Smarter Manufacturing with the Internet of Things (IoT)

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An approach for how to leverage digital capabilities to transform Processes, Organizations, Strategy, and/or Business Models within their organization or across their value chain

What does digitization mean to manufacturing companies? 

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Why now? Technology is having an exponential impact, It’s what’s different with this wave of Transformation- Things are possible now that were not before: Mobile engagement, analytics, cloud

delivery- Technology is PART of the value organizations can deliver, as opposed to just an

enabler- More scalability in transformation today because of the pervasiveness of technology

– nearly everything is connected (or will be)

“Smart, connected products are changing how value is created for customer, how companies compete, and the boundaries of

competition itself.”

What does digitization mean to connected products?

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Reduction in Defects

49%Defect rate down from

4.9% to 2.5%

Reduced Downtime

48%Unplanned

downtime down from 11%

to 5.8%

OEE Improvement

16%Average OEE

improved from

74% to 86%

Improved Inventory

35%Inventory

turns increased from

14 to 19

Reduction in Energy Use

18%Annual energy cost down from

$8.4Mto $6.9M

The Real Economic Value is Immense

New Product Introduction

23%New product introduction cycle time

reduced from 15 to 11

Source: SCM World/Cisco “Smart Manufacturing & the Internet of Things 2015” survey of 400 Manufacturing Business Line Executives and Plant Managers across 17 vertical industries.

What specific business benefits does it provide?

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Where and how do you start?To Capture Value, Manufacturers Must Build Foundational Capabilities of a Digitized Business

Build a Hyperaware Organization

Ensure quality and uptimeRespond to customers and end users in real time

Achieve unprecedented standards of excellence

Make InformedDecisions

Transform data into insightGenerate value by gaining insights from dataEx: KM & collaboration platforms, dashboards, analytics

Execute Fast

Enable innovation and business-model changeBreak down silos between IT/OT and engineering/services (ex: preventative maintenance) Outpace the competition

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Where and how do you start? Digital Transformation Capabilities Required

Analyze / Distribute

Personalize/ Predict

Interact / Collaborate

- Real time accessibility and Visibility into info and insights.

In order to be able to deliver on Digital Business Transformation, organizations need to excel at a number of capabilities including:

- Providing context and recommended action

- The ability of people/customers/value chain to collaborate, communicate, and make better decisions

Capture/ Collect

- Organizations need to become Hyperaware by increasing their ability to sense, monitor, and identify

Act thru Automation - Automate where possible (closed loop)

SECU

RITY

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Off-Line Factory Communication, Collaboration, Data

Strategies & Platforms

Connected Factory

Analytics & Big DataVirtualization & Compute

Connected Machines Factory Collaboration

Location-based Services

Connected Enterprise

Value Chain Collaboration

Design & Service Synchronization

Value Chain Orchestration

Digital Manufacturing Maturity Model

+ 16% OEE

- 35% Inventory

+ 23%

NPI

- 49% Defects

- 48% Downtim

e

Capture/Collect

Analyze/DistributePersonalize/Predict

Action (Automate & Collaborate)

Hyper- Aware

Informed

Decision

Making

Fast Executio

n

Where and how do you start?

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Start w/clear understanding of business strategies across the entire value chainBrainstorm areas of improvement use-cases, develop hypothesis statements w/business

impactsPrioritize and group common use-cases with clear, measureable business outcomesDevelop phased, balanced approach (people, process, technology)

Where and how do you start?

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Client Examples

“We have cases where downtime is costing over $20,000 per minute. The ability to predict service requirements will have a tremendous impact.”

- Rick Schneider – NA CEO FANUC Robotics

https://www.youtube.com/watch?v=DN4duKoNsak

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Complexityinhibits growth

productivity Enterprise Resource Planning Transition

Define capabilitiesfor growth &value capture

Business Architecture

2013 2014

IOE PLATFORM

Breakthrough Value

2012

Collaboration

ApplicationsEnterprise Resource Planning (ERP) System

Data Management

Client Examples – Cisco Supply Chain

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Internet of Things

Edge Computing

Data Analytics

Cloud Collaboration

Mobility

Energy Management AutoTest Predictive Quality Universal Order Visibility Supplier Collaboration VMES for Quality Intercloud Pilot Augmented Reality Warehouse Mgt Build Metrics Build/Ship RevenueShip Metrics Distribution and Inventory Visibility Innovation

CONNECTED Supply Chain CONNECTED Factory

CONNECTED Supplier CONNECTED Customer

CONNECTED Warehouse

Cisco ioE Enabled Supply Chain