Sustainable Manufacturing: An Opportunity Demanding Exploration

This blog was co-authored by May Ann Madlansacay, Director of Solution Program Management at PTC, Maria Lowry, Manager at Kalypso, Rein Singfield, Senior Manager at Kalypso, and Erin Halleran, Senior Consultant at Kalypso.

Sustainability used to be one of those buzzwords that is often used, seldom understood, and almost never put into practice. Subjective interpretations of requirements and vague “greenwashed” reporting allowed many companies to get away with haphazard and poorly documented sustainability practices.

Those days are coming to an end.

Regulatory bodies all over the world, including the SEC, are pushing for required environmental disclosures in annual statements. Investors of companies like Chevron and Shell are holding board members accountable by threatening to fire and/or sue board members for inadequate sustainability responses, while the impact that environmental sustainability practices have on brands continues to grow. The question is no longer “should my company have sustainable manufacturing practices and business strategies,” but rather, “how?”

Building out answers to this question is a major focus area for the Sustainability & Energy Management service line at Kalypso: A Rockwell Automation Business – which leverages its client experience and long-term partnership with PTC and Rockwell to develop a holistic understanding of how sustainable manufacturing impacts a range of industries.

“What we’re seeing now is that the goal is shifting,” says Maria Lowry, a Manager at Kalypso and one of the Sustainability teams’ driving forces. “The goal is: let’s make the best products, let’s get them out the door, AND let’s do all that in a way that optimizes the consumption of natural resources like water, gas, and electricity across your production facilities.”

In the interest of gleaning their insights on this increasingly important topic, we sat down with members of Kalypso’s Sustainability team and Director of Solution Program Management at PTC, May Ann Madlansacay, to hear their perspectives on sustainable manufacturing.

The devil is in the details… and the data

As requirements for data standards and reporting cadences become more stringent, data management and effective metrics are becoming a vital part of developing more sustainable manufacturing practices.

“You can’t improve what you can’t measure, and you can’t measure what you haven’t collected data for,” says Lowry. “The first line of defense is just seeing where companies are at today with managing their energy consumption, and what we are finding with clients is that even collecting the right data is a struggle.”

Rein Singfield, a Senior Manager at Kalypso and one of the service line leads, suggests that even when companies have the necessary data, accessing it and using it is often problematic.

“Data is everywhere. The individual contributors really have the information required for sustainability already,” says Singfield. “Do we want to centralize that information away from the SMEs? No, let’s keep it with the SMEs, but use IT/OT systems to obtain a more holistic view around energy management.” Much of the data necessary to make informed decisions and improve sustainable outcomes is pulled directly from existing meters, submeters, and sensors that many manufacturers already use today – the trick is to ensure that data is organized, displayed, and communicated effectively.

Singfield goes on to explain that, although many companies have the means to collect raw data, they are just now starting to invest in data visualization and contextualization tools like ThingWorx that enable enterprises to gain actionable insights into the amount of resources their operations consume.

“Data is often trapped in silos across many teams and many different locations,” says Madlansacay. “This is where ThingWorx comes in. It provides powerful visualization on dashboards. It displays thousands of data points to track production in real time and it gives you deep insights into resource management, overall equipment effectiveness, and enterprise optimization. And that’s going to be key for making decisions that drive sustainability.”

Conserve your energy, literally

Despite the fact that over 54% of the world’s energy sources are consumed by production sectors, energy management is an often under-explored component of resource optimization. Madlansacay suggests that digital technology will play an increasingly fundamental role in reducing energy consumption during production runs.

“WAGES (Water, Air, Gas, Electricity, and Steam) is going to be a key part of creating a standard energy model in the context of production, energy intensity, and the ability to measure key performance metrics,” says Madlansacay. “One automotive company found out they were using 40% of their energy on equipment when they were not producing anything. Having energy insights enables leaders to make impactful decisions that help the bottom line and the planet.”

Lowry elaborates on one project in which they found that steam power used in one plant was losing over 80% of its potential energy in transit through the facility. “WAGES does not encompass all energy, but it is an important way to parse out the ways that energy gets distributed.”

Improving energy quality across production facilities

What is energy quality? Singfield explains through a baking metaphor.

“I want you to imagine you’re making soufflés, but the energy provided to your oven is erratic – your soufflé goes flat. You’ll have to bake it again. This wastes the flour, eggs, sugar, and other resources, as well as the oven’s energy that could have been used more efficiently by contributing to a usable product. This concept applies directly to scaled production of tires, paints, potato chips, and engines: products saved from scrap directly contribute to more sustainable operations. This is called OEEE or Overall Equipment Energy Effectiveness.”

To address energy quality concerns, manufacturers can turn to PTC’s Digital Performance Management (DPM) solution, which uses advanced analytics to identify bottlenecks that may be causing resources like energy to be consumed inefficiently.

Even outside of energy management, quality improvements can lessen the environmental impact of manufacturing by reducing material waste. Proof of this is seen in a recent case study, where Rockwell and PTC were brought in by a tire company to improve their tire-building machines’ production capabilities. After identifying the root cause of the problem through a series of machine learning algorithms and iterative models, Rockwell and PTC identified the most sensitive variable in the production process. After making minor changes to this single variable, each machine was able to turn what would be 30 abnormal tires into 42 normal tires, which translates into energy and material savings of 65,000 tires per plant, per year. When calculating this improvement’s financial value, the savings totaled $1.3 million per plant, per year.

Early bird gets the compliance worm

“Your greenhouse gas emissions and energy information is no longer a nice to have, it is soon going to be required by the SEC. Soon it’s going to be a compliance issue,” warns Singfield. “Even if the SEC takes a while, the C-Suite will pay a heavy price for dragging their feet on sustainability initiatives. It is a market expectation now.”

Even though compliance may require investments, the cost savings attained from reducing waste or improving energy efficiency can be significant.

“For a long time, there was a prevailing myth around sustainability being a sunk cost,” says Lowry, “but it’s even graduated beyond an investment. It’s good business. We’ve seen that throughout the market.”

In the end, leaders will need to ask themselves whether they should rush to meet the minimum requirements – and in doing so waste countless labor hours sifting through outdated and imperfect metrics – or whether they should view this as an opportunity to explore innovative digital solutions that will help their operations meet compliance standards in an automated and efficient way. The answer seems self-evident, and those companies who realize it first will gain a competitive advantage in the years to come.