Is Christmas spirit still the North Pole’s greatest asset?

By and Graeme Noseworthy | 9 minute read | December 11, 2019

Nestled at the northernmost point on the planet sits a legendary operation of massive scale. Producing billions of gifts per year, it has primarily relied on Christmas spirit to ensure that every child on Earth has a holiday to remember. But to make all of this happen is no elfin task. It is critical that the hundreds of thousands of pieces of equipment, workshops and one magic sleigh are operating at peak performance.

As we uncovered in our interview with the Chief Happiness Officer (CHO) and Chief Operations Officer (COO) last year, these complex, connected software-driven assets are the key to delivering the most joyful day of the year. To maximize their usage, intelligence has become the North Pole’s greatest asset using insights from data, IoT, and AI.

In last year’s feature, we focused on the health and safety of the equipment behind the manufacturing of these toys. This year we sat down again – with only the finest cocoa and sugar cookies – to discuss three key topics:

  •       How to engineer billions of connected toys at scale
  •       Creating the most enchanting workshop experience
  •       Why arctic hares and musk oxen introduced the need for a remote monitoring solution

Since the CHO and the COO were away at the annual MUG Council (Merry User Group), they had us sit down with Twinkle, the Chief Tinsel Officer (CTO), Noel, the Head of Workshop Planning, and Kris, the Director of Chimney Operations to better understand how the North Pole continues to put data, IoT and AI to work.

Delight is the outcome that matters most

In an operation as complex as this, the primary goal is always to deliver higher-quality toys faster – at lower costs. As a non-profit operation, fueled only by Christmas spirit of the youth it serves, it is important to stretch every positive sentiment to the max. However, these young lads and ladies are not always easily impressed. In an era of limited attention spans and children who can navigate a smart phone before they are 6 months old, toys have become increasingly software-driven, connected and sophisticated. Development of these toys must respond in kind.

Elves examining the 2020 model of the next-gen toy car

How does a CTO with consumers who are not easily impressed always create such delight? Twinkle deploys an AGILE (Always Gifting Incredible Life Experiences) methodology to software development. Whether it is the toys that land under the tree or the software that guides the sleigh through the night to its billions of destinations, agile development means faster software engineering. Twinkle learned about this methodology at last year’s IoT Exchange from a presentation given by one of her peers.  She has since found enormous value in implementation of the engineering lifecycle management solution.

“Informed by AI and letters to Santa, the North Pole has been able to cut software development and delivery time by 37%. If that’s not a Christmas miracle, I don’t know what is!”

Toys are more complex than ever before

As toys have evolved far past the traditional days of wooden pull-ducks, basic stuffed dolls, and pressed tin tanks, delivering them at Christmas scale has become a substantial challenge. But, toys, just like any other complex product, are only as good as the requirements that drive them and the tiny, adorable elf hands that craft them. For Yuletide Engineers to manage the growing complexity of connected knickknacks, they need better visibility into changes, deeper insight into data and shared tools for global distribution.

Operations at the pole form a traditional super-system and today’s systems-of-systems require mechanisms to create versions and variants of holly products while maintaining relationships between the traditional and the new. The CHO’s shared, digital dashboard stores data in a single location from which many different teams can benefit.

Complete traceability all through the year

This approach integrates project stages for complete traceability, starting the day after Christmas, in order to achieve evergreen compliance and become less complicated. All activity and changes in requirements can be viewed by anyone at any time. It shows relationships throughout a project such as circuit boards to R/C cars or batteries to Power Wheels. The documentation is built-in to help manufacturing teams conduct reviews and audits more easily while remaining both holly AND jolly.

“The last thing any of us wants to see is a disappointed look on little Billy or Sally’s face after they open a beautifully wrapped box and the surprise inside doesn’t work to their absolute delight. You see, there’s no amount of milk or cookies that can fuel the magic we need to bring smiles to all the little boys and girls around the world. We have to rely on advanced technology to enable the annual production cycle that we strictly adhere to. During that time, we have very little room for even the smallest errors in our systems, assets, products, and more. We turned to IBM Engineering Lifecycle Facilitator (ELF) for their leading end-to-end, integration and goodwill development solution for complex gift management and cheer engineering.” – Twinkle, North Pole, CTO

Elves are demanding a workshop experience that promotes community and cheer

When you think of the North Pole and the holiday it serves, what comes to mind? Probably singing elves, open-space workshops, festive décor, and plentiful milk and cookies. If you recall from last year, the North Pole is home to many festive facilities, such as:

  •        Toy Workshops
  •        Worker Housing
  •        Reindeer Hangar
  •        Bake Shop
  •        Hoofsmith
  •        Candy Shop
  •        Hat Maker
  •        Post Office
  •        Cocoa Cafes
  •        Sleigh Valet

Each facility is the workspace for an elfin community. Yet, last year, the Head of Workshop Planning realized some alarming trends. Certain workshops were showing decreases in SLEIGH (Singing Loud Eagerly In Great Harmony) measurements. There were also some shops that were over-crowded while others sat under-utilized. This led to an increase in artisan milk and cookies running out in the over-used spaces. It also meant we were spending way too much Christmas spirit, the currency of the North Pole, to power the under-used spaces. The North Pole is not a cheap location to host one of the largest operations in the world. With real estate costs being second only to the cost of homemade cookie delivery, managing those costs is critical. Noel was concerned by these trends and began to do some research on how to improve in these areas.

Millieni-elves are shaping the future of the workshop experience

What he found gave him pause. No matter where they spent their days tinkering, some commonalities arose in what elves value in their workspace. In a recent study that interviewed 500 Millenni-elves (those elves that had been in the workforce for only 1000 years or less), some commonalities rang true.

Optimizing workshop utiilization

Shops that rank high in elf engagement are 21% more productive and have 37% less absenteeism. They also have up to 59% less turnover than their less-engaged counterparts.

There is nothing more disheartening to see than a disengaged elf. It’s just not in their nature so we knew we had to fix it ASAAP (as soon as angelically possible.)

In addition to this, elves spend their entire lives training for this job. It is their livelihood. “The only kind of turnover we want to see in the North Pole is of the apple variety!

Spaces matter for elf engagement

Noel took it upon himself to attend IoT Exchange in Orlando last April. While it gave him the opportunity to visit surrounding theme parks to do market research on his ideal customer, his biggest takeaways were around the technologies he could deploy to improve how his spaces were used. He wanted to make sure elves had the workshop setups that would ensure improvements in spirit and productivity.

Last year they had invested in additional Candy Cane Lane conference rooms and reduced the number of Snowball Bungalows. This had allowed them to save on square footage without needing to lease another building. However, they could see now that this shift simply wasn’t enough to increase elf engagement. Having rooms available was great, but not if it wasn’t easy to book one.

Jolly the Elf explains: “I had an important presentation to give last week about why we needed to enhance security measures on our AI-powered dolls after the release of the latest killer doll movie gave some parents a fright. It took me 15 minutes to find a free room and by then it was time for the bi-hourly cookie break and everyone had their next meeting to go to. Now I need to reschedule and it was a waste of everyone’s Christmas spirit.”

This experience is not uncommon for many elves. Nearly 70% of elves report that finding a place to meet is one of the biggest wastes of Christmas spirit. The average elf wastes 15 mins per day. Multiply this number by 400,000 elves and you’ve got a productivity issue!

While the North Pole has been using a facilities management solution for several years to manage maintenance and lease accounting, this expansion into space management and workplace experience has really helped them address their elf productivity issues.

In fact, in the most recent poll, SLEIGH scores were up 716% and turnover was at an all-time low. Noel is very excited to report these findings at IoT Exchange 2020!

Monitoring equipment near and far

Monitoring the operations of equipment at the North Pole is no small feat. A few things to consider are the extremely cold climate, unpredictable fluctuations on the naughty/nice list, and the global scale of operations. Think of what it takes to ensure that 2 billion chimneys are safe and operable for the CHO to scoot down each year! This can only be done using a state-of-the-art asset monitoring solution. Configurable dashboards and alerts mean that any change in chimney soot density is immediately detected and the nearest remote team is sent to restore to appropriate levels.

Ensuring equipment stays up and running with asset monitoring

On the Pole itself, they can immediately detect when there’s an overgrowth of ice chunks on the equipment that keeps the shops running.

“We have many Musk Oxen and Arctic Hares above the 85th parallel. When it gets cold, they huddle together for warmth. There was one time a few years back that we got a record-breaking cold streak and they needed to go to extreme measures to stay warm. They huddled together near one of our generators because it was emitting heat. But that then caused the generator to overheat. We had no monitoring equipment on it so it went down and caused 14 workshops to go dark for days. So much lost productivity and such a mess! It still makes my cheeks so red to think about!” – Kris, Director of Operations, North Pole

Thankfully now the North Pole has an asset monitoring solution that notifies them when temperatures and conditions are at risk for a similar situation.

We’ve equipped all 7,000 of our power generators with sensors and are notified as soon as anything goes out of range. We send a crew out to clear the hares, oxen and/or ice chunks so there’s no more interruption to production. We’ve estimated that it has saved us thousands of hours of lost elfpower and many disappointed children. Can’t put a price on that, no sir.”

Bring joy to the world with IoT and AI

The North Pole has aggressive targets to meet and the goal every year is 100% joyful children. Any deviation from that is unacceptable to the elves that dedicate their lives to the toy craft. Joy is the goal and solutions from Watson IoT help the North Pole reach their targets every year. Infusing intelligence into everything from buildings to toys to equipment produces the results they require.

How can you bring more joy to the world? Come share your story and network with your peers at IoT Exchange 2020!