This report was prepared following a visit to the Belgian conference Аsset Performance 4.0 on October 27-28 by a Ukrainian delegation, with the assistance and coordination of the Belgian technical service association BEMAS and the Association of Industrial Automation Enterprises of Ukraine (APPAU). Although our participation was online, we gained a lot of valuable information about the trends in Western markets in this area. Subsequent group discussions of APPAU experts, analytics regarding gaps, customer readiness and the availability of 4.0 innovations in our country allow us to identify the main challenges in the field of enterprise production assets management.
About Asset Performance 4.0
The Asset Performance 4.0 conference was held on October 26-28 in hybrid mode. It is the largest in the Benelux countries and Western Europe and annually attracts hundreds of visitors and speakers from more than 20 countries. The organizer of the conference is the Belgian association BEMAS, which unites more than 600 industrial enterprises of its country. During the 3 days of the conference, the participants held several workshops and panel discussions, many presentations – in total, more than 70 speakers, experts from different countries spoke at the conference.
APPAU participates in the conference for the second year. This year, our delegation was significantly strengthened by the leading specialists of the 3 largest holdings in the country (DTEK, Interpipe and Metinvest digital), the group of 22 people also included leading integrators and developers in the field of Asset Performance Management (hereinafter referred to as APM), as well as Kiev and Kharkov Industry 4.0 Centers. APPAU set the goals of group development and alignment in new knowledge, with the aim of subsequent widespread dissemination in its market, and then – the formation of its own development agenda in this area of Industry 4.0.
The main conclusions of Ukrainian experts
The main center of expertise of APPAU is the “AWP” working group, which includes leading experts in this field from among developers, integrators, enterprises and 4.0 Centers. The first discussions within this group lead to 3 main conclusions:
- The main impression concerns the assessment of the maturity of Western markets. The number of practical cases, specialists, the level of reports and discussions – all together, this indicates a much higher professional level and consolidation. It is also obvious that the penetration of 4.0 technologies into the workstation is already mainstream and is capturing an increasing number of enterprises.
- This makes a significant difference with domestic markets, where no more than 1% of customers systematically apply 4.0 technologies, such as predictive analytics using machine learning algorithms. The overwhelming majority of enterprises are located in APM 1.0-2.0.
- At the same time, the level of domestic developments and solutions is slightly inferior to what was seen. Workstation solutions from leading developers such as IT-Enterprise, Waites, a-Gnostics, service offers from Neftegazkhim Service and ASTRAM, Indusoft offers and the like, are generally at the level of APM 3.0-4.0. On the one hand, this gap in the level of maturity of advanced developers and the vast majority of industries is natural in the movement of any innovation. At the same time, a large gap between the potential of developers – integrators and the willingness of customers to consume their services – solutions is the specificity of the Ukrainian market, concerning all innovations.
One of the reasons for this gap is the underestimation of the processes of education – the formation of a market for end customers, as well as the lack of incentives to introduce innovations. The processes of diffusion of innovations are quite long and the main method of influencing the speed of diffusion is precisely education and market education. Actually, in this context, the main conclusion of the experts is the recognition that participation in such conferences is necessary for professional development and rapid alignment with the best world practices.
In the further presentation, we also use segmentation AWP 1.0 – 4.0, for a description from the leading research agency LNS (USA), see here (Ukrainian).
Basic touch points
The touchpoints approach is widely used in analytical works of APPAU. This refers to brief conclusions – insights about comparative moments in a particular professional area related to technology. The fixation of these moments during the Belgian conference was the entry point for subsequent expert discussions, which later turned into a detailed analysis and description of cases. Below is a list of these touchpoints that allow the reader to “sharpen” a specific topic and detail the conclusions presented above.
1. Scalability, Simplicity and low cost of service in the workstation – 3 key challenges, which are very well presented in the case of the New Zealand Synlait from the food industry. The customer described the business case as: “I need to optimize the maintenance tasks in 2 countries, at 12 factories, where there are 50 thousand assets, which in total amounts to 90 thousand tasks in preventive maintenance. And I want to manage these tasks without large teams of maintenance personnel.».
This case clearly resonates with the problems of the state of affairs in large Ukrainian holdings in metallurgy, oil and gas, railways, but also in the food industry, where the optimization of maintenance tasks is still a huge challenge. How the French AMSYST solved this business case – you can see in more details here. The speed of the solution is, of course, impressive – AMSYST “put things in order” in the Synlait MRO tasks in just 5 weeks!
2. Predictive Maintenance (PdM) – as the main way to reduce emergency and other unscheduled shutdowns, was covered by various speakers and, it is quite obvious that this is the mainstream in the AWPs of Western countries. In our description of «How much do crashes cost» – we cite data from the American Sensey, which says that 72% of customers see PdM as a strategic priority in asset management, and 20% have their own data scientists teams. The PdM topic is one of the top at the conference in Belgium – several dozen speakers talked about the transition to this service method.
In Ukraine, PdM is already quite popular, but so far in narrow expert circles. PdM solutions are provided by 3 of our key developers, members of APPAU – IT-Enterprise, a-Gnostics and Waites. The latter, moreover, have references from such world giants as Amazon, Tesla, Nike and DHL. Large holdings such as DTEK, Metinvest Digital and Interpipe have been investing in PdM for several years, they have their first successful pilots and their own teams of data scientists. All of them was presented at our conference on November 9 and, thus, visitors were able to see almost the full range of Ukrainian solutions and pilot projects in the field of PdM. At the same time, in our community there are many skeptics of this path, as “massive and for all” – after all, enterprises, they say, “must first get out of their current level of 1.0-2.0.” Their views will also be presented. Obviously, this is a question of the AWP roadmap, which – in a consolidated form – does not yet exist at the level of industries or communities.
3. «Not only Profit – Safety!» – the emphasis on security was not the top topic of the Belgian conference, however, as an integral part of the AWP, security was mentioned by many speakers. In describing the Dutch presentation «Main Trends in the Dutch Chemical Industry» we emphasize the parity of these goals and compare them with the situation at domestic critical infrastructure facilities. Where, frankly, we are not talking about any AWP 3.0-4.0 at all – most often, we are talking about elementary survival and, accordingly, the complete absence of any strategies in asset management. APPAU will raise a set of issues in this area at a separate event on November 29.
4. «Implementation of Industry 4.0 is a long road, and not a couple of new projects» – the thesis is quite familiar and even somewhat hackneyed for professionals who follow the trends in the world of 4.0. But we do not get tired of repeating it for one simple reason – “which is this way”, that is, which strategy, what our customers include in it – with extremely rare exceptions, it is impossible to understand. The country is still dominated by total ad hoc, mixed with hype for digital technologies. Actually, this is why new examples and cases are important, demonstrating how developed countries do it in their own countries. A good case on this topic was the presentation of the Belgian Aperam Genk on the implementation of the 4.0 strategy in its metallurgical holding. There is also about the stages of a long journey of 5+ years, and about changes in the structure of the organization, and about pilots – in short, this is a classic case of change management during the transition to 4.0. A similar holistic strategy exists in the Ukrainian DTEK – we are talking about the MODUS program and this was mentioned at our conference on November 9. And as far as our cases are concerned, there are a large number of them, including in the field of workstations, at IT-Enterprise, their SmartEAM solution is presented at a separate virtual conference stand, and we also expect a separate overview report on references in Ukraine.
5. «The use of artificial intelligence (AI) must be carefully prepared – IT infrastructure, data and personnel» – another seemingly obvious thesis, especially in the IT environment, is actually far from obvious in our industrial practice. At the Belgian conference, every third speaker said that the availability and quality of data is perhaps the biggest challenge in launching PdM solutions, digital twins, AI algorithms and other 4.0 technologies. Our experts are preparing a separate publication on this topic, where we will tell you in more detail how the problem is seen “in their place” and what is happening in our country. Here, for now, let us briefly note that the situation in Ukraine in the field of data management at most enterprises is at the most rudimentary level. The 2019 APPAU report on vertical integration says that the integration of control systems and advanced data processing is difficult to include simply because there is no data – in the quantity and quality that are needed to enable machine learning algorithms and the like. And therefore, you need to start with automated accounting and data collection from field devices. There is already a lot of evidence in our environment about the low quality of data, and a-Gnostics probably talked about this at the conference – one of the first companies in Ukraine to successfully implement predictive analytics algorithms in various industrial applications.
6. «How and with whom to resolve maintenance issues, if the new equipment is more and more complicated, the old one is more and more malfunctioning, and there is less and less qualified personnel?» The issues of personnel ageing, the need for retraining, the general shortage of qualified personnel were mentioned in Antwerp. For example, Sitech talked about 30% of the most experienced technicians retiring. In Ukraine, personnel problems are much more acute, especially in the SME category. According to the market logic, we should move towards outsourcing in maintenance. There are already many similar practices and examples in the EU, and several speakers have demonstrated their cases – we will mention here ERIKS, Sitech, I-care. Sitech, for example, offers the Asset Health Centre, which is a remote customer service center that operates primarily on predictive diagnostic methods. It is interesting that Ukrainian engineers have a similar experience – we are talking about Waites, the architecture of their solutions is presented below. However, while Waites serves clients not in Ukraine. Another strong integrator of process control systems, «Neftegazkhim Service» offers services of those. outsourcing service for several years. And although the first customers have appeared, the company’s management does not see a great demand for services. Both companies will perform on November 9th. Just like the Belgian I-care, it was interesting to compare the positions and services of our companies with those offered by the Belgians.
7. The circular industry – is another touchpoint. In the Belgian conference, we could observe how the “double transition” – digital and green at the same time – works in the EU. Review publications on the presented cases (SKF, Evonik, DimoMaint) are prepared by our Sustainable Industry Committee. In Ukraine, these processes are just starting, – the ideas of the circular industry are growing in popularity in many of our high-tech and industrial communities, both due to their novelty and the already existing directives of the European Union. However, we practically have no real projects or, moreover, state-level programs for the circular industry. If Ukrainian industrialists do not begin to act today, it is obvious that literally in a couple of years, many of them will simply be deprived of access to the EU market. The experts of our committee also note that the valuation and management of enterprise assets is becoming the topic of financial reporting and related technical standards.
The first discussions in narrow expert circles show that these touch points resonate enough with the opinions of various categories of the professional community. Therefore, the further agenda of discussions and events is being built around them and others like them.
Key challenges in Asset Performance Management
So, the European Asset Performance 4.0 conference served as a good catalyst in the consolidation and involvement of our experts. She gave us a lot of useful information, contacts and examples of practices that we need. Also – through information alignment, group discussions and case studies – it helps us to better understand and formulate our own challenges in the field of automated workplaces. The first iteration of these calls looks like this.
- How to accelerate the transition from stages 1.0 – 2.0 to higher levels? A roadmap for such a transition is needed for most industries, but it is most needed by SMEs. After all, large holdings now look self-sufficient, and what to do with industries dominated by hundreds of SMEs and where the gaps with developed countries are growing, there is no understanding.
- This roadmap should answer at least 4 important questions:
- What should be the stages or processes and KPIs in the transition to different levels of maturity, and how to link them with the introduction of new technologies for APM 4.0?
- How to maximize the potential of local developers and integrators? – after all, today it is obvious that it greatly exceeds the current demand, there are very good solutions, but the demand and the paying capacity of customers remain low.
- How to create a network of centers for training and expertise in the field of AWP 3.0-4.0, what should be their programs? Could the existing Industry 4.0 centers play this role?
- How to accelerate the transition to service models of service and how to overcome customer mistrust in such methods of work?
- How to increase investment in enterprise digital infrastructures – primarily in IIoT platforms. In a developed form, such platforms are practically absent in Ukraine.
- How to strengthen the processes of internationalization – exchange of experience and best practices both with the EU and the Eastern Partnership countries? – the Belgian conference, like our 2021 conferences on system integration and cluster interaction, show their growing need for professional development and growth of various categories of market participants.
- What is the real state of assets in critical infrastructure facilities and what to do about it? Is a separate challenge related to safety and man-made risks. How to change the situation in this area is unclear – so far it looks like a separate roadmap or action plan.
Many of these issues were discussed at the November 9th conference. Ukraine presented the strongest composition of its leading enterprises, integrators and developers, we will also had partners from Belgium and France. We were happy to exchange views with other countries of Eastern Europe, the Eastern Partnership and the EU.