Spring 1996 € Volume 1 € Number 1
EU Program Shifts Focus To Users
Interview with Esprit Director George Metakides and ESPRIT Manufacturing
Program Planner Ronald Mackay
By Peter Horner
To be competitive in the world marketplace, European industry needs to be
at the
forefront of the development, implementation and utilization of the latest
information technology. But high costs and investment risks, coupled with
an increasing globalization of the marketplace, make that a tall order for
any single company to undertake. Enter the European Strategic Programme
for Research and Development in Information Technologies (Esprit), a European
Commission initiative.
The program is focused on the emerging infrastructure which will provide
the basis of the global information society of the future. As a result,
the program is guided by the needs of users and the market. The overall
objective is to contribute to the healthy growth of the information infrastructure
so as to improve the competitiveness of all industry in Europe, not just
the IT industry.
The program emphasizes ease of access to information, services and technologies
for companies, administrations and individuals. Activities stress use and
usability of technologies, along with best practice.
The Esprit Programme runs from 1994-1998 and has a total budget of 2 billion
ECU. The program is implemented through open calls for proposals, of which
there have been five with two further calls planned for 1996. Funding to
the industrial participants is on a 50 percent shared-cost basis.
Along with its involvement in collaborative projects, the Esprit Programme
includes a range of training, information dissemination and technology transfer
initiatives. For example, EITC '95, a three-day Esprit conference organized
by the European Commission, brought top business leaders and policy-makers
to Brussels, Belgium, in November, 1995, to exchange insights for managing
change in today's Information Society. Conference speakers included Martin
Bangemann, EU Commission member for Industry, Information Technologies and
Telecommunications; Michael Spindler, former president and CEO of Apple
Computer Inc.; Jorma Ollila, president and CEO of Nokia Corporation; and
Edith Cresson, EU Commissioner member for Science, R&D, Human Resources
and Education.
To find out more about the Esprit Programme and its impact on the European
manufacturing sector, CiME editor Peter Horner recently posed a series of
questions to Esprit Director George Metakides and Ronald Mackay, who is
responsible for planning program activities that relate to the information
infrastructure for manufacturing. Fittingly enough, this "virtual interview"
was conducted in its entirety via E-mail on the Internet.
CiME: Through its support of the Esprit Programme, the
European Union has made information technology and associated research a
cornerstone of its agenda. Why the emphasis on IT ?
George Metakides: A few years short of the millennium, the 1990s
are increasingly characterized by the rapid spread of the information society.
Both in the workplace and at home, almost every aspect of our lives is being
affected in some way by information technology.
In our personal lives, we are beginning to comprehend some of the advances
that IT can bring in the home (entertainment, security), in transport (safety,
efficiency and reduced pollution) and in our own horizons (communication,
information and knowledge access). Speed of communication and shared access
to information will be as vital here as in the modern office.
The transition to the information society in Europe calls for a broad effort
in human resources, in cities and regions, on societal impact, on legal
and regulatory affairs, and in developing new services. Esprit is a key
part of this effort in providing new tools and technologies for industry,
in spreading best practice, in helping develop standards, and as a vehicle
for continuous professional training. Above all, this means meeting the
requirements of the user.
One of the fundamental objectives of Community-funded R&D is to support
the competitiveness of European industry. Within Esprit, we focus on the
technologies that underpin the information infrastructure.
CiME: What do you see as the key points of the new program?
GM: Esprit is driven by the needs of the user and the market
period. Esprit supports a new and broad-based R&D environment in which
research and development are complemented by measures to raise awareness,
to facilitate access to technologies and their use.
The program plans for a variety of awareness raising and promotional elements
such a best practice initiatives, first user actions, skills development
and support for the rapid acceptance of new technologies.
There is a clear emphasis on the usability of new developments, and one
way to ensure this is by promoting user-supplier collaborations.
Much of the work carried out in Esprit is closely related to other programs
such as Advanced Communications Technologies and Services (ACTS) and Industrial
and Material Technologies (IMT). There is an increasing cooperation between
the programs which reflects the convergence of the technologies and the
need to support interdisciplinary research and development. In addition,
the program management is evolving in a way which will make it easier for
organizations to participate in the program.
CiME: What can the European manufacturing sector expect
to gain from the Esprit Programme?
Ronald Mackay: Business organizations and institutions of all
sizes are more and more reliant on information which straddles national
and linguistic boundaries. Multinational corporations need their communication
and information exchange capabilities to function efficiently in a global
business environment. Moreover, smaller companies increasingly rely on access
to shared information and research facilities which would be financially
out-of-reach as an in-house facility.
In general, the proposed research tasks are needed to provide an information
infrastructure for manufacturing which enables the transition from traditional
engineering to a concurrent engineering environment. Activities will also
support the concept of time compression in all design, production and distribution
functions. The term manufacturing is used in this work program to cover
the full life-cycle of products from design to recycling, and refers not
only to discrete manufactured products but also, for example, to large-
scale engineering projects and processes, and other related industries.
CiME: The European IT Conference drove home the point that
the Information Society is upon us. From the point of view of manufacturers,
what was the most significant message you heard at the conference?
GM: We must continue to focus on the requirements of the users
rather than pushing technology for its own sake. We must make it easier
for the industrial community to gain access to the most advanced results.
We must also narrow the gap between state-of- the-art and state-of-usage
through imaginative supporting measures.
There was evidence at the conference that IT does indeed provide opportunities
for the creation of new jobs, as well as securing employment in other sectors
by making them more competitive.
The program must reflect the needs of specific industrial sectors. This
is not because Esprit is a sectorial program. It is not; the focus is firmly
on generic technologies of use across industrial sectors. But in the end,
each individual enterprise which makes use of Esprit's results is an enterprise
in one sector of industry or another.
CiME: It has been said that IT is expected to become the
biggest industrial sector in the EU by the year 2000. What does this mean
to your constituency?
GM: The Esprit constituency comprises all of industry, not only
the IT industry. Our activities impact the IT industry to a large extent
by creating a demand pull. There is obviously a huge growth in demand for
products which are clearly IT based, such as personal computers, mobile
telephones, etc. These products themselves are complex manufactured products,
but it must also be remembered that we are seeing an explosion in the invisible,
or embedded, IT. The percentage of value-added which is represented by IT
in many more traditional products is rapidly increasing. A much-quoted example
is the automobile industry, where the number of microprocessors in a modern
vehicle will soon exceed the number of electric motors.
Other areas -- aircraft, medical instruments and consumer electronic devices,
to mention only a few examples -- are pushing the demand for new displays
and user interfaces; not to mention the vast amount of embedded software
which goes into all the systems referred to before. The environmental pressures
on many industries, particularly in the process sectors such as chemicals,
food production and power generation, have also opened up a huge new market
for IT-based instrumentation, monitoring and control systems.
CiME: Can you give an example of how the program is responding
to these challenges?
RM: One response has been the setting up of User Group Reference
Projects which bring together the major players in a number of manufacturing
sectors. The focus is on defining the long-term IT requirements of these
industries and then, when necessary, carrying out the resulting collaborative
R&D projects aimed at meeting these requirements. The pilot for these
projects was AIT (Advanced IT for Design and Manufacturing) in the automotive
and aerospace industries.
The concept has now been extended to address the needs of the process industries,
the shipbuilding sector and the field of large-scale engineering projects,
such as building and construction as well as industrial plants.
CiME: Industrial managers have invested huge sums of money
in the hope that computer integrated manufacturing would transform their
factories into lean, agile, flexible operations. Many have been disappointed
by the results. What went wrong? Can higher levels of CIM and IT improve
the outlook?
RM: Too much faith has been placed in applying the latest technology
without having a hard look at the real business requirements of the organization
or the real needs of the people who work in it. It is not a question of
increasing the level of integration or IT usage, but finding the most appropriate
solutions to meet the business needs.
We also need to look at broader issues such as accounting practices and
the way in which return-on-investment calculations are done. For example,
a manufacturing manager would find it easy to justify a huge investment
in a new computer system if he could show that it results in appropriate
inventory reductions. He would find it very difficult to justify the cost
of a large retraining program for the entire shop-floor work force. This
is difficult to understand when every other annual company report seems
to open with a statement from the chairman claiming that the employees are
the company's most valuable assets. But I am also particularly fond of the
anecdote of the manager of a small manufacturing company whose bank manager
asked him how he could possibly justify purchasing a very expensive CAD
system. His simple answer was, "Well, we're still in business."
CiME: CALS (Continuous Acquisition and Lifecycle Support)
has been heralded as an IT-inspired concept that will revolutionize the
face of manufacturing. What promise does CALS hold for the European manufacturing
community? How important are international standards to fulfilling this
promise?
GM: Concepts which are at the heart of CALS, such as concurrent
engineering and electronic business, are also driving forces for many of
the projects in Esprit. These are helping to create an effective information
infrastructure for manufacturing (IIM) for European industry. Some of these
projects have also contributed to the development of international standards
for the interchange of design and manufacturing data.
Two of the major themes in the Esprit IIM work program are in fact called
"product and process data modeling" and "logistics for the
virtual enterprise." Standards are vitally important to us if we are
to achieve our objective of creating interoperable building blocks for the
information society which meet not only the needs of European industry,
but also serve the global marketplace. Measures which accelerate the convergence
between defense and civilian technologies will help to widen the markets
and create growth opportunities.
CiME: Is industry putting too much stock in IT? Is there
a danger that manufacturing companies might rely too heavily on IT, while
overlooking the potential contributions of their managers and
operators?
RM: Any company which overlooks or underestimates the contributions
of its managers and operators is making a grave mistake. But their tasks
are becoming more difficult. Design and manufacturing functions, whether
within an individual company or between collaborating companies, are becoming
more closely coupled. In order to make effective decisions, the people concerned
are dependent on obtaining and processing all the relevant information relating
to their field of responsibility. They also need to have an adequate model
of how their actions will influence other parts of the business. In short,
they require IT based tools for situational awareness, for problem diagnosis
and analytical tools to predict the impact of their decisions. The emphasis
is, however, on the fact that these are tools to support the decision makers,
not to replace them.
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