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Real-time Data for Better Decisions

As part of a collaborative effort with vendors, Nova Chemical is merging real-time plant floor data with enterprise financial data to improve decision making throughout the company.

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In the old days, when we were just thinking of transactional processing in the business context, SAP was a pretty good model,” says John Wheeler, senior vice president and chief information officer (CIO) at Nova Chemicals Corp., in Moon Township, Pa. But as Nova got larger and began looking at its operations in a more holistic manner, “we learned that there was a lot of ‘white space’ in [SAP’s] portfolio,” says Wheeler, in reference to application or integration needs that SAP software couldn’t fulfill.

That’s why Wheeler offers words of praise for the chemical industry value network, or IVN, that was announced on May 8 by SAP AG, the powerhouse Walldorf, Germany-based enterprise software vendor. The chemical IVN is a collaborative effort that brings together leading chemical companies, independent software vendors and systems integrators with SAP to develop and deliver solutions and integration scenarios that address specific problems and pain points in the chemical industry. It is one of various industry-specific IVNs planned; SAP has already announced an IVN for the banking sector, for example.

Some people once viewed SAP as a company whose management “thought they could do everything,” Wheeler observes. “But they realize now that they can’t [do everything],” he says, “particularly in the process automation world, which is not really the forte of traditional IT (information technology) vendors.” The formation of the chemical IVN is “a dramatic change for SAP,” says Wheeler, and one that should make life easier for SAP’s chemical industry customers.

Initial proof of that can be seen in a recent pilot project completed by Nova Chemicals. The $5.6 billion producer of plastics and chemicals is a member of the chemical IVN, and is one of the first chemical manufacturers to pilot a solution resulting from the IVN initiative. During a presentation at the SAP Sapphire customer conference May 16-18 in Orlando, Fla., Wheeler and Alan Schrob, Nova leader for manufacturing excellence, described the project and some of its benefits.


For the project, Nova worked with SAP and Pavilion Technologies, an Austin, Texas, software solutions vendor that is also a chemical IVN member. The result is a system that can “deliver real-time decision-making capability to anyone in our company,” says Schrob, based on the integration of real-time plant floor data with enterprise financial data.

The pilot project took place at Nova’s Joffre, Alberta, Canada, polyethylene plant, one of 18 North American manufacturing facilities operated by the company. In order to improve capacity utilization at Joffre, the plant’s process engineering staff had traditionally downloaded data from the process control historian, and then examined the data to identify key contributors that were inhibiting plant capacity. “It would sometimes take them a week to process the volumes of data into something that resembled what was occurring in the process, and that’s not very effective,” Schrob told the Sapphire audience.

Nova was already using Pavilion’s Advanced Process Control (APC) technology at Joffre and other plants, and had seen significant improvements in production, yield, quality and energy efficiency as a result, Schrob said. So as the first step in the pilot, and as a way to provide real-time visibility into the Joffre plant’s performance, Nova turned to Pavilion’s Model Predictive Intelligence (MPI) technology, which uses advanced analytic models to represent plant production processes.

Nova used MPI to develop a solution that relies on real-time data to predict a theoretical best capacity utilization for the plant, which is then measured against the plant’s actual current capacity utilization. This metric was then presented to operators on the Pavilion console in the Joffre plant control room. A key objective was enabling

quicker, better-informed decisions, Schrob said, and it worked. “Within a few days of us displaying this metric to the operators, they were already competing to drive the red line, which was the actual capacity utilization, closer to the green line, which was the theoretical.”

Sending data up

The next step in the pilot was to leverage the same information beyond the walls of the control room. For this, Nova turned to SAP’s xApp Manufacturing Integration and Intelligence (xMII) application. Based on technology that SAP obtained in its acquisition last year of Exton, Pa.-based Lighthammer Software Development Corp., xMII provides prebuilt, standards-compliant connectors for linking a large variety of shop floor systems to SAP’s enterprise systems.

A Nova team developed a relatively simple but secure architecture, and by using xMII and SAP’s NetWeaver integration platform, was able to quickly demonstrate the ability to deliver the same kind of real-time process information anywhere in the company, at any time, through Nova’s enterprise portal.

But the ability to deliver “some pretty cool charts” through the enterprise portal was only half of the objective, Schrob told the Sapphire audience. The real power of the technology would come with the integration of plant floor data with key financial data contained in the company’s SAP enterprise resource planning (ERP) system to enable faster, more strategic, fact-based decision making, he noted.

For the pilot, Nova accomplished this step by applying xMII’s integration capability to what the company calls its margin model. “Our margin models tell us exactly how much contribution margin, or gross margin, we earn on every pound of product to every customer on every order,” Schrob explained. By merging this data with the MPI-based plant floor data, the company was able to develop screens showing lost contribution margin opportunity for each product produced at the Joffre plant, as well as the constraints that prevented the plant from reaching the predicted capacity utilization. In the future, immediate access to this kind of information is expected to provide Nova management with a valuable financial decision-making tool.

Huge numbers

According to Wheeler, Nova has already realized significant financial benefits just through the delivery of the Pavilion MPI-based real-time information to the Joffre plant operators, enabling them to boost capacity through production fine-tuning. When a plant is sold out, Wheeler said, “then any additional capacity drops right to the bottom line, and the numbers are huge.”

Following the success of the pilot, Nova now plans to roll out the technology across its other plants. And the company also plans to develop additional real-time metrics to aid decision-making in other areas, including product transition, quality management, supply chain management and production run consistency, among others—which can be delivered whenever and wherever they are needed within the company. “All of these kinds of things can be explored, because the process automation environment has all of that rich information that we’ve never really effectively used, particularly when integrated with financial information,” Wheeler noted.

“The combination of Model Predictive Intelligence and xMII allows us to provide real-time and fact-based decision making to key decision makers in our company—from the process engineer who can continually tweak and address the operation of the plant to maximize performance within the constraints of the plant, to plant and senior manufacturing leadership who need to make decisions about where to make key capital investments,” Schrob summed up.

For more information, search keywords “real-time performance management” at

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