Digital Infrastructure, Cloud Computing Transforming Fragmented Manufacturing Industry Value Chain, According to Microsoft Study

HANNOVER, Germany — April 4, 2011 — New technology advancements available in a digital infrastructure, such as cloud computing and social computing, are transforming manufacturing industry value chains, according to a Microsoft Corp. survey released today at HANNOVER MESSE 2011 in Hannover, Germany.

The survey results revealed a need to better integrate collaboration tools with business systems (47.4 percent) and to improve access to unstructured data and processes (36.2 percent). Almost 60 percent see an industrywide collaboration that includes manufacturing products and services providers, IT providers, systems integrators and in-house business analysts as most capable of bringing about these improvements.

To support tighter collaboration across these stakeholders, Microsoft has created a Reference Architecture Framework for Discrete Manufacturers Initiative (DIRA Framework) to drive solutions based on cloud computing across manufacturing networks while helping integrate processes within and across the enterprise, extend the reach of the network to more companies globally, and connect smart devices to the cloud. Microsoft partners involved in the initiative currently include Apriso Corp., Camstar Systems Inc., ICONICS Inc., Rockwell Automation Inc., Siemens MES and Tata Consultancy Services Ltd.

“Globalization has fragmented industry value chains, making them more complex and unable to quickly respond to increased competition and shorter product life cycles. Cloud computing is empowering today’s global manufacturers to rethink how they innovate and collaborate across the value chain,” said Sanjay Ravi, managing director, Worldwide Discrete Manufacturing Industry for Microsoft. “As a result of these increasingly rapid changes in technology and business, manufacturers are seeking guidance on how to best plan and deploy these powerful technologies in concert with their business strategies and priorities and how to achieve greater competitive differentiation. Microsoft is leading a DIRA Framework in response to this need while offering a pragmatic solution road map for IT integration and adoption.”

Cloud Computing Survey Findings

The Microsoft Discrete Manufacturing Cloud Computing Survey 2011, which polled 152 IT and business decision-makers within automotive, aerospace, high-tech and electronics, and industrial equipment manufacturing companies in Germany, France and the United States, found that the biggest benefit of cloud computing is lowered cost of optimizing infrastructure, according to 48.3 percent of respondents. This was followed closely by efficient collaboration across geographies (47.7 percent) and the ability to respond quickly to business demands (38.4 percent).

“The survey shows current cloud computing initiatives are targeted at cost reduction, but a growing number of forward-looking companies are exploring new and innovative business capabilities uniquely delivered through the cloud,” Ravi said. “Manufacturers are exploring ways to improve product design with social product development, enhance visibility across multiple tiers in the value chain, and create new business models and customer experiences based on smart devices connecting to the cloud.”

DIRA Framework

Development of the discrete manufacturing reference architecture will be an ongoing effort led by Microsoft, with close collaboration by participating companies, including industry solution vendors and systems integrators. The initiative defines six key themes to guide this development: natural user interfaces, role-based productivity and insights, social business, dynamic value networks, smart connected devices, and security-enhanced, scalable and adaptive infrastructure.

Microsoft has developed the principles of the DIRA Framework in conjunction with the technology adoption plans and solution strategies of its key partners. Several Microsoft partners across multiple business areas in manufacturing have endorsed the DIRA Framework because it helps them deliver high levels of customer value through complementary solutions aligned with the framework.

“We see the DIRA Framework, combined with the unparalleled discrete manufacturing content and application solutions from Rockwell’s FactoryTalk, as an opportunity to help our customers leverage their IT investment by accelerating the integration of manufacturing and enterprise information to reduce the time-to-value for the enterprise,” said Doug Lawson, chief software strategist, Rockwell Automation.

“Siemens welcomes the new DIRA Framework — which is a good fit to its own industry software offering and Totally Integrated Automation approach,” said Ralf-Michael Franke, CEO Industrial Automation Systems, Siemens. “We expect this architecture to lever an improved interoperability information flow between the shop floor and the enterprise functions, as well as increase efficiency between enterprise systems and enterprises throughout the supplier network. The Siemens MES product, SIMATIC IT, is just one example that aligns well with this reference architecture.”

“Apriso supports the (DIRA Framework) initiative because it echoes many of the architectural principles that we currently practice — it is essentially an extension of the global platform for manufacturing operations that Apriso’s customers currently utilize,” said Tom Comstock, executive vice president, Apriso.

“A comprehensive reference architecture is essential for dynamic, data-driven applications to meet current and future challenges,” said Scott Jones, chief technology officer and vice president of R&D at Camstar Systems. “Customers will benefit from these technologies to assist in solving complex business problems and meeting today’s industry needs.”

“At Tata Consultancy Services, we help the manufacturing industry improve competitiveness with best-of-breed solutions that deliver business functionality, integration and data synchronization. Our solution uses industry best practices for all manufacturing enterprise roles,” said Kalpan Raval, practice director, Enterprise Solutions, Tata Consultancy Services. “The solution ensures full integration between shop floor systems, Siemens MES, enterprise resource planning and other data sources, which enable lean and traditional scheduling principles to be readily applied. Using this newly released reference architecture, we expect to accelerate value realization for our customers due to asset-leveraged, shorter implementation cycles.”

“ICONICS provides to the discrete manufacturing industry HMI/SCADA solutions and manufacturing intelligence solutions that assist our customers in maximizing their productivity and efficiency,” said Gary Kohrt, vice president, Marketing and Product Marketing for ICONICS. “ICONICS supports the DIRA Framework and utilizes many of the technologies referenced by it. For example, by utilizing Microsoft Silverlight and Microsoft SharePoint Technologies, our GENESIS64 and PortalWorX products are able to deliver user interfaces that are not only graphically rich, natural to use and role-based to the many different users in our customers’ enterprise, but also often ‘excite’ those that use and share information with them. By utilizing Microsoft’s mobile technologies, we can deliver information to our customers’ ever-shifting, on-the-go workforces, with no loss in functionality.”

“The principles of discrete manufacturing reference architecture align well with key offerings from Infosys, such as Supply Chain Visibility and Collaboration product suite and manufacturing collaboration accelerators,” said Sanjay Jalona, vice president and head of Manufacturing North America, Infosys Technologies Ltd. “These offerings take advantage of Microsoft technologies to solve business challenges like supplier collaboration, innovation management and knowledge management.”

Founded in 1975, Microsoft (Nasdaq “MSFT”) is the worldwide leader in software, services and solutions that help people and businesses realize their full potential.

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