2015 12-01 digital transformation in industrial automation sanitized

Thorsten Schröer Director Electronics Industry Europe [email protected]

December 2015 Düsseldorf, Germany

Digitale Transformation Status Quo – Beispiele - Ausblick

2

Thorsten Schröer Director IBM Europe Electronics Industry Work Experience

IBM Electronics Industry IBM Business Consulting Ryder Supply Chain Solutions Fraunhofer Institute Dortmund

Education:

Dipl. Ing. Maschinenbau, TU Dortmund Masters Industrial Engineering, Atlanta

Privat: Married, 2 sons Sports, BvB, Tennis

Digitale Transformation Warum?

“Otherwise others which are leading in the digital area will take the industrial production away from us.”

German Chancellor Angela Merkel calls for a faster merger of Industry and Digitization.

Mai 2015

IDC November 2015

Digitale Transformation Was ist das…?

https://www.youtube.com/watch?v=Zu65kiRfnnQ

Digitalisierung Gewinner & Verlierer

CxOs expect industry convergence to have the biggest impact on their business

Total CEO CFO CHRO CIO CMO COO

70%

60%

50%

40%

30%

20%

10%

0%

Industry convergence

The “anywhere” workplace

Rising cyber risk

The redistribution of consumer purchasing power

The sustainability imperative

Alternative finance and financing mechanisms

The sharing economy

Top trends to impact business (in 3 to 5 years)

IBM Institute of Business Value 2015

1943: "I think there is a world market for maybe five computers.”

Thomas J. Watson, IBM CEO (1914-1956)

Digitalisierung

Industrie 4.0 / IoT Cloud Mobile

Analytics Social

Security “One more Thing”

Industrie 4.0

© 2015 IBM Corporation 21

•  Versatile production process

•  Higher specialization towards specific client needs

•  Increased competitiveness across the value chain

•  Ability to create new markets by establishing new services and business models

Industry 4.0 Benefits

Whatisthe4thIndustrialRevolu3on?

creating new opportunities to achieve levels of productivity and specialization not previously possible – enabling innovation and differentiation.

Source: Recommendations for implementing the strategic initiative INDUSTRIE 4.0 - Final report of the Industrie 4.0 Working Group

© 2015 IBM Corporation 22

http://www.plattform-i40.de/I40/Navigation/Karte/SiteGlobals/Forms/Formulare/karte-anwendungsbeispiele-formular.html;jsessionid=045B67EE1A24367530C8185B1826AA62?oneOfTheseWords=Suchbegriff+eingeben

Siemens 23 Bosch 18 SAP 15 ABB 10 Telekom 9 Festo 4 Trumpf 1

23

SmartFactoryKL Demonstrator 2015

Fast setup and change of manufacturing lines

Lotsize 1 with +ROI

+ROI in high labour country

Provides and organizes the partner network www.smartfactory-kl.de

I4.0 – Smart Factory

Industrie 4.0 – Personal Observations

§  Industry 4.0 is omnipresent everywhere

§  Cloud/Analytics/Mobile is accepted

§  Security & Data ownership the concern

§  Focus is on Smart Factory- Business Model Innovation lacks progression

§  AsiaPac invests in Greenfield Manufacturing

§  Contract Manufacturers become turnkey provider and manufacturing consultants

In Summary – The Manufacturing To-Do list § Develop IoT / I4.0 Strategy

§  Factory

§  Product/Engineering

§  Supply Chain

§ Think security & data ownership § Look for partners / shape the ecosystem §  Implement cloud & analytics § Build digital skills § Pilot, learn, pilot again – become “AGILE”

3D Print

3 key software enabled trends will drive towards a software defined supply chain in the future.

•  Click to edit Master text styles –  Second level

•  Third level –  Fourth level

»  Fifth level

Click to edit Master title style

Digital Customer Experience B/S/H/

© 2014 IBM Corporation

FULL REPORT & MODEL NOW AVAILABLE ONLINE AND ON YOUR MOBILE DEVICE

58% of the total product value of a washing machine will be 3D Printable in ten years – impact service business!!!

T0 Traditional T0 Digital T1 Digital T2 Digital$0

$50

$100

$150

$200

$250

$300

$350

$400$368 $368

$336

$243

Washing Machine Unit Manufacturing Cost Curve

Mobile

2005

2013

Mobile in Manufacturing

33

MobileManufacturingWorkforceManagement

gettyimage

IBM Transparent Supply Chain designed for an App

Cloud

© 2015 IBM Corporation IBM Institute for Business Value 38

Why Cloud? Cloud adoption helped electronics industry to innovate, increase demand and improve process efficiencies

Clients have realized significant benefits as a result of cloud adoption during the last two years

Source: Economist Intelligence Unit Cloud survey commissioned by IBM, unpublished industry data, 2015, Question: 12. What business benefits has your company realized as a result of using cloud technologies during the last two years?, n=100

61,0% 52,0%

51,0% 49,0%

48,0% 43,0%

40,0% 30,0%

17,0%

Speed delivery of new IT services and capabilities Reduce costs and/or liabilities

Boost customer demand Expand sales channels (eg. web, mobile)

Improve internal business-process efficiency Increase innovation

Speed entry into new markets Improve data access, analysis and utilisation Work with partners and suppliers more easily

© 2015 IBM Corporation IBM Institute for Business Value 39

Why Cloud? Cloud has also delivered significant financial benefits.

Cloud has enabled electronic companies tackle specific business problems and improve financial performance

§  Electronic companies are able to increase their revenues, while drastically reducing their operational expenditure

§  Cloud has also reduced the need for capital investments by eliminating capital expense

Financial gains by cloud implementation 68,0%

61,0%

52,0%

32,0%

21,0%

1,0%

Revenue growth

Operating expense reduction

Operating expense avoidance

Profit growth

Capital expense avoidance

No financial benefits

Source: Economist Intelligence Unit Cloud survey commissioned by IBM, unpublished industry data, 2015, Question: 13. Which of the following financial benefits has your organization realized because of cloud technologies during the last two years?, n=100

1. Merger, Acquisition or Divestiture 2. Unexpected service interruption

3. Building an agile edge 4. Step change in IT Productivity

5. Creating a private cloud 6. Launch of an innovation initiative

When Cloud?

Business Model

• Payperusemodel• Clouddriven• Transforma4ontoproviderofmobility• Alwaysconnected-pickup/dropoffindifferentloca4ons• Smartphonebased,uniqueuserexperience,nearreal-4me

Kuka gets paid by the welding point.

gettyimage

Hospital get charged by # of x-rays taken (Managed Service)

gettyimage

Light charged by hours provided (Managed Service)

gettyimage

gettyimage

Big Data & Analytics

12% of all available data is being leveraged today.

80% of all data is unstructured today.

gettyimage

Critical Parts Supply after Social Listening

I4.0 – Analytics – Deployed Control Points

Security


BSI* Lagebericht 2015 – IT Security Report 2015

52

*Bundesamt für Sicherheit in der Informationstechnik


Upcoming: Business goes Mobile

and creates

The trend shifts Business

into Mobile

factors Risk

1.Device risks

2.Content risks

3.Application risks

4.Transaction risks

53 © 2015 IBM Corporation

There is one more thing…

Watson is cognitive computing, analyses structured and unstructured data, is self learning and answering questions posed in natural language.

Digital business + digital intelligence=

The cognitive era

§  Optimize time with support §  Increase First Time Fix §  Optimize Onsite Repair Time §  Less machine downtime

Watson @ IBM Technical Support Service

Watson @ Direct Procurement

iSuppli

Bing - Bloomberg

Supplier info

Industry news

Mfg stock chart

Web news

CAPEX graph

Documents Quotes Contracts

Alternate MPN

Cost vs. Resale

Historical spend

MPN entity details

Watson Explorer

Cloud

Activities Tagging Shared Spaces

Open PO table

1977 When?

https://www.youtube.com/watch?v=mxPWyuiBQ-c

Und nun IT?

Disrupt or be disrupted

IT?

Einige Ideen

Thorsten Schröer Director Electronics Industry Europe [email protected]

December 2015 Düsseldorf, Germany

Digitale Transformation Status Quo – Beispiele- Ausblick