August 2009

Automation Founders Circle

Marrying business, process performance measures earns Martin ISA Life Achievement

By Jim Strothman

In the late 1980s, after The Foxboro Co. introduced its I/A Series distributed control system (DCS), which was among the first non-proprietary DCS systems, Foxboro President Gary Willis asked Dr. Peter G. Martin, “What do you want to do now?”

Foxboro had invested significant amounts of money on state-of-the-art I/A Series features that would enable that company to join then emerging industry transition from proprietary to open, standards-based DCS architectures. Martin had spent the previous three years working long hours helping lead the I/A Series development.

Proud of the new features, Martin replied: “I’d like to find out how customers are using the system differently.”

He was in for a shock. Discussions with early I/A Series customers revealed most of the advanced technology, which helped “sell” the systems, was rarely being used.

“The systems were being implemented in the exact same way as traditional proprietary DCSs,” Martin said. “The change (from proprietary to open) systems was having almost no impact” on performance or productivity.

While plant-floor operators were pleased the systems made their jobs easier, senior plant managers were not seeing hard evidence that costs were lower or yields were better.

“We have no visibility into whether we are making or losing money,” Martin remembers plant managers telling him.

Sensors are key

Determined to fix that problem by taking advantage of DCS system sensors’ real-time measurement capabilities, Martin, helped by experts within and outside of Foxboro (now part of Invensys), pioneered marrying real-time business (accounting) algorithms with traditional production measurements.

The initiative led to Dynamic Performance Measures (DPM), patented by Martin and Dr. Malcolm Beaverstock, then members of Foxboro’s applied research team.

For his still continuing work improving plant performance metrics, ISA will present Martin, now Invensys vice president of performance management, with the society’s Life Achievement Award in October in Houston.

The award recognizes individuals with a history of sustained dedication to the instrumentation, systems, and automation community. Martin’s award citation reads: “In recognition of a three-decade career in the development of dynamic performance measurement technology and the sharing of these innovations through publication, global speaking engagements, and product application.”

“It was a quite a surprise to have won this award,” Martin said. “Greg Shinskey (control theory consultant, Wolfeboro, N.H.) won the award last year, and he is one of my heroes. I’m honored to be considered in the same category.”

Early on, Martin and others working on the metrics project realized if accountants could come up with the right equations, “we could use our engineering skills to transform the sensor data into real-time accounting algorithms.” Helped by Robin Cooper, then a professor at Harvard (now at Emory University in Atlanta), the team developed real-time accounting (RTA) measures; essentially unit-level equations.

RTAs offered by Invensys today, for example, measure direct material costs, direct energy costs, direct waste costs, and contribution margin.

Eureka, it worked

“We initially tried it on four or five industries. We tried it at BASF, Eli Lilly, Canadian Forest Products, and others. We found we could actually do it. It didn’t matter whether it was a Foxboro, Emerson, or Honeywell controller.”

In fact, at first it worked too well. “We ended up with a large number of financial and operational measures, almost too much information,” Martin said. So Foxboro enlisted help from Dr. Thomas Vollman, then of Boston University. Together, they developed a powerful tool that enabled process operators at the plant floor level—operation, engineering, and maintenance personnel—to make real-time decisions and see how they affect costs.

“We limited it to four DPM measures,” which appeared on gauges at the operator’s “dashboard” from left to right. For example, Martin explained, DPM measures might be Production Value, Quality, Energy Cost, and/or Feedstock Cost.

An operator might boost production by increasing the process temperature 10 degrees, but then see on the dashboard the higher energy costs more than offset Production Value. Operators can “tweak” temperature, or level, for instance, to see if it saved or cost more money.

“After the power grid opened up, the cost of power off the grid fluxuated very frequently,” Martin said. “The price you pay for energy in your home probably changes 24 times a day. Ten years ago, energy management programs just focused on consumption. Instead of controlling consumption, we should control the cost of consumption. If you’re only measuring once a month, and it’s changing 24 times a day, you’re not controlling costs as you could.”

Other sometimes rapidly changing business variables include feedstock prices and even product prices.

“Back in the 1970s, plants were trying to eliminate operators (to save labor costs). My opinion is exactly the opposite. If we give operators the right information, they can add a great deal of value to the company,” Martin said.

Saves BASF $2.2M annually

Martin and Invensys can point to several DPM successes.

For example, at a BASF plant in Freeport, Tex., which makes a product used in manufacturing nylon products such as upholstery and carpeting, a goal was to reduce raw material and energy usage. Prior to installing DPM, the production management team relied on traditional end-of-the-month reports to reconcile unit and area profitability based on aggregated monthly raw material and energy consumption.

“With this (once-a-month) approach, you can have a production or raw material problem and not realize it until the end of the month,” said Scott Hines, a BASF operation engineer.

After real-time econometric models were installed in BASF’s DCS, DPMs calculated hourly, shift, and daily averages. One performance tool for operators indicates real-time performance levels on the DCS. Another tool pops numbers up on the screens of managers every 24 hours.

“BASF estimates that DPM has been a contributing factor in more than $2.2 million in annual benefits, primarily attributable to cost savings,” the company said.

Steam operations improved

Sasol (originally known as the South African Coal, Oil & Gas Corp.) worked with Invensys consultants to develop real-time performance measurements at two steam plants. After Sasol began using more natural gas to produce some synthetic fuels, steam demand decreased, changing the focus from maximizing production to minimizing costs.

DPMs were modeled in the DCS and developed for each individual boiler, steam station, and steam generation in general. Station-level DPMs measured steam cost, quality, and production rate.

Sasol said first-month results indicated a 6% savings on energy feedstocks and 4% savings on electricity costs for making steam in the two plants. Savings progressively improved the second and third months.

Early results indicate the plant is exceeding projected bottom-line benefit results of $400,000 per year, Sasol said. The company plans to add real-time performance measures to five more plants.

“We haven’t found an industry yet where it doesn’t work,” Martin said.

“Our industry is changing, and dynamic performance measures are becoming more important,” the Invensys executive said. Some parameters and processes are changing faster than operators can deal with them. To help cope, Martin expects “predictive technology” will be increasingly used in coming years.

The ISA Life Achievement Award winner said Invensys has seen big savings in the petrochemical and refining worlds, as well as in batch operations such as pharmaceuticals, thanks to DPMs.

Active work history

Martin joined The Foxboro Company 30 years ago. He worked in a variety of positions in training, engineering, product planning, marketing, and strategic planning. He has held positions as the VP of Marketing as well as the Chief Marketing Officer for Invensys Manufacturing and Process Systems. During a brief absence from the company, he held executive positions at Intech Controls and industry research firm ARC Advisory Group.

He has authored numerous published articles and technical papers and has written two books: Bottom Line Automation and Dynamic Performance Management: The Pathway to World Class Manufacturing, both published by ISA. He has also co-written a book, also published by ISA, entitled, Automation Made Easy: Everything you wanted to know about automation – and need to ask. Martin holds multiple patents and, in 2002, was named one of Fortune magazine’s “Hero of U.S. Manufacturing.”

He also was named as one of ISA’s “50 Most Influential Innovators of All Time.” Martin has BA and MS degrees in Mathematics, an MA degree in Administration and Management, a Master of Biblical Studies degree, a Ph.D. in Industrial Engineering, and a Ph.D. in Biblical Studies.

 

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