintenance activities if maximum product life is desired 25

Access to Legacy Remote Support Are newer technicians skilled at maintaining all legacy products? Can they: Install or re-install... Configure... Maintain... Diagnose operating problems for... Fix operating problems associated with... Perform basic programming tasks for... all Legacy Products? Have the legacy experts been promoted, moved to different departments, employers or retired? 58% of companies surveyed have faced issues with training young engineers and technicians to operate and maintain older control systems (source: ARC Advisory Group 6/10) 26

Access to Legacy Spares and Repair Support Do you carry MRO automation spares inventory? If yes: How was it calculated? Has it been effective? By what measure? Is it too much? Is it too little? What is your carrying cost? Is it in operating condition? How do you know? Did you purchase, consign or leverage supplier? Do you know what is active, excess-active and inactive? Do you know what is legacy vs. current inventory? How have you re-calculated for your legacy installed base? If no: How are you going to support legacy products when you can no longer acquire new? An ineffective spares management process can result in at least 15% - 35% of machine down time MarcusEvans Maintenance conferences 2010 27

On-Going Management of Obsolescence Status Are you prepared to make the investment to maintain an obsolescence database? If yes: Who has the expertise to maintain it? What makes them qualified? Do they have the bandwidth? What tools are at their disposal? If no: How do you avoid future problems regarding obsolescence? The key to success for better obsolescence management is committing to a continuous process to identify-analyze-prioritize. Are You Committed? 28

Risk Mitigation - Lifecycle Service Agreement A Rockwell Automation Lifecycle Service Agreement is a service agreement designed to minimize the risk of operating discontinued Rockwell Automation hardware as you migrate to newer technology. Base services include: Reserved Repair (or exchange when available) Remote Support for Discontinued Product On-site Services for Discontinued Product Products include Rockwell Automation: AC & DC drives Programmable controllers Operator interface Medium voltage drives Motion products Support assurance for product no longer available for sale Quarterly usage/update reporting Migration planning support Up to 5-year contract options Monthly / quarterly payment options Continuous awareness of obsolescence risk Additional services available 29

Migration Solutions: Turnkey to Self-Serve Turn-key Solutions Global execution of complete turnkey migrations with the power of Rockwell Automation standing behind you Integrators & Solution Providers Global network of trusted systems integrators offering broad experience in Rockwell Automation technologies Self-Serve Tools & Programs Programs and Tools developed by Rockwell Automation to help you expertly and quickly migrate to newer technology at your pace Migration planning & execution options to meet YOUR needs 31

Obsolescence Risk Elimination Managed Migration Installed (Legacy) Control System New (Rockwell) Control System Customer Considerations: Downtime for new install New application code development Employee training on new systems Network compatibility Retain field wiring investment Disposal of legacy products Managing spares Rockwell Automation Products, Tools & Services New products: Integrate with existing systems (Drop-in replacement) Migration of legacy products: Migration tools (Adaptors, Code Conversion, IAB, etc.) Commercial programs Services (Installed Base Evaluation) Simplify the plant maintenance effort by making automation Common & Current 32

Global Process Technical Consultants (GPTC) Rockwell recognizes that the key to selling process control is having process domain expertise Rockwell has over 33 process control engineers worldwide for pre-sales support and technology adoption engagements Process Control Engineers come from a variety of industry segments as well DCS companies 33

DCS Migration Enablers Green = Available today Yellow = Future Developments Blue= Partner Capability OPC Server SW Database Conversion Tool Custom Cable Designs Control Strategy Library OLDi SAM Interface 08 Faceplate Library Legacy I/O Scanner N/A Graphics and Config Conversion Service 34

Bailey Migration Example 35

Bailey Conversion Tools Tools and Services to convert Bailey Console database tags and control logic to PlantPAx 36

Bailey Hardware Conversion Solutions Peer to Peer communications for HMI Console replacements (<40K tags) Custom Cable Solutions 37

Bailey Migration Solutions http://www.rockwellautomation.com/solutions/ migration/programs.html#dcs 38

Summary Effective management of automation obsolescence risk can be accomplished without sacrificing profitability, quality, and production rates Quantifying Obsolescence should be looked at as a three-step process: 1. Identify 2. Research 3. Prioritize Constantly monitor product availability and serviceability Provide Intensive Care Support for legacy installed base Minimize surprises through Managed Migration Planning Successful implementation of these initiatives will significantly minimize obsolescence risks and drive improvements in plant uptime as well as improve corporate financial performance. 40

Lifecycle Support Services & Support Maximize Productivity Optimize Plant Assets Improve Financial Performance Global Solutions Global Execution Domain Expertise Project Management Solutions and Services for the entire automation lifecycle 41

More Information at Automation Fair 2011 Booth 323: Services and Solutions Booth 531: Process Solutions T1: Process: Migration Strategies and Tools for Aging Distributed Control Systems Room: W470A - 8:00 AM, Wednesday & Thursday Presenter: Mike Vernak T37: Maintenance: A Proactive Approach to Lifecycle Management and Product Obsolescence Room: W474B - 9:00 AM, Wednesday & Thursday Presenter: Lonnie Morris T39: Maintenance: Training Solutions to Help Improve Workforce Productivity Room: W474B - 11:00 AM Presenter: Glenn Goldney W4: Migration Management Solutions - Tools and Services Room: W184D - 2:30 PM, Wednesday & Thursday Presenter: Chris Watkins 42

Thank You!!! Questions? Comments? Insert Photo Here Dave Carpenter dacarpenter@ra.rockwell.com +1.440.646.4426 Lonnie Morris lrmorris@ra.rockwell.com +1.414 382 1362 Rockwell Automation Process Solutions User Group (PSUG) November 14-15, 2011 Chicago, IL McCormick Place West