5 Financial justifications of DCS upgrades

New generations of control systems have brought us many new opportunities and capabilities compared to the previous generations. Nevertheless, it is still a big step, both financial and operational, to replace, upgrade or migrate the current control system and implement their successor. Both the on-site engineers and the financial decision makers need to be persuaded of the necessity and benefits of implementing a new generation control system. Many articles mention the cons of not upgrading/migration the current DCS, such as reaching the end of  its natural lifespan, unavailability and/or increasing costs of spare parts and the lack of knowledge of the old (obsolete) DCS due to retirements. These all result in the same problems; the risk of production loss and unplanned shutdowns. While these are legit reasons to consider and justify a DCS upgrade/migration, it does not often lead to persuading the financial decision makers. For them the increasing risk of operating the old (obsolete) DCS and the exact timing of a possible failure (shutdown) is undefinable.

The systems works today, so why would it stop working tomorrow.”

This day-by-day approach is justified by the fact that the risk of the system stating to fail the next day is very low, followed by a low urgency to upgrade the current system in the near future. Considering the costs you might say this is solid reasoning, from a financial view. Another view is that this approach is very short-sighted. In order to create opportunities with a new control system, it is only logical to accept the required investment to fund this control system. In terms of ROI (return of investment) these opportunities may well lead to less costs in the future (maintenance, spare parts, etc.).

Opportunities of implementing a new generation control system
An article by ABB defines several opportunities of new generation control systems that contribute to the ROI that companies are seeking when considering a control system upgrade, replacement or migration.

  • Increased return on net assets (RONA).
  • Reduced maintenance costs as a result of improved maintenance options, practices and procedures.
  • Increased effectiveness resulting in a decrease of operational errors and an increase in decision making.
  • Visibility of plant floor data for accurate and timely decision making.
  • Improved cyber protection compared to older generations of systems.

Source: http://www.controlglobal.com/assets/knowledge_centers/abb/assets/3BSE079517-en-System-800xA-DCS-Upgrades-Article.pdf