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When the town of Falmouth decided to build a new water treatment plant, the seaside Massachusetts community faced a nearly $42 million bill to build the facility. It then learned regulatory requirements would add nearly $1 million more in ongoing annual salary payments.
State regulators wanted the town's water department to have a qualified operator physically present at the plant whenever it was in operation -- which, in the summer, when the town's population spikes from about 30,000 to over 100,000, meant the town would have to staff the facility nearly 24/7.
Stephen Rafferty, the town's water superintendent, said the additional specialized personnel would cost around $1 million each year just in wages alone, provided he could even find enough qualified workers.
Faced with the additional personnel costs and the challenge of staffing up, Rafferty took a play out of the for-profit business book and turned to technology and automation innovation to address the problem. He decided to create a connected, highly resilient automated facility that would qualify for a waiver from the state's staffing requirements.
"The technology allows for complete monitoring of pump, valves and the water quality, as well as the pump station that's off-site," said Marc Lemoi, president of R.E. Erickson Co., a systems integrator specializing in water and wastewater treatment that worked with Falmouth on the project.
Automation innovation, server virtualization and other technology innovations saved the town upwards of $3 million annually in efficiency gains and personnel costs, Rafferty said, noting that the town's use of automation and remote monitoring meant the state waived the on-site staffing requirements when the plant opened in 2017.
Other IT and enterprise leaders should take note, according to management consultants and automation experts. They say organizations, even small and midsize ones with limited IT staff on hand, should be turning to automation innovation more than ever to remain competitive and cut down on costs like the ones Falmouth was facing.
"It's not so much whether the technology is there to automate and innovate, but whether there's someone in the company or helping the company who actually understands how to use the technology and apply it to specific situations," said Chris Rossi, a principle at SC&H Group and part of the management consultancy's technology advisory practice.
Automation innovation mindset required
Falmouth's move into a more sophisticated IT infrastructure at its new water plant came as a result of economic necessity, mirroring the experience of many organizations who implement automation and other state-of-the-art technology. These organizations, which range from small family businesses to midsize firms to municipalities, are facing the same pressure to save money and deliver better results as their larger counterparts.
Some, like Falmouth, are making the leap using various technologies to innovate and transform -- and in doing so, are showing that it's not necessarily the technology itself that makes the difference, but the initiative and will to do something different.
Statistics from McKinsey & Co. support that observation. The consultancy found that while automation is one of the most prevalent trends in IT today, its use is not evenly distributed. Its 2018 global automation survey found that 57% of responding organizations are at least piloting automation in one or more business units or functions, with another 38% planning to do so in the upcoming year.
However, larger organizations are further ahead, with 40% saying they're using automation across the organization or have fully automated processes in at least one function or business unit, versus just 25% of smaller organizations.
McKinsey also found that high-tech and telecom companies are more advanced in their use of automation than other industries.
Microsoft found similar trends when looking at adoption of IoT technologies. Its IoT Signals report, released in July 2019, surveyed more than 3,000 IoT decision-makers in enterprise organizations and found that 85% are in some state of IoT adoption, with IoT adopters saying they expect to see a 30% ROI within two years.
The Microsoft survey also found barriers, namely issues around the complexity and technical challenges of using IoT, as well as trouble finding and/or developing staff skilled in IoT deployments.
Rossi said many organizations continue to struggle with automation innovation and other IT-driven initiatives because they don't have executives pushing for innovation, nor the rank-and-file talent to support it. He noted that IT departments lacking specialized skills still find that the solutions aren't yet commodity technologies that are easily deployed.
"Automation can be applied in a lot of different companies and industries, but the question is usually whether there is someone thinking through whether it can be applied and in what situations," Rossi added. "[Many organizations] lack people with innovative mindsets who can put together technology to deliver results."
As such, Rossi credited Falmouth with having the innovative mindset needed to move forward with its technology plans for its new treatment plant.
He said he expects other organizations will be forced to do the same, as competition and disruption pressure them to be more innovative in order to survive. At the same time, Rossi said the cost and complexity of automation innovation and other emerging technologies will continue to diminish, making them easier for those organizations to adopt.
"Right now, we're sort of in the innovator stage where people have to figure out how to use it. But in the next five to 10 years we might start getting to a commodity level with these products where it's figured out for you," Rossi said.
As for Falmouth, the town worked with R.E. Erickson as well as Rockwell Automation to build the physical plant and implement the required IT elements. Falmouth deployed Stratus ftServer servers with VMware software, with Stratus providing continuous monitoring of the servers. The plant also has two ControlLogix controllers from Rockwell Automation for redundant control and relies on an EtherNet/IP network architecture.