Choosing the Right Path: Greenboard Controllers or COTS Controllers?
Once upon a time OEMs only had one approach to planning and commissioning a build project and nowhere in that approach was there a multiple choice option for controller selection. You had to design and develop your own “green board” based on your technological requirements.
To be sure, this approach has its advantages. For example: a proprietary, custom designed controller will be tightly focused on the project’s exact requirements. However, it has its disadvantages too and over the past few years the horizons have broadened and now OEMs can choose between designing their own controllers or adopting commercial-off-the-shelf (COTS) controllers from an automation vendor like Siemens Industry, Inc.
Since controllers have become the brains of almost every technical product, from manufacturing equipment to office equipment, commercial products and entertainment goods, picking the right controller is a critical decision that can have significant impact on future development, support, time to market and total cost of ownership.
“It’s a nice problem to have,” says Bob Nelson, a marketing manager in the automation business at Siemens Industry, Inc. “OEM’s can choose the approach to controller selection that works best for them. In the past they didn’t have that flexibility.”
Naturally, as an automation vendor, Nelson would prefer it if designers went with a COTS approach in most circumstances, however numerous independent studies support his view, including: Custom Controller or COTS? Step-by-step guide to making the right choice, by Dedham, Mass.-based industry analyst firm ARC Advisory Group which outlines a five step guideline to help OEM’s select the right path to take as they develop customer solutions.
In this paper, ARC Advisory Group outlines a five step approach to COTS vs. Green Board decision to help companies determine which option is appropriate for them.
Step 1: Assess and Compare Features
Each option has its advantages and disadvantages so it’s critical to do a thorough examination of the features each option delivers and assess how it may help the OEM deliver what its customer wants.
Custom controllers:
- Are purchased at a lower hardware cost
- Are designed for a specific purpose
- Usually include only the features and I/O points required for the task
- Incorporate no unused capabilities
- Are small in size
- Protect the OEM’s investment because a custom design is not easily altered
COTS controllers:
- Provide a variety of I/O expansion options
- Require no board level component engineering
- Use industry standard programming languages that provide scalable and reusable code
- Include all applicable agency approvals (UL, CE, CSA, etc.)
- Are small enough and low cost enough to be used in places where they were once thought to be impractical or not economical
According to ARC, the key takeaways from this comparison are how the COTS controller eliminates custom design work, greatly reducing the time and cost associated with design and engineering and enabling the OEM to bring products to market more quickly.
OEMs should also consider how easy it will be to make design changes or system modifications, whether or not I/O capacity can be added beyond the initial design specifications and what flexibility a custom controller offers for changing the supply voltage or I/O signal specifications.
Says ARC, “Offering variations can be difficult (for proprietary controllers). The more flexible [COTS controller], however, allows with little or no design effort or cost for I/O points to be added or removed, signal types (voltage, amperage) to be changed, or specialty features to be added to its modular design. Responding to a request for a software change is also quicker and easier with a [COTS controller].”
Step Two: Analyze all the costs
One of the primary perceived advantages of green boards is their low cost of entry. However, the total cost of ownership (TCO) includes many factors beyond the initial purchase cost, some of which may not be immediately obvious. These variable costs drive up the TCO associated with green board controllers, often making them much more expensive than COTS controllers.
These variable costs include:
- The cost of design and engineering
- The cost of component obsolescence
- The cost of purchasing overhead
- The cost of certification
- The cost of connectivity
- The cost of maintenance/support throughout the product’s lifecycle
“Typically, a [COTS controlller] supplier absorbs the costs of engineering and support efforts such as component compatibility testing, agency approvals and future obsolescence of board level components, which reduces variable costs,” says ARC. “As a result, when [COTS controllers] are viewed in terms of their total life cycle cost, they are becoming the controller of choice in more and more cases.”
Note: For a supporting life cycle cost analysis spreadsheet that compares custom controllers and COTS controllers, visit the Siemens Industry, Inc. Web site at www.sea.siemens.com/microPLC.
“A lot of that PLM cost is a variable cost,” adds Nelson. “OEM’s simply don’t have the volume to drive down those costs. So going with the custom designed controllers costs them money and it defocuses them from where their chief value-add lies; which is in the process and the technology of the machine or control they deliver.”
Step Three: Consider the impact of advanced technologies
As the pressure mounts on many end users to increase production while reducing downtime and waste, many OEMs are embracing advanced technologies such as product life cycle management (PLM) and digital manufacturing (DM) to optimize their businesses and to help their customers achieve their goals. These tools can have a significant impact on the decision-making process. COTS controllers often enable early adopters to make better use of these tools to capture real costs and reduce engineering overhead. It is more difficult to accomplish the same thing with green boards/custom controllers because they typically use non-standard hardware and software.
As a result, there has been a significant increase in the number of COTS controllers used by OEMs. According to recent research findings by the ARC Advisory Group, shipments of COTS controllers to OEMs increased from about $3 billion in 2003 to more than $4.5 billion in 2007.
Step Four: See the global picture
No decision, even one that may seem to be highly operational, should be made in a vacuum. The global marketplace isn’t becoming any less competitive so getting products to market as quickly as possible translates directly into sales and market position. Another key factor at work in the global marketplace that matters at the controller level includes rapidly changing end user requirements leading to shorter product lifecycles. As a result, many OEMs are preferring COTS controllers because they don’t have to invest the up-front R&D time up required by green boards.
Step five: Making an informed decision
According to ARC, OEMs should base their COTS controller vs. Greenboard decisions on two primary factors:
- Achieving lowest TCO
- The need to produce multiple products that are able to respond to changing market demands
“To be sure, there are instances where a proprietary approach is the right approach to use,” says Nelson. “However, in a large number of instances a COTS solution delivers all of the needed functionality with a lower total life-cycle cost.
“When you look at what an OEM is trying to do…they are designing a machine and delivering a solution for the customer. Their value lies in what they do. Their expertise does not lie in designing control products. While the proprietary approach has some attractive elements from an initial cost point…the cost of that controller has to be looked at in context with the total cost of ownership. I think a lot of people tend not to factor in the long term intangible costs.”
ARC offers OEMs struggling with this decision the following set of recommendations:
- Set internal key performance indicators (KPIs) that promote productivity, flexibility and agility throughout their operations
- Ensure that their engineering is investing in core product competencies instead of designing custom components when commercial solutions are available
- Focus on product improvements that generate higher productivity at a lower cost, evaluating and comparing the impact of COTS controllers and custom controllers on design and support time, product size and total cost
- When all these factors have been scrutinized and evaluated, application needs and TCO must, in the end, guide an OEM’s controller selection decisions
- If the correct choice is to go with COTS controllers, OEMs should select an automation supplier that has a track record proven to support products throughout their life cycle
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