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Process Safety and Environmental Protection 118 (2018)316-329

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Process Safety and Environmental Protection iChemEIII


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Industry 4.0 implementation for multinationals ®


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Arnesh Telukdarie3, Eyad Buhulaiga3, Surajit Bag3, Shivam Guptab, Zongwei Luoc’*
a F a c u lt y o f E n g in e e r i n g a n d t h e B u i l t E n v ir o n m e n t , U n i v e r s it y o f J o h a n n e s b u r g - A u c k la n d P a r k B u n t i n g C a m p u s , J o h a n n e s b u r g - 2 0 0 1 , G a u te n g , S o u th

A fr ic a
b I n d ia n I n s t i t u t e o f M a n a g e m e n t S a m b a lp u r , T e c h n o lo g y a n d O p e r a t io n s M a n a g e m e n t , J y o t i V ih a r , B u r la , S a m b a lp u r , O d is h a , 7 6 8 0 1 9 , I n d ia

c S o u t h e r n U n i v e r s i t y o f S c ie n c e a n d T e c h n o lo g y , D e p a r t m e n t o f C o m p u t e r S c ie n c e a n d T e c h n o lo g y , S h e n z h e n , 5 1 0 8 5 5 , C h in a

ARTICLE INFO A B S T R A C T

A r t ic le h is t o r y : D elivering on dig italizatio n for large m u ltin atio n al b u siness, in th e c o n te m p o ra ry c o n te x t of global o p e r­


Received 15 December 2017 atio n s an d real tim e delivery, is a significant o p p o rtu n ity . O perations of localised facilities in d e p e n d e n t
Received in revised form 7 June 2018 of global o p e ra tio n s can re su lt in co m p ro m ised global synergies. C entralised fun ctio n s such as resea rch
Accepted 22 June 2018 an d d ev elo p m en t, o p tim isa tio n s of assets, co rp o ra te p lan n in g (strategy, in v e s tm e n t planning, financial),
Available online 28 June 2018
an d su p p ly chain to g e th e r w ith any o th e r function deliv er significant b u sin e ss value. In teg ratio n of th ese
fun ctio n s via in d u stry 4.0 delivers significant b u sin e ss value, d elivering stra te g ic an d o p eratio n al b e n e ­
K e y w o rd s :
fits. This resea rch p ro p o ses a global sy stem ap p ro ach , as d efined by in d u stry 4.0 (vertical, h o rizo n tal and
Business optimisation
to tal b u sin e ss in teg ratio n ), to th is challenge, from ERP th ro u g h m an u factu rin g sy stem s d o w n to in stru ­
Industry 4.0
m en tatio n . The p ro p o sed w o rk resolves th e in te r-s ite challenges to g e th e r w ith global sta n d a rd iz a tio n
Organization information processing theory
Smart production systems and in ter-fu n ctio n al in teg ratio n . This p ro p o sed a rc h ite c tu re is rein fo rced by a sim u latio n illu stra tin g th e
b en efits o f th e in te g ra te d business.
© 2018 In stitu tio n o f Chem ical Engineers. P ublished by E lsevier B.V. All rig h ts reserv ed .

1. Introduction more recently Manufacturing Execution Systems (MES) (Hansen


and Schaltegger., 2016; Aqlan and Al-Fandi, 2018).
Business development is usually, but not always, related to These initiatives have not been totally integrated within the
short, medium and long term financial benefits. Facilitating opti­ Information Management (IM) capacity inclusive of data automa­
mistic growth targets has directed executives into diverse business tion. The challenge is further exacerbated within the HR area, where
growth initiatives. With the advent of globalization, it has become the rigid individual “measure" data does not exist. Essentially a
increasing natural to seek growth potential outside of the tradi­ total seamless, data enabled business solutions, facilitating near
tionally defined borders (Scholte, 2007; Kristianto et al„ 2017). real time decision making is a deficiency.
Accompanying the business perspective comes advancement in Total business optimisation requires the agglomeration of strat­
information technology bringing with it intense global competi­ egy, operations, human resources, supply chain together with all
tion. This has resulted in internationally competitive businesses business functions into a seamless decision making toolset. This
making significant changes to ensure competitiveness (Cigola and toolset should focus on real time data availability, enabling opti­
Modesti, 2008; Kim and Chai, 2017). mum business decision making. Large corporates have attempted
Multinationals have employed various optimisation initiatives business optimisation but with distinct gaps, this includes opti­
such as Functional Excellence (FE), Operations Excellence (OE), mum technology application and successful vertical and horizontal
Balance Score Cards (BSC), Financial Reporting (FR), Custom Satis­ integration (Stock and Seliger, 2016; Dolgui et al„ 2018).
faction Surveys (CSS) etc. Business technology perspective includes This research focuses on the development of a holistic business
information management toolsets; Enterprise Resource Planning solution focusing on Information management (IM) enablement
(ERP), Process Control Systems (PCS), Business Systems (BS) and of business strategy; system and data integration, facilitating real
time business optimisation. The research presents a toolset: A spe­
cialised focus area would deliver on industry 4.0.

1.1. Background-Context
* Corresponding author.
E - m a i l a d d r e s s e s : arnesht@uj.ac.za (A. Telukdarie), eyad.buhulaiga@gmail.com

(E. Buhulaiga), surajit.bag@gmail.com (S, Bag),


The evolution of technology from the most recent industrial age
connectwithshivamgupta@gmail.com (S. Gupta), luozw@sustc.edu.cn (Z. Luo). to the technology era, better known as Industry 4.0 has resulted

https://doi.O rg/l 0.1016/j.psep.2018.06.030


0957-5820/© 2018 Institution of Chemical Engineers. Published by Elsevier B.V. All rights reserved.
A. Telukdarie et al. / Process Safety and Environmental Protection 1 18 (2018) 316-329 317

in greater demand for horizontal, vertical and end to end digital The summarised approach to the research been proposed, would
integration as defined by Oesterreich and Teuteberg (2016), Weyer include literature searching, standards search and development,
et al. (2015) and Stock and Seliger (2016). Industry 4.0 embraces Information Technology (IT) architecture, Functional development,
the paradigms; viz., horizontal and vertical integration, end-to-end within the human resources, balance score-card, Information tech­
digital integration (Ivanov et ai„ 2016; Liao et al., 2017; Bechtsis nology, business operations and other relevant areas. Identification
et al., 2018). of opportunities, which would enable implementation of a sin­
Acquisitions and mergers (Sherman, 2018) combined with the gle total business solution. Development and propositioning of an
potential of organic growth, of national and international busi­ appropriate enablement model to sustain the proposed system.
nesses, have become an increasingly familiar practice over the last
century. This has resulted in the current scenario of the evolution
1.2. Problem statement
of business into large international corporates. Growth and cen­
tralisation, always-ensuring business sense, however could result
Current developments in technology including industry 4.0 and
in significant unanticipated exertions. With a low-resolution view,
Industrial/Internet of Things (IoT/IIoT) together with the global
the challenge seems purely functional but with a magnified view,
village concept (the world is contracting based on connectivity)
the actual challenges become apparent (Henson and Sandberg.,
have contributed to large international corporates demanding dig­
2017). Symptoms of the problem include but are not limited to:
ital enablement (Rymaszewska et al., 2017; Theorin et al., 2017).
Growth of companies has surpassed geological boundaries with
• Lack of real time, business critical data facilitating optimum busi­ business optimisation as the key driver in securing sustainability.
ness decision making Total business optimisation must include, but not be limited to (all
• Total business delivery lacks value chain optimisation business functions), production, supply chain, human resources,
• Low inter-level system integration resulting in manual data or finance, information management, sales and distribution research,
inaccurate data maintenance, safety, environmental, security, design, project man­
• Optimum automated workflows not enabled agement together with all other business functionality. This has to
• Organisation outputs become rigid and limited due to hierarchy be achieved on an international basis with a high level of repeatabil­
constraints ity and consistency, inclusive of all business functions (Laser, 2005;
• Apparent gaps in strategy between head office and business units, Xu et al., 2018; Yin et al., 2018).
down to individual employees Multinational have adopted various toolsets, including, Enter­
• The inability of an employee to deliver due to unclear roles, lack prise Resource planning, Functional Excellence, Operations Excel­
of appropriate data lence, Kaizen, Advanced Control, Supply chain optimisation and
• Different version of truths and different data sources Financial modelling. This would be referred to, in this research,
• Specialized tools that requires different skill-sets and different as the optimisation initiatives. The deployment has traditionally
training been approached via specialised consultants with silos of solution
• Low performance together with non-measurement thereof development. In many instances, the individual solutions do not
comply with business requirements with distinct cross-functional
gaps. Can the 41R solution cater for all optimisation initiatives?
The symptoms/problem identification is simple when compared
to the resolution thereof. Various attempts have been initiated There appears a distinct gap to deliver a seamless, strategic
aligned, total Information Management (1M) business intelligence
in resolving the issues associated with efficient functioning of a
toolset with global real time enablement. This would be referred
large conglomerated business. These include functional excellence,
cross-functional excellence, lean manufacturing and process excel­ to, in this research, as the contemporary opportunities. The toolset
should secure real-time data across business thus facilitating
lence (Quezada et al., 2017; Buer et al., 2018; Moeuf et al., 2018).
These are only a limited number of potential solutions that have optimum, real time, global, business decision making. The all-
been introduced, in an attempt to overcome these challenges. encompassing toolset catapults the business into an “all Knowing"
space where the master system can be extended for any new busi­
The success rate of these has been diverse, from significant to
ness requirements from reports to operational changes including
non-impacting. The reasons for the limited success includes; organ­
isational politics, positioning, hierarchy, time constraints, lack of new business modules inclusions. This would align to the industry
HR inclusion, the limitations of the proposed solution together with 4.0 concept. Can the toolset provided accommodate the contempo­
rary opportunities?
the skills for implementation.
The research question adopted for this research includes the
The challenge needs to be addressed using a different toolset, a
toolset that is independent or has a very low dependency on these delivery of industry 4.0 by maximising the three subsets detailed
below;
limiting factors. The higher level of this research aims at proposi­
tioning a total business solution, inclusive of auto data enablement
for optimum business decision making. This would provide role • business functions: These are the functions such as Finance, HR
based mission critical data for optimum business decision making. and Maintenance
The industry 4.0 proposition around system centric, total business • optimisation initiatives: These include traditional initiatives as
integration could provide a resolution. The two key dimensions of currently understood such as balance score cards, lean and oper­
business decision making includes location (Global) and site (Hier­ ational excellence
archical), see Fig. 1. • Contemporary opportunities: These include industry 4.0 subsets
This research aims at proposing a contemporary approach to such as integration, loT and intelligence.
improving the situation via the application and development of
a more quantitative toolset, with a human resource focus. The The paper is organised as follows. The next section provides the
total solution proposed includes the exploiting of IT, engineer­ review of extant literature; section three presents the current busi­
ing, mathematical models, statistics and modern business systems ness functions that must be enabled using Industry 4.0; section four
hybridized into a feasible, reproducible and sustainable business presents the methodology and industry 4.0 framework; section five
solution. Loeser et al. (2013) highlighted the opportunity for busi­ provides an illustration of industry 4.0 enablement. This section
ness optimisation together with the benefits of “green IT”. is followed by section six on discussion. The final section consists
318 A Telukdarie et al. / Process Safety and Environmental Protection 118 (2018)316-329

Business Intelligence

Enterprise Resource Planning A m e r ic a

M a n u fa ctu rin g Systems Asia

U n it e d s t a te s o f A m e r ic a C anada

• H o u s to n B ro o k s
Advance C ontrol A f r ic a
• C h e m ic a l

• C a rs o n R e g in a

♦ Fuel R e s e a rc h

In s tru m e n ta tio n and C ontrol E u ro p e

Fig. 1 . The Two Key O perational Dim ensions (Source: A uthors’ Own Compilation).

of conclusions drawn from study, managerial implications, unique There has been, over the recent history of the financial system, a
contribution, limitations and future research directions. significant number of mergers and/or organic growth of companies.
According to Mergermarket there were just fewer than 5000 merg­
ers in the US in 2016, with a total value of around 3.5 trillion USD
2. Literature review on industry 4.0 enablement and (Sherman, 2018).The primary reasons for mergers and acquisitions
considerations are to maintain, or increase, market share and/or shareholder value
via cost reductions.
The mechanisms studied here are grounded upon Organization Mergers and acquisitions have been instrumental in trans­
Information Processing Theory (OIPT). Information processing in forming national companies into large international corporates
business management includes the collection of data, converting (Sherman, 2018). The development of international corporate
the data into information for business decisions and storage of the implies decentralisation of executives, resources, production facil­
information in database (Egelhoff, 1991). Business processes are ities together with other resources of a business. The management
open systems and expected to react fast to the changes in dynamic of large corporates with a diverse conglomeration of business
business environment. The main research focus is directed towards approaches/strategies/cultures is a challenge (Sayles, 217). Global
managing uncertainties and reducing risks (Thompson, 1967). time zones, communication, languages, etc. further complicate this
Galbraith (1974) further extended the concept of Thompson challenge. Factors that drive, seemingly simple daily business oper­
and developed the OIPT framework. This concept rest on two key ations, into added levels of complexity.
pillars: the dynamic business environment induced information Complementary to the typical financial cycles, experienced by
processing requirement and the capability of information process­ the business world, comes periods of financial crises, akin to the
ing designed by the business organisation. The authors argue herein current international scenario. These situations add further uncer­
that the use of Industry 4.0 tools will benefit multinational compa­ tainty to the challenge of managing an international business. It
nies by enhancing the information processing capability and meet is apparent that business growth has emerged with significant
the information processing requirements under this volatile, uncer­ benefits together with associated challenges. The functioning of
tain, complex and ambiguous environment. This will not only help international corporates includes the effective management of a
to reduce the level of supply and demand uncertainties in the entire diversified business with multiple, global, locations (Sayles, 2017),
global business network but will directly aid in business process encompassing diversity in human resource, cultures, legal require­
optimization. ments, technical capacity, and linguistics together with financial
Business development is usually, but not always, related to diversities. All of which must be navigated in ensuring business
short, medium and long term financial benefits. Facilitating opti­ success.
mistic growth targets has directed executives into diverse business
growth initiatives. With the advent of globalization, it has become 2.2. Optimisation
increasing natural to seek growth potential outside of the tradi­
tionally defined borders. Accompanying the business perspective International, corporates seek to streamline the operation of
comes advancement in information technology bringing with it business by adopting business optimisation toolsets. Business opti­
intense global competition. This has resulted in internationally misation can be segregated into various focus areas including (ISA,
competitive businesses making significant changes to ensure com­ 2000 ):
petitiveness (Cigola and Modesti, 2008).
• Production Management
2.1. Challenges of business growth • Maintenance Management
• Quality Management
A key initiative among business executives has been the growth • Inventory Management
of business. Mergers result in operating synergies, economic advan­
tages, marketing rationalisation, economies of scales benefits Each of the functional areas (plant and equipment; mainte­
together with reductions in expenses (Hazelhurst, 2009). nance; safety, health and environment; production planning and
A. Telukdarie et al. / Process Safety and Environmental Protection 118 (2018)316-329 319

control; engineering design, financial, human resources, organisa­ • Role-based visualisation reducing information overload,
tional design and supply chain) has enjoyed variable consideration, • KPI generation to enable and support decision-making process,
as determined by company specific, current business drivers. • Improved response to both micro- and macro-economic factors,
Development is deployment value dependent, with alignment to • Optimum utilisation of equipment, personnel and material
lessons learnt based on implementation successes. resources,
The operational and production aspects of business manage­ • Ensure manufacturing operations quality standards are met.
ment has benefited from various systems such as Operational • MES as defines by ISA 95 includes four key areas including Oper­
excellence, Lean manufacturing and Six Sigma. These systems enjoy ations, Maintenance, and Quality.
structured methods inclusive of advanced systems, mathematical
modelling and IT (Blahova et al., 2017). 2.2.5. Functional excellence
Operational excellence, lean manufacturing together with other A more recent initiative has been Functional Excellence (FE).
production toolsets has been successful in streamlining busi­ Functional excellence highlights limitations of large organisations
ness operation via definitive methodologies. An example would and recognises opportunities for improvements. The key philos­
include lean manufacturing focusing on creating greater value with ophy has been the optimisation of complex business structures
reduced effort (Khanchanapong et al., 2014). with a centralisation focus. The key driver had been consolidation
into doing things in a single approach, aims at reducing repetitive
2.2.1. Operations excellence behaviour, with segregation of key functions within strategy, devel­
Operational excellence has achieved significant success in opment and production. Functional excellence, like operational
improving operations of large businesses, focusing on the oper­ excellence together with other initiatives has been found to have
ational component of business. Significant improvements in significant dependencies. This includes the skills requirements and
operational are generally achieved. (Mascitelli et al., 2017) capacity, among other issues (Kanji, 2001; Wongrassamee et al.,
In order to achieve improved international competitiveness an 2003).
organisation needs to include all employee functionality in creat­
ing new operational pathways. The human resource component 2.2.6. Industry 4.0
aligning to optimisation can be matured significantly with simi­
The concept of Industry 4.0 was introduced in Germany around
lar formal approaches. With reference to the various optimisation
2011 (Kagermann et al., 2013). Industry 4.0 quickly became a
toolsets the development of the human resources can be described
strategic inventiveness of Germany as listed in the “High Tech
as the key focus in achieving success. An employee must feel valued
Strategy 2010 Action Plan” (Kagermann et al., 2013). Industry 4.0
and skills/development must be explored.
embraces three paradigms; viz., horizontal integration (through
value networks), vertical integration, and end-to-end digital inte­
2.2.2. Enterprise resource planning gration (Stock and Seliger, 2016). These paradigms of industry 4.0
The current approach of business is to enable the business deliv­ are fundamental to this research.
ery via the implementation of an appropriate Enterprise Resource
Planning solution (ERP). These solutions, although operating on the
2.2.7. Human resource
business lever, are implemented in areas of specialisation (Jinno
Human resources are the key asset of any business. In order to
et al., 2017). Areas of specialisation include production, finance,
achieve the best of human resource it is key to identify capability.
human resources etc. ERP systems such as SAP do not characteris­
This is strongly supported by, resources been considered valuable,
tically construct information integration into the processes space
as aligned to the general business drivers. An employee must be
(Nad-and Vrazic, 2017) but focus on ERP value chain integration.
guided through how his/her skills contribute to driving the business
forward. An employee may benefit from continuous measure of
2.2.3. Process control compliance/enablement relative to the bigger business drivers.
The application of process control and advance process con­ Organisational culture is a critical factor in formulation and
trol as a specialised manufacturing level solution has contributed delivery on manufacturing strategy. Employee competence and
significantly to in improving production (Baldea and Harjunkoski, delivery can be strongly linked to organisational culture. Chang­
2014). The control based solutions interface with the lowest level ing an organisational work culture is not something that can be
instrumentation with programmable logic controllers and other achieved by incorporating a new mission statement, updating
lower level devices facilitating automated responses to process employee handbook, changing recruitment policy, or enhancing
events. Advances include the application of statistical process con­ mentoring program (Cigola and Modesti, 2008; Crane, 2017).
trol (Shapiro et al., 2015) together with historians etc. Process
control systems are built on a Plant Control Network (PCN), and
2.2.8. Strategy
data is reposited at the plant production level without significant
business visibility. The void in knowledge and practice, at large corporates,
between global strategy and human resource management is
identified as requiring development. Senior executives currently
2.2.4. Manufacturing execution systems (MES)
develop business strategy. This strategy is, highly dependent on
MES is an information and communication system operating
communication and senior management to roll down to employee
across a manufacturing organisation that integrates business and
level. Current strategy development lacks the role down/up effect,
plant systems. Manufacturing systems focus on value chain opti­
i.e. there is significant dilution/hazy as the strategy is rolled down.
misation seeking to provide data in real time for key preventative
Strategy alignment has been recognised to be among the key
action and decision making.
factors in the operation of an effective business. Marketing and
The benefits of an MES is summarised below:
manufacturing strategy must be in unison. The miss-alignment
between corporate strategies can prove expensive and time con­
• Central data/information repository across the enterprise, suming (Reich and Benbasat, 2000)
• Support regulatory compliance to safety, health, environment Company strategy development is typically a top-down process,
and financial standards, where lower level strategy is only theoretically a function of the
• Enterprise wide access to accurate, real-time data, higher levels. Most businesses seek the enablement of high-level
320 A T e lu k d a r ie e t a l. / P ro c e s s S a fe t y a n d E n v i r o n m e n t a l P r o t e c t io n U 8 ( 2 0 1 8 ) 3 1 6 - 3 2 9

strategy. Challenges include tightening the apparent gaps in strat­ prehensively align to business directions. In some cases were found
egy between head office and business units, down to individuals to be potentially misleading to managers (Jannesson et al., 2016).
(Parthasarthy and Sethi, 1992).
Traditional definitions of manufacturing strategy include the 2.4. Integration strategies
exploiting of certain properties of the manufacturing function as
an economical opportunity, more modern definition, as a collec­ One of the major challenges in globalization is the lack of
tive framework of decisions that act upon the formulation and integration strategies with the focus of compartmentalised imple­
deployment of resources related to manufacturing. mentations. This has resulted in different standards followed by
different parts of the enterprise which increases the initial Capital
Expenditure (CAPEX) cost as well as the Operational Expenditure
2.2.9. Strategy and human resources (OPEX) cost. Different industry organisation such as MESA, ISA,
The delivery of strategy from top floor to the shop floor has been OA1SIS have tried to take the lead in defining global integration
the most significant challenge. Performance of individual, within strategies and standard that could be followed by manufacturers,
diverse international organisations, have not necessary conformed within the Manufacturing2.0(Mfg. 2.0) vision. The following details
to linearity (Sherman, 2018). This has resulted in performance dete­ the different integration strategies.
rioration. Challengers include:
2.4.1. Application-driven integration
• Misinterpretation: Middle management has been responsible for This approach mandates hardwiring all applications together.
the enablement of strategic drivers at business. Key considera­ It is appealing as it is the cheapest when it comes to the CAPEX
tions for the enablement of these drivers are the ability/capacity however it is the most expensive when it comes to the OPEX due to
of middle managers to effectively enable these key drivers down the high maintenance required with no reusability. This strategy is
the organisation. Relating to this is the skills gap, inclusive of recommended for simple and short-term integration where there
the turnaround and maturity of middle managers to conduct are no reusable cases (Gifford, 2013).
the required task. The resultant effect is non-compliance and or
subjective/ill-defined strategically aligned measures. 2.4.2. Data-driven integration
• Staff turn around at middle and senior level results in gaps, which This approach mandates the development of a central data
could imply business failure rather than success warehouse to collect the data from all needed applications. Extract,
• Middle managers don't see the upper level development together Transform and Load (ETL) strategy is usually used to collate all the
with the lower enablement picture data. The advantage of this approach is that it provides a central
• The inability of an employee to deliver due to unclear roles database for all data allowing for standard reporting, analytics and
• Lower level staff do not understand the high-level goals or when performance monitoring. The disadvantage though is creating a sin­
rolled down they are diluted. This implies that individuals and gle point of failure with difficulties in data modelling. This strategy
teams efforts evolve in different direction, sometime negating is recommended for standard fixed reporting with low number of
each other. users that requires strategic decisions, not real-time (Gifford, 2013).

2.4.3. Interface-driven integration


The collective effect of the above factors results in low
This approach always refed to as Enterprise Application Inte­
performance together with non-measurement thereof. Various
gration (EAI) that depends on interfaces with the applications via
mitigating systems have been attempted to rectify the situation.
common integration hub referred to usually as Enterprise Service
There are various modern tools that have been adopted to facilitate
Bus (ESB). ESBs are usually expensive and have specific adap­
employee delivery measure inter alia Balance scorecards (Kaplan
tors that are following the EAI standard. The benefit is within the
and Norton, 1995; Tizroo et al., 2017).
expandability and flexibility within the management and support
of such an environment. This strategy is recommended for cor­
2.3. Human resources performance measures porate implementation to allow for central administration and
governance (Gifford, 2013).
Business finds the need to maintain focus within a diverse
environment. High performing organisations are characterised by 2.4.4. Model-driven integration
pressure. Using this pressure productively, so that employees are This approach is considered as the manufacturing industry best
neither overwhelmed nor complacent, requires three key skills: practice as it focuses on the service level integration rather than
choosing the right fights, optimising informal networks, and devel­ adapter’s level integration. In this strategy, there are industry stan­
oping proactive leadership skills. dards such as ISA-95 and Mimosa that have created service-level
Measure of compliance to strategy is a challenge that has eluded interfaces that could be used regardless of the underlying technolo­
research in this area. There has been significant effort with various gies (e.g. .Net, Java, etc.). It allows for Business Process Management
measure models: Normative quality focused model with a focus on (BPM) and standardization as it separates IT from business and mix­
division and plant performance measures; Close loop deployment ing traditional technologies with the legacy ones. The shortcoming
and feedback model; with some simple frameworks to performance of this strategy is that it requires an intensive training and change
measures. management program (Gifford, 2013).
In an attempt to close the gap between corporate strategy and
employee action, a recent trend has been the development of mea­ 2.4.5. Limitations in total business optimization
sures of employee performance against business drivers. These Research studies have clearly illustrated diversity in output
include balance score cards (Flamholtz, 2003) and various other capabilities of conglomerates at dissimilar global locations (Li,
personal assessment tools. There have been significant assessments 2010). Research has proven that various important business com­
of the effectiveness of these evaluation systems with some indi­ ponents that influence a production site to have a difference in
cating that up to 70% failing. There have been various suggestions capability from a correspondingly managed counterpart across a
on management of the balance scorecard. There were key gaps multinational (Vergidis et al., 2007). Li (2010) identified productiv­
identified, these included non-alignment to strategy, failing to com­ ity of skilled labour is higher in developed-economy subsidiaries
A Telukdarie et al./Process Safety and Environmental Protection 118 (2018) 316-329 321

than in emerging-economy ones. The questions relating to technol­ Table 1


ogy availability to the skilled labour can be considered a factor. The Business Solution List.
impact of technology, and application on conglomerates is inves­ • Safety Health and Environment • Production
tigated (Brambilla, 2009). The results of the study indicating that O Reporting O Value chain optimization
technology delivers a meaningfully advanced corporate output in 0 Data collection O Process Safety
0 Vetting 0 Production incidents
comparison to non-technology aligned corporates. Research results
O Monitoring O Variance management
in knowledge (technological) impact on multinational capacity is 0 Incident management 0 Scheduling
supported by other researchers (Girma et al., 2007) validating the 0 Early intervention systems
bearing of technology alignment from a conglomerate to a localised 0 quality
business. 0 Security
O Shift logs
Multinational seek to optimise business within the key consid­
O Optimization
erations detailed within this literature search but are limited. These
limitations are classified (Prescott, 2009) in studies and include: (1) • Emergency systems • Human resource
economic, (2) technological, (3) organisational, (4) geographic, and O Incident and personnel O Training
management O Scheduling
(5) sociological.
0 Fire and gas 0 Access
A growing number of multinationals are focusing on global tech­ 0 Emergency response 0 Vacancies
nological role outs, across geography’s. The success and impacts
of these role outs together with challenges are still being quan­ • Value Chain • Scheduling systems
tified by contemporary research. It has been established that the O Production capacity 0 Maintenance
O Schedule management O Production
region or the physical location has a considerable influence on the 0 Optimization O People and production
deployment of technology (Overby et al., 2006; Chesbrough, 2007).
• Security and personal management • Waste
3. Current business perspective O Vetting O Disposal
O Authorization management 0 Certification
O Access control O Analysis and quality
Bringing together the operations detailed above, results in a O Contractor site validation and O Cost management
rather complex structure with individual silos of decision mak­ Payment systems 0 Safe disposal
ing which has a significant effect on parallel delivery streams. O Certification 0 Logistics
With a view of the above, each site cum location and in even cer­ O Tracking
tain circumstances business unit on site runs specialised solutions • Content management . Building and site
or subsets of solutions. The business functions above cannot be • Linked to change, automated management
considered exhaustive and can be extended to include core func­ • Operational logs
tionality such as the list detailed in Table 1.
• Order management • Data security
These are some of the business functions that must be enabled.
This is considered as the key subset for enablement of industry 4.0. • Supply chain • Change management

3.1. An example of the dependencies can be illustrated via a • Business intelligence • Order management
detailed scenario
. Asset management • Finance Management
O Reliability management
A production event occurs in the form of a pump break down. O Maintenance management
The operator manually calls maintenance, requesting a repair. The 0 Skills
maintenance team lead, loads onto ERP a request manually. The management(competence/task)
0 Real time knowledge available to
planner receives the request and incorporates this manually into a
maintenance
plan. This plan is printed (manually downloaded) and an artisan
goes out to evaluate the event. Upon inspection, a paper (man­
ual) request is made for spares and people. The artisan reviews the
design specifications manually. The Artisan reviews the SOP manu­ deploy this application. Ripping and replacing software might have
ally. Prior to working on the equipment, he manually requests a hot an appeal to CAPEX figures, if looked at from standalone perspec­
works. On completion, he manually requests a close out and test. tives. If included within the overall multinational total business
The plant operator is manually contacted and asked to bring the solution, changing software would have a major impact on both
pump back online. This is considered part of the online protocols, the CAPEX and OPEX. This is due to the fact that the new intro­
secondary protocols include: duced software will require the following from CAPEX and OPEX
Fig. 2 illustrates the event within a functional perspective. It point of view seen below in Table 2.
would be difficult to illustrate multiple events across the spec­
trum of business functions. An attempt would be made to detail Table 2
a summary of business events dependencies on a cross functional Software requirements from CAPEX and OPEX perspective.
basis. CAPEX • Design OPEX • Training
• Integration • Documentation
3.2. The effect of multiple site-The challenge of standardization vs • Unit Testing • Adoption and
integration • Integrated Testing Change Management
• Deployment

Traditional business organic growth brought together a diverse


set of systems. Many companies approach the challenge via a
standardization approach with rip and replace. The results drive Additional considerations justifying the industry 4.0 solutioning
simplicity but may kill the business case due to financial impacts. include:
The differences between integration and standardization rely
within the engineering effort required to design, test, integrate and • Eliminating the requirement to change to a different system
322 A Telukdarie et al. / Process Safety and Environmental Protection 118 (2018) 316-329

E quipm ent Failure


Incident dosed system

Logistics system
Dispatch im pact

Fig. 2. Event within Functional Perspectives (Source: Authors' Own Compilation).

• Reducing the time to execute plant floor data extractions. Extrac­ ations with any concoction of products on different sites. The
tion and integrating plant data to other applications including proposed generic template should be fully inclusive but modular,
Enterprise Resource Planning (ERP). facilitating a self-service reconfiguration. The data model must be
• Migrating from a reactive to a proactive and even predictive dimensioned so as to navigate affinity variables.
operational environment. Facilitating engineers and operations High level time based view of total business solutions is shown
to respond faster. in Fig. 3.
• Maximising on current international best practice such as ISA-95,
global communication and integration technologies.
• The ability to collate engineering and other data, associated sce­ 4.1. Proposed operational implementation industry 4.0
narios, root cause analysis so as to synergise pattern recognitions framework
and other corrective action.
The total business solution proposed in this research encom­
passes the entire multinational from shop floor to top floor. The
This research seeks to provide insights into the options of traditional Purdue reference model defines level 0-4 (ISA, 2000),
developing a comprehensive industry 4.0 based solution for multi­ see Fig. 4. The key consideration has been the alignment with a
national enterprises. The functional and technical requirements
global, inter-site, and multi product businesses.
together with examples of enablement are provided. The simula­ A typical multinational focus on product manufacture on a
tion provides insights into the operationalisation of the solution. global basis with multiple sites, Fig. 4 above. The proposed solu­
tion exploits common units and maximizes business value via a
4. Methodology: implication of theory and practice “totally" connected network.

A seamless, data enabled business optimization solution bring


together all business functions, detailed in Table 1. This research 4.2. Application landscape
proposes providing an optimum total solution fulfilling the above
requirement. The Fig. 5 illustrates a typical configuration. Key considera­
The key solutioning approach would be based on a global tem­ tions are; total connected network of data, a common integrated
plate approach, wherein the generic business structure enables cross functional relational data structure, a single analytics and
all requirements. The business may include diverse product oper­ reporting tool, self-service, build once, global available for repli-
A Telukdarie et al. / Process Safety and Environmental Protection 118(2018) 316-329 323

Fig. 3. Current Scenario Typical Theoretical Structures (Modified Perdue Reference Model) (Source: Authors' Own Compilation).

Global
fca.T :.:s Enterprise Resource Planning

Business
Site Unit 2 Manufacturing systems

Plant control

Operational Unit __ZZ3iPL™_


Instrumentation

Fig. 4. Multinational Framework (Source: Author’s Own Compilation).

cation/modifications, common units (KPIs’, reports, calculations) Table 3


reused globally. Functional Enhancements.
Global teams have been assembled by vendors with major man­ List of business specific functional enhancements
ufacturing companies to design a generic reference architecture
• All data available in real time • Single version of data
that could be used to document all technical requirements for • No repeat builds, build once • Reproducible solutioning
global systems. The Chemical Reference Architecture (ChemRA) replicate at any site • Slice/dice any view (timeline.
includes the following components (Microsoft, 2015) (Fig. 6). • Fully integrated global business combination) of data
Total business solution considers most if not all the afore­ • Rapid time to modify and deploy, • Single reporting framework, for
centrally all organisational levels
mentioned components to allow for expandability, flexibility, • Reduced costs due to shared • Big data: capacity to apply
management and governance. infrastructure advanced analytics
• Simplification of application • Consistent data
landscape • Linear and none linear business
4.2.1. Enablement • Global inventory intelligence
The proposed research consideration implies a fully connected optimization( inbound/in • Data available for specific
process/outbound) solutions (maintenance,
global business with all system data available and the sharing of • Extensibility inspection, etc.)
knowledge, accelerated time to deliver (on different sites, globally) • Higher resolution visibility, all data • Global lessons learnt availability
and defined common KPI's. The key advantages are listed below from all systems available • Automated workflows
(Table 3): • Full system and data integration
The integrated data structures would allow for the location
of any specific equipment/product knowledge. The knowledge
would be expanded into all functional dimensions from a safety,
environmental, maintenance, operation, documentation, logistics, 1) Capitalizing on existing technological investment value
reliability, efficiencies etc (Qi et al., 2012; Laser, 2005; Manuele, 2) Creating real time KPI visibility for operational and business
2006; Dubeyetal., 2016; Bag, 2017; Gunasekaran et al., 2017). The optimization, locally and globally.
data would be constituted while dissolving the applications silos to 3) Improved capabilities in real time responses to plant challenges
maximize the utilisation of the systems and minimize functional 4) Forecasting conditions grounded on real time data and trends.
redundancy. The expected values of the integrated multinational 5) Delivering on an effective and efficient enterprise delivering on
total business solutions are (Gifford, 2013): global manufacturing efficiencies.
324 A . T e lu k d a r ie e t a l. / P r o c e s s S a f e t y a n d E n v ir o n m e n t a l P r o t e c t io n 118 (2 0 1 8 )3 1 6 -3 2 9

Centralised configuration
Processes/ Integration/ Master d a ta / KPI/ Reports

Self Service
KPl/Re ports
Executive to
operational
Site Serviced ERP Site Serviced ERP Site Serviced ERP Site Serviced ERP
r

Site Manufacturing Site Manufacturing Site Manufacturing Site Manufacturing

Site Control System s j ji g Site Control Systems Site Control Systems

Site B Site C

Fig. 5. Global System: Graphical Architecture (Source: Authors’ Own Compilation).

Data Service

“ dS H 3 | V b3« tiK management

Business Services
n in e s p u s io n c ir i,
Project Managment
ERP,CRM, etc.)

Application Interoperability Services


Integration Services Orchestration Workflows Discovery


End user Experince Services
Full web-based access Mobile access

Security Services
Authentication Authorization Auditing

F ig . 6 . A Globa! Service Structure (Source: Authors' Own Compilation).

6) D elivering operational efficiencies though m onito rin g of 9) Facilitating b est of b reed system deploym ent, in corporating
energy, equipm ent, reliability and quality in real tim e and long technological evolution.
term trends. 10) Im proved corporate p erform ance by easier in tro d u ctions new
7) D iverting from point to p o in t in teg ratio n reducing ad m in is­ system s and functionality as co rp o rate req u irem en ts and tech ­
tratio n and operational costs b u t m ore im p o rtan tly reducing nologies evolve.
points of failure. 11) M axim izing of system change cycles by single, w orldw ide
8) Eradicating delays and m istakes triggered by the physical entry d ep lo y m en t of apprises and changes.
of data.
A Telukdarie eta l. / Process Safety and Environm ental Protection 118 (2018) 3 1 6 -3 2 9 325

12) Standardization of applications internationally with negligi­ Table 4


ble differences in appearance and composition, navigation, and Results of Simulation.
reporting. Pump breakdown scenario
13) Optimize of time to role out, develop solutions once for global
Conditions Manual and Automated Automated Manual
sites in pre-built execution templates. Time distribution (hours) 31320 24840 60840

Supply chain Scenario


5. An illustration of industry 4.0 enablement
Conditions Manual and Automated Automated Manual
A fundamental consideration of the enablement of industry 4.0 Time distribution (hours) 17640 11520 39960
is the automation of all business processes. This is illustrated by the
architectural and system landscape. Global logistical optimization
1. No automation and integration
can be a significant challenge, with a diverse global sourcing and
2. Random automation and integration
delivery capability. Multi-site capacities producing similar prod­
3. Fully automated and integrated systems
ucts with sourcing, labour, operational and distribution diversity,
operational maintenance and plant availability.
Global delivery. The model is built based on the pump break
The process flow (refer to Fig. 7) illustrates a modern logis­
down process and supply chain process used in this paper. The two
tics system for site specific product dispatching. The assumption
processes are configured in any logic in order to simulate the time
is that the process is fully automated with system to system inte­
to execute the processes based on a manual set of activity relative
gration. The ERP, Manufacturing and plant systems communicate
to automated business process enablement.
to secure optimum product dispatching, preventing product inef­
The simulation (refer Figs. 8 and 9) is built and run for each
ficiencies through inaccuracy, delays, person interventions and
of the processes, with the first set of result clearly illustrating the
potential fraudulent transactions. The system has various preventa­
impact of automated execution of the business process. The results
tive measures such as driver/vehicle vetting and onsite checks. The
indicate the time take to execute the business process 1000 times.
system has various optimization opportunities such as GPS tracking
The simulation is established based on the business hierarchies,
and planning.
as per Medoh and Telukdarie (2017). Essentially an administrator
The plant specific dimension considered an integrated logistics
takes a set period to execute a task and a senior manager a pre­
system has significant benefits but the integration of the individ­
determined period. The model is developed based on automation
ual systems can potentially benefit other processes automation, as
of workflows between activity and the potential to escalate a non
illustrated in Fig. 7. The maintenance system usually comprises of
executed workflow after a period. The model assumes the business
an ERP/MES component with plant specific instruments for moni­
to be in stable operations, hence no disturbance to the execution of
toring. In the logistics scenario the maintenance data is fed to the
the business process.
planning system and used to confirm production capacity securing
It must be noted that legislative and other requirements stipu­
product dispatch. Integration into the maintenance system can also
lated employee (human) intervention. The simulation is configured
benefit other business processes such as automated event triggers
to accommodate the escalations of none active business processes.
for maintenance, auto notifications for incidents, emission reports,
This is merely an illustration of the modelling capability.
safety alerts based on equipment status, lockout interlocks prevent­
This includes manual and auto escalation and the ability to esca­
ing unsafe equipment restarts, artisan competence vetting, safety
late one level up (manager) or two levels up (Senior). The model also
and maintenance instruction, and various other benefits.
classifies the activity as standard, to high priority. This allows for
The point to point integration of individual system could prove
simulation on the impact of scenarios of priority and multi-level
to be challenging for multiple reasons including, multiple data
escalations.
queries, maintenance of multiple interfaces, and access into plant
An added component of value in an automated process is esca­
networks. A single data warehouse with a single extraction and
lations of activities where, due to the automation of the process an
multiple distribution of data would be ideal. Operational data is
employee could stop the process if his/her activity is not approved
usually gathered on a much higher resolution, usually less than a
timeously.
second. The logical approach would be to store, aggregate and man­
As can be seen from the results above the basic classification
age all plant data on a plant historian, allowing for data queries as
results in the slowest times but if an activity is classified as a high
required but with all data accessible.
priority the time is reduced significantly, it is also apparent from
The remaining MES systems may be fully integrated via a single
the results that automated escalations up to a secondary tier results
open integration to the database, implying full access to all data.
in a much more rapid run around time.
The MES layer, located at the middle, becomes the key integration
The simulations reinforces the theory presented in this study
and activity layer. Data always remains at source but data visibility
is key. by direct calculation of a sample set of business activity been per­
formed automatically versus manually. The simulations reinforces
The development of a fundamental self-service toolset becomes
the theory presented in this study by direct calculation of a sam­
imperative to deliver any report from data from any layer. The self-
ple set of business activity been performed automatically versus
service platform must classify and repost data appropriately. The
manually (Table 4). The two scenarios provided have a time differ­
platform must include key navigation components together with
entiator of 60% and 71 %. This implies almost two thirds time saving
the ability to templates all previous builds, KPI's, reports, calcula­
for an integrated and automated business process.
tions, secondary variables, etc.

6. Discussion
5.1. Proof of impact: simulation
The ability to optimise a global business using Industry 4.0
In order to reinforce the theory the researchers embarked on is fundamental, with the ability to deliver a similar technologi­
an extended simulation model. The model is based on Medoh and cal service globally significant. Adding to this the opportunity to
Telukdarie (2017) but serves as proof of the impact of an integrated develop solutions once, standardise and ensure a “single version
enterprise. The key scenarios for the model are; of data" globally makes for a comprehensive Industry 4.0 solu-
326 A Telukdarie et al. / Process Safety and Environmental Protection 118(2018)316-329

Logistics
E n te rp ris e R esource
M a n u fa c tu rin g System
P lanning

Fig. 7. Sample Business Process (Source: Authors' Own Compilation).

tion. This paper outlines the delivery of an Industry 4.0 solution 7. Conclusion
aligned to these goals. The delivery on comprehensive business
functions, optimisation initiatives and contemporary opportuni­ Multinational total business solution changes the way current
ties, as defined in the research questions, is delivered. Table 5 single-disciplined applications are implemented. Total business
provides insights into the three focus areas of this research together solution benefits include but not limited to total global business
with the detailed functions, initiatives and opportunities that are integration for optimisation (Cheng et al., 1999). The toolset pro­
delivered. posed accommodates the research objects:
A . T e lu k d a rie e t a l. / P rocess S a fe ty a n d E n v ir o n m e n t a l P ro te c tio n 1 1 8 ( 2 0 1 8 ) 3 1 6 - 3 2 9 327

DumpBreakdown logfvtR erpForOrder artisanS | equipmentRAJC reErsderd

0 J
— *T*------- — 1 E *0 2 n *® 5 H ® 5 3 ] < § S ll< § :
timeMeasureStart maintenances mainter,a; ceR artisanCEARS operatorslARBTS
rCA
rCA incidentRAA
in c id e n ta l s equ :p n U rtO S R ------- stoc«JQ IC evded------rec«,:y«A J

deviationR incidentC ^hutDU equipment) awaitCN unitSU------orderC breakdownlA planning/j newfti

Fig. 8. Anylogic Simulation: Pump Breakdown (Source: Authors' Own Compilation).

order erpCapture dispatchR vehicieODS vehicieODV siteAOC quaiityA inventotyU dispatdhC gpsT goodsR invclicing

, — i t i i yf — e k
tirneMeasureStart

plant(|Q SA planjnjng availajjiiityOM seur t) quantiiiesD warehouse weighbridge timeMeasureEnd end

TM- jEsak-fiSS—-B3—
Hsl- KOI

Fig. 9. Anylogic Simulation: Supply Chain (Source: Authors' Own Compilation).

Table 5
List of Enablement Benefits (Research Questions Specific).

Business functions Optimisation initiatives Contemporary opportunities


• HR processes • Lean . loT/lloT • Integration
• Financial systems • Six sigma • Advanced process control • Overcoming discipline (silos)
• Supply chain • Kaizen • Mathematical modelling specific solutions
• Strategy • Balance score cards • MES integration • Single version of data (truth)
• Communication . OE • Opex management • Easy of data mining
• HSE • Functional excellence • Capex management • Facilitating real time, data centric
• Security . JIT • PCN integration for real time data decision making across all levels of
• Operations . KPI’s • Enterprise Resource planning(ERP), the organisation
• Maintenance • Location centric data • Time zones • Real time deviation management
• Research and Development . Hierarchical centric data • Languages • Real time KPI's, operational and
« Legal • Standardization enterprise reports
• Technical • Replication • Skills based delivery
• Quality . IT
• Inventory . OT
• Warehousing • Historians
• Master data • Role based visualisation
• Intelligent KPI's

• business functions: Integration of all business functions; this previous studies conducted by Mehta and Reddy (2014) and Zhang
includes the operations layer via the PCN. and Tao (2016).
• optim isation initiatives: The solution provides for any optim i­ Mehta and Reddy (2014) discussed distributed control systems,
sation initiative, these can include functionality and workflow batch autom ation systems, safety instrum ented systems, asset
capacities. Initiatives can be enabled via real tim e data, through m anagem ent systems, calibration m anagem ent systems, advance
the defined network. process control systems, manufacturing execution systems and fur­
• contem porary opportunities: w ith a globally connected busi­ ther proposed architecture to support Industry 4.0 program.
ness all contem porary requirem ents can be included. This could Zhang and Tao (2016) in chapter 2, page 29 have also proposed
include any cutting edge technologies. an architecture which is conceptually similar to the framework
proposed herein. Zhang and Tao (2016) proposed architecture is
The simulation provides the necessary evidence supporting the however limited to manufacturing systems only; w hereas the work
autom ation and integration of two key business processes, further proposed herein proposes architecture for end to end business inte­
total business integration and autom ation has a similar impact. The gration.
design of the application and integration architecture provided in Finally, the findings are found to be supported by the Orga­
this paper delivers on industry 4.0 for an enterprise. The simulation nization Information Processing Theory. Industry 4.0 will benefit
of an autom ated process provides insights into the resultant time multinational companies by enhancing the information process­
saved in executing in an integrated environm ent as delivered via ing capability and m eet the information processing requirem ents
industry 4.0. The findings of this research study corroborates with under this volatile, uncertain, complex and ambiguous environ-
328 A. Telukdarie e t al. / Process Safety and Environmental Protection 118 (2018) 316-329

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