Interoperability Barrier No. 1: The CIO

According to AMR, 60% of Most IT Budgets Are Spent Attempting to Deliver to 2002 Expectations

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Charlie GiffordBy Charlie Gifford, Contributing Editor, 21st Century Manufacturing Solutions LLC

At the MESA 2007 North American Conference, former AMR Research senior analyst Colin Masson conducted the solution-provider CIO Panel with representatives from GE Fanuc Automation Americas, Rockwell Automation and Siemens Energy & Automation. Masson asked the panel members who among them knew of ISA-95 or B2MML and was planning to standardize for their B2M interoperability using one of them or another manufacturing operations management (MOM) standard. No one on the panel knew what what any of these standards were.

The panel’s consensus strategy for interoperability was to use their vendors for ERP or enterprise interface application (EIA) middleware to do services-oriented architectures (SOA) and B2B and B2M interfaces and transactions. Sounds sexy, but it’s a wrong-headed approach.

The entire room of end users, consultants and salespeople from the MES solutions space were simply floored. All three vendors on the panel claim some level of compliance to MOM standards, but none of their executives endorsed or had any concept of open-standards-based interoperability between their MOM systems, suppliers or customers. Unfortunately, this CIO panel’s mentality is typical of the executive and mid-level management in manufacturing companies and their vendors.

Why are these CIOs (and their counterparts) THE No.1 barrier to making adaptive manufacturing a reality in North America?

Besides the factors of age, budget and ego, four paradoxes play a role.

The CIO Paradox: Most CIOs have spent millions on the Y2K transition only to install monolithic, highly customized systems based on custom information models and point-to-point interfaces. The systems have a high cost of ownership, and the architectures do not scale globally to enable a pull network of suppliers and customers, so the cost of any change is high.

According to AMR, 60% of most IT budgets are spent attempting to deliver to 2002 expectations. The manufacturing markets of 2008 have made the Y2K architecture and investment obsolete.

The CIO’s budget has never been tighter, while his department is moving into doing multiplant manufacturing operations systems on a shoestring. The CIO is risk-adverse and does not want to support another IT standard at the very time when the evolution of open semantic information and business process transactions models will lower his cost and risk significantly for the first time.

The Vendor Paradox: The leadership at software companies does not want to drive customers towards open interoperability, application information models or standard business process transactions. Why? Because they want to control and protect their customers through their proprietary terminology, business processes and message structures. Truly, they are not concerned about lowering cost of ownership, change or interfaces, no matter what they say in their marketing brochures. They make money on the custom interfaces, analytics and reports, not configurable, open systems.

As a system integrator, I did $25 million in MOM projects of which $10 million to $12 million was doing customer backside applications to vendor “solutions.” The unspoken policy is “Keep the CIO and his staff in the dark about open MOM standards with vaporware discussions on Lean Six Sigma and SOA. Never explain that Lean IT is really applying the MOM open standards as “the semantic standard work for SOA.” IBM is the only large IT vendor who has open realized that its business process mapping tools, SOA and data warehousing solutions cannot succeed without standards-based semantic information models as their bases.

The Industry Analyst Paradox: The vendors are the analyst’s bread-and-butter clients, so industry analysts with few exceptions do not aggressively make or endorse the open MOM interoperability business case to the end-user executives so they can in turn force their vendors to adopt and support the efforts.

Analysts are not addressing “the end-user crisis” on open standards by strongly encouraging them to contribute to open MOM standards development efforts. They do not explain that the final results of these standards, once adopted at any level, will drive or limit the form of their business models, SOAs and business process adaptability. Except for one analyst at AMR Research, none participate in the development of any of the MOM standards; they do not even review and comment on the drafts. Except for AMR, none of them are doing annual briefings with the MOM standards groups; but all are providing their uninformed assessments on the maturity or applicability of the standards to the CIOs and their staff. In fairness, ARC Advisory Group did address briefly interoperability a few years ago.

The Professional Society Paradox: Why are there only 150 people, not 500 people, at the North America conferences for WBF and MESA, but analysts’ meetings get 500 people? Because CIOs would rather have vendors and analysts tell them what to do than recognize their own responsibility to build internal competency by seeking out the experts in adaptive manufacturing systems. Where is the leadership? It is in Europe and China.

The professional societies that develop and support automation and MOM standards also lack the executive contacts and relationships to make the business case for their interoperability products. Society leaders at ISA, MIMOSA, OMAC, OPC, WBF and others do not understand how make a business case for their own products to their customer executives. OAGi and AIAG are notable exceptions.

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