Ira A FULTON Schools of Engineering Global Challenges

Ira A. FULTON Schools of Engineering Global Challenges in Industrial Engineering and Operations Management for the 21 st Century Ronald G. Askin, Professor and Director School of Computing, Informatics, and Decision Systems Engineering Arizona State University Tempe, AZ 85287 -8809 USA Ron. Askin@asu. edu

Overview • On-going global manufacturing and economic activity trends • Where US manufacturing research and activity are headed • What are the implications/opportunities for IEs globally? • Where is IE’s future School of Computing, Informatics, and Decision Systems Engineering Kuala Lumpur, January 2011

Arizona and ASU School of Computing, Informatics, and Decision Systems Engineering Kuala Lumpur, January 2011

Shaping the World Environment and Nature Politics and Cultures Economics and Ingenuity School of Computing, Informatics, and Decision Systems Engineering Kuala Lumpur, January 2011

Manufacturing Trends and Status Today • Global Production/Supply Networks • Transit costs and speeds changing slowly • Raw material availability, labor costs, markets vary globally • Information access is level; education becoming level • Transition from Mechanical/Physical to Electrical/Info Dominance • Green for Sustainability (Financial and Environmental) • Health applications are growing markets • Nanomaterials are solutions on the horizon Manufacturing Creates Wealth! Services fleetingly facilitate life but limit wage growth due to standardization, scalability and automation difficulty. School of Computing, Informatics, and Decision Systems Engineering Kuala Lumpur, January 2011

Globalization! School of Computing, Informatics, and Decision Systems Engineering Kuala Lumpur, January 2011

Intel Wafer Fab and Test/Assembly Facilities It’s Markets, Resources and Economics Fab Assembly/Test School of Computing, Informatics, and Decision Systems Engineering Region Asia/Pacific Americas Europe Japan Revenue 51% 20% 19% 10% www. worldatlas. com Kuala Lumpur, January 2011

WTO: Peace and Prosperity Through Cooperative Commerce WTO: A system of trading rules and forum for intergovernmental negotiation 153 Member Countries, 30 Accessions (in process) in 2009 School of Computing, Informatics, and Decision Systems Engineering Kuala Lumpur, January 2011

Why is US IE Changing So Much So Fast? • Thomas L. Friedman, Hot, Flat and Crowded -Level playing field through logistics and global connections (web) -American expectations for good wages, clean jobs/environment - High competition outsourcing, off-shoring • Opportunity of new science – bio, info, nano • Growth of service expenditures (health care, finance) • Dragged along by our engineering counterparts School of Computing, Informatics, and Decision Systems Engineering Kuala Lumpur, January 2011

But are We Changing? • Of Top 20 Ranked Schools Industrial and Systems Engineering Industrial and Operations Engineering Industrial Engineering and Operations Research Industrial and Manufacturing Engineering Management Science and Engineering Industrial Engineering and Management Science Operations Research and Information Engineering Industrial and Systems Engineering Industrial and Systems Engineering Industrial Engineering and Operations Research Industrial and Systems Engineering Industrial and Enterprise Systems Engineering Industrial Engineering Operations Research/Industrial Engineering Industrial, Systems and Operations Engineering • IIE Members vote Down Name Change in 2009 School of Computing, Informatics, and Decision Systems Engineering Kuala Lumpur, January 2011

Industrial Engineering in the US – Past and Present 1910 2010 New Markets Outside of Manufacturing tics es H Hea s i Log ervic ur omela lthcare nd S e n o f e Fin Secu We’ve grown out but have we grown up? In repr anc t e rity En School of Computing, Informatics, and Decision Systems Engineering Kuala Lumpur, January 2011

The Scientist/Engineer Today The Doctor The Civil Engineer Realtime tracking (Cameras, GPS) CAT Scan PET Scan Embedded structural health monitoring/control School of Computing, Informatics, and Decision Systems Engineering Kuala Lumpur, January 2011

Revolutionary Change in Technology Human Genome Decoding Moore’s Law n n n 1990: $3 B, 13 yrs 2009: $350 k, 13 weeks 2015: $300, 13 min. Gordon Moore's original graph from 1965 School of Computing, Informatics, and Decision Systems Engineering Kuala Lumpur, January 2011

The IE Today Subject to: http: //www. strategosinc. com/value_stream_mapping 1. htm Methods have stagnated. Remaining traditional Manufacturing opportunities in US are limited. School of Computing, Informatics, and Decision Systems Engineering Kuala Lumpur, January 2011

IEs Improve Integrated Systems Today’s systems are complex and integrated. Why aren’t we flourishing most in complex environments? Have we changed at the same rate as others over the past 30 years? How must faster/better/cheaper can we define, model, and improve a system today than in 1979? While the world became a ubiquitous information, global society, IE found better icons for flowcharts! School of Computing, Informatics, and Decision Systems Engineering Kuala Lumpur, January 2011

Where Could/Should We Be? • Virtual Reality Models of Systems – miniature Ron sits on the part and flows through the machine and plant • Virtual Reality Models of datasets with automated coloring, sizing for outliers • Automated Simulation/Optimization Models from Capital Asset files • Automated model decomposers, data cleaners and preprocessors • Full data history on shop and order status with real-time planning updates – customers manage their orders. We’re too Cheap! School of Computing, Informatics, and Decision Systems Engineering Kuala Lumpur, January 2011

The Prevailing Business Attitude Phil Knight, Founder of Nike “There is no value in making things any more. The value is added by careful research, by innovation, and by marketing. ” Deputy Director, DARPA 7/19/2010 “To innovate we must make. ” School of Computing, Informatics, and Decision Systems Engineering Kuala Lumpur, January 2011

World Gross Domestic Product GDP by Region 40000 CONSTANT 1990 US BILLIONS 35000 30000 25000 Africa Asia 20000 Central America Europe 15000 North America 10000 South America World 5000 0 1975 1980 1985 1990 1995 2000 2005 2008 YEAR Data Source: http: //unstats. un. org/unsd/snaama/dnl. List. asp School of Computing, Informatics, and Decision Systems Engineering Kuala Lumpur, January 2011

GDP – Asia School of Computing, Informatics, and Decision Systems Engineering Kuala Lumpur, January 2011

GDP per Capita-Global Wealth Distribution GDP / Population $35 000 1990 USD Per Capita $30 000 Africa $25 000 Asia $20 000 Central/Latin America Europe $15 000 $10 000 North America $5 000 $0 1975 1980 1985 1990 1995 2000 2005 2008 YEAR School of Computing, Informatics, and Decision Systems Engineering Kuala Lumpur, January 2011

GDP/Capita – Asia and US School of Computing, Informatics, and Decision Systems Engineering Kuala Lumpur, January 2011

GDP Growth Rate: Current GDP/1970 GDP Manufacturing Growth Rate by Region 8 7 00 20 05 20 08 95 90 20 YEAR 0 19 197019751980198519901995200020052008 1 19 0 2 85 1 North America South America World 3 19 2 Central America Europe 80 Central America Europe 3 4 19 Asia 75 4 5 19 Africa 70 5 6 GROWTH RATE GDP Growth Rate by Region 19 GROWTH RATE 6 YEAR Asia Rising, Europe Falling School of Computing, Informatics, and Decision Systems Engineering Kuala Lumpur, January 2011 North America South America World

Export Dependence by Region Total Exports/GDP by Region Asia growing rapidly 0, 6 PERCENTAGE 0, 5 0, 4 Africa Asia 0, 3 Central America Europe 0, 2 North America South America 0, 1 World 0 1975 1980 1985 1990 1995 2000 2005 2008 YEAR School of Computing, Informatics, and Decision Systems Engineering Kuala Lumpur, January 2011

Export Importance by Country School of Computing, Informatics, and Decision Systems Engineering Kuala Lumpur, January 2011

Trends in Interdependency Total Imports/GDP by Region 0, 7 PERCENTAGE 0, 6 0, 5 Africa 0, 4 Asia Central America 0, 3 Europe North America South America 0, 2 World 0, 1 0 1975 1980 1985 1990 1995 2000 2005 2008 YEAR School of Computing, Informatics, and Decision Systems Engineering Kuala Lumpur, January 2011

Import Percentages by Country School of Computing, Informatics, and Decision Systems Engineering Kuala Lumpur, January 2011

Import Export Growth Rates Export Growth Rate by Region 25 Import Growth Rate by Region 20 Africa Asia GROWTH RATE 15 10 5 0 197019751980198519901995200020052008 YEAR 20 18 Africa 16 Asia 14 Central 12 America Europe 10 8 North 6 America 4 South America 2 0 World Central America Europe 197019751980198519901995200020052008 YEAR Central America Gaining Net Surplus Asia Expanding Activity Rapidly School of Computing, Informatics, and Decision Systems Engineering Kuala Lumpur, January 2011 North America South America World

Observations §US has room to consume more of the world’s goods §US spends most on services, not products §Central America and Europe highly dependent on trade § US, Japan and South America too insular? § Japan continuing to wane § Growth linked to global trade, particularly for small economies School of Computing, Informatics, and Decision Systems Engineering Kuala Lumpur, January 2011

What’s the Role and Impact of Manufacturing? School of Computing, Informatics, and Decision Systems Engineering Kuala Lumpur, January 2011

Global Manufacturing Growth Manufacturing by Region 9000 CONSTANT 1990 US BILLIONS 8000 7000 Africa 6000 Asia 5000 Central America Europe 4000 North America 3000 South America 2000 World 1000 0 1975 1980 1985 1990 YEAR School of Computing, Informatics, and Decision Systems Engineering 1995 2000 2005 2008 Europe, No. America losing ground; Asia gaining Kuala Lumpur, January 2011

Manufacturing Activity by Country School of Computing, Informatics, and Decision Systems Engineering Kuala Lumpur, January 2011

Manufacturing Importance by Region Manufacturing/GDP by Region 0, 35 Asia Gaining 0, 3 Africa 0, 25 Asia Central America Europe North America 0, 2 South America World 0, 15 No. /So. America , Europe losing ground 0, 1 1970 1975 1980 School of Computing, Informatics, and Decision Systems Engineering 1985 1990 1995 2000 2005 2008 World relatively constant Kuala Lumpur, January 2011

Manufacturing Production per Capita Manufacturing / Population $6 000 Africa 1990 USD Per Capita $5 000 Asia $4 000 Central America/Latin America $3 000 Europe $2 000 North America World $1 000 $0 1975 1980 1985 1990 1995 2000 2005 2008 YEAR School of Computing, Informatics, and Decision Systems Engineering Surprising relative growth consistency except Africa Kuala Lumpur, January 2011

Manufacturing per Capita by Country School of Computing, Informatics, and Decision Systems Engineering Kuala Lumpur, January 2011

Population Growth Rates Population Data by Year 8 000 000 7 000 000 Africa POULATION 6 000 000 Asia 5 000 000 Europe 4 000 000 North America 3 000 000 Latin America / Central America World 2 000 000 1 000 000 0 1975 1980 1985 1990 1995 2000 2005 2008 YEAR School of Computing, Informatics, and Decision Systems Engineering Despite problems, Africa is growing fastest Kuala Lumpur, January 2011

Population Growth Rates – Focus on Asia School of Computing, Informatics, and Decision Systems Engineering Kuala Lumpur, January 2011

The Rapidly Changing Landscape Companies brace for end of cheap made-in-China era By ELAINE KURTENBACH, AP Business Writer Elaine Kurtenbach, Ap Business Writer – Thu Jul 8, 12: 57 pm ET SHANGHAI – Factory workers demanding better wages and working conditions are hastening the eventual end of an era of cheap costs that helped make southern coastal China the world's factory floor. A series of strikes over the past two months have been a rude wakeup call for the many foreign companies that depend on China's low costs to compete overseas, from makers of Christmas trees to manufacturers of gadgets like the i. Pad. Where once low-tech factories and scant wages were welcomed in a China eager to escape isolation and poverty, workers are now demanding a bigger share of the profits. The government, meanwhile, is pushing foreign companies to make investments in areas it believes will create greater wealth for China, like high technology. shifting production to the inland areas …Massive investments in roads, railways and other infrastructure are reducing the isolation of the inland cities. Maybe, but the growing market is still there! School of Computing, Informatics, and Decision Systems Engineering Kuala Lumpur, January 2011

US Industry Activity – Percent of GDP* Where will these lines go from here? 0, 3 0, 25 Agriculture 0, 2 Manufacturing Retail trade 0, 15 Logistics Information 0, 1 Finance, insurance Health care 0 1947 1950 1953 1956 1959 1962 1965 1968 1971 1974 1977 1980 1983 1986 1989 1992 1995 1998 2001 2004 2007 0, 05 * US Dept of Commerce, Bureau of Economic Analysis School of Computing, Informatics, and Decision Systems Engineering Kuala Lumpur, January 2011

US Manufacturing Future • Focus on design (shorter product life cycles, more customized demands as choices proliferate) • Focus on green manufacturing (sustainability) • Focus on low volume, high precision, high tech products • Focus on developing and using nanomaterial processes – atomic scale layered composites • Focus on renewable energy power sources • Focus on defense industry • High volume only when automated (low volume and product flexibility relative to labor at least for awhile longer) School of Computing, Informatics, and Decision Systems Engineering Kuala Lumpur, January 2011

World wide Opportunities – Successful Approaches (Business 101) • Identify competitive advantage (low cost of labor, primary materials) • Identify market needs and means • Ensure adequate infrastructure • Find investors – gov’t, banks, parent companies • Focus on a core automotive parts assembly in Mexico first, then build up to aerospace parts • Low Cost Assembly originally in Asia (Is Africa the future? ) • Global Production School of Computing, Informatics, and Decision Systems Engineering Global Wealth Logistics Dominance Kuala Lumpur, January 2011

Where Do Manufacturers Build? • Close to Raw Material and Parts Suppliers • Close to Customers • Adequate Labor Supply and Low Labor Rate • Adequate Transportation Network (Air, Rail, Shipping, Roads) • Favorable Community/Tax Situation • Access to Utilities (power, water) • Possible risk mitigation driven facility distribution • Limited cultural/political hurdles School of Computing, Informatics, and Decision Systems Engineering Kuala Lumpur, January 2011

US National Academy of Engineering Grand Challenges n n Web page: http: //www. engineeringchallenges. org/ View video (6 min) 14 Grand Challenges for the 21 st Century §Make solar energy economical – less than 1% today but large potential §Provide energy from fusion – develop scalable, envir. benign method §Provide access to clean water – affordable and available for all §Reverse engineer the brain – combining engineering and neuroscience §Advance personalized learning – speeds, styles, content for individual §Develop carbon sequestration methods – capture and store excess CO 2 §Restore and improve urban infrastructure – better design and materials for transportation, water, waste, power, etc. for livable cities School of Computing, Informatics, and Decision Systems Engineering Kuala Lumpur, January 2011

NAE Grand Challenges cont. § § § § Engineer the tools of scientific discovery – blending of engr. & science to explain nature Advance health informatics – better everyday care and preventing bio attacks/pandemics Prevent nuclear terror – protect society from increasing risks and proliferation Engineer better medicines – body sensing, personalized drugs, delivery methods Enhance virtual reality – for training, treatment, communication, and entertainment Manage the nitrogen cycle – better fertilization techniques and recapture/recycle Secure cyberspace – protect essential infrastructure School of Computing, Informatics, and Decision Systems Engineering Kuala Lumpur, January 2011

IIE Fellows: Grand Challenges for Industrial Engineering Fellows Report: http: //www. iienet 2. org/uploadedfiles/IIE/News/Grand%20 Challenge%201. pdf § § § § Reengineering Health Care Delivery Creating a Technology Oriented Culture Engineering a Sustainable Society Developing Better Decision Tools Mitigating and Responding to Disasters Point of Use Manufacturing Infrastructure Food Security School of Computing, Informatics, and Decision Systems Engineering Kuala Lumpur, January 2011

1. Reengineering Healthcare Delivery: An Integrated Approach The Problem § § § § Demographics: Young and poor are fastest growing segment, U. S. and worldwide Number of senior citizens growing fast (and baby boomers won’t go gently into the night) Healthcare is largest U. S. industry Health care inflation rate 3 times overall rate Woeful under investment in info technology Excessive waste Medical info and treatment increasingly technologyenabled School of Computing, Informatics, and Decision Systems Engineering Kuala Lumpur, January 2011

1. Reengineering Health Care The IE Role § § § Individual care needed – risk analysis, modeling/mining genomic info, personalized treatment scripts, safety/quality in individual led treatment System improvements needed – QC, logistics, info technology, provider collaboration hierarchically and vertically, financial system and models Science advances needed – treatment protocols, data mining/bioimaging, human sensing School of Computing, Informatics, and Decision Systems Engineering Kuala Lumpur, January 2011

2. Creating a Technology Oriented Society The Problem § § § Body of tech knowledge growing rapidly System size and complexity growing rapidly (U. S. ) relatively wealthy – life is easy Many of brightest youth pursue law, business U. S. youths perform poorly in math/science School of Computing, Informatics, and Decision Systems Engineering Kuala Lumpur, January 2011

2. Creating a Technology Oriented Society The IE Role § Get the word out about opportunities and need § Optimize available human resource § Jazz up what we do School of Computing, Informatics, and Decision Systems Engineering Kuala Lumpur, January 2011

3. Engineering a Sustainable Society The Problem § § § U. S. population will double this century World population will more than double Over 50% now live in urban areas Wealth increases ecological footprint Climate change will change geographic resource availability School of Computing, Informatics, and Decision Systems Engineering Kuala Lumpur, January 2011

3. Sustainable Society The IE Role § § Need sustainable transportation systems Efficient/effective governmental services – judicial, social security, police/fire Designing scalable urban environments Designing efficient community structures connecting urban (production, consumption) to rural (raw materials) Is there an optimal city size? How to tradeoff privacy and security? School of Computing, Informatics, and Decision Systems Engineering Kuala Lumpur, January 2011

4. Develop Better Decision Making Tools The Problem § § Modeled entities are growing in size Models are expensive to build, hard to sell Models are limited in scope, life-span Organizations have vertical and horizontal boundaries (multiple constituencies) School of Computing, Informatics, and Decision Systems Engineering Kuala Lumpur, January 2011

4. Better Decision Making Tools The IE Role § § § § § Better, more fully deployed, and relevant sensors Models to fuse, validate and evaluate data/information Improved models of human behavior Enrich “Rational” models with subjective behavior Risk analysis and interaction models of tightly coupled massive technology-oriented systems and their failure modes/scenarios Rapid modeling and computational tools Scalable, maintainable, rapidly developable models More understandable models/More valid models Human embedded modeling paradigms and tools (immersion and visualization) School of Computing, Informatics, and Decision Systems Engineering Kuala Lumpur, January 2011

5. Mitigating and Responding to Disaster The Problem § Natural and man-made disasters are happening more frequently § Societal expectation is for safer lives, quicker emergency care § Larger urban regions, tightly-coupled specialized lives, and climate change lead to more susceptible systems and larger scale impacts School of Computing, Informatics, and Decision Systems Engineering Kuala Lumpur, January 2011

5. Mitigating Disaster The IE Role § § § § Optimal deployment of detection technologies (natural and competitive games) Optimization of emergency response resource positioning and deployment Managing transition from search to rescue to recovery and care Integrated communications, logistics, and decision making Real-time decision making with various info levels (resilient planning and control) Resilient system(s) design Optimal deployment and use of sensing technology and risk assessment models School of Computing, Informatics, and Decision Systems Engineering Kuala Lumpur, January 2011

6. Point of Use Manufacturing The Problem § Demand for Customized Products § Demand for Sustainable Manufacturing/Distribution School of Computing, Informatics, and Decision Systems Engineering Kuala Lumpur, January 2011

6. Point of Use Manufacturing The IE Role § § Distributed (home) or neighborhood manufacturing New process development for solid free form fabrication Development of nano and mega technology for point of use production Design of infrastructure for material delivery, user-driven design “It’s Not Easy Being Green” School of Computing, Informatics, and Decision Systems Engineering Kuala Lumpur, January 2011

7. Infrastructure Construction The Problem § Time to revolutionize infrastructure construction (progress has lagged) § Construction inefficient and quality variable School of Computing, Informatics, and Decision Systems Engineering Kuala Lumpur, January 2011

7. Infrastructure Construction The IE Role § Take advantage of advances in computing, robotics, materials, and management science to reduce cost, time, injuries, environmental impact § Design smarter structures § Determine optimal investments for infrastructure $ § Allow maintainable, culturally appropriate, ergonomically safe construction methods and system designs § Why Can’t we manufacture structures in factories for field assembly with higher quality and productivity? School of Computing, Informatics, and Decision Systems Engineering Kuala Lumpur, January 2011

8. Safe, Available, Affordable Food & Water The Problem § § § Population growth, changing weather patterns, political strife, man -made biohazards, natural biohazards threaten worldwide Current cultivation practices not sustainable and use nonrenewable resources Profits vs. Politics vs. Social Good Standard procedures, testing and traceability needed across food supply chain Procedures for local food production and security needed School of Computing, Informatics, and Decision Systems Engineering Kuala Lumpur, January 2011

8. Safe, Available Food and Water The IE Role § § § Develop traceable supply and distribution networks (RFID, imaging, procedures, etc. ) Design and deploy maintainable solutions Perhaps assist in governmental planning for development School of Computing, Informatics, and Decision Systems Engineering Kuala Lumpur, January 2011

What Constitutes IE? IE Today § § § Manufacturing planning (process planning, tooling design/maintenance) Production operations (planning, scheduling, quality assurance, material handling) Engineering management (engineering economics, product services, facilities design/mgmt. , distribution/logistics) System modeling (information systems/flow, modeling and simulation) Ergonomics/Human Factors School of Computing, Informatics, and Decision Systems Engineering IE Tomorrow • Additions? • Deletions? Kuala Lumpur, January 2011

Industrial Engineer 21 st Century We are the Information Preparer We are the Data Hunter/Gatherer School of Computing, Informatics, and Decision Systems Engineering Kuala Lumpur, January 2011

Conclusions § We are needed but we must Wander or Wither § We must Revolutionize on a Bigger, Broader, Faster Scale § We must integrate our strengths – humans, math models, computing, big picture/multiobjective comfort level, efficiency mindset School of Computing, Informatics, and Decision Systems Engineering Kuala Lumpur, January 2011

The Big Picture Opportunities Abound! But We Must Broaden our Workspace! School of Computing, Informatics, and Decision Systems Engineering Kuala Lumpur, January 2011

Questions/Comments/Complaints? Ron Askin School of Computing, Informatics, and Decision Systems Engineering ron. askin@asu. edu School of Computing, Informatics, and Decision Systems Engineering Kuala Lumpur, January 2011

Futurizing the BSIE Curriculum § § § § § Greater emphasis on global cultures Learning to serve on multidisciplinary, multicultural, politically pressured teams Must bring unique value to the team (Systems thinking, Project Management, Multiobjective Dec. Making, Dealing with Complexity & Uncertainty) Dynamic, Nonlinear, Continuous Large-Scale Modeling (Not just Discrete Event Simulation and Desk Top LP) Understanding Human Behavior and Preferences (Beyond HF) Risk Management and Mitigation as an integral activity Broader Science Knowledge (Biology, Ecology) Sophisticated Information Technology Users (Sensor Capability & Network Design; Data Information Decision Systems) Systems Modeling of Urban Environments, Infrastructure Broader Mindset of Major Societal Impact and Socio-Technical Problem Solving (not just making widgets) What’s Your Ten? School of Computing, Informatics, and Decision Systems Engineering Kuala Lumpur, January 2011