Increasing the world’s food supply is a major issue. Crop diseases can have a devastating humanitarian and economic impact and with sustained global population growth it is estimated that by 2050, a 70 per cent increase in food production is required to ensure the world is fed.
Against this backdrop global IoT cellular communications specialist Eseye is today announcing a new product partnership, with agricultural manufacturer Burkard Engineering, to fight against crop disease.
With 20-40 per cent of the world’s crop losses attributed to disease, the accurate prediction and prevention of diseases is a vital area to address. Burkard Engineering has developed connected real-time pathogen monitoring equipment to provide an early warning system of crop disease risk. The system uses Eseye’s AnyNet Secure global cellular data services to deliver data onto the AWS Cloud to provide farmers with tailored information from their own fields.
The Burkard Auto Sampler sits permanently within a farmer’s field remotely collecting DNA. Crop data is then transmitted back to the AWS Cloud where it is analysed and reported in a matter of minutes, enabling farmers to see exactly which fields are at risk and act accordingly to treat the crops. Once out of trials the product, which is part of the UK Government’s Innovate UK project, is expected to scale globally.
Stuart Wili, Managing Director at Burkard, says:
“We are finally giving farmers an answer to their concerns over the ramifications of crop disease. This not only provides peace of mind, but the solution also supports the environment, removes risk and saves precious time, resources and ultimately money.”
Paul Marshall, Chief Customer Officer at Eseye, says: “Eseye’s work with Burkard and AWS is a prime example of the range of economic, social and environmental benefits which can be reaped through IoT. By using AnyNet Secure cellular and AWS Cloud solutions, the agricultural industry can harness the knowledge and foresight from accurate data in making informed decisions. We are delighted to be part of this project and look forward to seeing the benefits rolled out across the globe.”
The Genius of Things. It’s the perfect title for four global events we hosted in September and October. There, we brought partners, customers and IBMers together in Mumbai, Shanghai, Boston and Dubai.
In four cities, with 2,100+ attendees, we were honored by the 80 clients who spoke on our behalf. So many amazing stories! That’s why I’m spotlighting those that made a lasting impression on me and our audiences, starting with two speakers at our event in Boston.
What made these speakers so interesting is summed up in one word: innovation. Yes, it’s an overworked term. But in this case, it’s the perfect description. Here’s why:
How innovation drives ABB
Founded in 1883, ABB has carried the world from one industrial revolution to another. And Doug Voda, the global segment leader for Smart Grid, shared two powerful examples of just how ABB stays ahead. First, Doug gave us a glimpse at what they’re doing with renewable energy. By working with IBM, ABB expects to improve productivity for its customers by 15+ percent by connecting weather pattern forecasting to their network controls. Next, he introduced us to paint robotics. We learned that there are 20+ paint defects that can’t be seen by the human eye. Yet through work with IBM, ABB can now identify and correct those problems, and deliver some of the finest paint quality you’ve ever seen. And just how impressive is an ABB robot? Even Iron Man has one!
ABB paint robots deliver some of the finest paint quality in the world.
How KONE uses predictive maintenance
“I stand before you as part of the elevator and escalator industry, asking you for some more love.” I know that Danillo Elez, senior vice president of KONE, asked a lighthearted question on stage, but he’s right. When it comes to machinery, cars definitely get all the love. We take it for granted that the elevator or escalator we choose will work. Every day, a billion people count on KONE to keep them moving. That’s why predictive maintenance matters. That’s also why — in a 100-year-old industry — KONE is differentiating with vision and vigilance. Using Watson IoT, intelligent, real-time (and real!) machine conversations happen. While we can listen for ourselves (and I highly recommend that you do), all this data allows KONE to spot problems before they happen. And because of that, those billion people can continue taking elevators for granted.
KONE elevators can “talk”, which means they can send alerts and anticipate problems.
Innovation for the future
These two customers have an incredibly rich history. But neither has ever been interested in holding onto the past. Instead, they’re winning because they’re constantly looking forward. See … innovation! Those 20 paint defects are fixed, and customers are even more delighted in the product quality. Those oddly soothing machine voices keep us from getting stuck as we go about our our daily lives.
Along with the drive to constantly innovate, companies like ABB and KONE use IoT to access not just data but all the insights this data holds: deeper customer knowledge, more efficient operations, revenue growth and the ability transform and reimagine business.
London, 21 February 2017: Visa Inc. (NYSE: V) today announced the launch of the Visa Innovation Center London, located at its European headquarters in Paddington Basin. The 1,000+ square meter space, the largest in Visa’s global network of innovation centers, is an immersive environment where Visa can work side-by-side with financial institutions, merchants and other partners to develop the next generation of payment solutions.
The space features practical demonstrations to excite and engage visitors, including applications of the Internet of Things (IoT) in connected car and connected home environments, such paying for car insurance or placing a grocery order from a refrigerator. Visitors will also experience the future of retail using virtual reality to pick just the right seat for an upcoming Formula E race and biometric authentication to pay for tickets.
Visa also announced today that fintech developers across Europe will now be able to take advantage of the Visa Developer Platform to create new, secure ways to pay. Developers at merchants, financial institutions, technology companies and startups can now select from an initial set of Visa payment APIs (Application Program Interfaces), SDKs (Software Development Kits), and documentation to create the next generation of commerce applications.
Rajesh Agrawal, Deputy Mayor for Business, said:
“London is a global fintech leader because we have been able to combine our traditional strength in financial services with our growing talent for tech and our innovative and entrepreneurial spirit. As a successful fintech entrepreneur myself, I understand that quite often businesses need a little bit of help to turn the kernel of a good idea into something truly transformative. I am therefore delighted that Visa is launching this new innovation center in London, bolstering our flourishing global tech and fintech reputation and proving that London is open to great ideas and innovation.”
Visa Innovation Center London
The new center in London joins a global network of innovation centers and studios located in technology hotspots, including Berlin, Dubai, Miami, San Francisco, Singapore, Sao Paulo and Tel Aviv.
“What makes the approach we take in our innovation centers unique is that they’re all about collaborating with clients to solve real world, consumer pain points or business problems using digital solutions,” said Jim McCarthy, Executive Vice President for Innovation and Strategic Partnerships at Visa. “We’ve had great success doing this in our centers globally and are very excited to be opening a state-of-the art facility in Europe.”
As the payments industry shifts from plastic to digital and new entrants join traditional stakeholders in payments, Visa’s mission is to ensure that every Internet-connected device, appliance or wearable can become a secure place for commerce. Visa’s global network of innovation centers are an important part of this mission by fostering innovation and creating an environment that enables Visa to engage, experience and collaborate with a broad range of partners and clients:
Engage: The Center’s immersive environment provides clients and partners with everything they need to work on new digital solutions – in a physical space designed to encourage dynamic interaction, real-time experimentation and rapid prototyping.
Experience: Visa emphasises a human-centered design approach where product development is customer-focused and delivers real benefits for users.
Collaborate: Clients and partners can interact with Visa payment experts and access Visa technology. This includes APIs and SDKs available through the Visa Developer Platform.
About Visa Inc.
Visa Inc. (NYSE:V) is a global payments technology company that connects consumers, businesses, financial institutions, and governments in more than 200 countries and territories to fast, secure and reliable electronic payments. We operate one of the world’s most advanced processing networks — VisaNet — that is capable of handling more than 65,000 transaction messages a second, with fraud protection for consumers and assured payment for merchants. Visa is not a bank and does not issue cards, extend credit or set rates and fees for consumers. Visa’s innovations, however, enable its financial institution customers to offer consumers more choices: pay now with debit, pay ahead with prepaid or pay later with credit products. For more information, visit our website (www.visaeurope.com), the Visa Vision blog (vision.visaeurope.com), and@VisaEuropeNews.
Most research on open innovation has focused on the use of ideas and knowledge from outside the organization in the development of products and services. But openness can be useful for process innovation, too. Our research shows that manufacturers can benefit substantially when they look for ideas beyond the factory gates, especially when their operations are already advanced.
We often meet managers in manufacturing companies who keep process innovation activities tightly under wraps. Some see their processes as a source of competitive advantage that should not be shared with anyone. Others consider them organizational knowledge that could be detrimental to expose to outsiders.
Some companies have good reasons for keeping process innovations concealed. For example, a combination of process and product innovation often jointly results in competitive advantage for a company. If you have found a unique production process with which to manufacture a differentiated product — for example, a new metal alloy or a medicine — it can be wise to keep that know-how within the company. In such cases, there is an obvious risk of loss of intellectual property.
However, our research suggests that for many manufacturers, such defensiveness deprives companies of a valuable source of ideas for productivity improvement. We draw our conclusions from an analysis of nine years of survey responses from 1,000 Swiss manufacturers, as well as 200 interviews with personnel at the Volvo Group (AB Volvo), a manufacturer of trucks, buses, construction equipment, and marine and industrial engines that is based in Gothenburg, Sweden.1 One of the authors also visited 45 Volvo Group factories around the world. (See “About the Research.”)
Even for an industry leader, walling off process innovations from the outside world can be a losing strategy, because sooner or later, competitors usually catch up.2 As counterintuitive as it may seem, our research suggests that most operations managers can build greater advantage for their company by following a policy of open process innovation rather than secrecy. However, evolving from a closed to an open culture is not easy, and it generally requires taking six big steps.
1. Open up internally. Most large global manufacturers encourage their factories to share innovative practices and success stories with one another. The best ideas that emerge from this sharing become part of the overall corporate program. Empirical evidence shows that sharing process ideas has a profoundly positive effect on operational performance.3 Companies that already do this informally can extend the process improvement activities with a systematic effort inside their factory network. In this way, they gain some of the advantages of open innovation without the risk — while laying the groundwork for other open information sharing about processes.
This tends to work well. Because the factories belong to the same “family,” their operations and contexts are usually comparable. This means the hurdles for implementing novel ideas are often lower than when technology or knowledge stem from outside the network. Through open process information within the company, the factories lift the productivity bar together.
For approximately 10 years, the Volvo Group has worked intensively to share process innovation practices among its manufacturing sites. One goal is to raise all truck factories in the network to a defined “gold standard” by 2018. One initiative is a corporate process innovation program that collects best practices from factories in a global database accessible through the Volvo Group’s intranet. Another initiative is a global online knowledge-sharing conference that brings together about 200 to 300 attendees from across the company’s operations. Held about 10 times a year, the conference is scheduled in the morning according to U.S. Eastern Standard Time so that the majority of factories located in the United States, Europe, South Africa, and East Asia can participate. The conference slogan captures the idea behind intracompany open process innovation: “Everyone has something to teach; everyone has something to learn.”
2. Focus on the pace of process innovation. We find that many managers tend to overrate the quality of their company’s process innovation. The truth is that not everybody can be above average. Even in the exceptional case where a factory’s processes are indeed state of the art, hiding them can usually fend off competition for a limited time only. The only way to know how advanced your practices actually are is to compare them with someone else’s set of practices.
A more sustainable way to create competitive advantage in the manufacturing industry is not to keep your manufacturing excellence off the radar screen but to be faster than your competitors at process innovation. In Lyon, France, for instance, Renault Trucks, a subsidiary of the Volvo Group, has a state-of-the-art engine factory. In a central, highly visible part of the factory, quality rejects are put on display. Anybody who visits the factory — employees, customers, suppliers, sister plant managers, collaborating researchers, or other visitors — can immediately see whether the factory has unresolved quality issues. Such exposure motivates factory managers and employees alike to speed up problem-solving and idea generation, as a way to keep the rejects out of sight. The “open” strategy increases the creativity, motivation, and, most importantly, the pace of process innovation at the plant. This gentle nudge provided by openness has helped Lyon become one of the Volvo Group’s flagship factories for process innovation, motivating the factory to strive always to be the best possible version of itself.
3. Exploit connectivity technologies. Our research found that data access systems help companies capture process innovations from the outside and spread them internally. Many business systems come with preinstalled “production know-how” that vendors have already integrated from their experiences across a multitude of customers. Although off-the-shelf solutions never guarantee that operations will improve, our findings show that increased use of data access systems leads to greater production cost reductions as employees adopt process innovations recommended by the software.
Customer relationship management, supplier relationship management, supply chain management, and enterprise resource planning (ERP) software systems all require codification of tacit knowledge, which makes it easier to understand and transfer a process. This enhances a company’s capacity to spread external process ideas and technology to the people who need it.
A medium-size Volvo Group remanufacturing factory for engines and transmission boxes in North Carolina offers an interesting case in point. Until a few years ago, the factory was digitally disconnected from the rest of the Volvo Group’s dispersed remanufacturing factories. Remanufacturing operations tend to incorporate a lot of tacit know-how, and the factory had previously not seen any particular need for what managers described as “static software to plan its highly dynamic business.” In spite of the managers’ opposition, Volvo Group headquarters mandated that the factory implement the same ERP suite as other remanufacturing plants within the group. Since then, the new business software implementation forced the factory managers to think harder about their current practices and learn about new best practices from other units in the group.
Although such global ERP implementations can be difficult and expensive, they offer many benefits to users. A process innovation elsewhere in the factory network — which can be codified as an ERP parameter or a new planning procedure — can be shared across all the network’s factories quickly.
4. Improve your organization’s ability to absorb and implement ideas from external sources. To make innovations matter for production cost reduction, factories must strengthen their ability to make learning from the outside stick — something scholars call an organization’s absorptive capacity.4 Absorptive capacity starts with a deep belief that there are important lessons to be learned from others. In addition, factory management must establish routines for gathering ideas from external sources and putting them to use. A good way to do this is to specify and codify the existing knowledge in a set of standards. While standards should never be taken as generally valid across all areas of a company, they make it easier for people to use past learning and help focus improvement efforts. The use of standards and regular standards revision meetings are practical ways to build absorptive capacity, particularly when those standards can be shared online with the entire plant and any sister factories.
A Volvo Group powertrain plant in the Kantō region of Japan offers an excellent example of what strong absorptive capacity can do for process innovation. For decades, the plant management benchmarked their operations against others in Japan and incorporated practices that they found better than their own. After many years of systematic internalization of external best practices, the factory found itself at the “performance frontier.” Seeking new inspiration, the factory teamed up with Volvo Group headquarters to access the group’s powertrain R&D departments in Sweden and external technology partners. Today, managers have tried to combine the best of Japanese kaizen culture with the latest engine assembly technology from abroad — and they’re not done yet: The managers report that leveraging their proficiency in absorptive capacity helps them stay at the forefront of competition.
5. Open up to the outside. It is not surprising that factories that lag in operational performance tend to improve when they participate in open process innovation. The benefits for the best-in-class factories are not so obvious, yet real. Cutting-edge factories can attain deeper expertise by teaching others, but they often need to search outside their factory network for new inspiration. Our research indicates that the deeper a company searches for a source of external knowledge (for example, understanding a novel casting technology researched at a university), the greater the cost reduction it will experience, whether or not it is a leader in its industry.
In fact, under normal circumstances, the better you get, the more you can gain by opening up. In a Volvo Group truck assembly plant in Virginia, the management team decided to move their customer fairs from exotic locations to the factory site. This turned out to be wildly successful: During the fairs, old and new customers would ask blue-collar operators questions directly on the line. The customers received passionate answers from skilled people who were not trying to sell anything and just wanted to convey their expertise. At the same time, operators learned firsthand what customers really wanted from Volvo trucks. Opening up to the outside paid off in terms of both higher sales and increased productivity.
6. Utilize unconventional sources of knowledge. Art Fry, who coinvented the Post-it note at 3M Co., has proposed that creativity is “a numbers game”5: The more ideas you have, the more good ones you find. Innovation fairs, internal contests, conferences and exhibitions in other industries, and joint projects with research institutions and universities are all good sources of fresh ideas that enable managers to step back and think outside the box. Provocative ideas from nontraditional sources of knowledge may spark process innovation and help overcome difficult problems.6
One good example is from a truck plant in Pennsylvania. Operators had identified a safety hazard when technicians worked on top of the cab to do final installations. Searching for ideas from outside the organization, they came up with a tailored bungee jump cord that safeguarded the technicians without limiting their mobility. The role of unconventional sources of ideas at the Volvo Group resonates with other iconic examples from the manufacturing industry. For example, Toyota’s Taiichi Ohno took his inspiration from American supermarkets when designing and introducing just-in-time parts delivery to Toyota’s assembly lines after World War II.7 Another example is the way that GlaxoSmithKline plc learned to minimize downtime from McLaren Honda, a British Formula 1 automotive racing team company that shared its expertise about pit stop operations.8
How to Get Started
Open product innovation is already a well-known strategy. We think open process innovation is a logical extension. As product life cycles continue to decrease and demand for individualization increases, companies that master the combination of superior product and process development will be better positioned.
Ultimately — and ironically — the success of a program of operational openness will depend most of all on how well a company knows itself. Managers will need to ask: What part of our product innovation would benefit most from the search for external knowledge? What part of our process innovation could benefit most? Where should we combine the search for product and process knowledge? Given our strengths and weaknesses, from whom would it be most beneficial for us to learn? What can we offer them in terms of product and process know-how in return for what they can teach us?
As with many organizational changes, open innovation is best begun gradually. We do not recommend switching from closed to open process innovation in a day. However, that is not to say that companies should not start now. The bulk of our research persuades us that the businesses that win in the future will be those that master both the process and product sides of open innovation.
As the world’s largest aerospace company, and having been in business for more than 100 years, the continued need for innovation has been at the heart of Boeing’s success. With the increasing possibilities of the Internet of Things (IoT), artificial intelligence (AI) and more, this innovation remains undimmed.
Like many organisations of its size, Boeing generates huge amounts of data. The question, of course, is how much you can get out of it to improve both company efficiency and customer satisfaction. Ted Colbert, Boeing’s CIO, told an audience at the Sands Expo and Convention Center in May that companies have to ‘both improve the skill set within the IT organisation and raise the digital IQ of our business leaders, so they pull on recognising the tech enablement opportunities to transform their business.’
So what does this mean? Al Salour, who is speaking at the IoT Tech Expo event in Santa Clara on November 29-30, is a technical fellow at Boeing Research & Technology. His role, as he puts it, is to “establish strategies and systems for the enterprise production systems.” In practice, this involves automating previously manual processes, putting in sensor-based technologies, and establishing standards that will flag deviations from engineering requirements.
A McKinsey article from earlier this year explains how the company’s workers are now using wearables and augmented reality tools on wiring-harness assembly lines. Yet there is so much more potential. As Salour explains, while 3D modelling and model-based design has been around for some time in a variety of industries, from aviation, to construction, and to entertainment, Boeing is taking steps beyond the traditional use cases.
“Our effort will go beyond that, to virtually create our manufacturing process and make important producibility plans in terms [of] our facility and equipment utilisation before we introduce a new product,” he explains. “Our linkage to engineering design will continue as we manufacture parts, so we can compare physical conditions against their digital twin model.”
It is therefore an iterative, constantly evolving process which Boeing is undertaking. But there are plenty of hurdles to cross in the meantime. Salour says he works in a ‘technologically challenging’ environment, with advancements taking place more quickly than the industry can keep up, but adds the changes are ‘exciting and interesting’. Another issue, that of cost, is pragmatic – “I consider my contributions to R&D advancements will bring results but at the same time they must be affordable or else they won’t survive,” says Salour – but the other is comparatively far-reaching.
“We need to be able to trust the digital data,” says Salour. “The issue is for the developers not to stop early before their work can be fully validated. We also need to consider the cultural change in relying and accepting the digital data.
“There are important compliance issues and procedures that will not quickly change, and the best way is to accept them and include them in our implementation plans.”
Partnerships are key, too. Last year, Boeing teamed up with Microsoft to ‘enable further integration between humans and machines, leveraging AI to streamline business operations while enabling airline operators to be more efficient, competitive and attractive to consumers’. Boeing’s partners include industrial leaders, academia, and government-sponsored research centres. “We believe our investments will be rewarded through internal and external advancements and technology maturity from our labs to the production floor,” says Salour.
Salour is speaking on the topic of manufacturing and ‘smart factories of the future’, a topic he is well-versed in given the day to day routine at Boeing. Expect various examples of how Boeing’s factory systems are moving towards the digital world. “We understand many of our traditional efforts in planning, manpower utilisation, and production flow decisions can be simplified through connected systems and real-time information,” says Salour.
“We would want our operation and support personnel to have instant access to their work-in-progress data so they make better decisions.”