Announcer: You are listening to Augmented ops where Manufacturing meets innovation. We highlight the transformative ideas and technologies shaping the front lines of operations. Helping you stay ahead of the curve in the rapidly evolving world of industrial tech. Here's your host, Natan Linder, CEO, and co-founder of Tulip, the frontline operations platform.

Natan: Eric, what's up? 

Erik: Hey Natan. Good to 

Natan: see you. Yeah, it's almost summer. Almost summer. 

Erik: Well, it's Boston, so we'll see. It was winter until Monday and then it was summer for a minute, then it was winter again. I think it's summer again now. 

Natan: It's funny 'cause you know we're recording this like a day after Memorial Day weekend.

So some friends went down to Cape Cod and reported snow in Yarmouth. 

Erik: Yeah, that sounds about right. But today it's like 70 degrees and sunny. So I'm hoping that that's gonna stick around. Yeah. Dare I say, 

Natan: so I guess this is formally the season summary episode. Yeah. This is, uh, is that how we think about this?

Erik: This is the recap. This is the last, uh, episode of the season. We talked to a ton of folks from across industry. We talked to CEOs. Frontline operators, engineers, digital transformation, lean practitioners. I got a long list, but folks all on the frontline leading digital transformation in the context of what they're doing day in, day out.

Natan: Quite a season, I gotta say. 

Erik: Yeah, we had some real hits, I think. 

Natan: Yeah. What's your favorite? It's a tough question. 'cause now like I know people listening and like, what is he gonna say? 

Erik: This is when you, you don't answer, you, you deflect. Deflect. But what was my favorite? My favorite was something came up outta nowhere.

Specifically. Two letters came up that I had never heard before. Mm-hmm. But you know, uh, they seem to be everywhere. I can't turn around without hearing it. What's your take on the AI movement? Natan? 

Natan: Oh my God. Do we really have to start there? I guess ai, it's just to get it out of the system. It is kind of everywhere in nowhere in a way.

Maddie and I recorded a full rant on it that uh, we don't have to repeat today, but the gist is that we see a lot of tacking on of AI features into existing products that have not materially changed for years. Right. Creates great marketing, but the question is like, how does it actually contribute to the bottom line in operations?

You know, it's, it's like the world is moving so fast with the way the infrastructure and the tooling in non OT or in IT landscape, but when it comes to physical environments like your factories and your labs and your warehouses, giving the tools to people who can work with them routinely and trust them to do something useful, that those tools would.

In turn would be integrated enough to have a, an impact to the rest of the things you have and above all have minimal to no side effects, meaning they won't shut down the factory, they won't destroy raw material. So I think there's a huge gap between. Where AI marketing is at and where productivity is.

Erik: It's interesting, right? 'cause I think a year ago, marketing got there first for sure. So the AI marketing that was in full force 12 months ago, I think was, you know, that was, that was front center. What I've seen over the last year is. It's fundamentally, even in the last six months, three months, transformed so much of what we do day in, day out as somebody that's fundamentally interacting with web native tools in their day to day.

I think about like CRMs, I think about like how do you interact with data? How do you make sense of data? But I. There's still lagging adoption, not on the marketing side, but adoption when this has to interface with physical environments. When you're talking about machines on and off, when you're talking about environments where a potential hallucination could be a very real like, yeah, best case, maybe you're gonna have a higher scrap rate, but really you could be talking about like safety situations.

This is an area where the actual adoption of this in frontline operations still has a little ways to go. 

Natan: And you know, at the same time we're seeing, like even internally here at Tulip and many other friends companies, it's real. It's like a great research tool and it's wonderful integrating a bunch of ideas and it's definitely a new way to type code.

Just to be simplistic about this. Are you kidding? And the pace it's working is definitely contributing to lots of great outcomes. I mean, 

Erik: even in the last six months, it's transformed the way that I work. Yeah. I use it every hour of every day. Just about. 

Natan: Yeah. And we've built our own internal tools, like in Hooked Up.

We have more CPS than I care to remember at this point. 

Erik: You've gotta say MCP, otherwise you're not cp, otherwise you're not in, you're not, you're not, you're not a serious AI practitioner. 

Natan: Not really. Not really. But what happens when operations have, uh, been the forgotten child of the classical digital transformation, and then they will be forgotten again in the uh, era.

It's just like, well, it took the 

Erik: internet. How long to catch up to operations? 

Natan: I think it's still catching up. 

Erik: Oh, I think so. 

Natan: So at least 30 years I'd say. 

Erik: Yeah. Yeah. AI's gonna happen faster. Yeah. But it's not there yet. I look at what our customers are doing. I see a lot of pretty encouraging things. I think we were early in taking some of these capabilities and embedding them in the product, but we also have a, you know, I think about Tulip specifically.

I think we've got a privileged space in that we're already that layer of engagement where we have the attention, we have the engagement of that frontline worker, and it gives us, I think, a unique position to be able to incorporate these capabilities into the way that they actually work. 

Natan: So if we tie it to another big theme that, you know, we covered this season with folks like Re Van Castle from SBD and bunch of frontline engineers, Nicole, Nicolette, Kevin Kid, the, the, all those folks.

So we're saying the era of AI is coming and it's definitely gonna move fast, but the Arab citizen development is here and now what are you seeing out there? 

Erik: Well, the tools changed, right? So I think what you're seeing is. No longer are people beholden to central teams to be able to solve problems using digital tools.

And this is just unlocking, I think, a whole new wave of makers and doers and problem solvers to be able to take on bigger challenges. Being able to solve those problems in a very structured way, uh, and be able to do this with full visibility. So, you know, if I go back. 10 years ago, you know, you either had some IT led initiative that was kind of top down, rolled out, and you kind of got what you got and you had to use what you had and work around the constraints and solve the problems with Excel or with paper or whatever the case may be.

Now that divide is, I. No longer there. So if you're a frontline engineer, you can be plugged in using these tools and solving these problems in a very real way and getting very real time engagement and feedback from that frontline worker. So what's working for them? What's not working for them? They know where the problems are and being able to take that perspective and bring it in to the way that folks are working.

I mean, that's here and that's now, and I think that's tremendously exciting. 

Natan: Yeah, there's a guy from Bloom Energy who said the B2B software landscape. It's like either you're signing up to live by somebody else's rules, but with Tulip you make the rules. Yeah. Which I think is the essence of citizen development in operations.

So first of all, it's a, it's a widespread phenomena. Like we have tens of thousands of people doing it on a daily basis. Oh yeah. We see it. It's not theory. And our customer base is fundamentally multinational companies, complex supply chain sites across the globe, many languages, many product lines, and so on.

You know, the fact that they're actually thinking, oh, we're gonna make rules. You know what this tells me? They understand this is not like the wild west. Yeah. You know, it's not like, can I afford my people to be able to sit down and solve problems? Like how can you afford not to? Yeah, absolutely. So it's just like completely changed around.

Erik: It's interesting. So citizen development, I think we are there. We've arrived. But you bring up an important point, which is that's not to be said that you can do this work without appropriate governance. Right. And controls. And approvals and permissions, so on and so forth. I'm curious to hear your perspective on something.

You've heard a lot of talk, you know, a few years ago, digital transformation. Digital transformation, yeah. Unlocking order of magnitude, productivity gains. Could you define digital transformation for me? What does that word specifically mean? 

Natan: I can't, for the love of God, I can't. If there was a competition, like for the most beat up buzzwords, digital transformation would definitely be first or second place.

Erik: Above Industry 4.0 above IIOT above, oh, by far, above industry 

Natan: 4.0. Industry 4.0 would be like in the. Top 10 maybe, and definitely requires deprecation, but digital transformation is like a veteran. It's kind of like the Lakers or the Celtics of beat up buzzwords. But let's talk about why is this so meaningless?

Is because fast forward since wherever you wanna put the early marker for digital revolution. Let's just say it's the PC and not the punch guards. Okay? It's just, just to make it easy, this is like 40 years. So what is non-digital transformation? What does it actually mean? So it doesn't mean anything.

There's no transformation that are non-digital. And then the other big question is, when is it over? Instead of suggests that if you go through a digital transformation, you're done, at some point you should accomplish, you have transformed. And therefore you're digital. You stand on an aircraft carrier with the banner and that's mission accomplished.

Mission accomplished. And uh, that's just can't be further than the reality of people. Yeah. Yeah. The fact 

Erik: of the matter is, and I mean, it comes back to like core lean principles, right? Yeah. It's. You're always trying to identify inefficiency and work it out of the system. And you do this with the awareness that when you solve one problem, you're gonna see other problems.

And that's the game. You know, there's no end state, you know, you're always trying to improve your operations. And there's, in the context of these complicated sort of complex, dynamic systems that are Manufacturing operations, you know, there's always another bottleneck. There's always another source of inefficiency.

Or you know, you have a supplier issue that you didn't have two weeks before, or you invested a new piece of CapEx equipment and it changes the. Flow through your operation or you have workforce turnover or you're scaling up production or, or, or, the point is this is not, you know, some sort of exceptional state.

This is just how our customers and how our champions, I think, work day in, day out and what they have now or what they need are tools that allow them to continuously improve and surprise, surprise. Those are digital tools 

Natan: and you know, the people who actually do the work, what are they actually doing?

They're doing production systems that that's what they're building. Mm-hmm. And what they're actually doing is continuous improvement. Yep. And so we started using this term at the risk of creating another buzzword that instead of digital transformation, really talk about continuous transformation. So kind of leaning in into this state.

And this is sort of a critical mindset because organizations who don't think like that. They're gonna be probably spending a lot of money on all sorts of digital tools and projects that don't really do much, which brings me to the elephant in the room. You ready for this? 

Erik: I'm nervous. Should I be nervous?

No. What's the elephant? 

Natan: Well, can we declare traditional MES as we know it dead? Well, I was gonna ask you because long live composable MES or MES is not dead for excuse one, two, and three. Assuming you can agree what MES means. Well, 

Erik: I was gonna ask you, 'cause you, you said production system before, not MES.

I was gonna ask you why. MES. It's been an interesting road for MES. It had a good run. 

Natan: Yeah, 

Erik: had a good run. But the first time we have a conversation with anybody about MES, the first thing we need to do is say, great, what do you actually need? What is MES? And then we define what the MES is, which usually boils down to a set of requirements or challenges or problems that need to be solved that have some sort of like overlapping interdependencies.

And we say, okay, great. These are the problems we wanna solve. But they oftentimes don't fit with the standard definition of MES, and I think that you're seeing this reflected in the market as well. I mean, it's pretty interesting that Gartner discontinued the magic quadrant for MES. That was this. They stopped doing it in this year, right?

Natan: Yeah. I mean, they're still covering what remains of the category, but I think what this is reflecting is that you're in a quadrant for a category that is not evolving. I. Yeah. Or that has evolved in a way that has dramatically changed the market. And I think it's about architecture and modern enterprise architectures now more than ever, they need to be open.

They need to have the ability to integrate easily to the rest of the, you know, civilized internet. They can't be like, oh, just let me use my propriety protocol and like, you know, we'll. We'll pass the bill to the system integrator we work with down the street. They're great. They'll take care of you. And you hear Joel, the CIO of, uh, next pharma.

Yeah. And Jim Fox, who was here, who's one of the key leaders in AZs operations, and you hear how they think about composable systems. They really talk about future proofing their operation, having a modern tech stack that actually works with the rest of the investment. The org is made. In finally closing this weird gap that has existed for years between the IT and the ot.

Erik: It's the, I don't know, platform. Ification. Platformization of the category. Yeah. And I tell you what, so I think MES certainly went the way of the platform, but I have a prediction. I don't think it's the last category to go the way of the platform. 

Natan: I guess industrial iot is already, that's done too. 

Erik: Yeah.

That that's like, I don't know, second place or third place, not using 

Natan: different things. 

Erik: Well, I think the point is like, look, it's really hard. Why does the category, or did the category of MES exist? And it's like you couldn't draw a neat boundary around individual use cases and say, this problem needs to be solved and only this problem.

Because if you have a production visibility issue, then you may also have an inventory issue. Or you may also have like quality issue. Quality issue or digital workforce guidance or training. Yeah, or, and on, or. The point is like, it's really hard to draw a neat line around these individual use cases, and if you kind of expand that concept, you can start to put a few together.

But again, MES the problem doesn't start and stop within the scope or surface area of MES. It goes far beyond that. So I think MES is, uh, running its course. I, I actually like the term composable. I think it makes a lot of sense. The idea is not that you start with a fixed and static set of capabilities that.

That's kind of what you got. The idea is that you would continue to grow this continuous transformation. I don't know, I kinda like the buzzword, but the idea is that you would continue to adapt and have a more agile solution for your shop floor while expanding into other use cases that, dare I say, may exist in other categories.

Natan: And you know the word agility and remaining agile. I think that's a really good topic. 'cause at the end of a season, beginning of the season, I guess we do all sorts of predictions and what's gonna happen and all that kind of stuff. And we're not so 

Erik: bad though. Typically I get nervous when I'm on camera or on record making predictions, but we're at least accountable every year we make our predictions and every year we go say, how did we do the next year?

This 

Natan: year was pretty good. It was. It was pretty good. I think a lot of stuff is coming together, but. You know, this year has been kind of crazy. It's been kind of just a little bit, it's just here and there. It's just like, well, only this year, not the year before. The year before that. Not before, just specifically right now.

And not like what happened before with the This Global Pandemic thing. This one Black Swan one only. Only one. I think it's like a whole flock of black swans flying in formation, dumping on different places in the planet. Like the last few years have been a little uniformly. They've been interesting. Yeah, they've been interesting.

And this, what, what did we have? We had like global pandemic, supply chain disruption. Remember 

Erik: when that ship got stuck in the, uh, Suez Canal? In the Suez Canal for like a month? Yeah. Trade wars. Real wars. But surely, surely next year is gonna be smooth sailing, right? 

Natan: Of course, I mean, the black swans 

Erik: only happen once in a generation, so we should be good for the next five or six generations.

Natan: I think we're getting to the state of, uh, habitation to randomness, so nobody cares anymore. Yeah. It's like they just assume next week there will be some news that changes everything again. But we really happens is that people have, um. Hard time planning. What we're hearing is like people are ready to make like tough decisions and doing this and doing that, but which way to go.

We're, we're ready to decide, but, but where should we go? Well, but 

Erik: I think that's the key point, right? One of the shifts that I've seen is like people aren't saying, let me wait and see, wait for the dust to settle and then I'll start my planning. They're increasingly planning with this kind of volatility in mind.

They're saying, who knows what tomorrow holds. But that informs our strategy, how we think about our IT architectures, how we think about the digital solutions we deploy in our shop floor. And increasingly we're seeing. What people want is to orient towards adaptability. So come what may. They need to have flexibility, they need to have adaptability, and that's how you can work your way through these kinds of crazy times, which is a 

Natan: great way to summarize our episode here and to put out one important prediction on the board.

Let's hear it that because the world is not gonna get less complex, what organizations really need. Is to remain adaptable and agile. Yeah. So they can invest in their most important asset that is so scarce at the end of the day in operation, which is their people. Mm-hmm. And give them the tools to do the work such that they can equip the company that they're working for to deal with the next flock of blocks once and whatever it may bring.

And that in turn, embracing composability. And we kind of called it. The next year is the year of the composable operation, as opposed to, you know, if you just have the architecture, 

Erik: a category bending term. Yeah. Yeah. But I think it's good. Right? But the point is that reorients not from the perspective of the vendors in the space, but reorients towards the challenges that the operations is dealing with and how they're gonna deal with these challenges and, and what's the technology, what's their gonna be, their strategy to employ technology to be able to handle whatever comes next.

Natan: Yeah. And we will be here and test this prediction. So Eric, I have 

Erik: one prediction. We'll do this again. Augmented ops. We will do Augmented ops again. We'll do it again next year 

Natan: and we're gonna come back with new episodes in the fall. Alright. Alright. Back to operations then. Alright. Alright. Thanks Eric.

Announcer: Thank you for listening to the Augmented Ops podcast from Tulip Interfaces. We hope you found this week's episode informative and inspiring. You can find the show on LinkedIn and YouTube. Or at Tulip dot co slash podcast. If you enjoyed this episode, please leave us a rating or review on iTunes or wherever you listen to your podcasts.

Until next time.