Collaborative framework spells new potential

Customers demand increasingly high levels of performance from manufacturers: low cost, high quality, short cycle times and ever-greater flexibility are the norm. The result: some manufacturers are starting to realise that achieving the performance benchmark now required means rather more than simply extending their enterprise systems, no matter how intelligently. They need to bridge the 'business to IT gap', which in large part means moving to a technology infrastructure that tears down organisational barriers and unifies whole businesses. Hewlett-Packard's answer is its Collaborative Business Infrastructure (CBI) initiative. CBI can be thought of as an enabler: it's about facilitating both the integration and optimisation of an extended enterprise by connecting applications, information and people more intelligently to business processes and web services. And rather than start with a clean sheet, HP's CBI leads to an infrastructure based on best practices, but harnessing your existing investments in technology – everything that still adds value from previous projects and installations. And higher levels of integration within a manufacturing operation, along with the introduction of web services will, says the company, boost that most important of all activities – collaboration. That's both across the company and out to include partners and customers across the supply chain. Just as important, with the CBI approach, time to value on projects is very fast and low risk: the approach takes a lot of the pain of requirements analysis, architecture and infrastructure delivery out of the project lifecylce, because the IP and best practice is already packaged in the architecture and process templates. HP is its own proof point: the company uses its CBI approach internally. The company's imaging and printing group in the Middle East and Africa, for example, works along CBI lines, acting as a collaboration hub for distributors and suppliers. It's not just achieved by moving everything over to web services. While a shift in that direction makes sense under CBI, it also recognises that not all parties can or should be served in the same manner. In fact portal technology, rather than dedicated links, is one of the essential tools to enabling flexible collaboration founded on infrastructure re-use. Adaptive manufacturing "CBI allows multiple channels of communication, but it implements the same back-end processes," says Paul Helm, world-wide manufacturing team director at HP. He also makes the point that HP is building on previous work done under its 'Adaptive Enterprise' banner. Ian Cole, technical director for the CBI initiative at HP manufacturing industries, adds that a core benefit is achieving flexibility right down at the infrastructure level. What he means is creating new solutions that harness existing systems to deal with market changes much more quickly than is currently the case. Indeed, Cole insists that "a true CBI has to scale well, be robust and enjoy first class systems management capability." HP sees the choice being between industry standards and a dead end in both technical and business senses. The task is to repurpose IT architecture for a more flexible environment capable of supporting collaboration, but without the manufacturer needing to rip and replace its IT. Cole cites ERP and CRM implementations, for example, as needing to be integrated under the CBI umbrella, rather than replaced. That's how to provide support for online business-to-business transactions and information flow as part of a collaborative network, rather than yet more point solutions. Importantly, HP is adopting proven industry IT standards to fulfil CBI projects. According to Helm, the start point is Microsoft technology – and that's a natural evolution of the relationship between HP and Microsoft. In large part, it's what makes the CBI possible, and HP points to work done at Volvo Aerospace and Akzo Coatings (see below). Microsoft's .NET environment, for example, is at the centre of the CBI offering, with its BizTalk and SharePoint Servers, as well as the SQL Server database – all founded on the Windows Server 2003 platform. But Cole hints that HP is also looking at working with the J2EE standard as demand arises. HP enjoys relationships with many parties in that camp, including BEA Systems, a leading provider of solutions based on enterprise Java standards. The principle in action Paint manufacturer Akzo Nobel Coatings provides one example of what can be achieved. Akzo needs to have thousands of contacts with global raw material suppliers: requirements include the sourcing of solvents, pigments, additives, resins and packaging. In the past, purchase order-based requisitioning was the norm for replenishing material supplies. The process was largely manual, involving thousands of paper documents exchanged across the supply chain. The company decided to automate its supply chain with a common, shared messaging engine based on .NET. It was a considerable undertaking, but one important change was that key activities – such as orders, shipping and processing – became the responsibility of suppliers rather than the paint maker itself. The system became known as P@CCESS, standing for Procurement Akzo Nobel Coatings Common Electronic Sourcing Support. But it's cleverer than that sounds. Within P@CCESS, there are e-procurement and e-auction capabilities, as well as integrated supply chain communications, a vendor managed inventory solution and a common shared infrastructure using BizTalk and other technologies. HP was able to develop the system, founded on CBI. Annual savings of eur10m are claimed for this project, and HP says Akzo achieved a 20% annual saving in document handling, a one time saving of eur65m on invested capital and an infrastructure based on standards capable of tackling all current and future business-to-business processes. The company also reckons that up to 70% reductions in order-to-fulfilment cycle times can be achieved, along with a doubling of inventory turns and up to 20% reduction in material costs as a result of initiating a CBI project. And that's without considering ongoing adaptability benefits. Independent perspective There can be little doubt that better integration is one of the hottest topics in manufacturing IT right now. Simon Bragg, European research director at analyst ARC Advisory Group, agrees it's hot, particularly where the talk is of integrating from the shop floor to the top floor, and including aspects like customer access for improving make-to-order operations and service. Bragg sees HP joining a growing band of IT giants seeking the same end result – client projects that yield the advantage of collaboration and automation between manufacturers and their customers and suppliers, that is sustainable and able to flex relatively easily to meet future requirements. ARC has itself also been active in the development of a collaborative manufacturing management model (CMM), recognising the growing importance of business process synchronisation when it comes to the next level of operations built on real-time visibility. Bragg echoes the importance of standards, and adds that one of the breakthroughs is the emerging ISA95 standard for manufacturing IT interchange, with (finally) its mark-up language for shopfloor communications. Call it CBI or CMM – the goal remains the same, and manufacturers can perhaps look forward to some breakthroughs when it comes to integrating tightly at multiple levels without spending a fortune and without committing to a single path.