Speaker 0 00:00:00 By month three, we want our customers be aggressively pursuing ROI in the area that they were focused in by month six, people are using dated due predictive maintenance to do analytics on their quality, things like that. Okay. Where do we take the next step then?
Speaker 2 00:00:25 Hello everyone. And welcome to the robot industry podcast. My name is Jim Beretta and I'm your host. And with me today is Jared Evans from magic systems. Jared, welcome to the podcast. Thanks
Speaker 0 00:00:37 For having me, Jim. It's uh, great to see you again,
Speaker 2 00:00:40 Jared. Uh, and we know each other for a long time. Jared's in kitchen Waterloo, and I'm in London, Ontario now, but I've done work with Jared's company before. Can you tell our audience a little bit about yourself?
Speaker 0 00:00:51 Yeah, sure. So magic systems, what we do and we focus on is connecting directly to industrial assets and production equipment on the plant floor in major manufacturers. And we use realtime operational data that we capture from that equipment to help optimize, uh, different essential processes and manufacturing, whether that's, uh, production, OEE, downtime, telemetry, things like that. So that's what our company focuses on me personally. I'm one of the co-founders and, uh, the COO at magic systems my day to day is mostly focused on sales partnerships, customer delivery, that type of thing. So try to get out in the field lots and wear steel toed boots, slots as I'm out on the plant floor.
Speaker 2 00:01:40 So you have safety glasses with you at all times,
Speaker 0 00:01:43 All times. Yep. It's part of my, to go bag. <laugh>
Speaker 2 00:01:46 That's good to hear. And a lot of your, your partners of course, have all come from industry as well, too, right?
Speaker 0 00:01:52 Yeah, definitely. Um, our founding team has all been industrial engineers by trade and everybody that we hire, we try to have as much experience actually working in manufacturing environments as possible to, because that's just so important in this industry to really understand it and know the meat of what's going on in a plant
Speaker 2 00:02:14 And you're doing the hard work, right? You're connecting systems that would maybe were never designed to be connected.
Speaker 0 00:02:21 Definitely it's one of our specialties is working with older automation equipment, figuring out connectivity strategies for equipment that maybe wasn't really supposed to be networked when it was first designed. We obviously work with a lot of newer and more high end equipment as well. But what we usually find is our customers have a range of equipment. And one of the things we pride ourselves on is being able to figure out strategy and roadmap for connecting everything in your plant.
Speaker 2 00:02:48 So what's happening in your industry? I mean, you're getting calls from plant managers and presidents of companies and what are they asking?
Speaker 0 00:02:56 I don't want to be, uh, beating the dead horse, but like COVID is a huge <laugh> thing in our lives still and has been for the last two years. And while we've been trying to sort of do business as usual, as much as possible and things like that, we've also definitely seen our customers go through a lot of challenges and also a lot of changes to how they work. There's a lot more need for data in some cases because they can't always have personnel on site. They wanna minimize how many people are out on the plant floor. There's also more turnover right now just across the industry in terms of, uh, operators and lead hands and production supervisors and other plant floor roles. So the use of data and displays to be able to indicate equipment status, to indicate how you're doing over the course of a shift, that type of thing becomes super important as well.
Speaker 0 00:03:50 It's almost a training resource and, uh, company culture resource, as well as just the sort of basics of Hey, that that helps us, uh, hit our production goals. It also allows people who are coming into company new to say, oh, that's, what's important. We care about these metrics. We all work together to hit these metrics, that type of thing. So there's been a lot of that. It's also changed the way that we've been doing business because we used to try to go on site all the time, as much as possible. We still are doing that, but it's just, there's less time that it's, <laugh> actually possible. So we've been working on building up our third party integrator network and having people in different locations that we can go to when we need somebody on site to help the customer and things like that as well.
Speaker 2 00:04:37 So are you seeing some general trends? Like, are you seeing more people sharing more data that they're finding?
Speaker 0 00:04:43 Definitely. I I'd say over the last two years, maybe the industry sped up five years in terms of how much data is being shared, how much people have transitioned to using cloud systems that are centrally accessible for tracking and sharing data, the amount of data that gets rolled up to executives, and also that executives push back down to plants and I'm no genius. I think we are all sort of seeing the industry going that direction. Right. But in terms of how fast it accelerated, I think we're ahead of the curve now versus I think maybe manufacturing lagged a little bit, if I'm being honest, as compared to other industries, even up to 20 18, 20 19.
Speaker 2 00:05:26 So one of the things that I, I kinda laugh when I'm thinking about this, right, is that you probably deliver some pretty amazing results to your clients like coming in and saying, Hey, do you know why your line is down last night? Or do you know here's, what's happening to your operators? Or so can you give us some of those kind of stories a bit?
Speaker 0 00:05:44 Yeah, for sure. I think that's sort of back it up a step even it's, uh, that's one of the biggest things when we're implementing, right. Is making sure that the data's correct off the bat, being able to say yes, these displays are showing the correct information. We're capturing the correct signals from the equipment and also doing that whole hypercare phase and making sure that we're working really closely with the plant and their personnel to take on ownership of a industry 4.0 type system and take on ownership of a digital manufacturing system. So like you said, there can be sort of those head scratching moments at the start of, we can't have been down for that long or, oh, why are you showing that as that type of downtime when this is something that our, our operators always dealt with before or something like that. Right.
Speaker 0 00:06:38 But you get a lot of that, obviously, especially during that hypercare phase, I sort of like to skip to the good part sometimes though, like we've had a number of customers who have been able to adjust out their maintenance schedules once they've moved to condition based maintenance from either reactive or preventative maintenance. So they've been able to say, Hey, we're actually only running this equipment 75% as much as we thought. Yeah. So moving to condition based maintenance from either reactive or preventative maintenance, some interesting stuff we found with some of our customers was that, uh, they're able to cut down on their maintenance cycles, cuz maybe they're only running their equipment about 75% as much as they need to for what they're doing on their maintenance periods beforehand. They're also finding that not having to have maintenance technicians go around to different pieces of equipment and inspect them and things like that with saving a lot of sort of busy work and data recording work, that kind of thing that really, you don't wanna maintenance technician.
Speaker 0 00:07:42 Who's a skilled technician to have to deal with. And then they're even finding the less that they had to open up machines and touch them and do all that kind of stuff. Actually the better the machines ran too, because you're reducing the human error element as well. So that was a pretty interesting one for sure. We've also been finding lots of interesting stuff, uh, especially around like quality checks and as you start to integrate weigh scales and capture good product versus bad product and underweight versus overweight, how much giveaway often happens. And I think that's sort of a tragedy sometimes, right? Because, um, you get fined heavily. If, if your product's underweight, nobody really cares if it's overweight except uh, you're, you're giving away money, right. It's a good product that got out the door, but it cost you more to make it. So all kinds of interesting things, once you dive into the data and start correlating different data sets that's for sure.
Speaker 2 00:08:42 Can you give us, uh, I know that I know some of your clients, but I was wondering if you can maybe give us an idea and you don't have to name them, but maybe give us a paint us a bit of a picture. I know you did, uh, some work for a big packaging company.
Speaker 0 00:08:54 Packaging's a huge industry for us. Um, we're doing a lot of expansion with packaging and packaging. We find too our, our system's uniquely designed for, in some ways, because of our, our schedule connect integration, where you can integrate with E R P systems and other scheduling software and then start matching up your performance to plan against that. We find that that's a huge win for companies when they're trying to sort of get to say that 75, 80% or above overall equipment effectiveness score within their plant, having the schedule in and starting to understand are we doing well on our changeovers? Are we running slow for certain types of products? Are we running, uh, too fast and causing extra downtime for other types of products that can really, really help? We've also been expanding a ton into industrial supply, like metal working and extrusion and things like that. Also been doing a lot with, uh, very large, uh, solar panel manufacturer. They have sites in Canada and also the us that's been really interesting to see and obviously, uh, anything that we can do to help with that sort of transition to green energy and alternative energy sources and things like that is awesome. And to see their growth and being able to, uh, be all along for the ride with that has been great.
Speaker 2 00:10:19 So, and this must go right to ROI, right? So one thing you're doing is you're reducing downtime and you're increasing uptime and you're optimizing schedules for product mixes or, or whatever those are. Where does that ROI conversation happen?
Speaker 0 00:10:35 Yeah. And the truth is it happens at multiple levels and I'll, I'll start with say a plant manager, for example, a lot of plant managers have a portion of their compensation based off of certain incentives or bonuses, right? And whether it's a scrap reduction program or hitting targets, um, for production, those are the two most common, obviously quality and tracking quality is the way to go for doing scrap reduction. Increasing production can come from multiple sources. It can come from increased availability. It can come from higher performance when you are running. It can come from SPC and diving into process tracking and things like that as well. So there's a lot of ways you can come at it, but I think it's good to actually sort of step back and say, okay, why is the plant manager receiving variable compensation for those different areas? And when you look at it, there's an operations component and a financial component, right?
Speaker 0 00:11:40 So in this sort of fictional corporation, I'm, I'm making up on the fly here. That means that the CFO and the CEO cares about it a lot, right? Because the CFO wants to see better margins and they look at obviously quality, uh, because there's add on cost for quality, not just your basic, okay. That was a bad part. We have to scrap it, but was it cost if bad quality gets out the door, both in penalties and return business from customers, all of that kind of thing. Right. And then same with, uh, being able to hit production targets. Often you can get more lucrative contracts with your customers if you can guarantee delivery, especially in, uh, this day and age with supply chain disruptions and all that kind of thing going on. Right? So, so at a higher level, you see that as sort of that ROI for the, the CFO and the financial side of the business.
Speaker 0 00:12:42 And then for sort of the CEO or the more operational side, you see a lot of sort of knock on effects. Obviously they care about the finances as well, but also, Hey, can we take the best practices from our best plants and disseminate them to all our other plants? Can we create a corporate culture that revolves around making decision based on data? Can we, uh, get people trained up and working at the level that we need them to faster when we're bringing in new people, that type of thing. So I think there's a lot of ROI around that as well as streamlining your operations, where you're not having to manually collect data, not having to spend a whole bunch of time on capturing data in spreadsheets or clipboards, things like that, too, taking this all the way back to sort of plant floor for production supervisors, operators, having clear goals, being able to have data, to help advocate for things that you need to do your job properly and better, I think is also a great sort of intangible return on investment because can't tell you the number of times we've done a implementation and you would maybe naively think, Hmm.
Speaker 0 00:14:01 I wonder like play manager told me the night shift never runs as well as the day shift. I wonder if they're gonna be in trouble, but the night shift guys say, oh, thank God you're here. Finally, people are gonna see that we actually have a ton of downtime that is outside of our control, right? And <laugh> now we actually have data to prove, Hey, we need a maintenance guy here for the night shift, or we need you to fix this issue. We've been telling you is a problem, that type of thing. So I always try to look at it at different levels within the plant and also within the organization. And I do think that there's ROIs in several different areas. There's obviously that sort of top line get more contracts or increase quality. There's also how well do you operate? How well do you use people's time when they're at work? How do you communicate as an organization more effectively as well?
Speaker 2 00:14:54 Jared, when you, um, have a plant and maybe you've got 10 plants, right? But what's your best practices, is it to fix the one plant and then to figure out all the learnings from that one plant and then kind of slowly branch out.
Speaker 0 00:15:07 We definitely take a crawl, walk, run approach. And I'll be honest. That's not always initially popular with our customers. <laugh> they'll say, no, no. We saw on your website, you guys do machine learning and AI, and you have this great partnership with Microsoft and we wanna get everything on Azure and be doing big data and data lake and all that kind of thing. And what we've found is that's excellent to have that goal. It's excellent to have that idea from day one, that, Hey, we are going to take advantage of machine learning. We are gonna take advantage of predictive analytics and big data and industry 4.0, but you really have to sort of start like, okay, let's get one work cell. Let's pick either your problem work cell, or maybe your work cell with your best operators start tele traumatizing that capturing data from it.
Speaker 0 00:16:06 Get them used to using data on a work cell by work cell basis. Extend that to a full line from a full line. Okay, let's get that whole plant. Let's take the lessons learned from that and the proven ROI within your industry and within your, uh, organization. And then bring that over to the next plant. You can start to pick up speed for sure. Like you don't for the second, third, fourth plants need to also go, okay, one work sell one line, one whole plant, that type of thing, but it is very good to move through that. So you get buy in from those different levels and also have a specific use case for that organization of how it was used to improve productivity, how it was used to streamline operations, that type of thing, because I, I can spout out facts and general studies and things like that. But until you imply it to your organization and until you have that proof internally, it can be really hard to, uh, get everybody to align on that. That's for sure.
Speaker 2 00:17:13 When you and I spoke, uh, at setting up the podcast, you talked a little bit about kind of setting customers up for visual factory production monitoring practices and what some of those challenges are.
Speaker 0 00:17:24 Yeah. It's and I'm glad you're mentioning it. Cause it is one of those things that you have to, um, discuss at the start of any implementation and is a big part of our proposals and things like that is your operational technology. And how do you have your PLCs or other automation equipment set up? Do you have it networked or not? Do you have a network diagram? Do you know what all the assets are on your plant floor? That type of thing, because that's something that anybody who wants to do industry 4.0, whether it's with us, with somebody else with an internal team or as is most common putting multiple different solutions together, you really need that kind of thing to be successful. And it's one of the biggest stumbling blocks because as a software provider, I can give some advice and some help on that and things like that, but you're the one who owns your network, right?
Speaker 0 00:18:22 You, and you're the one who owns your automation equipment. Sometimes it can be a little bit of a point of contention. Like I remember a few times when, where we come in and say, Hey, like, did your machine builder not provide you with the code for this PLC? Oh no. They've said it's proprietary. Um, and it can't be accessed and we have to pay them if we want access to it, things like that. And that's something to watch out for. I'd say like, if that's something to take away from listening to the podcast is, uh, ask for that up front, right? When you're bringing in equipment, ask your machine builders about what their connectivity strategy is, how they fit into a larger ecosystem. Don't take it at face value. If they say, oh, we're building our own proprietary system, uh, for that, because you need everything to be interoperable these days to get the full industry 4.0 benefits. And I think that that's even something that if I can help educate people on, I, I really want to do that. Whether we're involved in a project or not, because things are changing quick, like we talked about at the start, we've sort of gone through five years of progress in two years. Right? And so you're gonna have to make those type of decisions. You're gonna have to ask those type of questions. As you bring more automation into your plants,
Speaker 2 00:19:43 You mentioned about the kind of manufacturing culture and getting operators on board. And I imagine there must be a little bit of both, right? Some operators like, oh my God, please. I want to see this data. Cause I wanna prove to management when I've been tell 'em all along, do you find it both ways? Uh, getting operators on board?
Speaker 0 00:19:59 One thing I find with operators almost universally is that they're straight shooters. They don't take any bull sort of thing. Right? And that goes both ways. So if the data is helping them to show their case and streamline things and make things easier, then they're very happy if it's causing them impediments to do their job. And they all wanna do a good job, almost universally, everybody I've seen in manufacturing over my career, any time things aren't going well, it's not because of effort. It's not because of any of that. It's usually because of a process issue or an operational issue. So if you're introducing things to them that make their job more difficult or make them have to do extra, that isn't directly related to sort of what they're getting evaluated on. There's gonna be pushback, right. And the pushback, all isn't always just directly, Hey, this is difficult for us because this, sometimes it manifests with, oh, the night shift didn't record any reasons for downtime or the data collection appliance got unplugged. How about that magically or <laugh> things like that, but you gotta have a bit of a thick skin and you can't really take that as just face value of, oh, they don't like having data around what they're doing or things like that. It's usually this is something that's causing them an issue it's making their job more difficult to do, and they're not seeing the benefits. So you have to work harder to help them find that and also understand their process more so you can streamline things for them.
Speaker 2 00:21:36 Jared, how do you work with clients? Like when you get that phone call, Hey, I heard you on the robot podcast there. What happens?
Speaker 0 00:21:43 Usually what we start with is, um, some discovery figuring out the customer's needs, their wants, what they see as an impact of not changing. Also mapping out who we're gonna be working with on the project, right? Like these projects, unless you're doing something very, very small, these projects are going to take multiple players and multiple people across your organization. Like it likely needs to be involved. At least somewhat your automation team needs to be involved. Your plant management needs to be involved. This is obviously all depending on the scope of the project, but the bigger, the scope and the more committed you are to industry 4.0, the more people that it's going to sort of encompass at the same time, our goal is always to make these projects very sort of short and sweet in terms of their implementation time and things like that. So the upfront planning and identifying who needs to be involved in what is sort of that upfront work we do.
Speaker 0 00:22:46 So we sort of are measuring twice and cutting once and getting things implemented quickly. At this point, we usually can provide standardized implementation packages for our customers when we're actually ready to sort of put the rubber to the road. So we can say, okay, it's gonna take eight days to do a visual factory installation. And it'll be another four days to connect your maintenance management system with this new data stream, things like that. And then that gets into our actual project management process and different gates. And whether we have to be on site or whether it's a third party integrator, that kind of thing. So that's sort of how we approach things is figure out, make sure we we're lined up with what product modules we're recommending based on the customer's needs and wants and impacts if they don't change what they're doing, figure out the players, figure out the connectivity and then try to hit the ground running and get these projects done in, in sort of short bursts. So people can start using the system as soon as possible.
Speaker 2 00:23:53 And what does success look like for your customer?
Speaker 0 00:23:56 We always look at things over different time periods cause success at one month can be very different than success. At six months for success. At one month, you will get a productivity improvement in a lot of cases over one month, but it's usually just because of a bump up in people realize, oh, we're having data collected. We're going to see the numbers every day. We wanna do a little bit better, right? So there's just that sort of immediate intrinsic motivation, but you really don't wanna focus on that so much in the first month, you want more focus on the process and sort of trusting the process in terms of, okay, if we're putting in all the information we need, we're gonna get the results that we want. Right? And, and for some of our customers, they never even put in any information directly into our system.
Speaker 0 00:24:48 It's all collected automatically other customers we need because either the age of their equipment or how their schedule works or information about how they capture quality data, that type of thing. We need them to put in some information, Matt manually and match that up with what we're automatically recording. So especially in those cases first month should really be focused on that data verification and getting people trained up on using the system and trusting the system. So if you're doing that after one month, that's success to me after three months, it starts to become about ROI. And we always look at, okay, what's the ROI. This is part of our proposal process. What's the ROI that the customer's looking for? What areas are they looking to have improvements in? Can we provide them training around that? Whether that's direct in person training, zoom calls or broadcasts, or we've done a lot more with our learning management system, uh, our magic academy where we have hosted videos, as well as information and things like that too, by month three, we want our customers be aggressively pursuing ROI in the area that they were focused in.
Speaker 0 00:26:03 If that's being accomplished, then by month six it's okay, what's the next step in our crawl walk, run phases. Maybe you're already running. Maybe you have your whole plant hooked up and telemetry and people are using data to do predictive maintenance, to do analytics on their quality, things like that. Okay. Where do we take the next step then? Do we integrate this with more systems? Do we look how to take your best practices to the next plant? Do we look for more assets that you're looking to connect that type of thing, and those ROI cases then become easier because you have a proven track record and you can say, okay, here's what we did. Here's what we can expect for our next thing. And there's a little bit more appetite for say, connecting that harder to connect equipment that might need a hardware upgrade or figuring out how to, um, have operators capture some more information, that type of thing.
Speaker 2 00:26:58 Do you work with fines directly or do you sell through distributors?
Speaker 0 00:27:01 When we started, we always worked with clients directly. And like you mentioned off the bat, uh, were based in Kitchener, Ontario. So a lot of our clients were along the 4 0 1 <laugh> cause we wanted to be able to drive and help them out whenever we needed to. Right. So, uh, it was a couple hours either way on the 4 0 1 was sort of our, our selling geography, if you will. That definitely changed. As we got a little bit more mature, did a little bit more in the us and things like that. Now I'd say about probably 70 or 80% of our business is in the us. Obviously we still go visit customers, but it's not as frequent as, as those, uh, hop on the highway and, and get over their days. Right. We've looked at a number of different ways to still provide support to customers and things like that.
Speaker 0 00:27:55 We did try and had a big push, trying to work with distributors. One thing that we found is that for a distributor, it's a little bit harder for them to sell a software product like ours, because yeah, there's a quantitative ROI which a distributor can sell off of. Well, there's also all the intangible and I shouldn't even say intangible, cuz it is real money, real ROI, but a little bit harder to explain like, Hey, this is gonna save your operations team two hours a day because they're not gonna be entering data into spreadsheets. It's a little bit harder to explain. This will help the culture of your operators so that they ramp up faster when you hire new ones. Um, as you expand, it's a little harder to explain those type of benefits to somebody who doesn't live it and breathe it every day like we do, right.
Speaker 0 00:28:48 What we've been finding is some of our modules like our maintenance connect module and our process connect module, they're still fairly commodity type driven. They, they connect your information to other tertiary systems that you have. We have a number of distributors who sell that and either included as part of their product or that we, that we work with in various arrangements. But more and more, what we've been doing is we do partner. We do do sales with partners, but we come in for our specific area of the sale and, uh, make sure that we do that same sort of hands on proposal and mapping of, of your process and your value stream to make sure that, uh, you're getting the ROI that you want and deserve out of it.
Speaker 2 00:29:41 So if a machine builder out there is listening or a robot integrator and they don't really have these in-house capabilities where they could simply partner up with you.
Speaker 0 00:29:48 Yeah, for sure. We love working with machine builders because like I said, some of the most difficult things are around connectivity to the actual control, knowing what's, um, available as data. And in some cases, the customer comes back and says, I want this to do more now. Right. I, I wanna have it record more data. I wanna have more tertiary systems connected and things like that. And that can also be a great income stream. Um, repeat business in a industry that's hard to get repeat business in if you're a machine builder, right. Is to expand your systems within an existing customer as well as obviously we, we reward our partners when deals come in and things like that too.
Speaker 2 00:30:31 Jared, thanks very much for, um, coming on the podcast today. So how would people get in touch with you if they are interested to learn more?
Speaker 0 00:30:37 Our website is www dot M AJ. I K do IO. Uh, so that's sort of starting point. Um, you can definitely get in touch directly with me, uh, either on LinkedIn, Jared Evans on LinkedIn or, uh, J Evans magic.io is my email address. And there's lots of resources on our website as well as on our social media, like Twitter and LinkedIn as well, uh, for the company that you can see some of the case studies that we've done, some of the partnerships that we have in specific areas, as well as, uh, our products capabilities.
Speaker 2 00:31:20 I've just asked you a personal question here too. What do you like to do when you're not building out information systems?
Speaker 0 00:31:26 Well, one thing that I've especially been lagging recently is getting out in nature and, uh, gain a little bit of time away, either camping or in the winter, some skiing, things like that. So that's pretty much, if you get an out of office notification from me, that's, uh, I'm really out of office. You're not gonna be able to get ahold of me.
Speaker 2 00:31:46 No wifi
Speaker 0 00:31:47 Reception probably.
Speaker 2 00:31:48 Well, thanks for coming on. Nice to chat with you again, our sponsor for this episode is Airhart automation systems. Airhart builds and commissions turnkey solutions for their worldwide audience. With over 80 years of precision manufacturing, they understand the complex world of robotics, automated manufacturing and project management, delivering world class custom automation on time and on budget contact one of their sales engineers to see what Airhart can build for you and their
[email protected] and Airhart is spelled E H R H a R D T. And I'd like to thank our partner, a three, the association for advancing automation. They're the leading trade association in the world for robotics, vision and imaging motion control and motors, and the industrial artificial intelligence technologies visit automate.org to learn more. And I'd like to thank our partner painted robot painted robot builds and integrates digital solutions. They're a web development firm that offers SEO, digital social marketing, and can set up and connect CRM and other E R P tools to unify marketing sales and operations. And if you'd like to get in touch with us at the robot industry podcast, you can find me Jim Beretta on LinkedIn. We'll see you next time. Thanks for listening. Be safe out there. Today's podcast was produced by customer attraction, industrial marketing. I'd like to thank my nephew, Chris gray for the music, my partner, Janet, a three painted robot and our sponsor Airhart automation systems.
