Intelligent Enterprise on the Move – Kennametal’s Modernization Journey
A look back at the American Manufacturing Summit 2019
What a great week it was at the American Manufacturing Summit in Chicago! This year’s attendees were a who’s who of manufacturing excellence. The sessions were outstanding – with so many success stories of companies that have made progress on Industry 4.0, digital transformation, and smart connected devices and equipment.
I was particularly fortunate to be onstage with Tom McKee, an industry visionary and Kennametal’s VP and CIO, who has been one of the company's key leaders driving this enterprise modernization program. Tom and I presented Kennametal’s journey in a case study format using the company’s Intelligent Enterprise model:
Tom makes this journey accessible and understandable by speaking directly to the challenges, setbacks and successes he and Kennametal have faced along the road. At the heart of their strategy is The Smart Factory, Kennametal’s Advanced Manufacturing initiative to automate and modernize plants. This initiative has been underway for the past 18 months and is accelerating through a major capitalization program. It’s redefining the manufacturing process across all major business lines and plant facilities.
What Kennametal needed to ensure the full value of their investments was a tightly integrated program that brought together the power of several organizational competencies into a cohesive program. Each of these was already in motion, and pulling them together has streamlined and accelerated progress, while reducing risk and increasing efficiency.
Tom explained the value within each of the four pillars that everyone making this trip should keep in view:
Organization Development – As Tom spoke about the technology and workforce shifts underway in America, he addressed several ways Kennametal is building talent to make these changes happen. A few highlights were their training programs for the digital factory, and the role of talent acquisition and training in a very tight labor market. Organization communication and change management are core to a successful shift. One key statistic from Tom was a recruiting survey of the digital engineering and manufacturing workforce needs in America – 20,000 open positions with 5,000 applicants.
Factory Automation – Tom walked through their experiences with automation, calling out some of the lessons learned as they found that their machine manufacturer OEM’s were not providing the full range of Operational Technologies, sensors, and Human Machine Interface technologies to optimize both operations and maintenance. Kennametal has been developing these standards to spec into their machinery procurement and installations.
Operational Excellence – As a LEAN Enterprise, Kennametal has a well-established OE program. This is key to embed the shop floor principles into the operational upgrades and changes. So, the new tools, metrics and operational feedback, insights and corrective actions are tied to the changing environment of modernization. This ensures that the workforces are learning and self-correcting along the journey.
Systems Integration – This critical element addresses the IT/OT integrations that harmonize the enterprise systems (SAP for Kennametal) with the factory systems running the plants. Kennametal has been a long-standing leader in leveraging Microsoft’s Modern Workplace, Azure cloud, and Dynamics Business Applications. Coupling these platform capabilities with SAP and integrating with shop floor data has unlocked tremendous power to dynamically capture data and turn it into actionable insights.
Unleashing the Power of Data through Advanced Analytics and Machine Learning
Tom pulled all these topics together as the foundational elements to build Kennametal’s processes and data for their Intelligent Enterprise. Their goal is to build actionable insights into every part of the business – customer engagement, supply chain planning, shop floor operations, R&D and performance management from shop floor to top floor.
This was a very down-to-earth expose’ of Kennametal’s journey and lessons learned. Tom gave credit to the external network of partners who have helped them to make this successful transition. eLogic is proud to be the Systems Integrator and Microsoft, PTC, and Rockwell partner to pull it together for Kennametal.
Mike Shields (left) -- Founding Partner & Industry Strategist, eLogic | Thomas McKee, Jr. (right) -- VP & CIO, Kennametal