In 2011, Gartner accurately predicted that the industrial world would soon see operational technology (OT) and information technology (IT) coming together in a shared environment. This concept of fusing previously siloed systems so that business intelligence could be more efficiently shared and leveraged wasn’t a new one. It made sense that OT and IT would model this historically successful integration – once the benefits of convergence were realized.
However, despite emerging benefits there remains an undeniable resistance to converging OT and IT. A recent Automation World article shared that the two departments, “not only operate in a very separate way, but sometimes even have conflicting approaches.” The solution is to ensure that leadership brings the benefits of such a merger to the forefront. The positive impact the convergence brings to both OT and IT is the great equalizer that unites two distinct organizational cultures.
The four key IT/OT convergence benefits are: cost, performance, productivity, and agility. Cost is often the benefit that overlaps the most for OT and IT departments. For IT, cost is about demonstrating and predicting profitability. For OT, cost is most often tied to their goal of reducing production expenses. For both, improving costs positively impacts the organization’s bottom line.
Performance and productivity are benefits that go hand-in-hand. Creating a common platform where OT and IT data work together, means that organizations can generate accurate, key performance indicators (KPIs). These KPIs allow both sides to pursue common objectives side-by-side as well as benefiting from company-wide visibility.
Once an organization gains greater control of costs and begins looking at KPIs in real-time, they become empowered with the ability to react with agility and flexibility. This means quickly improving production timelines and making room for innovation – something that was difficult, if not impossible, to initiate within a siloed OT and IT environment.
Let’s look at an example where all four IT/OT convergence benefits come into play within a manufacturing environment:
OT systems are busy taking in and making sense of a large intake of data from the production floor, effectively monitoring the many moving parts that help determine things like production rate and inventory.
On the flipside, the company’s IT systems are harvesting data, such as which products are languishing in customer shopping carts and what the likely rate of conversion for these customers is. They then utilize this predictive data to determine current and future market demand.
Prior to an IT/OT convergence, the sharing of this data between these departments was typically calendar driven. Perhaps, a quarterly review where IT systems provided the data that would be used to determine future inventory requirements, and OT systems provided the cost per item data that drove discussions on pricing and profit. Post integration, both sides are now sharing this data in real time.
A less than stellar quarterly report might have previously put pressure on the manufacturing side to quickly reduce production costs. This reactionary approach had the potential to negatively impact wages, safety and a host of other concerns. However, once manufacturing is able to review and respond to things like inventory demand on a day-to-day basis there is more room for strategic thinking around cost improvement.
In an integrated IT/OT environment, the IT department can provide a more comprehensive picture to key decision makers. Reporting on the impact a sudden increase in materials cost is having on the existing profit margin. Empowering the organization to react proactively, perhaps adjusting their marketing strategy so that more emphasis is placed on promoting a product with a lower production cost before the quarter ends.
For a real-world example of a modern OT/IT infrastructure, download our webinar, How a Modern OT/IT Infrastructure Can Help Food & Beverage Manufacturing Challenges, and explore the solutions critical to manufacturing operational challenges facing food & beverage manufacturing.