Breaking a single chopstick is easy, but it becomes considerably tougher when a few of them are bundled together. Like the message in this principle that most people in Asia grew up with, the main takeaway from DMG Mori’s Open House is that unity is strength.

Held in Singapore from December 3 - 6, 2013, the four-day event strongly reiterated the themes of close communication and collaboration. This was made evident with the participation of industry partners, tooling suppliers and material suppliers. Through the use of live demonstrations and seminars, the participants provided solutions for various industries, one of which being oil & gas.

“We focus very strongly on oil & gas, that’s why we have an oil & gas day here and we brought colleagues from all over,” said Dr Christian Braun, MD of DMG Mori Seki (SEA). He explained that apart from the US and Europe, the company’s third biggest footprint is in Southeast Asia, especially in Singapore, Malaysia, and Vietnam.

While markets like Thailand and Indonesia are dominated by the automotive industry, it is the oil & gas and aerospace industries that drive the company’s business in this part of Southeast Asia.

Unsurprisingly then, Dr Braun has confidently projected growth for the oil & gas sector in 2014 to be at least 20 percent. “For the overall market, we expect a growth for the next year, and especially for oil and gas,” he said. His optimism is attributed to the strong investments and expansion of international OEMs as well as the supplier industry for OEMs here in Southeast Asia.

He said: “Not only will Singapore be the hub here, but we also see significant development in all markets around, like Malaysia, which is a key driver behind Singapore.” He also expects strong developments in Vietnam, and believes that along with the US, Middle East and Europe, Singapore as well as Southeast Asia will be the major hub for oil and gas in the future.

Demanding For More

Despite the positive prognosis of the industry, it is undeniable that today’s customers are demanding more. “I’ll tell you one thing about the oil and gas market — as fast as it can go up in more work that you can do, it can equally go down as fast,” said Roger Atkins, VP of Sales & Marketing at MIC Group, a contract manufacturer headquartered in Texas, US.

He explained that trends in the sector are driven by the trinity of quality, delivery and price. Quality is no longer fixed, but subject to the individual needs to each customers. The industry is seeing an emergence of customisation where each buyer has a very specific set of requirements for their materials (eg: the extent of heat treatment).

To top it off, there is a lower acceptance of deviations when it comes to the adherence of tolerances, which — contrary to what some might think — are as tight as those in the aerospace industry. Greater part stability and reliability is required as the industry heads toward the use of parts for deeper, subsea activities.

According to Dr Braun, the growth areas for manufacturing are mainly for cutting tougher materials, which as many know, is harder to machine. Yet, the general consensus dictates that coming close no longer makes the cut; it has to be correct.

The same applies for delivery, which according to Mr Atkins, has to be on time at least 95 to 98 percent of the time. Suppliers are expected to deliver lower lead times without forecast in the face of unknown industry fluctuations. On time delivery has evolved from a preference to an expectation, especially in Asian markets where higher expectations for punctuality exist.

 As a result of the quest for 100 percent quality and delivery, metrics requirement is at an all time high. Documentation plays a growing role along the entire supply chain, starting from raw material right up to services. Everything needs to be documented for greater accountability and transparency.

Documentation errors are as critical as machining errors and making a good part is no longer sufficient. In light of various disasters within the industry, traceability measures have proven to be a crucial tool for protecting the credibility of an organisation.

Embracing Challenges

Further muddling the already complex environment are challenges that span from technology and labour to secondary equipment and industry demand.

Labour shortage is a perennial issue that is seen across all industries in manufacturing. With an ageing population becoming more prominent throughout the world, job shops are hard pressed to find replacements with the skills and expertise required in the oil and gas industry — people who are, and will be able to train, the workers of tomorrow.

Shops and firms across the manufacturing sector are all competing for the same workforce, which inadvertently leads to higher costs. In addition, the lack of sufficient skilled workers also mean that time as well as money has to be funneled into training.

Apart from nailing the right employees, it is also crucial to have the right secondary support. “Those kinds of secondary services are very important. The increase in requirements that are going down from us manufacturers, those same requirements are going down to the secondary suppliers. The same stringent requirements are moving down on them,” said Mr Atkins. As a result, suppliers have to overcome challenges that include varying raw material specifications, tooling availability and knowledge too.

While seemingly small at first glance, these issues have a substantial incremental effect on overall cost efficiency and productivity. Throw in tougher industry demands into the mix, and manufacturers are inevitably in for a tougher time ahead. With these challenges, how can they lower costs and increase their competitiveness?

The answer lies in technology.

Key Technologies

“For every trend, for everything that the oil and gas market is challenged with, technology is the answer,” said Mr Atkins. For instance, the labour issue, made worse with higher globalisation and outsourcing, has left companies with little choice but to do more with less people. More specifically, engaging in new technologies in the areas of multi-tasking machines, tooling and work holding, and machine inspection among others have helped companies regain their competitiveness.

Take the trend of multi-tasking machines, where more can be achieved without needing to increase the number of operators. For instance, two machines may now be manned by a single skilled operator. Another configuration could include pairing two operators, one skilled and the other unskilled, for three machines, where training and production could be implemented simultaneously. This not only saves time and ups productivity, but eliminates workforce issues.

In Singapore’s context, these types of machines are particularly useful as the labour crunch has been exacerbated by the restrictions on foreign labour. Having machines do most of the work also resolves the challenge of unskilled labour, as reduced human intervention results in less room for error.

To tackle this problem, among others, Dr Braun has revealed that one of the company’s main aims is to have the fastest and easiest process from the idea phase right up to finished parts.

“Our biggest target for future R&D is to develop the idea of easy manufacturing,” he said. This includes the integration of U and W axes into various machine types, as well as the creation of an intuitive user interface.

In particular, the latter was realised with the launch of CELOS, an operating system that provides operators with ease of use. Speaking on the motivation behind this development, he said: “The discussion is always how to find the workforce, so you must always go in the direction where it is easier to operate the machine.”

Inspired by today’s smartphones, the system utilises visuals to provide easy instructions and the management of data. According to Dr Braun, this is the future of shop floor control as it interrelates all the different departments, be it externally through the internet or connecting it directly to other facilities.

Nonetheless, having the right technology is far from sufficient. Instead, “the future is partnering with people we trust,” said Mr Atkins.

From Machines To Solutions

Being a manufacturer of good machines is no longer enough as today’s customers seek solutions to their problems. Being a solutions provider, however, requires collaboration.

Technology is moving far too quickly for anyone to successfully keep up by themselves. The prudent decision then is to partner others and work out recommendations and other challenges as a team. “This is the only way to win in the oil and gas market,” warned Mr Atkins.

Echoing the importance of collaboration, Dr Braun said that the possibility of improvement always exists, and close communication — a core tenet of the company’s philosophy — is the key to achieving it. “What we are establishing with our partners is a continuous exchange of ideas, networking to bring together people in open houses like this, to continuously discuss, and to learn from each other,” he added.

At the most basic level, the aim of the organisation is to provide customers with close support. This means offering the best engineering solutions with turnkey projects, test cuts, and time studies to help customers achieve their requirements. The goal is to lower cost per part, produce better output results, better quality, and ultimately, to improve the manufacturing process at the site itself.

Whether customer requirements can be fulfilled depends strongly on how closely machine tool makers and their suppliers work together. As a result, the company maintains a regular exchange with its partners (eg: suppliers, employees and customers) to plan on how to further develop cooperation and customer projects.

The after effect of these sessions have led to customised solutions, where for instance, the company followed on a customer’s idea and added a hydraulic clamp and steady rest to the workpiece table, resulting in greater flexibility among the axes and greater workpiece accessibility.

At the end of the day, staying competitive in the fast moving oil and gas industry requires manufacturers to evolve into solution providers. Customers need resolutions to complex and often specific problems, and the only way to achieve this on a constant basis in the long run is through collaboration with industry partners — establishing regular exchanges, a mutual reliance on each other’s expertise, and a shared focus on delivering what the customer needs.