As we kick-off 2023 and take a moment to reflect on 2022, I need to first extend my sincere gratitude to all our customers and employees for making 2022 another successful year for ACE. We strategically grew our team by nearly 15 percent, making key hirers to adjust for growing demand for our MES, cybersecurity, and project management services, and opened our eighth office in Denver, CO.
But as we noted at the end of 2021, one of our biggest takeaways from navigating two years of pandemic-induced challenges was that we need to remain agile so that we can adapt to the unexpected and still meet our customer’s needs. As we wrap up our third year of the COVID-19 pandemic, agility and adaptability are still some of the key themes driving the way we conduct business. In 2022, we continued to work with customers to navigate supply chain issues by adapting modernization plans to get more out of existing assets with software and services rather than hardware upgrades. We are also helping customers ease the pain of labor shortages by integrating our experts into client teams – keeping projects moving forward on time and on budget.
Adapting Our Design Approach to Respond to Continued Supply Chain Delays
While pandemic-induced supply chain disruptions continued throughout 2022, instead of being complacent with 48 – 60-week lead times for certain components and delaying or canceling projects, we are working with customers to refocus or restructure projects. Drawing on lessons learned during the recession that began in 2008, we are working with customers to weather the current supply chain storm, which is also mixed with a fair amount of economic uncertainty, with the following strategies:
- Getting more life out of existing systems and assets: These projects have been largely expansions of existing systems and feature enhancements to help increase throughput.
- Starting earlier and planning for phases: We are encouraging all our customers to begin the design phase earlier and to order components with long lead times as early as possible – a strategy we expect to continue recommending through 2023. Planning for system modernizations in phases can also help mitigate supply chain issues, again, if hardware is ordered early enough.
- Executing software-driven improvements: This is a good time to look at initiatives for building out manufacturing execution systems (MES) such as overall equipment effectiveness (OEE) and production tracking. Projects like this have helped our customers develop strategies for extracting additional value from existing manufacturing assets, maximizing their return on investment (ROI) in future capital expenditures, and presenting real-time production data to key stakeholders in the organization.
- Implementing cybersecurity improvements: Many of our customers are putting a high emphasis on cybersecurity. As the supply chain stretches out our project timelines, we are recommending incorporating efforts that advance the site’s cyber posture. This approach ends up being less expensive than doing this as a standalone project and generally does not affect the project schedule.
- Performing advanced obsolescence planning: We saw a new supply chain issue arise as the availability of spare parts for many older control systems diminished, even on sites like eBay, as companies began to hoard parts (think back to the 2020 toilet paper shortage). Our team helps assess which critical components are nearing obsolescence, if suitable substitutions exist, and what the risks of a failure are.
Prior to the pandemic, hardware availability was hardly a consideration let alone a driving factor for design. But today, hardware availability is adding a design dimension that complicates everything and may result in multiple design iterations to accommodate ever-changing supply and lead times. We have adapted our approach for control and automation system projects to compensate for this by examining different hardware form factors and availability upfront and then coordinating delivery between part numbers in an attempt to shave weeks off delivery times.
Helping Customers Bridge Gaps in Labor and Expertise
Throughout 2022, long-time engineers continued to retire while companies simultaneously experienced challenges in hiring. Remaining engineering resources are being pulled in multiple directions and are often left with little time to dedicate to managing all the details of ongoing control and automation projects. To ensure manufacturing lines run efficiently and continuous improvement projects stay on track, companies need to bring in project management and advisory expertise. But this is difficult because dedicated project management companies rarely have the controls and automation expertise required to successfully execute these projects, and conversely, many integrators do not have the expertise in managing projects outside their organization.
Over the years, ACE has set itself apart with a unique combination of control and automation system design expertise as well as multi-discipline project management experience. In 2022, we experienced significant growth for these project management and advisory services as our skilled engineers are being brought into teams to manage projects or serve as the owner’s agent for larger projects with many parties involved. To accommodate for increased demand for these services, we are continuing to invest in hiring new talent to coordinate and run our projects so that some of our more tenured employees can step into these strategic positions.
Bringing Our Expertise Directly to the Rocky Mountain Region
One of the most exciting things to happen in 2022 for ACE was the official opening of our new office in Denver, CO. Our Denver office will help us immediately service our growing customer base in the region as we already have a team of highly skilled engineering and project management resources in the area. The local team’s in-depth expertise includes hardware design and integration, plant floor historian development, MES and modernization, cybersecurity project management, and pharmaceutical system validation.
Looking Ahead to 2023
As we enter 2023, many experts predict that supply chains will begin to gradually improve but we will continue to see a thin labor market. In addition to these continued challenges, I also believe that 2023 will bring with it another new challenge to contend with – an added level of economic uncertainty. Throughout the last three years, the economy has not behaved in line with conventional thinking, and many top economists have vastly different opinions on what may happen in 2023. Since the opinions on how the manufacturing sector will be impacted are also widely varied, we remain cautiously optimistic about growth in 2023. Whether efficiency gain projects become even more critical as budgets tighten or the need for in-house project-based engineering expertise becomes more prevalent, ACE is well prepared to remain agile so that we can adapt quickly and continue to meet our customer’s control and automation needs.
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