This chapter links several points of the WITORG Guide, with the so-called ‘automation pyramid’ and with the concept industry 4.0 and about organizational systems.
The automation pyramid is a concept created in the previous millennium. It has to do with the ICT systems treated in external element C. The concept industry 4.0 was coined in 2011. It includes the pyramid of automation and other more or less recent concepts such as artificial intelligence and cognitive machines, big data, internet of things, 3D printing and robotics, among others.
The term industry 4.0 has had great commercial success, even without knowing very well what it consists of, given the large number of existing definitions. In addition, it has been able to include all the ICT world already developed prior to its creation. WITORG wants to highlight its importance in terms of connectivity and the advantages it will bring to organizations that know how to take advantage of the possibilities of a connected world.
The technological options available within the pyramid of automation or within the industry 4.0 concept will not be shown. The intention is, mainly, to reflect on the information flows to be designed and managed subsequently as a fundamental part of an organizational system. The storage capacities to record information generated in the information flows are also fundamental to understand concepts such as big data and continuous improvement in organizations.
The automation pyramid
Classic elements of the automation pyramid:
The described classification can be questioned regarding the number of levels. If you see images of automation pyramids in an internet search, there are at least with four, five and six levels. According to each organization, the levels shown in the figure can be reduced because there are any of them, or by integrating two in one. Here are some characteristics of each level:
Level 1: Process network (field devices – sensors – actuators – hardware)
These devices are parts of a productive or industrial team. They inform the control (PLC) of level 2, about the situation of a device regarding its situation (temperature, position/distance, open/closed, etc.). They also act upon receiving an order from the PLC. The data transmission speeds are in milliseconds. The frequency of data transmission can be in milliseconds if the process control (PLC-Level-2) so requires. Some devices may store information, even if it is not their main function.
Level 2: Control network (PLC-HMI)
These devices control a productive or industrial team. The main function is to control and govern it. They receive information from level 1, they control the state of the productive or industrial team and send orders so that the elements of the productive or industrial team perform their functions. The information transmission speeds can be in milliseconds. Level 2 transmits information to both level 1 and level 3. The frequency of transmission to level 1 can be from a few milliseconds to seconds or minutes, depending on the need to execute the process.
From level 2 to level 3 the transmission frequency can be high as well. From a few milliseconds, to seconds or minutes, depending on the need. The connection between level 2, level 3, is one of the key aspects in the industry 4.0 concept. A PLC controls manufacturing processes or industrial equipment, where it would be interesting to store information every few milliseconds or seconds to learning what happens. Level 2 does not currently have large storage capacities. This is transmitted to level 3, and then it is decided where to store it, whether at that level or at higher levels.
If you want to know the operation of a process, you can obtain from the PLC output variables every few seconds. These variables will be transmitted to level 3. According to the variables that you want to register in the mentioned few seconds frequency, an analysis of the storage capacities is required. Here the SQL or NoSQL databases come into play, depending on the nature of the information and the amount of data to be stored and the talk about big data begins. The PLCs that send the information of variables in high frequencies (seconds), generate such amount of information as to catalogue it as big data.
Level 3: Supervision network – SCADA
A SCADA can monitor in real time level 2 of one or more PLCs at the same time. From a SCADA you can send orders to one or several PLCs and coordinate them together. The PLCs, level 2, in turn will govern the systems under their control.
The SCADA environment allows for important storage capacities through SQL or NoSQL databases, in addition to various software for applications used in the industry world and up to an MES, although in the pyramid it has been represented in level 4.
Level 4: Operation Network – MES (Manufacturing Execution System)
As indicated by its initials, the term MES has to do with the operations carried out in industrial plants. It includes information on productive operations, logistics, maintenance, quality and safety. It could also show information about products and processes.
Level 3 versus level 4
Here begins the first big break in terms of storage frequency of information from level 4 to level 3. In level 3, it may be required to manage and store information (PLC output variables (level 2) such as temperatures, intensities, pressures, positions/distances, alarms and a long etc.) in each cycle (seconds) to manufacture a unit of product. However, the MES of this level 4 may be enough to store records by OF or a predetermined minimum lot.
Level 3 can manage the information in real time from the technological point of view. In this level 3 and in the SCADA environment, the functionalities and tools required for managing information in real time or at high frequencies every few seconds will be created.
In level 4, the information does not require in many cases to be stored every few seconds, but in minutes, hours, shifts or even days. The storage capacities of level 4 are less demanding than in level 3. However, the possibility of managing information in real time disappears as soon as the storage frequency decreases. For this reason, the possibility of reacting immediately disappears as soon as the frequency is low. In summary, if the update of information is given in large intervals of time, hours, shifts or days, the system will not have information between these intervals.
This point highlights the importance of understanding the information needed to manage in real time and the information needed to store at greater intervals. This makes a differentiation of Type A and Type B:
- Type A: Reading and analysing information in real time and making decisions in that real time, or immediately.
- Type B: Storing information at certain frequencies, for a posteriori, draw conclusions and take action.
The more information is managed from Type A, the greater the proactivity of the organization may be. Obviously, not all information can be managed as indicated in Type A. But there is a lot of Type B managed information that could be managed as Type A in many organizations.
Level 5: Information network – ERP
The information in the ERP is usually more static than that in the lower levels. In general, the information update is given in a lower frequency, comparing it with levels 1, 2, 3 and 4. This level includes information about customers, suppliers, offers, contracts, assets, information consolidation of several production plants, accounting, costs, project management, etc.
Level 5, ERP, and level 4, MES, are encompassed as a single system in some organizations. This is because the frequency of updating the information used is similar, or that it does not have a differentiated MES system. In this case, some ERP modules will function as MES.
Automation pyramid, external level and communications
Another level will be added to the automation pyramid, called ‘external level’ or ‘level E’. This level is composed of those entities external to the organization with which it connects to receive or analyse information, as well as to send information. Examples of external entities in level E:
- Internet.
- Customers, EDI, delivery communications, access to customer portals, etc.
- Suppliers.
- Public Administrations.
- External collaborators. External services in which even an internal level 1, 2, 3, 4 and 5 of the pyramid could become external.
Another key aspect of the automation pyramid and industry 4.0 are communications. At present, there are cases of organizations where communications between levels are precarious or do not exist. Between levels 1, 2, 3, 4 and 5 the information can go through the pyramid level in ascending or descending order.
In the following image the connections in the pyramid are presented conceptually and its connection to level E. The great amount of elements that compose this environment and the different technological options of how to do it, imply a unique pyramid for each organization.
The automation pyramid, as it can be seen in the image, can interrelate an entire organization and its organizational system. Three aspects of the automation pyramid will be classified:
- Aspect A: The technological infrastructure necessary, considering software, hardware and communications used to connect all levels.
- Aspect B: Information storage needs at the different levels in the automation pyramid. This information can be used for self-learning and even for artificial intelligence.
- Aspect C: The management processes, which information is traversed and stored in some cases in one or several levels of the pyramid. We will call these flows ‘management process information flows, for short, ‘MP-InfoFlow’. These MP-InfoFlow are key to understand the organizational systems. MP-InfoFlow will also be considered for the management subprocesses. Not forgetting the importance of keeping in mind the management process that encompasses the management subprocesses.
Organizations, according to their needs, require Aspect A assemblies, where the combination of ICT elements and the information that flows through them makes them unique for each organization in particular.
Within Aspect B, the importance of the analysis of information as a learning source should be highlighted, for its later use in continuous improvement.
Aspect C is the basis by which an organizational system operates. The information flows of a management process, MP-InfoFlow, are key to understanding an organizational system. Through them, orders are executed and thousands of tasks are carried out in order to meet goals and evolve the organization.
Back to the name of this section, it is important to understand Aspects A, B, and C. These aspects are key to organizational development and, increasingly, their design will help to create efficient organizational systems to a greater or lesser extent.
Organizational system in relation to the automation pyramid
Having described the main concepts of the automation pyramid, and imagining an organization where the aforementioned components are partially or totally? implemented, it is evident that several people participate in it. Surely, there will also be external from suppliers or partners that are an important part of the implementation. Issues that may arise from this point:
- Is there a team of people, or people, within the organization responsible for the automation pyramid or industry 4.0?
- Is the automation pyramid itself managed as a management process or management sub-process? Is this possible?
- Is there a person or persons in the organization or partners with enough knowledge to understand the possible technologies (hardware and software) to use to build the pyramid?
- Are there people in the organization with enough knowledge to understand the complete information flows, MP-InfoFlows, that go through the pyramid?
- Is the automation pyramid fully connected? Is this possible?
- Are all the elements shown in the automation pyramid necessary in all industrial organizations?
- Any other the reader wants to add.
The questions raised may have different answers depending on the organization and its organizational system. Even so, we will present a few points where most organizations coincide in terms of the automation pyramid or the industry 4.0 concept:
- It is a complex world in constant evolution.
- Technology currently offers connection possibilities of the pyramid until recently not available (and affordable).
- The industry 4.0 concept is fashionable.
- It is complicated, or rather almost impossible for a single person to be an expert in everything that the pyramid includes, if we focus on the aspects A, B, and C cited.
- These tools can provide levels of control and self-learning regarding the organization itself clearly usable in continuous improvement.
- Organizations currently need, or will soon require, expert knowledge in the technologies used in the construction of the pyramid and in the design of information flows of a management process or PM-InfoFlow.
- Organizations with Taylorist influence find it difficult to build and communicate/connect a pyramid, since the departments have a partial vision of the organizational system.
- Sooner rather than later, organizations will realize the importance of understanding the pyramid from a technological point of view. And also the MP-InfoFlow of Aspect C.
- Organizations will have to consider how to evolve their organizational system for better management of the pyramid. And all this thinking in the aforementioned Aspect A, Aspect B and Aspect C.
A couple more questions:
- If the importance of the automation pyramid is increasing, how does an organization propose the management of making it evolve in its organizational system?
- Considering that even today most organizations are structured in a Taylorist way by functional departments, what parts of the automation pyramid does each department assume as their own?
Information flows from a management process. MP-InfoFlow
In organizations, information is generally understood by concepts and departmentally. A description will be made of part of the information stored in level 5 of the pyramid, ERP-information network. Next, we will analyse how the information travels through or is stored in the pyramid, Aspect B and Aspect C.
Level 5. At this level corporate information is managed, you can find:
- The economic and financial consolidation information of a multinational company
- A plant or business unit’s financial administrative information.
- Information about customers, CRM modules.
- Contracts with customers.
- Information about suppliers.
- Contracts with suppliers.
- Organization’s assets.
- Deliveries to customers via EDI or others.
- Supplier materials delivery programs.
- Projects executed, to undertake or in progress in the organization.
- Information on the products and processes used in the organization.
- Plans for planned, preventive or predictive maintenance.
- Information on the operations of the organization, sales, purchases, manufacturing orders, technical support, service orders, maintenance orders, stocks, rejects, scrap, non-quality costs…
The different information concepts cited are managed in an organization’s ERP. In the ERP environment, and sometimes connected or integrated into it, there are also systems (software and hardware) for PLM, PDM, project management, product and process design, several simulations and a long etcetera. The information described in this paragraph is in the ERP level 5, although this is conceptually questionable.
Much of this information is stored in relational databases (SQL). Other types of files are used in the storage of information such as 3D product designs, etc. For some time now, we have also been working on NoSQL databases.
The NoSQL databases have been used mainly for the information available on the internet. For large companies such as Google, Amazon, Twitter, Facebook, etc., these NoSQL databases begin to allow small and medium enterprises to store information generated in any of their levels 0, 1, 2, 3, 4, 5 and level E in a massive way. Then, these data can be analysed and used for self-learning, continuous improvement and the search, in short, for various types of benefits for an organization.
In addition to where the information is generated, storage can be done at levels 3, 4, 5 and E-level.
Once described the information of level 5, we will observe where it is generated:
- On the same level 5.
- In levels 1, 2, 3 and 4.
- External agents (clients, suppliers, partners…) can send information for different use from level E.
- The organization can take it at level E, that is, on the internet.
Where can level 5 information travel? It can travel to external agents to inform about something in particular. It can also go down all levels, reaching in some cases level 1, sometimes reaching levels 2, 3 or 4. To do this, the different levels must be communicated. Level connectivity options fall within Aspect A, with different options. WITORG considers the need for communication in Aspect A, however, we will not enter into its analysis as there are many options and we are not experts.
Just as there is information stored in level 5, the other levels as well, mainly levels 3, 4 and the external level, may require information storage. This is typical of each pyramid and the reasons for this can be:
- Functions executed in a level and a database required at that level, when that information is not necessary at level 5, but where a functionality is executed.
- Due to safety issues.
- Due to different speeds of data transmission between levels.
- Others.
In conclusion, level 5 can communicate bi-directionally with both external agents and levels 2, 3, 4 and 5. This does not mean that all information received by external entities’ level 5 has to go down to level 1 Nor that the information in level 1 has to travel to external agents. There will be information flows from a management process or MP-InfoFlows that will partially or fully use the levels of the automation pyramid.
Some examples where there are information flows through the pyramid:
- The departmental function information, possible management subprocess ‘maintenance of productive facilities’. This information can cover all levels. The manufacturer of a production facility gets information about his customer’s installation from level E. He gets level 1 information and, combining it with information from other levels, stores it in level E. He will then analyse it to help his customer to better use the installation.
- The information of stock transactions that are given through the automation pyramid in the process of order management and delivery to customers could go through all levels.
- The information necessary for the preparation of an income statement, what levels does it cover?
- The information about competitors existing on the internet in terms of products characteristics, processes or services, what levels does it go through?
- Any other the reader wants to add.
MP-InfoFlows are an essential part of any organizational system. The data of the MP-InfoFlows flows and is stored on the elements of the automation pyramid. This can help to know the status of an organization, even in real time, and to execute operational actions from the information obtained from the MP-InfoFlows immediately. Hence the importance of MP-InfloFlows, that is, of the management processes designed to navigate the pyramid.
New organizations of all sizes and in various sectors have been created in the last twenty years, which have surpassed the previous market leaders thanks in part to how they have built and used their pyramid and how they have built and used their MP-InfoFlow over the pyramid. In Zara’s case, for example, its pyramid and the design of its MP-InfoFlows are even a core part of its business model.
WITORG and the automation pyramid
Once explained the automation pyramid in its Aspect C, information flows MP-InfoFlow, and Aspect B, storage of information for its analysis and big data, it will all be analysed from the internal and external elements of the WITORG Guide.
100. Essence of an Organizational System – Automation pyramid
An organization’s shareholders and CEO, with their decisions, will draw the main lines in the construction of the automation pyramid regarding the following parameters:
- Investments.
- Power sharing. The organizational model in terms of its more or less taylorist or holacratic conception implies a different design in terms of management processes. In departmental Taylorist organizations, the concept of the management process is not usually the same as in organizations more focused on process management in a more integral way; when it comes to building information flows or MP-Inflow, the approach can be very different. For two organizations it could be possible to have the same ICT technology in terms of the construction of a pyramid, although different management process designs and, therefore, different MP-InfoFlow.
- Level of transparency in the organization. The availability of the information also goes in relation to the CEO or the shareholders’ decisions.
- The sector in which it operates. There are sectors where not having a connected pyramid nowadays or not being in that process could leave an organization out of it. On the contrary, in sectors where a connected pyramid is not usual, doing so could bring competitive advantages.
- The country. There are public administrations that promote and support investment in the industry 4.0 concept. Some organizations will take advantage of these opportunities.
- The level of training within the organization. Depending on the academic level and professional experience cultivated, within the organization it will be more or less simple to connect the pyramid and take advantage of its benefits. WITORG considers a mistake to believe that an external partner is going to be enough for the connection of the pyramid and the development of the information flows of a management process.
200. Continuous improvement – Automation pyramid
How does the automation pyramid help to continuous improvement?
Being connected both internally and externally can help detect changes immediately. From the KPIs point of view, any significant deviation can be monitored. The connection with different entities can provide information directly and in real time. The information from customers, suppliers, public administration, collaborators and competitors in real time facilitates activating management processes, when that information implies making changes.
The possibilities of self-learning on manufacturing processes or products goes through the big data concept. A well-connected automation pyramid will allow the storage of product and process data. Then, or even in parallel, that stored information can be studied. The conclusions of this information’s studies may be applied both in products and processes for improvement. The analysis of data or information acquired on the internet (big data) will provide conclusions to facilitate continuous improvement or even disruptive improvement. The concept of artificial intelligence is being brought to reality in different fields, this is partly due to the storage capacities and the learning or self-learning derived from these capacities.
300. Process Management – Automation pyramid
In this chapter, we have discussed the concept of information flows in a management process, MP-InfoFlows. They have been categorized as Aspect C of the pyramid. An automation pyramid connected to all levels can facilitate a MP-InfoFlow. The design of the MP-InfoFlows and the design of the pyramid are directly related. Not taking them into account as a whole can cause organizational inefficiencies.
ICT and new business models supported in them have brought new market leaders in different sectors. In all cases, the management processes have been developed considering the pyramid.
400. KPI and targets – Automation pyramid
Part of the performance indicators, KPI, are obtained through the information flows of a management process, MP-InfoFlow. The management processes and their information flows supported in pyramids connected to all levels facilitate the reading of KPIs. This allows a monitoring of the result even in real time. The information in real time will in turn allow the proactivity of an organization through its organizational system.
500. Projects – Automation pyramid
The big data on the internet information, or the big data on the internal information stored in the different levels of the pyramid, will provide new knowledge about the external environment or about the information generated in the organization itself. This acquired knowledge will require new developments, which are ultimately projects to be managed through the organizational system.
600. Teams of people – Automation pyramid
In this section, we have reviewed general considerations about how people get involved and participate in an organization. In the end, the creation of a pyramid and the information flows of the management processes is carried out by the organization’s people. Therefore, WITORG considers the following key points in the aspect of people in the pyramid:
- Educational level and professional experience for the understanding of all the sections of a pyramid regarding the necessary ICTs and the information flows of the management processes.
- Importance of the organizational structure in terms of its more or less taylorist or holacratic philosophy.
- The need for teamwork.
B. Quality systems – Automation pyramid
Quality systems (ISO 9000 and family, EFQM, QMS, TQM, etc.) have influenced organizational systems in an important way. These systems have usually been driven by the quality function in a large part of the organizations. The automation pyramid has been managed by other functions, other than quality, within an organization. In the past millennium, the use of the pyramid in management processes was perhaps not as important, today, its use in the management processes of some business models is a core part of the organizational system.
The following questions arise:
- Are standards or quality systems disconnected from the automation pyramid?
- Should the quality function be reconsidered from its traditional conception in its relation with the organizational systems?
- The relationship between automation pyramid and management processes is increasingly necessary. Who should be the designers of the organizational systems within an organization?
C. Systems – Automation pyramid
The automation pyramid is directly related to the external element ‘C.Systems’ of the WITORG Guide. The complexity of the ICT world requires a constant review, hence the importance of taking into account internal elements 100, 200, 300, 400, 500 and 600 for the organizational system’s review. Through these points, you can understand the environment where an organization operates. Starting from the understanding of the environment, it will be easier to reach goals or detect opportunities to continue evolving and surviving. At least if survival in time is one of the objectives of an organization.
D. People and environmental circumstances
Can it be attractive for people to work in environments or organizations where a connected pyramid favours learning, bidirectional information, transparency, efficiency, etc.?