How Digitization is Changing Manufacturing

Full transcript below:

Chitra Sethi

Hello again, everyone, and welcome back to the Mechanical Engineering magazine webinar series. I am Titra Seti, Managing Editor of, and I will be the host of today’s event, “How Digitization is Changing Manufacturing.” I am very happy to welcome Arena to our webinar series and would like to thank them for being the sponsor of today’s webinar. Arena provides companies with a product lifecycle management solution that increases the speed of prototyping, reduces scrap, and streamlines supply chain management. In this webinar, you will learn how digitization is changing, how manufacturers reduce risk, and implement change more proactively to lower costs and accelerate time to market. Some of the discussions today’s speakers will have include how cloud-based technologies create a new continuum for digital processes, the importance of controlling quality at the factory floor, and the value of an all-in-one product development platform to streamline product processes.

Let’s welcome our speakers today: Entrepreneur and Blogger Oleg Shilovitsky of Beyond PLM; Nipun Girotra, the President and Founder of 1factory; and George Lewis, Senior Director of Solutions Consulting at Arena. As always, your feedback is important to us, so if you have any questions for our speakers during today’s event, please type them and send them to us over to the screen. Presenters will attempt to answer as many questions as possible today.

So now, without further ado, I would like to turn it over to our presenters. Oleg, would you like to take it over from here?

Oleg Shilovitsky:

Sure. Hello, everyone. My name is Oleg Shilovitsky. I am Entrepreneur and Blogger and Beyond PLM, and today, I’m going to talk about digitalization in manufacturing and how digitalization is impacting manufacturing and engineering processes, and how it’s impacting the way we are doing business and interacting with the environment. And for the beginning, I want to remind you that we are probably the last generation now that remembers life before the internet. And probably if you speak to your kids, they will tell you that they don’t remember, they don’t know how to interact without the internet and without online devices and without online instruments. So the digital media came into our life and became a natural part of our environment, a natural part of everything we do. And if you think about the historical past before digital technology and computer, over the last 50 years, we can see the evolution of computing power and we can see the evolution of different devices from mini-computers to personal computers and mobile devices.

But what is important, and what we see these days, is the integration of computing power—different devices and different services together—and what we see in front of us as social computing, we see the integration of all these devices, data, media content, and people together interacting and working and enjoying and doing everything they need online. And to understand it a little bit more in detail, I would like to take you on some historical look at how digitalization and digital disruption happened in photography and pictures and I’m pretty sure you remember life before digital medium and the photograph actually was a physical thing. So, we printed it, we put it on the shelves, and we enjoyed it. And then digitalization started to come to us step by step from introducing different storage devices from personal computer to personal storages, then we took it online and we share it using our network and our ability to interconnect with other people, we’re able to share pictures and send them over the email. Then the Cloud came, first as a medium to expand our storage. From the beginning, it was obvious that it’s easier to store data online and not on your local disc because it will be available from everywhere.

But then the latest stage of this game is a medium that not only connects your data but also connects the people and everything that you do together. From that point, placing photographs on Facebook became not only a way to store your data, but also interact with your friends, families, groups, and also doing business. So from that perspective, you can see how we moved from the physical photograph that we printed in the local photo shop to online services that today consider it as one of the most important and easiest ways to share information, interact with your family, and interact with your friends. If you think about businesses, we can see a significant trend of businesses thinking about how to leverage and use digital media and digital data.

So, something that’s called a digital supply chain, it becomes very important in companies these days because manufacturing went global. And engineering and manufacturing companies are located everywhere. And you could think about how the digital interaction becomes very important to companies then and think of how to leverage digital data. How to combine data, how to interconnect with data, is becoming very important for manufacturing companies these days.

Not only interacting with data and not only combining with data but also online data in digitalization is changing the way processes work around us. And in order to understand that, let’s think about a simple process of driving. That, then, 50 years ago, was purely non-digital. So, if you still remember paper maps, we printed them, we kept them in the car, and we’ve been driving using these maps. I doubt somebody is doing it these days. But here is an interesting thing. It’s not only about how to take your map and make it digital on your mobile device. Think about scanning a PDF of the map, placing it on your mobile device, and trying to drive. I’m sure you see the difference. This is not the experience that we have with the modern navigation application. And the point here is that in navigation, in the modern application, it’s not only about the map. It’s about different elements of data. Different data points, different information combined together. Some of this information is about the map and location of services and places that you’re navigating to. Some of this is the information about particular services, like for example, the hours of the operation. And something else is completely dynamic, and this is information about traffic.

Combining all this data together creates a digital environment that allows you to navigate from point A to point B with completely different user experiences and completely different driving experiences. So, if you think about this as a process, the digital workflow is about how to connect different islands of data and different activities together in a completely different form from what we’ve seen before digitalization actually happened.

But think about a traditional process in a manufacturing company. This process is run by paper and email and maybe some applications. And if you think about how the future will take over these practices, we probably will see something different. And in order to understand the way it happened, I want to take you through the three steps of the evolution that will happen to application, and applications in the product lifecycle management.

So, from the very early beginning, product lifecycle management applications were designed and implemented by companies to centralize data and access to data around engineering manufacturing processes. And the most important element here was access to the network. So you were able to connect those servers, get data, and run the process. The network was the value on this page. Now, within the last five years, we have seen a great demand for cloud environments, and at first, how cloud environments came to PLM was the introduction of a cloud server. So a cloud server is basically able to host enterprise applications such as PLM and other applications in the Cloud using on-demand services and virtualization.

So the great advantage of those services is that the companies eliminated the need of heavy investment in IT and heavy investment in the infrastructure. So everything runs on demand, but still, there is a point and difference between cloud servers that disconnect within the Cloud, or actually disconnected in the same way they are disconnected from the company’s IT services. And the next step, and this is where the service applications are coming. So you can think about this as the formal trade book, which connects people, groups, and applications from my previous example.

But thinking about this as an application that connects companies, users, suppliers, contractors all together by providing them an environment where they can store data and manage processes. So, the way evolution will be going in our future communication model is by connecting people with different data, connecting people with different context goals, need data, and the unified communications model, allowing people and companies to perform tasks and to work in a much more efficient way rather than how they’ve been doing it before. If I speak about engineering and manufacturing, we can see how digitalization can impact the most fundamental processes between engineering and manufacturing.

And you’re probably familiar with the term “over the wall manufacturing” or “over the wall process,” so that was the old-fashioned process that happened before in the way designers and engineers worked on the project. They made a design, they throw the design to manufacturing and hope for good. And they hoped for the manufacturing to understand what they do and plan the manufacturing process.

In the future and even today, companies are discovering how actually to break the wall between engineering and manufacturing. And if you think about digitalization and their digital processes, you can see how new applications can facilitate better processes and better information exchange between engineering and manufacturing. By doing this, the highest level of efficiency can be achieved. Engineers can expose their work and plan for manufacturing in the very early stages, and manufacturing can get access to the engineering information and interact completely differently than they’ve been doing before.

So, thinking about how digitalization is coming to engineering, manufacturing, I can see how this process in the future will be even more streamlined. And you can think about a future completely digital environment connecting manufacturing companies, contractors, supply chains, and all people involved in the whole manufacturing process in a completely digital form.

So this is the end of my slides and hope to have questions later on. Thank you.

Nipun Girotra

Thank you, Oleg. Good morning, everyone, my name is Nipun Girotra, and I am the CEO of a company called 1factory. At 1factory, we are working on digitizing manufacturing and supply chain quality control. And so what that means like Oleg was describing a few minutes ago, and he did a great job of this, digitization is basically connecting a whole bunch of siloed data sets and activities. And we’re doing something similar in the quality control department, which traditionally has been very paper and Excel-based. So, we’re helping connect all the processes from starting with quality planning to data collection or data acquisition, data management, data analysis, and eventually reporting, and then the actions people can take with the reporting.

So that’s what 1factory does. Just a quick technical note, I’m having issues with my slides, so I’m going to ask the administrator to advance them for me. So Bill, can we move it forward, please?

So, before we kind of get into the details of digitalization and quality control, I want to talk about why all of this is happening. And kind of the biggest driver for digitization is, of course, technology is improving and enabling kind of digitization, but the biggest driver is increasing customer expectations. We’re all getting spoiled with the number of features that we get on all our products, the fact that we can customize the products that we buy, the fact that delivery seems to happen before we even decide to buy our products, and the fact that some of the products that we buy actually get better and better over time even after we buy them. So our expectations are increasing from the products and services that we buy.

But what this means for manufacturers is that the complexity is increasing, the complexity they need to manage. So, if I am Toyota and I’m now selling over 100 different car models, I’m buying tens of thousands of parts, I’m trying to manage thousands of bills of materials and thousands of configurations. I have a whole bunch of challenges doing this. Okay, so how do I manage all of this complexity? How do I do all of this in a shorter and shorter amount of time? Next slide, please.

And so what manufacturers are doing is, they are actually responding to this increasing set of customer expectations by digitizing their value chains. And what does that mean? That means that they’re taking a fresh look at their process of how they bring products to market and how they interact with the customers after the product is in the market. So all the way from design through manufacturing and through actual customer use. And so if you look at what I have on the screen now, this digitization didn’t begin kind of today. It began many years ago. But slowly, things are starting to get increasingly more integrated, so that we want people to get away from stand-alone data sets and stand-alone activities. And probably the most kind of neglected aspect in the past has been the ability of the employee to do his or her job. And that actually is the most significant change in this go-around. And what’s changing is that for the first time, these tools are being kind of redone so that the factory floor employee, whether it’s in manufacturing or in quality control, actually has the tools to do his or her job more effectively. And everybody wins. The employee can get his job done faster and better, productivity improves, and also the customer experience eventually improves. Next slide, please?

And so, just going back to what’s the value of digitization, the value is, there’s going to be value along every dimension of these activities. So how do I manage these thousands of car models, if you will, how do I manage thousands of parts, the features, how do I manage all the inspection, how do I manage all the testing? How do I customize my products quickly and also deliver quickly? And how do I make sure that I am actually monitoring my product after the sale and learning from my product? How do I learn how my product is being used, how do I learn how my product is performing, and how do I improve that? So that’s digitization and that’s the value it’s going to bring. All right? Next slide.

So at 1factory, we’re focused in on a very small subset of all of the digitization activity, and we’re focused specifically on the quality control department. So it turns out that quality control, there’s lots of innovation in the sensing and in the measurement technology. But there really hasn’t been much change in kind of data collection and analysis and reporting, and that’s what we’re focused on. So, we are automating how data gets collected, analyzed, and reported, and also, we’re working on making sure we provide real-time insights to the factory technicians to do their jobs in a better way. Next slide?

So, I want to back up now and talk a little bit about the kind of problem that we solve. So for many years, I was at a manufacturing plant and I was buying nearly 100,000 unique parts for my factory. Now, if you take any given parts, you take the part diagram that’s on the screen, you can see that that part is made up of many features. In some cases, it’s five features, in some 10 features, in others it’s a thousand features. Now, the key part about a quality control challenge is that quality control is always at the feature level. If you buy a hundred thousand parts, and you have 10 features per part, you now have to control a million features. So how do you do that effectively and how do you do that within your factory? How do you do that across your supply chain? And like I mentioned earlier, and like Oleg also mentioned in his talk, a lot of this has been done using Excel and paper. And it’s very data exchanges over email, and I think most importantly, the data analysis is kind of delegated to some point in the future or it’s usually too late after the parts are shipped.

And there are huge expensive consequences. There’s lost productivity, and I was at a factory where initially we were losing about 50% of our productivity to quality control issues. There are defects, and those defects could slow down your manufacturing line, they could impact your customer, they could shut down your customer’s production. Then up goes cost, in terms of rework, defects, and scrap. And most importantly, many people don’t realize this, is kind of the impact on capacity. When you waste your factory capacity dealing with a bad part or a series of bad parts, that time is gone forever. It’s hard to recover. It’s impossible to recover that time. So those are all the impacts of poor quality, and it’s important and essential to control quality at the source. And that’s where digitalization can help. Next slide?

So, at 1factory, we’ve kind of studied this problem and we looked at what a quality control engineer does. So we think about what a quality control engineer has to do, they have a number of activities they do from quality planning, which is defining what they’re going to measure, how they’re going to measure it, and what they’re going to use, what frequency, and so on. Through validation, which is, “Is this the right quality control plan? Can I make my part? Can I catch a defect?” And then, kind of ongoing production. My incoming inspections, my in-process inspections, my finished-goods inspections. My nonconformances, as the correction piece of it. My reporting, how do I report out this data to my customers or to the interested parties in a kind of manageable manner? And then how do I use the data and the insight to actually improve my processes? So, we are working on digitizing all aspects of a QC engineer’s job. Next slide?

And not only are we doing this kind of within the factory, we’re also doing this across the supply chain. So modern manufacturing is no longer about making everything in-house, so you are dependent on a series of partners or suppliers to help bring your products to market. But you have no visibility into their quality controls, so we’re working to fix that. So our product, the 1factory product, is designed to be collaborative. And the way we have built it, you can connect with your suppliers, you can work with them to define the controls, you can lay out what is it they’re doing to measure, how you are going to measure it. Rather, how are they going to measure it? And then you can actually make sure the data is being collected in real-time. And in real time, you can actually see the data they’re collecting. And you can work with them to ensure that the quality is good before the parts leave their factories. You don’t want to do an incoming inspection, ideally, you want to kind of check-in at the source, which is at the supplier. Ideally, during the manufacturing process at the supplier. Next slide?

All right. And we see benefits in this model for both. We see benefits for the suppliers, and we have worked really hard to make sure that the product is very user-friendly, and we’re actually simplifying and speeding up the QC task for the suppliers themselves. And also, for the buyer, there’s the benefit of real-time visibility into the data. And this helps both sides kind of find problems early in the supply chain and people can work there to solve quality problems. Next slide, please?

I just want to kind of go back to one of my points in this talk, which is that digitization must make life easier for the end user. And we’ve all used complex ERP systems that have been very hard to use, where somebody puts data in, it takes a long time to run reports, and so on. But we’re trying to break that paradigm. We kind of brought the ease of use of a consumer product into the enterprise space. We make sure the part is very easy to use, and it’s lightning-fast, and it’s designed around the quality control person’s life and the work they do. And so I can’t emphasize this point enough, that digitization activities must make life easier for the end user. To make life easier for the end user, all the work that needs to happen at that point can happen to the point, decisions that need to happen at that point will happen at that point, and you’ll get better outcomes. You’re empowering your employees to do better work. Next slide?

And finally, as this slide slows, we are actually partnering with Arena. We’re building an integration with Arena to make sure that we give you an integrated business process all the way from a change initiative in Arena to when a quality control plan is changed in 1factory. And also, when a defect is logged in 1factory, an out-of-spec measurement is made in 1factory to when a nonconformance event is generated in Arena. And so working to provide a closed-loop change control experience for the user. That’s all I had, please take a look at and if there’s any questions I’ll take them at the end.

George Lewis:

Great. Nipun, that was fantastic.

Nipun Girotra:

Thank you.

George Lewis:

Hello, everyone. My name is George Lewis, Director of Solutions Consulting here at Arena. And I just want to take you through a few slides kind of talking a little bit about Arena’s background, but I can say anecdotally that the industry has changed a lot in the last 18 years that I’ve been doing PLM, from client-server software all the way to cloud-based solutions, and I can tell you for a fact, in 2005, here at Arena, a cloud-based solution wasn’t always that popular. But nowadays, it’s a very popular solution for a variety of reasons I’m going to take you through here today.

So, Nipun just mentioned the 1factory/Arena integration—I’m going to come back to this here in just a moment. I just want to take you through some of the basics, a quick level-set to make sure we’re all speaking the same language, and I want to talk to you about how I think digitization has changed the platform and what customers require from tools like Arena PLM.

So, taking a step back, one of the slides that you may have seen in sales presentations is what we call, at Arena, “the spaghetti slide.” Don’t try and interpret this slide, but it really represents the chaos that is often a business without a PLM tool in place. And so, by that, I mean there’s multiple silos of information, things are scattered throughout the organization, the mechanical engineers may have their own CAD vault, the electrical has a different vault, there’s an official company document control vault, may even be an ECO vault, and then the communication between all these systems is really ad hoc and manual. Some companies try to automate it; it’s difficult to do. Invariably, you see things like email, and then web platforms like Dropbox playing a role in it, which really isn’t much more than a glorified FTP site.

And so, put simply, that’s the problem that we seek to solve here at Arena. And so, centralize all that information, so the orange circle on the slide here, centralize the information about the product data as it comes from the engineering departments, meaning BOMs, approved sources, documents, and drawings, but also the workflows around it. Certainly, ERC, ECO, ECN workflows play a part in the core tool, but it can move well beyond that as well, into NPI workflows. And today, we’ll talk a little bit about quality workflows where a nonconformance may originate from one factory and end up in Arena.

But this landscape that is shown on the slide here really hasn’t changed a whole lot, starting 15 years ago until recently, and by that, I mean 15 years ago, it was really about integrating to the CAD tools on the left, meaning mechanical engineers, electrical engineers, pushing that information into PLM where you can organize it under change control and then eventually push it to ERP on the right. But I would say starting five or six years ago when the internet or things really began to come to life, it began to include things like software as well. So firmware, the software that needs to go on a CD, and the box that goes with the product, that began playing a role and so commonly, today, you see software also being pushed into PLM.

But it’s even bigger than that now. And so, my two key points in today’s presentation is, number one, there are other tools and partner solutions that you need to be able to play ball with. 1factory is the example today, where 1factory is collecting live data from the manufacturing floor, could even be at your supplier, but there’s a strong need to have a bi-directional integration to PLM because the product data drives it, number one, but if there’s a nonconformance or some other quality issue, we may need to escalate that to engineering. There are a variety of other partner solutions where that may apply as well, but today we’re going to focus on the 1factory story which I think is an exceptionally powerful one.

The other piece in the landscape that you see commonly today is the fact that very few are vertically integrated these days, and like we just saw with 1factory, the idea of including the supply chain in your PLM solution, in my view, is critical because those suppliers are separated, typically, by thousands of miles—there may be language barriers, and you need a tool that can help accommodate that communication that may otherwise happen manually, which is extremely error-prone. Actually, an interesting story with a prospective customer, actually, a few weeks ago, that I just had, was, I hear this commonly, is that, “Oh, well if we deploy a PLM tool, will my supplier even get involved? We’re a small manufacturer, can we convince them to log into the tool?” And it was an interesting conversation because we actually had a representative from one of the major contract manufacturers out there on the call, and they absolutely, adamantly, insisted the answer is “yes” because they don’t want to make a mistake either. So I think those are the two key things, is supply chain access and then partner solutions like the one with 1factory, where you tie everything together. The combination of these two things really provides you a way of tackling the digital problem, but also the global problem that is today’s manufacturing.

So a quick word on partner landscape—I’m not going to go into this slide a whole lot today. Arena has a fairly broad partner landscape. Today, we’ll talk about 1factory, but the one slide I do want to mention is the fact that cloud-based solutions have a unique advantage in the supply chain because they can penetrate the supply chain much more easily than other tools. I mean, I don’t have to put holes in firewalls and focus things like that, and so being that Arena PLM has been doing this, we actually have vast penetration into the global supply chain already. And so for those of you that may be looking into a PLM system, one of the things I would encourage you do is ask your suppliers and contract manufacturers if they know of Arena, or what other tools they know of because nine out of 10 of the top contract manufacturers already use Arena today. And so you actually have a leg up on the game if you decide to engage one of them, because they’re already logging into the tool, they’re already trained, and so you can include that supply chain quite effectively in a tool.

Okay, so taking a look at a couple of screenshots of how some of these processes can work. Like, here we see Arena PLM and this is really your conventional PLM view of just product data. The satellite navigation unit, we can see the name and number up there at the top. We can see an indented bill of material view here, so managing a fully indented view with maybe thousands of lines that a BOM is very common, but at its core, we’re also managing the product data that went with it, and by that I mean drawings, datasheets, et cetera. But also approved sources, at its core.

Beyond that, you’re able to include workflow and so your change control workflows, like engineering change control, and then the next-step path that is usually quality workflows, which we can see on the diagram here to the right where we may be including information coming from quality departments, coming from inside our organization, but potentially, externally as well, where on some of these parts, we may have had quality issues. A corrective action report, an 8D, or a CAPA, or a nonconformance all come to mind. And the idea being, “Hey, those could be driven from the supplier or manufacturing floor internally, and we have visibility as a designer.” And so here, in this example, if I were working on the packaging shown here, I could immediately know that, “Hey, we have some kind of quality issues that are popping up on my part.” And so if I’m working from the new version, maybe I’d take some preventative action to reduce risk. But if I’m working on this part, I have immediate access to see what’s going on inside some of those quality workflows.

And so the concept of PLM has grown much, much bigger than just the design process alone. It actually bleeds over into the manufacturing side and also sustaining side as well. Moving over into the quality side of the workflow a little bit, here’s an example of the workflow that Nipun mentioned just a little bit ago, where a nonconformance … This workflow is in Arena, and this has been created by the 1factory integration. So the idea that you need your PLM system driven by other business systems that exist in the organization is a very powerful one, and it’s part of the direction where the industry is going, where if we have an issue with a part in 1factory, like it’s on a spec, we’ll automatically create the quality process in Arena. This same quality process may eventually get promoted in Arena to become a bigger quality process … Let me go back one slide here.

And so it begins as an issue in 1factory, which is what you’re seeing on the screen here, where, “Hey, the part’s out of spec.” We can see it’s out of spec, 1factory will boil this up for you, and then we can also see here that it’s been promoted to Arena, and that could happen on an automated basis or when a user selects a button to say, “Hey, you know what, I’m repeatedly seeing a problem here, we need to promote this over to engineering where they can then take a look at it.” And so that turns into an NCMR, potentially, in Arena, and then here’s a follow-on workflow where it could potentially become a corrective action report. And so this is a different workflow, by the way, these are configurable, and there’s a bunch of them out of the box, but the things I wanted to point here would be, as part of step one here in the problem description, we have a number of objects tied to it at the bottom.

And so first off, a very simple example would be a picture. We have a failure, take a picture, attach it to the workflow. It can also be product data, so it’s related to XYZ part or a different assembly. But if you take a look at what’s circled here, that nonconformance we just looked at that came from 1factory could eventually be attached to this new workflow to more investigate, “Hey, what’s going on and why are we experiencing the problem?” and, “Maybe we need to set up some kind of preventative action with our supplier,” but I also want to point out, at the bottom there, it could also come from other business systems, which is what you see out of the digitization of the world today, where hey, it could be a case in CRM. You might have a support staff that has eight or 10 people working on it, they’re collecting customer cases. Well, if one customer case comes in, it might not necessarily be enough to trigger an escalation to PLM, but if that support agent says, “Well, wait a minute, I have 10 issues that are all very similar in nature,” then you may have an automated integration that automatically drives the workflow in Arena from the CRM tool on an automated basis.

Those are two very common integrations that are coming up more and more often these days and I think really represent a sample of where things are going. So, one last thing to cover in the way of the interface here, I did mention supply chain plays an important part in all of this. This is the same corrective action that we were looking at just a few moments ago, and so we’re looking at it further along in the process. We’re getting a sign-off, this is the signature block that folks may have at the bottom of a paper document today, and we’re collecting e-signatures from the various folks on the workflow. They can be internal employees, of course, but what I’ve circled here on the screen is an example where it can include the supplier. And so going back to that example I talked about earlier, contract manufacturers desperately want to be involved in these workflows because it really serves to prevent problems. An ounce of prevention is worth a pound of cure. By having them here, you can collect their feedback before the workflow is closed out, and really tighten up the manufacturing process, which I think is also a big part of it.

So in summary, what I covered here was the core PLM solution, the idea of just centralizing product data and change control. This has been going on for years now. But the two key points where I think it’s changing and the digitization of manufacturing is propelling it, is the integration of partner solutions. So 1factory might be on the floor of your supplier driving information into Arena, but it’s also on the other side as well where the outsource manufacturing environment that is the reality of manufacturing today really needs to be thought through and integrated into the same process, and I think cloud-based solutions like Arena are the right choice for dealing with this problem because it really helps collect information from these various entities and consolidate it in one place where you are in control.

So with that, I’ll pass it off to Chitra, where we can handle some questions.

Chitra Sethi

Great, thank you so much, George, Oleg, and Nipun for your insightful presentations. I learned something today too. And now, it’s time for questions, which I have been keeping an eye on and there are lots coming in from the audience. Just a reminder, if anyone has questions for a speaker, please type them and send them to us and we’ll try to answer as many questions as possible today. So here is one question for you, Oleg. How do you think digitization will come together with existing and established processes?

Oleg Shilovitsky:

Yes, thank you, that’s a great question because, for many years in enterprise, the adoption is quite a big challenge for many companies. So, there are several interesting points that will help manufacturing companies to embark on new practices, and the most important is the connection between companies and the new digital environment. If you think about existing space like the internet and available services, they introduce something that we didn’t have before. And if you think about this, that this is the media, the new environment. We allow people to get value. For example, online information about manufacturing parts. Online information about supply status. Online information about some changes that are happening, for example, in traffic, because if you have complex interaction between companies and between manufacturing suppliers, contractors, you need to take into account everything. So the global data availability and the value that you can get from this will drive manufacturing companies to think about how to become more efficient because everything can only come through the value and the return investment that companies need to invest in order to get this value. So, I think that’s the one place where companies will see value and they will be able to drive to the digital space because there is nothing that can replace it. There is no alternative to this.

Oleg Shilovitsky:

Another thing is mobile devices, and we’ve seen how the modern environment is moving to a new type of device and a new type of interaction. You don’t have to be at your desk to answer your questions and you don’t have to be at your desk to make some action. So that’s something that will help people to move to a new digital environment because your personal computer is in your pocket, will drive you to this digital process. So those are just two examples that can impact the way companies will be moving to the new digital process. Thank you.

Chitra Sethi

Thank you. Oleg, also, do you have any tips to help people adopt new digital processes?

Oleg Shilovitsky:

Well, thanks. I think it’s kind of related to the previous one. So first of all, I will start from don’t. Don’t try to do it overnight because it will not work. And the second, don’t try to take everything that you have and replicate it because some of your current processes are possibly obsolete, and before trying to make everything digital, try to analyze what you do and create some rationalization in this. So, try to go step by step, small steps, and get the value from the small steps, where it’s very powerful to move from one environment to another environment. And it will take time and it will take years, so I don’t think it will happen overnight.

Chitra Sethi

Okay, thank you. George, here’s a question for you from one of the viewers. Can you elaborate on the CRM use case mentioned in the PLM demo?

George Lewis:

Sure. Yeah, so what we talked about was one CRM use case, and I would say, from what I see out in the industry, it’s one of the more common, where your call center is receiving calls about issues with the product, and at some point in time, there is an escalation event that needs to happen to escalate it to engineering. And so for example, if you have one issue that the resolution might just be to RMA the product and be done with it, but if you have the same issue 10 times over again, there may be a decision made by the call center to send it over to engineering. Or, it might just be automation. If a certain type of issue happens more than five times, auto escalate it to PLM or engineering can take a look. That’s the use case I ran through today, but there are a variety of other use cases that we’re always happy to talk to you about.

I mean, the other one you sometimes see is engineered-to-order, build-to-order businesses have configurations that exist in CRM for building sales orders. There’s also an integration story around that where PLM may need to drive the configuration, but in cases of engineer-to-order, it may need to come back to PLM where the additional engineering work is done. So it does depend upon your use case, but those two situations are the most common that I see.

Chitra Sethi

Thanks. Do you also have any advice for engineers who are just starting out in this space and who want to implement digital manufacturing?

George Lewis:

Yeah. I mean, I would say, do your homework, take a look at some of the solutions that are out there, and realize cloud-based solutions give you the best opportunity for growing into a larger footprint. And so, focus on what you need today, and as a small company that may be only two or three licenses, but by getting started early you can then create the infrastructure you need to grow the business and add additional capabilities. So initially, it may be as simple as bonds and files, but in a year’s time, it may need to include quality workflows as your organization grows. Even for midsized companies, oftentimes you need a solid footprint to really be able to begin from, and from there you can grow outward and include the partner solutions, like include 1factory, for example. And so I think the cloud solutions give you unique benefits there and probably the right way to get started because you can really get started very minimally to get your toes wet, so to speak, and then grow it as your business needs change.

Chitra Sethi

Okay, thank you, George. Nipun, here is a question for you. Does 1factory have any reference stories to share, I guess, of any particular type of industry or any case studies that you would want to share with the audience?

Nipun Girotra:

Yeah, definitely. So, first of all, we are industry agnostic, so it turns out that the basics of quality control are the same across industries. What changes are things like sample sizes change, things like reporting requirements change, but the basics remain the same. You’re always dealing with specifications and kind of comparing actual measurements to specifications, and then you start with that data and then you build a layer of analysis and reporting on top of that. So we’re industry agnostic, we’re selling medical device, aerospace, precision optics. We’re even serving food manufacturing, packaging manufacturing, so it’s a wide variety of customers that we’re serving. In terms of case studies, the case studies are actually available openly on our website, so if you go to, at the top of the page, there’s a link to the case studies. There’s, I think, a couple different where we shared stories around, kind of machine shops and how they have benefited from digitalization, and also kind of complex product manufacturers that have worked with their suppliers across the supply chain and how the suppliers have benefited and how the buyer has benefited. So both of those sets of case studies are available on our website.

Chitra Sethi

Great, thank you. The next question, if either of you, Oleg, if you want to answer. How do you see digitalization impacting manufacturing processes?

George Lewis:

Hey, Oleg, I don’t think we hear you. This is George. I’ll start out, you might be having trouble with audio.

Chitra Sethi

Yeah, sure, George, maybe … [crosstalk]

George Lewis:

I was just going to say, I think this is a trend that we’re beginning to see here at Arena. So it’s something that’s in its infancy, but we’ve had discussions around this with various companies already, where I think it puts a heavier impact on the need to be able to communicate native CAD files, which has been done for years, but it’s putting a heavier need on that. I think that trend’s going to continue where, “Hey, I need to be able to send large CAD files over to the supplier to be able to run their machine and build the parts …” Oleg, please jump in here, but that’s what I’m seeing.

Oleg Shilovitsky:

Sure, absolutely, and sorry, I was on mute and I didn’t pay attention. I think the trend that I can see here is that digitalization can potentially eliminate mistakes in communication because what they call analog processes is hard to translate it in some media that can be transferred and then translated back. And it’s very inefficient, it happened in the past, that is where everyone wanted to hold his own copy of data and I think the trend is towards sharing information in the native way and communicating in a more efficient way, and this is where the efficiency and the future efficiency in a company will come, and it’s why we see the demand like I said, the sharing of native design data, sharing of online quotation information, sharing of problems and consumer report. So all these things are starting to be connected in real time, and by the ability to connect this information natively in real time to gain more efficiency and always to take the cost down.

Chitra Sethi

Thank you both. Do you have anything more to say?

Nipun Girotra:

Yeah, I was just going to jump in… I think the question was around kind of the impact of digitalization on the additive manufacturing process. I view digitalization as a kind of an enabler of that additive manufacturing process. There’s always been this dream that we can go directly from the 3D model to the part, and from that 3D model equipment with no translation steps in between. Or actually, we can have a more complex design, but we can get to it sooner in fewer assembly steps. We can eliminate lots of assembly steps. But I think digitalization is a huge enabler in this process. We can now really go from the 3D model to the manufactured part. The more assembly steps you can get rid of, the more ways you can reduce, the more mistakes you can eliminate, and so on. So, the benefits are enormous.

Chitra Sethi

Thanks, Nipun. Here’s another interesting question, either of you want to take it on? What’s your experience with company size? Is there a minimum critical mass needed before embarking on the digitalization of a manufacturing process?

Nipun Girotra:

So I’ll speak for 1factory and, then, George, if you want to jump in for Arena. So on the 1factory side … As few as three to five users, as many as 200 users, we’ve had no issues with company size. The benefits are to everyone because no matter the size of your company, the tasks remain equally complicated or equally labor-intensive. So if I’m making just a few parts, I still have to do quality control for all the features of that part. I still have to collect all that data. I still have to analyze all that data, right? And so you see the benefits of digitalization even in a very small company. Over to you, George.

George Lewis:

Yeah, dovetailing what you just mentioned there, Nipun, I think the advent of cloud-based solutions has driven the deployment of tools like Arena and 1factory much earlier in the company’s lifecycle. And in my own opinion, I think you should adopt it as soon as you have your first bill of materials, for example, but the benefit of the cloud-based solution is the fact that you can really get started with one or two or three users or whatever you need, and then as the business starts to expand and grow, you’ve already laid the groundwork for success. Where if you try to do that after the fact, we’ve all heard the story about how it’s like trying to change the tires on a moving car. It’s difficult. So do it as early as you can.

Chitra Sethi

Thank you. I think we have time for one more question. Oleg, this is for you. Why digitalization in manufacturing is important now?

Oleg Shilovitsky:

This is a great question. Thank you. I think the simple answer to this is digital habit. And I think what happened over the past 10 years is that our digital habits are formed and actually established. And what was hard to think and imagine 10 years ago, today it’s natural for people. So it’s natural for people and as a result, it becomes natural for organizations. Because those people in the organization think the same. So, and that’s the reason why people are thinking about how to bring the processes to digital because this is what they have in their consumer space and this is their environment. They’re starting to think alike, and this forming of digital habit is something that’s very very hard to speed up. And what I think, what I can see around us, is that there is a critical mass of digital habit around people and organizations, and that’s why we will see the spike of digitalization in manufacturing.

So digital habits is one thing. And the second thing is actually the reality of manufacturing, which is that global, distributed are required to have more efficient digital tools to communicate and collaborate together, which is basically impossible to do in the old fashioned way.

Chitra Sethi

Thanks, Oleg. Okay, it looks like that’s about all we have time for today, so I would like to thank our presenters again for their interesting talks. On behalf of Mechanical Engineering magazine, I would like to thank you all once again for joining us today. This is Titra Seti, Managing Editor of Have a good day.