IBM PQM Analytics

© 2013 IBM Corporation

IBM Predictive Maintenance & Quality (PMQ) Overview


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Setting the Stage….

PMQ is an important product from IBM

that is made up of many components.

Participants will leave with an

understanding of the value of the

solution along with what is required to

build sales & services practices around

the offering.

David Zyla

Partner Technical Enablement Specialist

Business Analytics Division,

IBM Software Group

Anuj Marfatia

Program Director

Business Analytics Division,

IBM Software Group

Why this is Important to Know… Speaking to you today…

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Agenda

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Background & Value

Case Studies

Solution Stack

Positioning

ROI


Success of PMQ will be based on Team selling

What is it?

A cross-SWG, packaged solution with its own PID

Utilizes technologies from SPSS, Cognos, DB2, Websphere, Infosphere, and integration to Maximo

Why should I care?

Market size of $8B

Key industry targets: Manufacturing, E&U, and Chem & Petro

Direct integration to Maximo

$325,000 avg. deal size for software only; minimum 1:1 software to services ratio

PMQ + Maximo is a key differentiator

Partners are a key channel

Several upcoming focused events in 2013 (Chicago-Oct.9, Cleveland-Oct. 15, Calgary-Oct.22, Toronto-Oct.2?, IOD (Vegas)-Nov.3-7)

What are the primary use cases?

Primary use cases

Predict asset failure

Determine anomalistic characteristics that lead to poor product or component quality

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Background & Value

Organizations forced to reduce operational costs to remain competitive

Impacts manufacturers & organizations managing field level assets

Challenge: organizations reacting and not predicting

What is the impact when …

– a manufacturer encounters a machine failure during a production run?

– a heavy machinery operator performs unscheduled repair on a bucket wheel excavator?

– a water main breaks?

– A transformer fails causing a power outage in an electrical grid?

Aberdeen study - #1 risk to operations was failure of critical physical assets


Assets are more than just manufacturing machinery

1. Manufacturing process

Manufacturing machinery utilized to create a product

2. Field-level assets

Consumer Appliances o Washers, dryers, hot water heaters, furnaces, HVAC

Vending Machines o Food, drinks, cigarettes, electrical products, videos, money

Connected Transportation o Planes, trains, ships, tanks, buses, passenger automobiles, fleets, electric vehicles, gas

powered autos, motorcycles, snow mobiles, lift trucks

Heavy Equipment Machinery o Earth movers, mining equipment, cranes, wind/gas turbines, nuclear plants, solar panel

arrays, oil drills, oil rigs

Networks o Electrical grids, water/sewage infrastructure, IT systems, telecom lines/cables, security

systems

Buildings o Property, real estate, universities, stadiums, corporate offices, headquarters, field offices

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© 2013 IBM Corporation 9

Predictive Maintenance is the next step towards Maintenance Excellence

Reactive Maintenance (machine fails, then fix)

Preventive Maintenance (based on manufacturers’ schedules, time, or operational observations)

Condition-based Maintenance (based on monitoring to assess condition of assets)

Predictive Maintenance (based on models of evolution of the condition of assets)

Source: Gartner

Maintenance Maturity Model

Managing budget costs while improving reliability and safety

Predictive Maintenance uses analytics to model foreseeable evolutions of the characteristics of individual systems or assets


New Offering!

IBM Predictive Maintenance and Quality •Reduce operational costs •Improve asset productivity •Increase process efficiency

Accelerate Time-to-Value

Real-time capabilities

Big data, predictive, and advanced analytics

Quick and accurate decisioning

Maximo integration

Open architecture

Business intelligence

Singular software capabilities

(SPSS, Cognos)

Customizable, cross-IBM, software and services solution

(Analytics with real-time data integration)

Packaged, cross-IBM, software product

(Analytics with real-time data integration)

2012

Q1 2013

TODAY!

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Severity Factors

•Health and Safety Issues

•Asset Damage / Repair Costs

•Loss of Revenue

Predictive Maintenance and Quality delivers significant value where both the impact of failure and the probability of failure are high

Greatest need for Predictive Asset Optimization

Lower need for Predictive Asset Optimization


• Monitor, maintain and optimize assets for

better availability, utilization and performance

• Predict asset failure to optimize quality and

supply chain processes

• Remove guesswork from the decision-making

process

IBM Predictive Maintenance and Quality reduces operational costs, improves asset productivity and increases process efficiency

Combined with out-of-box models, dashboards, reports and source connectors

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Business Use Case Business Value

Predictive Maintenance and Quality generates business value for organizations

Predict Asset Failure/Extend Life

Determine failure based on usage and

wear characteristics Estimate and extend component life

Utilize individual component and/or

environmental information

Increase return on assets

Identify conditions that lead to high

failure

Optimize maintenance, inventory

and resource schedules

Predict Part Quality

Detect anomalies within process Improve quality and reduce recalls

Compare parts against master Reduce time to identify issues

Conduct in-depth root cause analysis Improve customer service


Where are my opportunities?

Industry

PMQ Categories

Key Opportunities by

Region Manufacturing Consumer

Appliances

Vending

Machines

Connected

Transportation

Heavy

Equipment

Machinery

Networks Buildings

Automotive X X X -North

America

-Japan

-Western

Europe

-Eastern

Europe

-South Korea

-India

-Brazil

-Russia

Aerospace and

Defense X X X -North

America

-Brazil

-China

-Middle East

-Western

Europe

-Sweden

Chemical &

Petroleum X X X -Middle East

-Russia

-North

America

-Brazil

-Venezuela

-Nigeria

-Nordics

Consumer

Packaged

Goods X X X X

-US

-Japan

-China

-South Korea

-Western

Europe

Electronics X X -Japan

-South Korea

-US

-Germany

-China

Energy &

Utilities X X X -Western

Europe

-US

-India

-China

Mining /

Construction X -Australia

-Western

Europe

-Brazil

-North America

-China

-South Africa

-Sweden

Government X X X -North

America

-Western

Europe

-Japan

Travel &

Transportation X X -US

-Japan

-Canada

-China

-India

-Denmark

-Switzerland

-Germany

Telco X -China

-Western

Europe

-India

-Mexico

-US


Case Studies – Predict Asset Failure / Life

• A city government wanted to boost city services and address infrastructure sustainability

• IBM combines asset management innovations, predictive modeling, and geospatial and business analytics to help the city improve planning, operations and services

Outcomes: • Anticipates saving $100,000 per year

in staff time spent on capital plan forecasting

• Expects to reduce costs related to project coordination, operations and capital expenditures

• A global petroleum company wanted to increase asset utilization and reliability in a remote environment

• IBM helps predict where and when ice presents a threat to existing drilling platforms

Outcomes: • Produces real-time visualization of

ice floe positions and trajectory cone forecasts

• Predictions determine whether to move platforms — providing cost savings

Environment Enterprise Asset Mgmt

• A regional utility company needed to maintain an aging infrastructure

• IBM delivered an industry-specific solution to detect potential problems before they occur

Outcomes: • Improved asset maintenance

identification • 20% productivity gains for

service trucks • Up to 20% reduction of fuel

costs due to fewer truck rolls

Extend Life


Case Studies – Predict Quality

• A global manufacturing company wanted to more quickly detect part defects

• IBM implemented an early detection model to detect part defects earlier and respond in the most optimal way

Outcomes: • Early identification and mitigation of

enterprise component and quality issues

• Provide insight to the health and probability of failure for in-service equipment maximizing uptime

Global manufacturing company

Global auto manufacturer

• A vehicle manufacturer wanted to improve its production quality

• IBM’s solution helped use real-time data to monitor the production quality and more quickly identify and resolve issues

Outcomes: • Reduced the defect rate by 50% in

16 weeks in the production of cylinder heads

• Increased customer satisfaction

Predict Production Quality Predict Part Quality

• A not-for-profit marine society dedicated to ensuring safety and pollution

• IBM helps the company detect anomalies in vessel monitoring systems even under dynamic changes of ocean conditions

Outcomes: • Significant reduction of the cost for

detection rule construction (~1/10) • Significant increase of detection

coverage (~ x 2-3) • Reduction of overall maintenance cost

(demonstrated at least 10%)

Predict Part Quality: Anomalies

Not for profit company


Solution Stack

Integration Bus (Message Broker)

End User Reports, Dashboards, Drill Downs

High volume streaming data

Telematics, Manufacturing Execution Systems,

Legacy Databases, Distributed Control

Systems

Enterprise Asset Management Systems

Analytic Datastore (Pre-built data schema for storing quality, select machine and prod data, configuration)

Predictive Analytics

Decision Management

Business Intelligence

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Advanced analytics powered by IBM SPSS and Cognos

Data integration provided by Websphere Message Broker and Infosphere Master Data Management Collaborative Edition, which feeds a pre-built, DB2-based data schema

Process Integration with Maximo – automatic work order generation

Includes data models, message flows, reports, dashboards, business rules, adapters, and KPIs


Predictive Maintenance and Quality analyzes data from multiple sources and provides recommended actions, enabling informed decisions

Asset Maintenance Asset Performance Process Integration

Collect & Integrate Data Structured, Unstructured,

Streaming

Generate Predictive & Statistical Models

Conduct Root Cause Analysis

Display Alerts and Recommended Actions

Act upon Insights

Predictive Maintenance and

Quality

• Data agnostic • User-friendly

model creation • Interactive

dashboards • Quickly make

decisions

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Predictive Maintenance and Quality provides several key features

Accelerated Time-to-Value

Big Data, Predictive and Advanced Analytics

Open Architecture

Business Intelligence

Real-time capabilities

Quick and Accurate Decisioning

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Maximo integration


IBM PMQ contains adapters for IBM Maximo, which allow data integration

IBM PMQ uses existing Maximo infrastructure for data integration

Maximo Upstream Module (Master Data Loading)

– IBM PMQ can consume master data residing in IBM Maximo

– IBM PMQ mirrors the asset data that is managed in IBM Maximo.

– An automated process can be designed to synchronize data between IBM PMQ

and IBM Maximo

– Data that comes from IBM Maximo must be updated and maintained in IBM

Maximo. It is not possible for changes that are made in IBM PMQ to be propagated

back to IBM Maximo

Maximo Downstream Module (Work Order Creation)

– IBM PMQ generates recommended actions which can be passed to IBM Maximo

– IBM PMQ can be customized to import IBM Maximo work orders as events to

record activities such as inspections and repairs.

Maximo Integration Overview

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Positioning

Targeting and Qualifying the right customer with the right problems

– Operating high cost, high value assets OR sufficient quantities of lower cost assets with recurring

failures that could be predicted and prevented

– Sufficient investment or desire for asset instrumentation and maintenance / asset history to

populate models

– Reasonably mature maintenance processes

– Primarily enterprise organizations

– Pricing based on fixed price (by asset type) and a variable data point price

Not a technology sale

– Selling better maintenance outcomes to maintenance professionals

– We must be very focused on Return on Investment and Operational Improvements

– Optimizing all aspects of asset operations, not just predicting failure

Not a technology sale….however

– Embedded technology justifies the higher investment and competitive distinction

– Leverage the Industrial Internet of intelligent devices, assets, and content/data sources

– Applying principles of Big Data Analytics to a maintenance setting

– Closed Loop Integration with Maximo

– Integrated Rules-Based Decision Making


Positioning for joint Maximo and Business Analytics value

Maximo Install Base

– Helps to justify investment or solidify ROI of Maximo implementation

– Strengthens overall commitment to value of IBM solution

– Re-energizes relationships

– Potentially justifies expansion of Maximo solution into other areas of the business

Maximo and PMQ White Space

– Maximo and PMQ together strengthens overall solution in competitive situations

– PMQ may offer a Trojan horse scenario for competitive take-outs

– PMQ can introduce an IBM Maintenance solution into a competitive installation/site

• May offer a Trojan Horse scenario for competitive take-outs

– Business Analytics / PMQ have a LOT of sellers, expanding the potential reach of IBM’s

Maintenance Solution conversation


Partner Strategy

Traditional Maximo implementation and resale partners

– Critical to expand deployment options beyond IBM

– Leverage their existing customer relationships

– Partners want to be able to add more value and differentiated solutions

– Partners to provide industry focus/customization

Large System Integrators, OEMs and Maintenance Outsourcers

– Introduce PMQ to become part of their “tool kit”

– Use Maximo and PMQ combined to enable more compelling and cost effective maintenance

contracts

– Enhance profitability of fixed price maintenance outsourcing agreements

– Embed PMQ as part maintenance support contracts for manufactured or re-manufactured assets

Skill set required

– SPSS Enterprise certification

– Partners with expertise in Business Analytics or Maximo will find most value

– Software will need to be configured to customers’ data


ROI that Organizations are Seeing

Auto manufacturer

– Reduction in warranty claims from 1.1 to 0.85 per vehicle

– 5% reduction in warranty claims

– Reducing the reject rate within 15 months by 80% by the specific attachment of heating elements and other measures

– Production loss of 3 days at 2 machines could be prevented in 35 minutes (€ 200,000 savings)

Office appliance manufacturer

– Increases revenue by USD104.93 million in the first year

– Production up to four times more efficient

– Lets thousands of employees optimize production line variables to support low-cost, standardized production of high-quality products

HVAC manufacturer

– Reduced warranty claim processing times by 20 to 30 percent, increasing internal efficiency and boosting customer satisfaction

– Enabled the company to identify fraudulent claims prior to payment and minimize financial losses

– Reduced support personnel required to maintain multiple warranty systems by 5 to 10 percent, eliminating duplicate efforts and lowering

costs

Energy provider

– Reduced costs by up to 20% by avoiding the need to restart turbines after an outage – an expensive process.

– Saved approximately USD 75,000 in fuel costs per turbine by identifying inefficient fuel usage.

– Increased the efficiency of maintenance schedules, costs and resources, resulting in fewer outages and higher customer satisfaction.

– Provides early warning of certain types of failure up to 30 hours before they occur, instead of 30 minutes.

Water utilities – 36 percent reduction in customer calls through increased preventive maintenance and implementation of automated meter readings

– Increased percentage of emergency investigations dispatched within 10 minutes from 49 percent to 93 percent

– Ability to generate reports for regulatory compliance and management review in seconds versus days

– Significant reduction in asset downtime


Revenue

Growth

Operating

Margin Shareholder

Value

Capital

Efficiency

Improved

revenue growth

Improved

Cost position

Improved Working

capital position Fixed Asset

Improved

efficiency of capital

outlays

Cost per Ton

Higher

Productivity

Increased Up Time

Mechanical Availability

% scheduled

Component Life

Component Rebuild Cost

Mean Time Between Stops

Mean Time to Repair

Tons per Hour

Fewer Spares

Number of Spares

TCO Per Spare

Maintenance cost

Maintenance

Key Performance Indicators Value Drivers Financial Impact

Inventory Fewer Spare Parts

/ Components Average Spare Parts /

Components Inventory

Renewal Cost

Risk

Mitigation

Reduced Risk

Safety /

Compliance

Infrastructure Dedicated Shop space

Labor resources

Parts consumption

% field repairs

% improvement / ton

Availability Index

% scheduled Maintenance

Comp Life Target Achieved

Comp replacement cost

MTBS

MTTR

% improvement / Hour

Average Inventory value,

major components

Average inventory value

Spare Parts / Components

Inventory

Maintenance Ratio

Parts Ratio

Predictive Maintenance Value


Resources and Final Thoughts

Sales kit exists on PartnerWorld

– Business Analytics/SPSS section or just type in Searchbox

Predictive Maintenance collateral exists on ibm.com

Business Analytics Partner Channel Contacts

– BA Software Sales North America

• Craig Wacaser [email protected]

– BUE Business Partner Solutions and Growth Strategy

• Brad Jeffers [email protected]

– BUE WW BI/AA Channels

• Michael Bigenwald [email protected]

http://www-01.ibm.com/software/analytics/solutions/operational-analytics/predictive-maintenance/products.html

mailto:[email protected]




1. the value of PMQ and which organizations would benefit from it

2. which IM and BA components are included in the solution

3. what’s required to build sales & services practices around PMQ

After attending this session, you should have an understanding of…

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Resources

Business Analytics area on PartnerWorld

Business Analytics Web Seminars

Business Analytics events

Business Partner Learning Center

Demand Generation Programs

Demonstration content

BA Demomate Interactive Demos

Business Analytics competitive resources

Self Paced Virtual Classroom Program for Business Partners

You Pass, We Pay

IBM Business Partner Locater Tool

IBM Business Partner Communities

Follow us on twitter ibm_ba_partner

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https://www-304.ibm.com/partnerworld/wps/pub/overview/BF6A0

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https://www-304.ibm.com/partnerworld/wps/servlet/ContentHandler/pw_com_sfw_business_analytics_software_demos

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IBM PQM Analytics