Breakfast Keynote. Mike Holtkamp Digitalization Account Executive Siemens
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1 Breakfast Keynote Mike Holtkamp Digitalization Account Executive Siemens
2 Industry 4.0 Leading the Next Industrial Revolution
3 Page 6
4 The Founders of Sears Richard Sears Alvah Roebuck Born 12/3/1863 and 1/4/1864 Founded Sears & Roebuck 1886 Page 7
5 Innovation Transforming Commerce in the U.S. Time was right for mail order merchandise: Homestead Act of 1862: westward expansion followed growth of railroads Postal system permitted the classification of mail order publications as aids in the dissemination of knowledge entitling the catalogue to a postal rate of 1 cent per pound Rural Free Delivery in 1896 made distribution economical Rapid pace of innovations: Advertised lowest prices, best values Added Spring and Fall editions and color sections Offered cloth bound books as a cheap alternative to hardbound Continual expansion to wide variety of goods Page 8
6 The Old Chicago Main Post Office Page 9
7 The end of an era... The last Sears Catalogue was released in 1993 Page 10
8 J.P. Jorgenson Born Jan 12, 1964 in Albuquerque, NM Graduated Phi Beta Kappa from Princeton Cadabra / Cadaver Makeitso.com AARD.com Awake.com Browse.com Bookmall.com Relentless.com Page 11
9 Wall Street Journal Thursday Aug 25, 2017 Page 12
10 The Old Chicago Main Post Office Page 13
11 Chicago Bids on New Amazon Headquarters Page 14
12 New business models in the internet age are disrupting complete markets to e-book to streaming From bookstore From record store to marketplace to ride sharing From Yellow Pages From taxi Page 15
13 Mike Holtkamp Digital Enterprise Account Executive 35 years in Power, Automation & Digitalization (Westinghouse, Siemens) BSME (WVU), MA Bus. (SUNY), Add l Training Smart Mfg. (MIT) Work with small to large manufacturers & customers of all types SIEMENS 377,000 employees, ~$100B in annual revenues, Founded in 1847, business in 200 countries globally $26M+ spent per day in R&D $10B+ in last 10 years in acquisitions for Industry 4.0 Page 16
14 Achieving Digitalization / Business Transformation To survive disruption and thrive in the digital era, incumbents need to become digital enterprises, rethinking every element of their business. Source: 2016 World Economic Forum Page 17
15 Digital is the main reason just over half of the companies on the Fortune 500 have disappeared since the year Pierre Nanterme CEO Accenture The Innovator s Dilemma - Christensen Page 18
16 Disrupt or Be Disrupted! Page 19
17 Understanding Industry 4.0 What Does It Mean? The term was introduced by the German government and Siemens at Hannover Messe in INFORMATION TECH OPERATION TECH Convergence Physical World Digital World Industry 4.0 is a name for the current trend of automation & data exchange in manufacturing. It includes cyber-physical systems, the Internet of things, cloud computing and cognitive computing. Page 20
18 The First Industrial Revolution First Industrial Revolution Second Industrial Revolution Third Industrial Revolution Fourth Industrial Revolution Use of mechanical production with the help of water & steam power. Introduction of division of labor & mass production using electrical energy. Use of control systems and IT begin to automate the factory floor. Introduction of cyber physical twins, 3D printing, cloud computing. First mechanical loom, 1784 Assembly line slaughterhouses, 1870 Siemens launches the SIMATIC name 1958, first PLC Page 21
19 The Second Industrial Revolution First Industrial Revolution Second Industrial Revolution Third Industrial Revolution Fourth Industrial Revolution Use of mechanical production with the help of water & steam power. Introduction of division of labor & mass production using electrical energy. Use of control systems and IT begin to automate the factory floor. Introduction of cyber physical twins, 3D printing, cloud computing. First mechanical loom, 1784 Assembly line slaughterhouses, 1870 Siemens launches the SIMATIC name 1958, first PLC Page 22
20 The Third Industrial Revolution First Industrial Revolution Second Industrial Revolution Third Industrial Revolution Fourth Industrial Revolution Use of mechanical production with the help of water & steam power. Introduction of division of labor & mass production using electrical energy. Use of control systems and IT begin to automate the factory floor. Introduction of cyber physical twins, 3D printing, cloud computing. First mechanical loom, 1784 Assembly line slaughterhouses, 1870 Siemens launches the SIMATIC name 1958, first PLC Page 23
21 The Fourth Industrial Revolution Industry 4.0 First Industrial Revolution Second Industrial Revolution Third Industrial Revolution Fourth Industrial Revolution Use of mechanical production with the help of water & steam power. Introduction of division of labor & mass production using electrical energy. Use of control systems and IT begin to automate the factory floor. Introduction of cyber physical twins, 3D printing, cloud computing. First mechanical loom, 1784 Assembly line slaughterhouses, 1870 Siemens launches the SIMATIC name 1958, first PLC Page 24
22 Understanding Industry 4.0 What Are the Drivers? Companies are using more complex, worldwide supply chains and data networks in their operations. Physical connectivity is being replaced with digital links many of which are stored in the cloud. Greater international collaboration is possible. Using cloud-based software, any staff member in any geographical location can contribute to a design. Cheap data storage and transfer will increase the decentralization and flexibility for businesses. 800 times as much data for less than 2 tenths of one percent of the price! 1990 Page 25
23 Understanding Industry 4.0 What Are the Impacts? Companies must now compete on a global scale; cannot rely on their physical location to win business. Companies must focus on meeting ever-changing consumer demands requiring flexible manufacturing and production flexible. Industry 4.0 requires changing the workforce and increasing the ease of access to services. Page 26
24 Our customers have essential requirements throughout the manufacturing industry Speed Flexibility Quality Efficiency Security Page 27
25 Five Megatrends shaping our world Demographic change World population 1, in bn Developing countries Urbanization Contribution to global GDP growth, , in % Cities >10mn Industrial 65+ countries Growing and aging population Exponential growth of connected devices... and digital data 6 Global warming and weather extremes Digital transformation Connected devices 5, in bn ZB ZB = Zettabytes = 10 9 Terabytes 40.0 ZB Climate change Annual mean temperature variations (in C) Nationalization Imports vs. GDP 4) -19% +14% 5mn 10mn 2mn 5mn 38% Other cities and rural areas 150k 2mn Cities as main driver of GDP growth Trend to bring investment back FDIs total 5) ) UN World Population Prospects (2012) 2) Met Office Hadley Centre observations (2014) 3) McKinsey Global Institute Cityscope (2011) 4) UNCTAD: Import Flow merchandise: Total trade and share / GDP 5) : UN Conference on Trade and Development: FDI inward flow ; 2015: UNCTAD Global Investment Trends Monitor No.22 6) Cisco: The Internet of Everything (2013) 7) IDC: The Digital Universe (2012) Page 28
26 Understanding the Needs of Modern Manufacturing What Do The Customers Say We are aggressively reducing costs and reallocating capital to the products and markets with the highest potential for growth and returns. As we improve the efficiency and focus of our business for today, we also are accelerating our efforts to be a leader in the smart vehicles and mobility services of tomorrow. We took steps to strengthen our capabilities in areas such as data analytics, avionics, actuation and additive manufacturing high-value work that benefits from our internal expertise and global scale. Competition is intensifying and consumers expectations are shifting. Likewise, digital disruption is reshaping how consumers connect and communicate, buy products, and engage with companies. We are anticipating these changes and responding to them with a healthy sense of urgency, setting an agile course for the future. Page 29
27 Understanding the Needs of Modern Manufacturing Terms You Will Hear AGV IIoT MES Real Time Capability Lean Manufacturing Predictive Analytics Virtualization If all you have is a hammer, everything looks like a nail." Abraham Maslow Big Data Page 30 AM
28 changes everything Digitalization Page 31
29 Change is Inevitable, Success is Not Digital Darwinism is a significant threat More than 50% of companies that attempt to move to a digital model will fail. Page 32 Source: John Chambers, McKinsey & Company Report March 2016
30 Why will these Companies Fail? Digital is not central to their corporate strategy They perceive digital only as a tool for incremental efficiency gains Companies invest in the latest point solutions or siloed digital technologies and fail to work horizontally ( localized optimization ) They do not drive the necessary cultural changes for success Product design Production planning Production engineering Production execution Services Page 33
31 Technological forces transforming industry Changing the way products come to life Changing the way products are realized Changing the way products evolve Generative design Intelligent models Intelligent automation Additive manufacturing Cloud ecosystems Knowledge automation System of systems Advanced robotics Big data analytics Page 34
32 Manufacturers must embrace the technologies and transform their business into a digital enterprise Ideation Realization Utilization Generative design Intelligent models Intelligent automation Additive manufacturing Cloud ecosystems Knowledge automation Systems of systems Advanced robotics Big data analytics Page 35
33 Digital Twin MindSphere feed back insights to continuously optimize product and production Digital Twin of the product Digital Twin of the production Digital Twin of the performance Page 36
34 Digital Twin MindSphere One integrated data model Digital Twin of the product Digital Twin of the production Digital Twin of the performance Page 37
35 We embrace digitalization in our own operations Speed Flexibility Quality 1 per second % We produce more than 1 million products per month one per second. A growing portfolio of 1300 products digitally designed for 60,000 different customers. Quality level of or 10.5 defects per million. Page 38
36 With Siemens integrated technologies, Maserati reduced development time while increasing production output 30% shorter development time More than 70,000 combinations available 3 times more cars produced Page 39
37 MachineSense Power Analyzer Component Analyzer Power Analyzer measures and tracks: Avg. 3-phase voltage Avg. 3-phase current Power factor Active working power Power waveforms Cumulative active energy Ground faults Power quality harmonic distortion for current & voltage All values needed for energy optimization Reports phase imbalance Machine on-time Measures and predicts: Filter condition Vacuum analytics Oil condition Bearing condition Pump Health Vacuum Pump Analyzer Measures and predicts: Filter condition Vacuum analytics Oil condition Bearing condition Pump Health Page 40
38 . Air Curtain App Control of air curtains from a smartphone. Allows users to: Program their Berner Air Curtain Change settings Monitor usage Page 41
39 Digitalization Can Introduce Uncertainty How can I create business value from digital technologies? Do I have the right business partner to guide and support my decisions? How do I develop the new skills needed to lead the digital transformation? Page 42 How will digitalization impact my business? CUSTOMER Will new digital players go after my core business? How can I create new Business Models from digitalization? How can I create thrive in Industry 4.0? SUPPLIER Where is my roadmap to lead my product development? How can I align my business for things like successful co-creation? How can I move from a product based model to a value based model?
40 How Can Industry 4.0 Help Me? Some things we know New business models can create new revenue streams Digitalization addresses many challenges of today ( and the ones you haven't thought of yet ) Elevates you among suppliers Industry 4.0 is not going away Page 43
41 Industry 4.0 Next Steps - General Keep an open mind Talk to others Accept that it is a journey Embrace the Culture of Change Evolution not Revolution Understand the Road Map The journey We re of a thousand lost but miles we re begins making with good but time a single step. Lao Tzu Page 44
42 Thank you.
43 Closing Remarks Mike Holtkamp Digitalization Account Executive Siemens
44 Industry 4.0 Leading the Next Industrial Revolution
45 changes everything Digitalization Page 260
46 Industry 4.0 Next Steps - Specific Identify current system capabilities & gaps Make sure you fully understand and can document the current business processes Leverage proven critical analysis methodologies to conduct workshops and perform benchmarking Develop a full digital architecture and desired data flow Define future investments based upon the road map Prioritize investment Page 261
47 Now is the time to realize the Digital Enterprise and your opportunity to lead the next Industrial Revolution Page 262
48 Thank you.
49 Page 264
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