Presenting the Nineteenth Annual ARC Industry Forum
Industry in Transition: The Information Driven Enterprise for the Connected World
February 9-12, 2015 - Orlando, Florida
Forum Keynotes Address Technology Adoption, Cyber Security, and the Industrial Internet of Things
ARC’s 19th Annual Industry Forum in Orlando drew more than 700 participants from approximately 300 different companies and 25 countries. The theme for this year's Forum, "Industry in Transition: The Information-driven Enterprise for the Connected World," resonated well with attendees, many who are currently trying to get a handle on the latest Internet-enabled automation and information technologies and determine if and how they can enable competitive advantage.
Presenters from industry, government, and academia shared knowledge and experiences on a wide variety of topics including cyber security, plant lifecycle design, automation project management, integrated control and electrification, smart manufacturing, and the Industrial Internet of Things (IIoT).
At the Tuesday morning general session, ARC President Andy Chatha introduced the first keynote speaker, Peter Holicki, Corp. Vice President, Manufacturing and Engineering and Environment, Health & Safety Operations at Dow Chemical. In his brief introductory comments, Andy indicated that Mr. Holicki is currently responsible for two new mega projects: Gulfstream, a world-class ethylene complex that Dow is constructing in Freeport, Texas to take advantage of the current abundance of domestic natural gas; and Sadara in Saudi Arabia, a joint venture between Dow Chemical and Saudi Aramco, which is on track to be the world’s largest and most highly integrated petrochemical complex.
Teaching an Elephant to Dance
Mr. Holicki began his presentation with the words, “We at Dow are addicted to technology; but it is a healthy addiction.” This is how he set the stage for his discussion on how Dow Chemical, one of the world’s largest chemical companies, integrates technology into its business to remain agile and competitive, or in his words, “It’s how we make the elephant dance.”
According to Mr. Holicki, in today’s global chemical industry, the large companies that haven’t survived either were too complacent about adopting technology, or followed the wrong technology trends. “However, technology alone is not the solution; technology adoption must follow strategy and business goals. It’s important for companies to control technology, rather than letting it control them and to partner with the right technology suppliers.”
In his concluding comments, Holicki summarized, “Technology and innovation have to align with business strategy, but companies must also be willing to adapt their technology to meet new challenges as needed.” In this manner, “You can teach an elephant to dance.”
Cyber Security Is Not a Technology Issue
The second keynote speaker at this general session, Brigadier General (Retired) Gregory Touhill, began his keynote presentation by stressing that people misunderstand cyber security, “It’s not really a technology issue, it’s a risk management issue, and it’s a risk for companies and individuals alike.”
Gen. Touhill’s, admittedly lengthy formal title is Deputy Assistant Secretary for Cybersecurity Operations and Programs in the Office of Cybersecurity and Communications within the National Protections and Programs Directorate of the Department of Homeland Security. However, he characterized his job as being the “captain of the neighborhood cyber watch team,” an analogy he uses to describe his responsibilities, which include selectively sharing information about cyber security vulnerabilities and bad actors along with best practices and compensating controls. According to his bio, Gen. Touhill, who retired from the US Air Force in 2013, now focuses on developing and implementing operational programs designed to protect US government networks and critical infrastructure systems.
Gen. Touhill leads the National Cyber Security and Communications Integration Center (NCIC), which includes the Industrial Control Systems Cyber Emergency Response Team (ICS-CERT). His group also maintains the EINSTEIN network security program, a collection of tools designed to defend the federal IT systems within the “.gov” domain.
Gen. Touhill explained that government and companies alike have to evaluate a number of different threat vectors relative to cyber security. These include:
Nation states - that represent very potent and capable adversaries
Criminals – that are generally trying to steal information
“Hacktivists” - groups that might not agree with your company’s policies and/or activities
Gen. Touhill also confided that, in his personal opinion, stupidity represents a fourth potential threat vector. In other words, “smart people doing stupid things.”
His organization also looks at the physical aspects of cyber security, such as physical attacks against the electric power grid, which threaten computer networks.
Industrial Internet of Things and the Connected Plant
Following these presentations on the importance of technology adoption and cyber security, Andy Chatha, ARC’s founder and president, took the opportunity to share his thoughts on the Industrial Internet of Things (IIoT) and the Connected Plant.
To provide appropriate context for this discussion, Mr. Chatha pointed out that while many companies in the upstream oil & gas sector are getting squeezed by the severe decline in oil prices, downstream companies are benefitting from the low energy and feedstock costs. In fact, low energy prices represent an opportunity for most companies to invest in their plants. According to Chatha, this is long overdue, since due to competitive pressures, many companies are operating assets that are 20, 30, or even 40 years old. And while it’s often possible to keep old assets running, these may place companies at a disadvantage compared to companies that have built new plants in recent years.
This provided a natural segue into a discussion on the Industrial Internet and the Connected Plant. “When your information is in the cloud, you can begin to apply more powerful analytical tools to help improve the performance of your assets.” Chatha also stressed that this, of course, requires a safe and secure Internet.
He is convinced that the IIoT is already taking shape and that users are seeing benefits. “Today, you can buy field devices that connect both to the plant network and to the Internet; enterprise software and analytics are moving to the cloud; and automation systems are evolving, with the traditional layers compressing. This all provides opportunities for companies to improve productivity, improve asset utilization, improve business processes, and lower lifecycle costs. Chatha indicated that, according to GE, the Industrial Internet represents a $32 trillion opportunity for the global economy.
Clearly Mr. Chatha believes that the Industrial Internet of Things will have a significant impact on industrial companies by providing more sensors, data, automation, and software applications, including powerful new advanced analytics that will help transform the massive amounts of data generated by intelligent, connected assets into timely, in-context information for both planning purposes and real-time decision support.
He also believes that the IIoT will enable new architectures, service capabilities, customer/supplier relationships, ecosystems, and – in fact – entirely new business models.