Selection and decision-making criteria for a Distributed Control Systems in the process industry...

Selection and decision-making criteria for a Distributed Control

Systems in the process industry

Willem D. HazenbergWillem D. HazenbergMBA Researcher Newport International UniversityMBA Researcher Newport International University

InhoudInhoud Intro & Framework Main objectives – Study and research questions Research project methodologyResearch project methodology Customer Value PropositionCustomer Value Proposition Methodic: Multi attribute utility theoryMethodic: Multi attribute utility theory Main- and Sub sectionsMain- and Sub sections Big- Short- Final listBig- Short- Final list Business reasonBusiness reason Economic Profile (EP)Economic Profile (EP) MigrationMigration More info – next stepsMore info – next steps

At Controls Manufacturing At Controls Manufacturing Community List Community List

Dear AllDear All Can anyone send me a single page comparison or Can anyone send me a single page comparison or

presentation on PLC Vs DCS as on today's date?presentation on PLC Vs DCS as on today's date? I shall be thankful for your kind inputs.I shall be thankful for your kind inputs. Thanking you,Thanking you, Regards,Regards,(Name removed) Control System Staff Engineer (Name removed) Control System Staff Engineer

Introduction To partial fulfillment of the requirements for

the degree of Master of Business Administration in Information Management at the Newport Business Academy and Newport International University, I decided to work out a thesis proposal with the title “Selection and decision-making criteria for a Distributed Control Systems” in the process industry.

The project framework (1) For the control of the chemical processes in the process

“chemical” industry Distributed Control systems (DCS) are applied. These systems are the heart- and nerve system within these factories.

The choice of DCS for a concern is a matter of strategic

importance. High demands are made to the availability of a DCS and

if the concern made a choice, she is committed to it for a lengthy time. Replacing a DCS is a very valuable matter because of the arisen production loss at a reconstruction for example.

The service costs of a DCS could be a multiple amount of

the initial investment during the life span.

The project framework (2) The process industry in the world for approximately

spends 45.8 billion dollar per year at the top 50 suppliers

on process control systems (included DCS). (2004 data) The expenses of these investments often amount to more

than 1 million Euro by per system. The selection process generally varies from 12 up to 24

months. At large DCS projects there sometimes are investments of

more than 45 millions Euro. The total expenses, which are involved with the selection

of one investment, amount more than 100,000 Euro per system. To earn an order, the marketing/ sale expenses generally are more than 50.000 Euro at a supplier.

The project framework (3)

Local employees of the establishments are involved frequently in the choice for a system. Because of the fact that this investment only takes place every 10-15 years, they are lacked from experience and methods to be able to take this kind of decisions. The consequence is that the choice for a certain system is not always univocal at this moment and the relation between a business case, a chosen solution, and the selection process isn’t always there. This study has to contribute that we make the choice of a system in a more univocal way and the decision-making becomes more

transparently.

Purchasing a DCS systemPurchasing a DCS system

Main objectives

The goals of this research is:

The improvement of model-based consideration concerning a selection of a new distributed control system (DCS), by making an analysis of selected criteria within the “chemical” industry to choose a DCS and to establish an investment/ selection model with these insights/ ideas.

So that future investment can be bought faster and the decision-making will be more transparent.

Study Define the core selection criteria and their priorities

for the purchase of a Distributed Control system (DCS) in the chemical industry and a design a decision-making model so that the decision-making for new systems more balanced more consequent and faster can be carried out.

Interview employees who are involved in the purchase decision of DCS within large DCS using companies like Alcoa, Akzo Nobel, BP,, Dow, Dupont, Exxon Mobil, DSM, Lyondell, P&G, Sabic, Shell etc.

Also account managers and marketing managers of the chosen DCS have to be involved in this research.

The areas of the study (1)

1. What is the business case of your investment in a new DCS system?

2. What is the reason for this investment (migration, replacement or a new installation) and what are consequences of the choice of system?

3. Which DCS supplier knows the person who is concerned in the company purchase of a new system?

4. What decides whether the DCS supplier comes on the Big List for further evaluation?

5. What decides whether the DCS supplier comes on the Short List for further evaluation?

The areas of the study (2) Which staff functions are involved in the

selection? At which components do these people pay

attention and which priority do they give to the different components?

Is there a difference between the ideas of DCS suppliers and users concerning these criteria?

Research project Research project methodologiemethodologie

•Documents review more then 850. •Online research (WWW.DCSSELECT.EU)• 124 respondents: End Users Engineers, Purchasing, line management and DCS vendors VP, Service – Account- marketing managers and Business consultants • Across industries in 31 different countries: EMEA, Australia,

America, Far east• Working for organizations ranging from: End Users – SI, Engineers Company’s, DCS vendors• Various industries:

Return Received survey documents End users

Involved OthersInvolved Others

Input up to 29 sept. 2007

Organization relation to DCS

End User industry segment

Job Title respondentJob Title respondent

Reason last DCS projectReason last DCS project

Project Project sizesize

Technology trendsetter?Technology trendsetter?

Best Time/Cost

Best Product at Best

Time/Cost C 48.6% / V 36.4%

Best Time/CostPlus High Touch C 2,9% / V 13.4%

Operational Efficiency C 25,7% V 9.1%

CustomerIntimacy C 1,4% / V = 4.5

High Touch and Best

Product C 8.6% / 31.8%

BestProduct

EnterpriseResourceTrade-Off

Product Superiority

C 12,9% / V = 4.6%

BestHigh Touch

DCS Customer Value DCS Customer Value PropositionsPropositions

C = End user

V = DCS vendor

AHP-Maut (Analytical Hierarchy Process AHP-Maut (Analytical Hierarchy Process en Multi attribute utility theory) Methodicen Multi attribute utility theory) Methodic

Bron Schmitt D, THE MAUT MACHINE : An Adaptive Recommender System

Result = Score * Weights of importance

•Global variable 1

•Local variable 1

•Local variable 2

•Sub variable 1

•Sub variable 2

•Local Variable 3

DCS Selection main DCS Selection main groupsgroups

DC

S S

ele

ctio

n

Bu

sin

es

s C

as

e

Fu

nc

tion

ality

Te

ch

no

log

y

Inte

rop

era

bility

Imp

lem

en

tatio

n

pro

ce

ss

Se

rvic

e a

nd

S

up

po

rt

Tra

inin

g

Do

cu

me

nta

tion

Via

bility

Vis

ion

--- Fu

ture

m

ark

et fo

cu

s

Initia

l co

st

On

go

ing

Co

sts

Ba

rrier to

Ex

it c

os

t

Us

er e

xp

erie

nc

e

DCS Selection

Fu

nc

tion

ality

Te

ch

no

log

y

Inte

rop

era

bility

Imp

lem

en

tatio

n

pro

ce

ss

Se

rvic

e a

nd

Su

pp

ort

Tra

inin

g

Do

cu

me

nta

tion

Via

bility

Vis

ion

--- Fu

ture

m

ark

et fo

cu

s

Initia

l co

st

On

go

ing

Co

sts

Ba

rrier to

Ex

it co

st

Us

er e

xp

erie

nc

e

Us

e o

f ind

us

try

sta

nd

ard

s

Ma

turity

Bre

ad

th a

nd

de

pth

Sc

ala

bility

Mo

nito

ring

A

uto

ma

tion

Co

nfig

ura

tion

Mn

g.

Op

en

- Pro

prie

tary

p

latfo

rms

Re

liab

ility

Ea

sy

of u

se

Pe

rform

an

ce

Ma

inta

ina

bility

Wire

les

s

Bu

sin

es

s c

as

e

DCS Selection

Tech

nolo

gy

Fu

nctio

nality

Intero

perab

ility

Imp

lemen

tation

pro

cess

Service an

d S

up

po

rt

Train

ing

Do

cum

entatio

n

Viab

ility

Visio

n --- F

utu

re market fo

cus

Initial co

st

On

go

ing

Co

sts

Barrier to

Exit co

st

User exp

erience

Rem

ote

Su

pp

ort

Secu

rity

Easy o

f use

Main

tain

ab

ility

HM

I

Rep

orts

SIL

inte

gra

tion

Batc

h c

on

trol

Ala

rm m

an

ag

em

en

t

Ad

van

ce c

on

trol

Con

trol

I/O S

can

rate

s

Bu

siness case

Seam

less in

teg

ratio

n b

etw

een

all co

ntro

l S

eam

less in

teg

ratio

n b

etw

een

all co

ntro

l

fun

ctions

fun

ctions

Capable of serving a purpose wellCapable of serving a purpose well

DCS Selection

Tech

nolo

gy

Fu

nctio

nality

Inte

rop

erab

ility

Imp

lem

enta

tion

p

roc

es

s

Serv

ice

an

d S

up

po

rt

Train

ing

Do

cu

men

tatio

n

Viab

ility

Visio

n --- F

utu

re

mark

et fo

cu

s

Initia

l co

st

On

go

ing

Co

sts

Barrie

r to E

xit c

os

t

Use

r exp

erien

ce

Rem

ote

Su

pp

ort

Secu

rity

Easy o

f use

Main

tain

ab

ility

HM

I

Rep

orts

SIL

inte

gra

tion

Batc

h c

on

trol

Ala

rm

man

ag

em

en

t

Ad

van

ce c

on

trol

Con

trol

I/O S

can

rate

s

Bu

sin

ess

ca

se

Rate

of

Rate

of

change a

larm

change a

larm

Prin

ted a

larm

Prin

ted a

larm

Dynam

ic D

ynam

ic ala

rm sy

stem

ala

rm sy

stem

DI a

larm

sD

I ala

rms

Fla

g a

larm

sFla

g a

larm

s

Com

p. E

EM

UA

C

om

p. E

EM

UA

1

91

19

1

Levels o

f Le

vels o

f ala

rmala

rm

SEQ

ala

rms

SEQ

ala

rms

Nr. A

larm

s on

Nr. A

larm

s on

screen

screen

Sin

gle

win

dow

Sin

gle

win

dow

Suppre

ss Suppre

ss ala

rms

ala

rms

Sca

n ra

teSca

n ra

te

Ala

rm m

an

ag

em

en

t

Most important at biglistMost important at biglistBig listJob - function Viability

Vision

Main Selection item

Barriers to exit costs

Most important at short listMost important at short listShort list

Documentation

Job- function

Training

Main Selection item

User Experion

Implementation process

Business case guaranty from DCS vendor

Functionality

Technology

Services

Interoperability

Most important at Final listMost important at Final list

Final list Initial costsJob - function

Ongoing cost

Main Selection item

AVG Score main items DCS SelectionAVG Score main items DCS Selection

Business reason Big list selectionBusiness reason Big list selectionKnock – out criteria 46%Knock – out criteria 46%

Knock – out criteria 12.7%Knock – out criteria 12.7%


Knock – out criteria 19%Knock – out criteria 19%


Knock – out criteria 21%Knock – out criteria 21%Knock – out criteria 8.2%Knock – out criteria 8.2%



Business reason Final selectionBusiness reason Final selection

Business case new systemBusiness case new system Big listBig list 57% improved automation57% improved automation 43% Business information to the plant floor43% Business information to the plant floor 43% Could not maintain old system43% Could not maintain old system Short listShort list 38% Need for a easy to use system38% Need for a easy to use system 30.7% Could not maintain old system30.7% Could not maintain old system 30.7% create a more cost effective process.30.7% create a more cost effective process. Vele anderen rond de 30%Vele anderen rond de 30% 23% improved automation23% improved automation Final ListFinal List 42% Automatic start-up and shutdown routines42% Automatic start-up and shutdown routines 29% increased real-time decision making29% increased real-time decision making 29% 29% improved automationimproved automation

Conclusie: De belangrijkste businesscase redenen Conclusie: De belangrijkste businesscase redenen variëren dus per fase.variëren dus per fase.

Business case MigrationBusiness case Migration Big listBig list 76% Could not maintain old system;76% Could not maintain old system; 65% Replace obsolete system;65% Replace obsolete system; 41% Create a more cost-effective process;41% Create a more cost-effective process; 41% Reduction in Equipment maintenance.41% Reduction in Equipment maintenance. Short listShort list 67% Replace obsolete system;67% Replace obsolete system; 60% Use of advanced control algorithms60% Use of advanced control algorithms 4646% Improve loop control% Improve loop control final listfinal list 56% Could not maintain56% Could not maintain old system old system 44% Replace obsolete system;44% Replace obsolete system; 44% Improve loop control44% Improve loop control

Conclusie: De belangrijkste businesscase redenen is en Conclusie: De belangrijkste businesscase redenen is en blijft een obsolete systeem.blijft een obsolete systeem.

0

5

10

15

20

25

30

35

40

45

50

Prio1

Prio2

Prio3

Prio4

Prio5

Prio6

Prio7

Prio8

Purchase cost

Initial cost

On going cost

All Cost incl 1 year

All Cost incl 3 years

All Cost incl 5 years

All Cost incl >5 years

Exit Cost

Cost PriorityCost Priority

Zoom in op verschillen > 5 jaar Prio 1Zoom in op verschillen > 5 jaar Prio 1

DCS End users 19/71 = 26.7%DCS End users 19/71 = 26.7% DCS Vendor 4/15DCS Vendor 4/15 = 28.6%= 28.6%

– Account managers Prio 6-8Account managers Prio 6-8– Sales en Marketing's dep. Prio 1-2Sales en Marketing's dep. Prio 1-2

Eng Comp. 0/6Eng Comp. 0/6 = 0= 0 System Integrators 2/6System Integrators 2/6 = =

33.3%33.3%

Economic Profile (EP)Economic Profile (EP)

EP = Life Cycle Benefits (LCB) - Life Cycle Cost EP = Life Cycle Benefits (LCB) - Life Cycle Cost (LCC)(LCC)

LCB = NPV LCB = NPV YEL (Annual (Annual ManufacturingManufacturing Cost savings + Annual Cost savings + Annual Production Increases)Production Increases)

LCC = System Price + Initial Eng. Cost + LCC = System Price + Initial Eng. Cost +

NPV NPV YEL = Annual Eng. Cost + Annual Ops costs + Annual = Annual Eng. Cost + Annual Ops costs + Annual Maint. Maint. costs)costs)

Annual Ops. CostAnnual Ops. Cost• Software licenties (aanschaf, licentiekosten Software licenties (aanschaf, licentiekosten

voor uitbreidingen)voor uitbreidingen)• Onderhoudscontract, remote onderhoudOnderhoudscontract, remote onderhoud• Investeringswaarborgen (lange Investeringswaarborgen (lange

termijnondersteuning, migratie en termijnondersteuning, migratie en softwarebescherming)softwarebescherming)

• Betrouwbaarheid (Hardware, software en Betrouwbaarheid (Hardware, software en configuratie)configuratie)

• Complexiteit (topologie, software, Complexiteit (topologie, software, procedures)procedures)

• Kennis (Training, toepassing, ondersteuning) Kennis (Training, toepassing, ondersteuning) • Down time (van productie installatie)Down time (van productie installatie)• ( het niet kunnen produceren doordat ( het niet kunnen produceren doordat

systeem niet beschikbaar is) systeem niet beschikbaar is) Yel = Years of Expected lifeYel = Years of Expected life

Live cycle CostLive cycle Cost

SysteempriSysteemprijsjs

Initiële Initiële engineerinengineerings- kostengs- kosten

Installatie Installatie kostenkosten

Jaarlijkse Jaarlijkse engineeringsengineerings

kostenkosten

Jaarlijkse Jaarlijkse operationeloperationele kosten e kosten (OPS)(OPS)

Jaarlijkse Jaarlijkse onderhoudsonderhoudskostenkosten

GemiddelGemiddelde de percentagpercentage kosten e kosten eerste eerste

5 jaar5 jaar

23,2%23,2% 28,5%28,5% 16,1%16,1% 9,3%9,3% 7,6%7,6% 15,3%15,3%

Op basis onderzoek 1996 (data 1991-1996) Source ISA

Model Woordward 1997Source: Ken Keiser en Todd Stauffer levenduur DCS componenten 2007 intech

Migration Yes / NoMigration Yes / No

Difference life cycle componentsDifference life cycle components Best offer Standard migrationBest offer Standard migration Obsolescence equipmentObsolescence equipment

– Withdrawn and/or not supported by vendorWithdrawn and/or not supported by vendor Risks assessmentRisks assessment Postponement periodPostponement period Risk managementRisk management Plant integrityPlant integrity

Migration Risk versus Migration Risk versus BenefitsBenefits

EndEnd

Contact information for the next study Contact information for the next study phasephase

[email protected]@dcsselect.eu

WebsiteWebsite WWW.DCSSELECT.EUWWW.DCSSELECT.EU 1e results 1e results

http://www.dcsselect.eu/RES_ENDUSER/_frame.htmhttp://www.dcsselect.eu/RES_ENDUSER/_frame.htm

Selection and decision-making criteria for a Distributed Control Systems in the process industry...

Documents

Transcript of Selection and decision-making criteria for a Distributed Control Systems in the process industry...