Ep. 273 - How to Build a Systems Integration Company: Positioning, Money and Procurement

Most conversations about starting a systems integrator skip the parts that sink people. Dave and Vlad spend this one on insurance, licenses and procurement.After a month of founder interviews, Dave and Vlad close the series with their own experience. Vlad started at plant level with Procter and Gamble and Kraft Heinz, deciding how outside integrators would execute, before crossing over to work for an integrator across food and beverage and CPG packaging. Dave came from aviation and aerospace through a German machine builder and a distributor, then ran a small integration company doing MES, OEE and track and trace. Both reached the same conclusion. Integration starts after the requirements are written, so you quote to a spec and a budget, build the thing, and real handover rarely follows.Blame does not sit in one place. Vlad puts it plainly: people resent a solution that has not actually solved something for them. But end users say they do not need training and ask for the lowest number, and training is the first line cut. Dave counters that if a customer wants five dashboards on an ugly six inch HMI that has sat in the plant for fifteen years, that is the job. Vlad's answer is that your time is finite, and a year on work you cannot show anyone positions you as the person who does that work.The technical centerpiece is a migration that sounds nearly free. Moving from RSView 32 to FactoryTalk View gets justified because conversion tools exist. Then come the undocumented Visual Basic scripts written around tag limits on old controllers, which no conversion tool touches. Then the PLCs will not support the new terminals and servers, so the controllers go too. Then the networks underneath, often Data Highway Plus. Then servers, remote racks, IO, sensors and drives. Vlad argues these decisions get made by people who never price the second and third order effects.An integration firm is a service firm, billing time and materials or a fixed fee, with a markup on hardware and software. Vlad quotes roughly $200 a month for $2 million of liability coverage, a capable laptop, and software licenses reaching tens of thousands of dollars per seat without preferential pricing, usually several across PLC and HMI programming. Then procurement, which nobody warns new integrators about. Dave has cleared it in twenty minutes and has waited seven months, three or four of those with lawyers arguing over a master service agreement.Vlad closes on complexity. Industrial equipment no longer ships with a full schematic and a six dollar replacement sensor, so ramp up time climbs while the population who understand electrical, mechanical and process together shrinks as the best of them retire. Dave sees it from the other side. Entry now takes an LLC, a laptop and a phone, and he expects private equity to keep buying medium and large integrators over the next five years.Timestamps0:00 Introduction10:30 Vlad and Dave's paths into integration18:40 Why integrators start after the requirements are written23:40 Who is to blame when training gets cut30:00 RSView 32 migrations and the hidden cascade36:40 Choosing where you sit on the integration spectrum42:20 How integrators make money and what it costs to start48:40 Procurement and getting paid53:10 The future of integration and rising complexity1:01:40 Career advice1:13:20 The industrial app marketplaceReferencesThe Little Red Book of Selling by Jeffrey Gitomer: https://www.amazon.com/Little-Red-Book-Selling-Principles/dp/0743572548Influence, New and Expanded by Robert Cialdini: https://www.amazon.com/Influence-New-Expanded-Psychology-Persuasion/dp/0062937650About Your HostsVladimir Romanov is a co-host of The Manufacturing Hub Podcast and the founder of Joltek, an independent manufacturing and industrial automation consulting firm specializing in modernization strategy, digital transformation, and workforce development. Joltek works with manufacturers and investors to de-risk modernization and build the internal capability to sustain results.Connect with Vlad: https://www.linkedin.com/in/vladromanov/Want to go deeper? Vlad and the team at Joltek have covered related topics here:System Integrators: https://www.joltek.com/blog/system-integratorsRockwell PLC Lifecycle and Migration Guide: https://www.joltek.com/blog/rockwell-plc-lifecycle-migration-guideDave Griffith is a co-host of The Manufacturing Hub Podcast and founder of Capelin Solutions, an industrial automation firm helping manufacturers adopt smart manufacturing technology. He brings 15 years of experience in industrial automation and digital transformation.Connect with Dave: https://www.linkedin.com/in/davegriffith23/Subscribe to Manufacturing Hub: https://www.manufacturinghub.liveLinkedIn: https://www.linkedin.com/company/manufacturing-hub-networkYouTube: https://www.youtube.com/@ManufacturingHub

Most people ask how to start a systems integrator. Rich Kuechenmeister has effectively built one five times, and the lesson is that the parent business decides what you become.Rich is owner and partner at Fishbone Technical Services. Before that he built automation groups inside a semiconductor equipment OEM, an automation components manufacturer, a products distributor, and a custom machine builder where he stood up a UL 508A panel shop from nothing. Each of those businesses sold something different, and that changed the engineering. At a machine builder the machine is the dog and the controls are the tail. At a distributor you build toolkits so somebody else can build the solution, handcuffed to the lines you carry. Rich argues that constraint is what made him good, because a single vendor solution is easy while four component areas from four vendors is where real integration lives.His definition of a control systems integrator stays traditional. SCADA and below, field instrumentation through PLC and HMI, bridging a little into MES. Fishbone works line control, process control on boilers, pumps and valves, and material handling where suppliers ship a motor and a few sensors and nothing more.The business advice is specific. He would rather have one $100,000 project than ten $10,000 projects, because that is one project management cycle instead of ten. He cautions against mixing maintenance work and capital projects without a plan, since context switching between a vision system callout and a pump control program burns budget on both. Dave adds the pattern he keeps seeing: come in at the bottom and you get saved in the phone as the maintenance guy, never the capital project guy. Rich hires on desire, attitude and aptitude, and admits he was once the bottleneck himself.Looking ahead, he expects acquisitions to keep rolling up integrators and leaving a void underneath, since a twenty person firm will not get out of bed for the projects a five person firm lived on. On AI he is practical. He turned three day estimates into eight estimates in a single day, but insists code writing is a subset of the job. He is also still doing a PLC-5 conversion and a DeviceNet upgrade.About Rich KuechenmeisterRich Kuechenmeister is owner and partner at Fishbone Technical Services, a nationwide remote technical services company he co-founded in 2021 with business partner Robert Summers. Fishbone is based in Texas and covers plant engineering and control systems integration from field instrumentation through PLC, HMI and SCADA, with some MES. Rich began his career in the United States Navy working on radars, servos and guidance systems, then spent three decades in industrial automation building engineering groups before starting Fishbone.https://fishbonetechnical.comTimestamps0:00 Introduction2:20 Inside Fishbone Technical Services5:20 From the Navy to OEMs, distributors and machine builders9:00 Becoming unafraid and starting a company15:40 What a control systems integrator actually is20:40 How the parent business shapes the work31:40 Filling the sales hopper and qualifying projects36:40 Maintenance work versus capital projects43:00 Hiring for desire, attitude and aptitude48:20 Letting go of the client relationship56:20 Distributors, acquisitions and the void they leave1:04:40 AI, estimating and reverse engineering PLC codeReferencesPrOTect IT All by Aaron Crow: https://www.amazon.com/PrOTect-All-Plain-Spoken-Cybersecurity-Protecting/dp/B0HBM3F4XSISA/IEC 62443 Series of Standards: https://www.isa.org/standards-and-publications/isa-standards/isa-iec-62443-series-of-standardsAbout Your HostsVladimir Romanov is a co-host of The Manufacturing Hub Podcast and the founder of Joltek, an independent manufacturing and industrial automation consulting firm specializing in modernization strategy, digital transformation, and workforce development. Joltek works with manufacturers and investors to de-risk modernization and build the internal capability to sustain results.Connect with Vlad: https://www.linkedin.com/in/vladromanov/Want to go deeper? Vlad and the team at Joltek have covered related topics here:System Integrators: https://www.joltek.com/blog/system-integratorsEngineer to Entrepreneur in Manufacturing Technology: https://www.joltek.com/blog/engineer-entrepreneur-technology-business-manufacturingDave Griffith is a co-host of The Manufacturing Hub Podcast and founder of Capelin Solutions, an industrial automation firm helping manufacturers adopt smart manufacturing technology. He brings 15 years of experience in industrial automation and digital transformation.Connect with Dave: https://www.linkedin.com/in/davegriffith23/Subscribe to Manufacturing Hub: https://www.manufacturinghub.liveLinkedIn: https://www.linkedin.com/company/manufacturing-hub-networkYouTube: https://www.youtube.com/@ManufacturingHub

Oil and gas automation runs on royalty accounting as much as process control. Dustin Symes explains how that shapes every SCADA decision JPI Solutions makes.Canadian oil and gas is structured differently than most assume. In the US mineral rights usually sit with individuals, so custody transfer draws a hard line between upstream and midstream. In Canada the provinces hold most rights, so a producer can gather 100 wells into one plant and sell to a pipeline company there. That lands on the automation: much of the SCADA data collection exists to answer who is paying whom and how much royalty is owed. Once a well is drilled, automation might find 5 to 10 percent off nameplate, so the work protects a long production tail rather than chasing throughput.Mining behaves nothing like it. Thinner margins, $100 million capital projects, an hour long elevator ride down, underground space running 20 miles across. Those are small cities: control systems cover substations, air monitoring and lighting as well as conveyors and pumps. Mining clients want programmers on site rather than remote, and they buy for continuity: a major vendor PLC paired with their DCS, meant to last 20 years. Horizontal drilling has rescaled oil and gas, from one well and a dozen sensors to a 32 well pad carrying 300 IO, pushing designs toward redundant PLCs and ring networks. The genuinely new technology lands on the data layer, where MQTT and report by exception are displacing polled Modbus.Dustin set two gates before his first hire: enough cash banked to make that person whole for a month or two, and enough overload to have work worth delegating. He hired out of the instrumentation program at SAIT rather than a 15 year instrument mechanic. When he weighed taking on partners, dozens of people advised against it. He brought in Dan and Brent Lawther anyway in 2018, went from five people that spring to ten by the fall, and says JPI would not exist without them.His hardest won lesson is unglamorous. Communication is the only consistent complaint he has ever had from a customer. Nobody complains about the code. They complain that nobody told them it was finished. On AI, JPI is decompiling Rockwell files into shutdown keys and landing 85 to 90 percent of the way there on a good prompt, and running log analysis across FactoryTalk directory, HMI and historian logs to find real root causes. He expects PLC code to become text so it can be version controlled like software, and customers to treat that as baseline within five years.About Dustin SymesDustin Symes is Chief Technology Officer at JPI Solutions, a Calgary based systems integrator serving oil and gas and mining clients across North America from four offices in Alberta, BC and Saskatchewan. A Red Seal journeyman electrician who moved into automation, he founded JPI in 2017. JPI covers process control from the sensor to the HMI, then up into SCADA and corporate data.https://www.jpisolutions.caTimestamps0:00 Introduction5:50 Why he started JPI Solutions10:50 Oil and gas primer: upstream, midstream, downstream12:50 What makes mining automation different16:10 Where JPI sits in the automation stack28:30 Bigger well pads, redundant PLCs and MQTT41:20 Bringing on partners when nobody recommended it51:10 Communication as the only consistent complaint1:04:40 The future of integration, AI and knowledge graphsReferencesRadical Candor by Kim Scott: https://www.amazon.com/Radical-Candor-Kick-Ass-Without-Humanity/dp/1250103509Creativity, Inc. by Ed Catmull: https://www.amazon.com/Creativity-Inc-Overcoming-Unseen-Inspiration/dp/0812993012ThredCloud: https://www.thredcloud.comAbout Your HostsVladimir Romanov is a co-host of The Manufacturing Hub Podcast and the founder of Joltek, an independent manufacturing and industrial automation consulting firm specializing in modernization strategy, digital transformation, and workforce development. Joltek works with manufacturers and investors to de-risk modernization and build the internal capability to sustain results.Connect with Vlad: https://www.linkedin.com/in/vladromanov/Want to go deeper? Vlad and the team at Joltek have covered related topics here:System Integrators: https://www.joltek.com/blog/system-integratorsPLC Scan Cycles and SCADA Polling: https://www.joltek.com/blog/plc-scan-cycles-polling-scada-systems-dataDave Griffith is a co-host of The Manufacturing Hub Podcast and founder of Capelin Solutions, an industrial automation firm helping manufacturers adopt smart manufacturing technology. He brings 15 years of experience in industrial automation and digital transformation.Connect with Dave: https://www.linkedin.com/in/davegriffith23/Subscribe to Manufacturing Hub: https://www.manufacturinghub.liveLinkedIn: https://www.linkedin.com/company/manufacturing-hub-networkYouTube: https://www.youtube.com/@ManufacturingHub

Most people who start a systems integrator expect to keep doing the engineering. Dylan DuFresne explains why that stops being true inside two years.Ask ten people what a systems integrator is and you get ten answers, so Dylan DuFresne starts from first principles: a third party that connects systems which used to sit isolated. The market then splits in two. One is the generalist who has seen a hundred platforms across a thousand facilities and knows how they behave together. The other is the specialist who lives inside one or two stacks. If you know what you are building, hire the specialist. If you are still deciding, the generalist saves you money.Abelara exists because of a pattern Dylan hit repeatedly during more than a decade inside other integrators. By the time a client calls, the platform is chosen, the budget is set, and the outcome is locked in, even when that platform cannot deliver it. His answer was to move upstream into architecture, change management, and business process work with VPs and C suite sponsors. His first question is always why. Why this site, why this machine, why this platform, and what outcome is attached to it.With no clear scope of work, Abelara declines to bid or sells the consulting engagement that produces one. When scope is fuzzy but workable he prices it all in and writes explicit exclusions and assumptions up front. His test before a proposal is one question: what does done look like. A striking number of buyers cannot answer it. He also corrects an instinct: a $200 sensor may beat a $30,000 camera technically and still be the wrong call, because the expensive option is a known quantity and carries less risk.Scaling gets treated as line balancing applied to a company. Find the bottleneck, find the gap in skills or availability, and staff it. Each hire moves the constraint somewhere new, and the hardest part is emotional: letting go of work you enjoy and are good at. On AI, Dylan predicts integration goes back to being integration. A generation of integrators drifted into custom coding, with companies of 400 and 500 people building MES and SCADA stacks from scratch, and he expects code generation to strip that work away. Writing a tool that pulls PLC data to the cloud is easy. Running it reliably and securely 24/7 for a year is not.About Dylan DuFresneDylan DuFresne is co founder and lead architect at Abelara, a manufacturing transformation firm that works with plants as coach, consultant, and integrator. He spent more than a decade inside systems integrators covering robotics, PLCs, SCADA, HMI, recipe management, and ERP integration before starting Abelara with co founder Glenn. He also wrote The Phantom Pallet, a manufacturing fable about data, trust, and transformation.https://abelara.comTimestamps0:00 Introduction4:30 What a systems integrator actually is9:00 Why Dylan and Glenn started Abelara14:00 Following the customer or picking platforms first20:00 Consulting versus integration work25:00 Why integrators get brought in too late32:00 The $30,000 camera and business trade offs36:30 Scope of work and what does done look like43:20 Handing projects to the team and subcontractors52:10 First hires, bottlenecks, and forecasting57:40 AI and the future of systems integration1:05:40 Predictions, career advice, and booksReferencesThe Phantom Pallet by Dylan DuFresne: https://www.amazon.com/Phantom-Pallet-Manufacturing-Fable-Transformation-ebook/dp/B0GGYCK5PRImpro: Improvisation and the Theatre by Keith Johnstone: https://www.amazon.com/Impro-Improvisation-Theatre-Keith-Johnstone/dp/041346430XAbout Your HostsVladimir Romanov is a co-host of The Manufacturing Hub Podcast and the founder of Joltek, an independent manufacturing and industrial automation consulting firm specializing in modernization strategy, digital transformation, and workforce development. Joltek works with manufacturers and investors to de-risk modernization and build the internal capability to sustain results.Connect with Vlad: https://www.linkedin.com/in/vladromanov/Want to go deeper? Vlad and the team at Joltek have covered related topics here:System Integrators: https://www.joltek.com/blog/system-integratorsConsulting, Upskilling, and Systems Integration: https://www.joltek.com/blog/humble-beginnings-consulting-upskilling-systems-integrationDave Griffith is a co-host of The Manufacturing Hub Podcast and founder of Capelin Solutions, an industrial automation firm helping manufacturers adopt smart manufacturing technology. He brings 15 years of experience in industrial automation and digital transformation.Connect with Dave: https://www.linkedin.com/in/davegriffith23/Subscribe to Manufacturing Hub: https://www.manufacturinghub.liveLinkedIn: https://www.linkedin.com/company/manufacturing-hub-networkYouTube: https://www.youtube.com/@ManufacturingHub

Siemens says a small manufacturer can start production optimization for $2,000 a year. Martin Valkysers and Flemming Kongsberg explain what that buys you.Most digital transformation advice assumes a budget and an engineering bench most plants do not have. Flemming Kongsberg, who runs the SMB focus inside the Siemens CTO organization, discards the usual revenue and headcount definitions: an SMB is any manufacturer without the skills to absorb a complex digital change, and that includes some very large companies. He describes one customer running 900 devices across 17 locations where 90 percent of the machines are 30 years or older with zero connectivity. Siemens research also found 40 percent of SMB customers have no IT department.Martin Valkysers frames Siemens Xcelerator as the open digital business platform tying hardware, software, data, and services together, with more than 600 partners today. The SMB starter package is where that becomes concrete. Instead of asking a plant with no IT staff to assemble something from hundreds of apps, Siemens curated roughly 10 to 12 into one bundle covering device connectivity, Performance Insight dashboards for OEE and quality, and a slice of Mendix. A partner installed it in a lab in 24 minutes on an ordinary Windows machine, against the roughly 60 hours a traditional Industrial Edge deployment takes. It is $2,000 per year for three machines with the first three months free, and PROFINET, Ethernet/IP, and the standard protocols are supported, so competitor PLCs connect too.The most useful argument here has nothing to do with buying anything. Flemming makes the case that reaching for AI before you own your data is a losing move, because a model built on information everyone else can reach produces no strategic advantage. You also do not need AI to build a Pareto chart of where your quality losses sit. Martin adds the discipline that gets skipped most: be clear about the problem before you pick the tool.About the GuestsMartin Valkysers is Head of US Market Launch and Growth for Siemens Xcelerator, Siemens' open digital business platform spanning industrial, building, grid, and manufacturing sectors. He has been with Siemens roughly 12 years, previously leading a US operations consulting team focused on lean manufacturing.Flemming Kongsberg leads Global Technology Partners at Siemens Digital Industries Software and runs the company's SMB focus in the US. Before Siemens he spent nearly eight years at Amazon Web Services building partner infrastructure and strategic ISV alliances.Timestamps0:00 Introduction2:20 Martin Valkysers on his path to Xcelerator4:20 Flemming Kongsberg from AWS to Siemens SMB7:10 Four challenges facing manufacturers13:40 Why data comes before AI18:00 What Siemens Xcelerator actually is22:30 Partner ecosystem: build, service, sell31:40 Inside the SMB starter package35:50 What the package costs38:20 A 24 minute install and non Siemens PLCs45:50 Redefining what counts as an SMB53:50 The future of industrial marketplacesReferencesGetting Started with Production Optimization: https://www.siemens.com/en-us/products/industrial-edge/production-optimization-get-started/Operational Efficiency Pack for Small Manufacturers: https://news.siemens.com/en-us/siemens-small-manufacturers-operational-efficiency-pack/This episode is sponsored bySiemens is a global technology company operating across industrial automation, digital software, smart infrastructure, and mobility. Siemens Xcelerator is its open digital business platform and marketplace.https://www.siemens.comAbout Your HostsVladimir Romanov is a co-host of The Manufacturing Hub Podcast and the founder of Joltek, an independent manufacturing and industrial automation consulting firm specializing in modernization strategy, digital transformation, and workforce development. Joltek works with manufacturers and investors to de-risk modernization and build the internal capability to sustain results.Connect with Vlad: https://www.linkedin.com/in/vladromanov/Want to go deeper? Vlad and the team at Joltek have covered related topics here:Digital Transformation in Manufacturing: https://www.joltek.com/blog/digital-transformation-in-manufacturingEdge Computing and the AI Value of Manufacturing Data: https://www.joltek.com/blog/edge-computing-ai-value-manufacturing-dataDave Griffith is a co-host of The Manufacturing Hub Podcast and founder of Capelin Solutions, an industrial automation firm helping manufacturers adopt smart manufacturing technology. He brings 15 years of experience in industrial automation and digital transformation.Connect with Dave: https://www.linkedin.com/in/davegriffith23/Subscribe to Manufacturing Hub: https://www.manufacturinghub.liveLinkedIn: https://www.linkedin.com/company/manufacturing-hub-networkYouTube: https://www.youtube.com/@ManufacturingHub

David Nichols of Loupe explains what actually changed in automation engineering this year, and why control retrofits just got far cheaper.Nearly twenty years into building high performance controls, David Nichols is blunt about what AI did to his business: what used to take six weeks now takes two, and his team ships roughly five times more software per sprint. An engineer dropped the raw documentation from a failing robotic cell into a folder, asked Claude for a state diagram, and got a reverse engineered flow chart in thirty minutes that beat anything the customer had. The error recovery gap causing the downtime was visible right there in the chart. A SASE member handed a model a hundred page ethernet specification and got working code for every function, plus tests, on the first try. That was a six week project. It took a day.The implication is the sharpest part of the conversation. Software rewrites used to be the dumbest thing an engineer could propose, because software was expensive and full of unknowns. That logic has inverted. If a rewrite takes a week and produces better documentation, better tests, and better coverage, then brownfield modernization stops being a risk calculation. His words: open season on old controllers. For an industry sitting on Windows 7 machines and undocumented cells one PC failure away from stopping a line, that is a different economic picture entirely.Vlad walks David through the full project lifecycle, and the answers stay practical. Discovery becomes a context gathering exercise where interview transcripts and a drawer full of legacy PDFs turn into control diagrams and proposals in days. Development becomes worth treating as a real software engineering project, because source control, digital twins, and automated testing are exactly what these models are fluent in. David is equally direct about platforms: the bottleneck in automation was never technical, it is cultural. His analogy is a shop that insists on carburetors because that is what the technicians know. The close tackles the chat's harder questions, including what is left of a software moat once building software is trivial. His book pick is Richard Rhodes and The Making of the Atomic Bomb.About David NicholsDavid Nichols is co-founder of Loupe, a West Coast automation engineering and systems integration company he started in 2007. Loupe does high performance controls work across aerospace, semiconductors, and metal cutting, built largely on the B&R Industrial Automation platform. He also founded SASE, the Society of Automation Software Engineers, a free community of roughly two thousand engineers. This is his fourth appearance on Manufacturing Hub, following episodes 29, 53, and 127.https://loupe.teamTimestamps0:00 Introduction2:45 Loupe, 20 years of controls, and the SASE community8:40 Carburetors in industrial automation: culture, not technology11:20 The ChatGPT moment versus the Claude Code moment20:20 Inside an integrator: six week sprints become two21:30 Reverse engineering a robotic cell in 30 minutes26:10 A 100 page ethernet spec turned into working code in a day27:50 Does this change who gets to be a builder40:40 AI across the project lifecycle from discovery to handoff49:00 How to actually get started, and what to prompt53:20 If software is no longer a moat, what is57:50 Predict the future, career advice, and the book pickReferencesSASE: https://sase.spaceClaude: https://claude.aiClaude Code: https://claude.com/claude-codeSendCutSend: https://sendcutsend.comAcquired Podcast: https://www.acquired.fmAbout Your HostsVladimir Romanov is a co-host of The Manufacturing Hub Podcast and the founder of Joltek, an independent manufacturing and industrial automation consulting firm specializing in modernization strategy, digital transformation, and workforce development. Joltek works with manufacturers and investors to de-risk modernization and build the internal capability to sustain results.Connect with Vlad: https://www.linkedin.com/in/vladromanov/Want to go deeper? Vlad and the team at Joltek have covered related topics here:Control System Modernization Strategy: https://www.joltek.com/blog/control-system-modernization-strategyEdge Computing and AI Value from Manufacturing Data: https://www.joltek.com/blog/edge-computing-ai-value-manufacturing-dataDave Griffith is a co-host of The Manufacturing Hub Podcast and founder of Capelin Solutions, an industrial automation firm helping manufacturers adopt smart manufacturing technology. He brings 15 years of experience in industrial automation and digital transformation.Connect with Dave: https://www.linkedin.com/in/davegriffith23/Subscribe to Manufacturing Hub: https://www.manufacturinghub.liveLinkedIn: https://www.linkedin.com/company/manufacturing-hub-networkYouTube: https://www.youtube.com/@ManufacturingHub

Deglobalization is rewriting where factories get built, and Ujjwal Kumar of Siemens explains what has to change on the plant floor before reshoring actually works.For thirty years the manufacturing playbook was labor arbitrage. Move high volume, low mix production to wherever disciplined labor was cheapest, then ship it back. Ujjwal Kumar, President of Automation for Siemens Digital Industries in the Americas, argues that model has quietly stopped making sense. Demand has fragmented into high mix, lower volume, regionally specific production, and the factories in Suzhou running on robots and autonomous systems no longer carry a cost advantage over the same operation in Chicago. When the labor content collapses, the business case for distance collapses with it. That single shift explains more about the current reshoring wave than any tariff headline.The trigger was not one event. Supply chain disruption after COVID proved that geographic proximity to supply was a profitability advantage, not a nice to have. Then came the political shock: vaccine access turned out to be governed by country of citizenship rather than global distribution, and leaders across every region started sorting industries into a folder marked critical. That folder now holds semiconductors, steel, power generation, defense, space, and life sciences. Ujjwal walks through where the money is actually landing right now, including AI data centers in remote locations that demand autonomous and remote operations, power generation across fossil, renewable, nuclear, and hydro, and a level of greenfield life sciences investment in the United States he has not seen in decades. The life sciences point is the sharpest one in the episode. Drug manufacturing left as mass produced batch operations and is returning as cell and gene therapy, personalized medicine, and precision biologics, which means lot sizes of one and R&D sitting physically next to production. The design it here, build it there model taught in business schools simply does not survive that.About Ujjwal KumarUjjwal Kumar is President of Automation for Siemens Digital Industries in the Americas. A mechanical engineer by training with an MBA from the Michigan Ross School of Business, he began his career at General Motors in Detroit and went on to spend ten years at GE and seven years at Honeywell Process Solutions before leading Teradyne Robotics, one of the largest physical AI based robotics platforms. He oversees the Siemens automation portfolio spanning discrete, process, and intralogistics automation, and he continues to mentor MBA students at Michigan Ross.Timestamps0:00 Introduction2:00 Career path from General Motors to Siemens6:10 What deglobalization means for manufacturing9:00 COVID, vaccine quotas, and the reshoring trigger13:05 Labor arbitrage versus automation arbitrage15:50 Attracting the next generation of factory workers19:35 Why semiconductor reshoring will take years23:00 Tribal knowledge and the documentation problem26:00 Where the investment is going right now32:30 Adaptive manufacturing and the AI hype question35:30 Platforms, ecosystems, and Siemens Xcelerator43:20 Careers, AI, and advice for engineersReferencesSiemens Xcelerator Marketplace: https://xcelerator.siemens.com/global/en.htmlThis episode is sponsored bySiemens is a technology company focused on industry, infrastructure, transport, and healthcare, and it supplies industrial automation hardware and industrial software to manufacturers worldwide. Its Digital Industries business covers discrete automation, process automation, intralogistics, and the Siemens Xcelerator platform.https://www.siemens.comAbout Your HostsVladimir Romanov is a co-host of The Manufacturing Hub Podcast and the founder of Joltek, an independent manufacturing and industrial automation consulting firm specializing in modernization strategy, digital transformation, and workforce development. Joltek works with manufacturers and investors to de-risk modernization and build the internal capability to sustain results.Connect with Vlad: https://www.linkedin.com/in/vladromanov/Want to go deeper? Vlad and the team at Joltek have covered related topics here:Understanding Supply Chains: https://www.joltek.com/blog/understanding-supply-chainsManufacturing Challenges with New Machinery and Plants: https://www.joltek.com/blog/manufacturing-challenges-new-machinery-plantDave Griffith is a co-host of The Manufacturing Hub Podcast and founder of Capelin Solutions, an industrial automation firm helping manufacturers adopt smart manufacturing technology. He brings 15 years of experience in industrial automation and digital transformation.Connect with Dave: https://www.linkedin.com/in/davegriffith23/Subscribe to Manufacturing Hub: https://www.manufacturinghub.liveLinkedIn: https://www.linkedin.com/company/manufacturing-hub-networkYouTube: https://www.youtube.com/@ManufacturingHub

After several weeks away from the podcast, Dave Griffith and Vladimir Romanov return to Manufacturing Hub to unpack their experiences at Automate 2026 and discuss what the event revealed about the current state of industrial automation.Automate showcased an enormous range of robotics, industrial AI, machine vision, software, cloud connectivity, and emerging automation technology. However, some of the most revealing conversations were not about futuristic factories. They were about PLC 5 migrations, aging SLC systems, obsolete PanelView terminals, industrial networks, basic data collection, and how platforms such as Ignition actually connect to plant floor equipment.Vlad shares what he learned from demonstrating a complete packaging line environment built around a CompactLogix PLC, an industrial computer, Ignition, and production performance data. The demonstration was designed to show how manufacturers can use OEE, downtime information, and machine states to identify production bottlenecks and determine where capital investment could deliver the greatest return. Instead, many attendees wanted to understand the underlying architecture, where Ignition runs, how it connects to PLCs, what protocols are required, and whether it can replace traditional HMI and SCADA platforms.Dave discusses his experience inside the Ignition ecosystem booth, the FactoryStack cloud demonstration, the advantages of MQTT in a difficult trade show network environment, and his Automate panel on software defined automation and the factory of the future. He also introduces Elephant, an industrial log analysis and contextualization tool being developed to help users identify meaningful patterns across Ignition gateways, reduce system noise, compare facilities, and diagnose intermittent problems.The conversation then moves across the industrial automation stack. Dave and Vlad examine virtual PLCs from Siemens, Phoenix Contact, and other vendors, including where software based control may provide value and where it may add unnecessary organizational complexity. They discuss AI generated PLC code, the limitations of translating functional specifications into reliable control applications, and why tools that produce 80 or 90 percent of an automation solution still require experienced engineers to validate the final result.They also explore AI assisted HMI and SCADA development, Ignition 8.3, MCP servers, high performance HMI design, and the risks of providing AI agents with uncontrolled access to production systems. At the MES layer, they question whether manufacturers should build custom applications through vibe coding or focus instead on creating clean, contextualized, well governed data that can support many future applications.The central conclusion is that AI tools, virtual controllers, cloud platforms, and dynamically generated applications will continue to improve. However, manufacturers still need reliable controls, secure networks, maintainable architectures, experienced people, and ownership of their operational data. The companies that establish those foundations today will have the greatest freedom to adopt whatever technologies emerge next.Dave and Vlad also preview the 2026 Ignition Community Conference in Sacramento, upcoming Manufacturing Hub conversations, new demonstrations, and several projects the community will see throughout the remainder of the year.Join us for a detailed and candid discussion about Automate 2026, Ignition, industrial AI, virtual PLCs, HMI and SCADA development, MES, MQTT, data architecture, and what manufacturers should prioritize next.

Automate 2026 lands in Chicago next week, and Dave and Vlad break down how to work the show floor, where to network, and what to expect from their live booth demos.Automate is the largest automation trade show in North America, and a four day event rewards preparation. Dave and Vlad share tactics refined over five years of attending together. The floor opens at 10:00 AM on Monday, and registration lines have swung from a five minute wait to nearly two hours, so arriving early matters. Monday morning and Thursday are the quietest days to reach specific vendors, while Tuesday and Wednesday draw the heaviest crowds. The hosts also favor the official show app over a paper map for finding booths and session rooms across multiple halls.The real value of a show like Automate often lives in the networking. Dave points to the A3 networking event on Monday, a ticket of roughly 45 dollars, and the Manufacturing Champions happy hour on Tuesday organized by Chris Luckey and Jake Hall. Vlad's advice is structural: build a checklist before you arrive. He researches each company, finds the booth number, and tracks every connection in a spreadsheet so the week becomes a series of deliberate meetings instead of aimless wandering. For anyone with ten or more booths on their list, setting up meetings in advance is the highest leverage move you can make.The centerpiece of the conversation is the live demo Vlad built for the Teguar booth. It pairs a Rockwell CompactLogix PLC with an Ignition gateway running on a Teguar industrial PC, and it simulates a food and beverage packaging line with five assets: filler, capper, labeler, case packer, and palletizer. The line overview screen shows real machine states including faulted, starved, backed up, and running, and the whole point is to make the bottleneck visible. When the case packer needs six bottles from the labeler but the labeler cannot keep pace, you watch the downstream asset flip between starved and running in real time. It is a practical illustration of why line balancing and constraint analysis drive real ROI on a production floor.Under the hood the stack is modern. The Teguar IPC runs Ubuntu with Portainer managing containers for Ignition 8.3, Ignition 8.1, and a MariaDB database for alarm history. Ignition 8.3 ships new drivers for Rockwell, Siemens, Mitsubishi, and Omron controllers along with OPC and MQTT, and each asset carries ten randomized faults written in both Ignition and PLC logic. Vlad built it for everyone from engineers to the decision makers running SCADA and MES projects. Dave and Vlad will also shoot content at the Siemens booth on Tuesday and the Horner Automation booth on Wednesday, and Dave is moderating a Wednesday session on software defined automation and the factory of the future.Timestamps0:00 Welcome and Automate 2026 preview1:50 First timer tips and arriving early for registration3:10 Networking events worth attending: A3 and Manufacturing Champions4:40 Building a trade show checklist to maximize your time7:00 Manufacturing Hub at the Siemens and Horner booths9:50 Vlad's live production line demo at the Teguar booth15:40 The line overview screen and five packaging assets17:30 Fault handling and finding the bottleneck20:10 Inside the stack: Ubuntu, Portainer, Ignition, MariaDB23:50 Random fault simulation and PLC driver options27:00 Who should come see the demo29:40 Vendors Vlad is tracking and closing thoughtsReferencesAutomate 2026: https://www.automate.orgIgnition by Inductive Automation: https://inductiveautomation.comHorner Automation: https://hornerautomation.comAbout Your HostsVladimir Romanov is a co-host of The Manufacturing Hub Podcast and the founder of Joltek, an independent manufacturing and industrial automation consulting firm specializing in modernization strategy, digital transformation, and workforce development. Joltek works with manufacturers and investors to de-risk modernization and build the internal capability to sustain results.Connect with Vlad: https://www.linkedin.com/in/vladromanov/Want to go deeper? Vlad and the team at Joltek have covered related topics here:Connecting an Allen Bradley PLC to Ignition: https://www.joltek.com/blog/connecting-allen-bradley-plc-ignitionManufacturing Line Speed Optimization: https://www.joltek.com/case-study/manufacturing-line-speed-optimizationDave Griffith is a co-host of The Manufacturing Hub Podcast and founder of Capelin Solutions, an industrial automation firm helping manufacturers adopt smart manufacturing technology. He brings 15 years of experience in industrial automation and digital transformation.Connect with Dave: https://www.linkedin.com/in/davegriffith23/Subscribe to Manufacturing Hub: https://www.manufacturinghub.liveLinkedIn: https://www.linkedin.com/company/manufacturing-hub-networkYouTube: https://www.youtube.com/@ManufacturingHub

AI can finally write back to the plant floor, but only if you can trust it. Chris Stevens and Annemarie Breu of Siemens explain how orchestration makes that safe.Industrial AI has reached a turning point. Manufacturers can already collect data, contextualize it, and surface insights, but the hardest step has always been turning insight into action on real control equipment. Chris Stevens and Annemarie Breu of Siemens explain how an orchestration layer finally closes that loop. Annemarie frames the tension clearly. Automation depends on determinism, while large language models are probabilistic by design, so the goal is to bring that discipline into AI and validate any suggestion before it changes a set point.Most executive conversations start with return on investment, and two forces are making the case easier to prove. The workforce shortage has stretched the expected payback window from 18 months toward 36 months, and when a line cannot run for lack of people every idle minute costs thousands of dollars. The other driver is overall equipment effectiveness, since most plants run near 70 percent OEE and even a fraction of a percent of gain can justify a project. Energy is a standout case too. A BorgWarner sustainability effort used a digital twin to flatten demand peaks and reportedly paid for itself in under six months, even as data center growth pushes electricity demand higher through 2040.On trust and safety, Annemarie borrows a principle from industrial safety. Just as fail safe IO modules rely on two channel evaluation, every AI suggestion is validated against a state machine, a workflow, or a physics based digital twin before the orchestration layer passes it to a controller. With virtual commissioning and soft PLCs a change can be tested virtually, approved by a human in the loop, and only then written to control, an approach PepsiCo and NVIDIA echoed at CES when they called the digital twin a must have. Making AI real, the pair argue, comes down to discipline, clear scope, acceptance criteria, and focused 90 day challenges, plus the change management and user experience that drive adoption. Their favorite quick win is preventive maintenance driven by machine data, which both BorgWarner and Maersk tied to millions in savings.About Chris StevensChris Stevens is President of US Automation at Siemens, where he leads a roughly one billion dollar business spanning software, services, and hardware. He brings more than 25 years across Siemens Digital Industries, starting in the field selling assembly and test equipment, moving into the software and digital twin world, and returning to automation to bring the hardware and software sides of the business together.About Annemarie BreuAnnemarie Breu is a senior technology leader at Siemens Digital Industries focused on automation software deployment and customer technology partnerships in the US. She began at Siemens about a decade ago as a systems engineer in the San Francisco Bay Area, working with consumer electronics manufacturers on virtual commissioning and digital twins. Her work today centers on bringing the determinism and reliability of automation into industrial AI.Timestamps0:00 Introduction and Automate 2026 preview2:50 Meet Chris Stevens and Annemarie Breu9:30 The first AI question is always ROI14:00 Workforce gaps and OEE drive the business case19:30 Energy management and the data center demand surge23:20 Data, sensors, and contextualization requirements28:00 Guardrails, hallucinations, and two channel validation32:40 The digital twin and the human in the loop37:40 How partners and integrators move up the stack45:30 What it takes to make AI real on the floor55:50 Preventive maintenance as a quick win59:40 Predictions, career advice, and book picksAbout Your HostsVladimir Romanov is a co-host of The Manufacturing Hub Podcast and the founder of Joltek, an independent manufacturing and industrial automation consulting firm specializing in modernization strategy, digital transformation, and workforce development. Joltek works with manufacturers and investors to de-risk modernization and build the internal capability to sustain results.Connect with Vlad: https://www.linkedin.com/in/vladromanov/Want to go deeper? Vlad and the team at Joltek have covered related topics here:Edge Computing and the Value of AI in Manufacturing Data: https://www.joltek.com/blog/edge-computing-ai-value-manufacturing-dataIT and OT Architecture Integration: https://www.joltek.com/services/service-details-it-ot-architecture-integrationDave Griffith is a co-host of The Manufacturing Hub Podcast and founder of Capelin Solutions, an industrial automation firm helping manufacturers adopt smart manufacturing technology. He brings 15 years of experience in industrial automation and digital transformation.Connect with Dave: https://www.linkedin.com/in/davegriffith23/Subscribe to Manufacturing Hub: https://www.manufacturinghub.liveLinkedIn: https://www.linkedin.com/company/manufacturing-hub-networkYouTube: https://www.youtube.com/@ManufacturingHub