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© Fraunhofer IESE SEC Special Seminar: Software Engineering and Business Innovation at the Era of IoT Tokyo, February 20, 2015 Prof. Dr. Dieter Rombach [email protected] Fraunhofer IESE Kaiserslautern, Germany Smart Ecosystems: An Enabler for Future Innovations

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Page 1: Smart Ecosystems - IPA...© Fraunhofer IESE SEC Special Seminar: Software Engineering and Business Innovation at the Era of IoT Tokyo, February 20, 2015 Prof. Dr. Dieter Rombach Dieter

© Fraunhofer IESE

SEC Special Seminar:Software Engineering and Business

Innovation at the Era of IoTTokyo, February 20, 2015

Prof. Dr. Dieter [email protected]

Fraunhofer IESEKaiserslautern, Germany

Smart Ecosystems: An Enabler for Future Innovations

Page 2: Smart Ecosystems - IPA...© Fraunhofer IESE SEC Special Seminar: Software Engineering and Business Innovation at the Era of IoT Tokyo, February 20, 2015 Prof. Dr. Dieter Rombach Dieter

© Fraunhofer IESE

Applied Research: The Fraunhofer-Gesellschaft

On the way to the Digital Society 2.0

Challenges for Software and Systems Engineering

AGENDA

Page 3: Smart Ecosystems - IPA...© Fraunhofer IESE SEC Special Seminar: Software Engineering and Business Innovation at the Era of IoT Tokyo, February 20, 2015 Prof. Dr. Dieter Rombach Dieter

© Fraunhofer IESE

Researcher

Discovery of the “Fraunhofer lines” in the solar spectrum

Inventor

Development of new methods for lens processing

Entrepreneur

Director and partner in a glass manufactory

Joseph von Fraunhofer (1787 – 1826)

© Fraunhofer-Gesellschaft

“Fraunhofer Lines”

© Deutsches Museum

3February 20, 2015

Page 4: Smart Ecosystems - IPA...© Fraunhofer IESE SEC Special Seminar: Software Engineering and Business Innovation at the Era of IoT Tokyo, February 20, 2015 Prof. Dr. Dieter Rombach Dieter

© Fraunhofer IESE

Fraunhofer-Gesellschaft, the largest organization for applied research in Europe

4

Applied Research for Economy and Society

About 23,000employees

Above 70% of industry contracts and publicly funded research projects

About 30% of base funding fromfederal and state government

66 institutes andresearch institutions

Res

earc

h V

olu

me

2 billion €

2013C

on

trac

ted

Res

earc

h

1.7 billion €

February 20, 2015

Page 5: Smart Ecosystems - IPA...© Fraunhofer IESE SEC Special Seminar: Software Engineering and Business Innovation at the Era of IoT Tokyo, February 20, 2015 Prof. Dr. Dieter Rombach Dieter

© Fraunhofer IESE

Fraunhofer Worldwide

5

Dubai

Bangalore

Jakarta

Beijing Seoul

Tokyo

Cairo

Ampang

Santiago de Chile

Singapore

Brussels

Porto

Vienna

Bolzano GrazBudapest

Wrocław

Gothenburg

Thessaloniki

Sydney

Salvador

Sendai

Paris

São PauloCampinas

Jerusalem

Stellenbosch

Boston

Plymouth

East LansingSan José

NewarkMaryland

Cambridge

LondonVancouver

Storrs

Glasgow

SouthamptonDublin

Subsidiary Center Project Center ICON / Strategic Cooperation Representative / Marketing Office Senior Advisor

February 20, 2015

Page 6: Smart Ecosystems - IPA...© Fraunhofer IESE SEC Special Seminar: Software Engineering and Business Innovation at the Era of IoT Tokyo, February 20, 2015 Prof. Dr. Dieter Rombach Dieter

© Fraunhofer IESE

Fraunhofer Fields of Research

Health and Environment

Communication and Information

Production and Services

Mobility and Transportation

Energy and Resources

Safety and Security

6February 20, 2015

Page 7: Smart Ecosystems - IPA...© Fraunhofer IESE SEC Special Seminar: Software Engineering and Business Innovation at the Era of IoT Tokyo, February 20, 2015 Prof. Dr. Dieter Rombach Dieter

© Fraunhofer IESE

Fraunhofer Institute for Experimental Software Engineering

7

Founded in 1996

One of the leading software engineering institutes in Europe and worldwide

Over 200 employees

Schkopau

Teltow

Oberhausen

Duisburg

EuskirchenAachen

Schmallenberg

Dortmund

PotsdamBerlin

RostockLübeck

Itzehoe

Braunschweig

Hannover

Bremen

Bremerhaven

LeipzigDresden

CottbusMagdeburg

Halle

Wachtberg

München

Holzkirchen

Freiburg

Efringen-Kirchen

FreisingStuttgart

PfinztalKarlsruheSaarbrücken

St. Ingbert

DarmstadtWürzburg

Erlangen

Nürnberg

Ilmenau

St. Augustin JenaChemnitz

Fürth

Ettlingen

Kandern

Kaiserslautern

February 20, 2015

Page 8: Smart Ecosystems - IPA...© Fraunhofer IESE SEC Special Seminar: Software Engineering and Business Innovation at the Era of IoT Tokyo, February 20, 2015 Prof. Dr. Dieter Rombach Dieter

© Fraunhofer IESE

Our Formula for Your Success

8February 20, 2015

Page 9: Smart Ecosystems - IPA...© Fraunhofer IESE SEC Special Seminar: Software Engineering and Business Innovation at the Era of IoT Tokyo, February 20, 2015 Prof. Dr. Dieter Rombach Dieter

© Fraunhofer IESE

The Basis of Our Success…

9February 20, 2015

Page 10: Smart Ecosystems - IPA...© Fraunhofer IESE SEC Special Seminar: Software Engineering and Business Innovation at the Era of IoT Tokyo, February 20, 2015 Prof. Dr. Dieter Rombach Dieter

© Fraunhofer IESE

Core Competencies of Fraunhofer IESE

10

SOFTWARE-ENABLED INNOVATIONS

forinnovative

Systems

February 20, 2015

Page 11: Smart Ecosystems - IPA...© Fraunhofer IESE SEC Special Seminar: Software Engineering and Business Innovation at the Era of IoT Tokyo, February 20, 2015 Prof. Dr. Dieter Rombach Dieter

© Fraunhofer IESE

Core Competencies of Fraunhofer IESE

11

SOFTWARE-ENABLED INNOVATIONS

IS/MobileES/CPS Smart Ecosystems

February 20, 2015

Page 12: Smart Ecosystems - IPA...© Fraunhofer IESE SEC Special Seminar: Software Engineering and Business Innovation at the Era of IoT Tokyo, February 20, 2015 Prof. Dr. Dieter Rombach Dieter

© Fraunhofer IESE

How do we help?We create evidence!

We analyze software and systems to create evidencesthat enable us to provide sound evaluation results

and decision support

12February 20, 2015

Page 13: Smart Ecosystems - IPA...© Fraunhofer IESE SEC Special Seminar: Software Engineering and Business Innovation at the Era of IoT Tokyo, February 20, 2015 Prof. Dr. Dieter Rombach Dieter

© Fraunhofer IESE

Applied Research: The Fraunhofer-Gesellschaft

On the way to the Digital Society 2.0

Challenges for Software and Systems Engineering

AGENDA

Page 14: Smart Ecosystems - IPA...© Fraunhofer IESE SEC Special Seminar: Software Engineering and Business Innovation at the Era of IoT Tokyo, February 20, 2015 Prof. Dr. Dieter Rombach Dieter

© Fraunhofer IESE

Integration: A Driver in Private Life

14February 20, 2015

Page 15: Smart Ecosystems - IPA...© Fraunhofer IESE SEC Special Seminar: Software Engineering and Business Innovation at the Era of IoT Tokyo, February 20, 2015 Prof. Dr. Dieter Rombach Dieter

© Fraunhofer IESE

Integration as Driver for Business Life: Integration Enables Innovation!

… in Information Systems as well as in Embedded Systems

15February 20, 2015

Page 16: Smart Ecosystems - IPA...© Fraunhofer IESE SEC Special Seminar: Software Engineering and Business Innovation at the Era of IoT Tokyo, February 20, 2015 Prof. Dr. Dieter Rombach Dieter

© Fraunhofer IESE

Physical Objects Get a Digital Life

Physical objects (things, living objects, people)

produce data (through observation using sensors)

have a history (enabling prediction)

are influenced by data (using actuators)

context-dependent

Location-aware

in real time

across software system boundaries

16

[Picture from http://b-metro.com, Cheri Ellis]

February 20, 2015

Page 17: Smart Ecosystems - IPA...© Fraunhofer IESE SEC Special Seminar: Software Engineering and Business Innovation at the Era of IoT Tokyo, February 20, 2015 Prof. Dr. Dieter Rombach Dieter

© Fraunhofer IESE

17[Bosch Software Innovations 2012]

February 20, 2015

Page 18: Smart Ecosystems - IPA...© Fraunhofer IESE SEC Special Seminar: Software Engineering and Business Innovation at the Era of IoT Tokyo, February 20, 2015 Prof. Dr. Dieter Rombach Dieter

© Fraunhofer IESE

IT Mega-Trend: Integration

Big Data / Data Analytics18February 20, 2015

Page 19: Smart Ecosystems - IPA...© Fraunhofer IESE SEC Special Seminar: Software Engineering and Business Innovation at the Era of IoT Tokyo, February 20, 2015 Prof. Dr. Dieter Rombach Dieter

© Fraunhofer IESE

Societal Changes through Smart Ecosystems

19

Closed Systems(IS, ES)

Open Systems(IS, ES)

Integrated Systems •Systems of

Systems•Emergent

Systems•Cyber-

Physical Systems

Smart Ecosystems

Digital Society 1.0

Digital Society 2.0

February 20, 2015

Page 20: Smart Ecosystems - IPA...© Fraunhofer IESE SEC Special Seminar: Software Engineering and Business Innovation at the Era of IoT Tokyo, February 20, 2015 Prof. Dr. Dieter Rombach Dieter

© Fraunhofer IESE

Smart EcosystemsA Trend across Domains

Smart Ecosystems

Industry 4.0

Smart Mobility

Smart Energy

Smart X

Smart Health

Smart Farming

20February 20, 2015

Page 21: Smart Ecosystems - IPA...© Fraunhofer IESE SEC Special Seminar: Software Engineering and Business Innovation at the Era of IoT Tokyo, February 20, 2015 Prof. Dr. Dieter Rombach Dieter

© Fraunhofer IESE

Example: Smart Cars

21

[Roland Berger]

In open ecosystems, the question is no longer “What is the customer going to pay for?” but “Who might be willing to pay?”

February 20, 2015

Page 22: Smart Ecosystems - IPA...© Fraunhofer IESE SEC Special Seminar: Software Engineering and Business Innovation at the Era of IoT Tokyo, February 20, 2015 Prof. Dr. Dieter Rombach Dieter

© Fraunhofer IESE

Example: Smart Farming

22

Preventive error avoidanceNo standstill during harvesting period

Protection of field soilCoordination of agriculture machines

Minimizing fuel consumptionPrediction and control of machine routes

Foresighted planningUse of real-time data streams

Automated control of harvesting speed

Coordination of agriculture machines and their routes

Optimized harvest logisticsExplicit consideration of various

influencing factors

[CLAAS]

Innovation through connected & integrated software systems and context-dependent & location-based services

February 20, 2015

Page 23: Smart Ecosystems - IPA...© Fraunhofer IESE SEC Special Seminar: Software Engineering and Business Innovation at the Era of IoT Tokyo, February 20, 2015 Prof. Dr. Dieter Rombach Dieter

© Fraunhofer IESE

The Fourth Industrial Revolution

Research initiative to answer four major challenges of the modern world

Global competition

Resources shortages

Demographic changes

Urbanization

Role of software and IT in connected production facilities

Presentation of the final reportIndustry 4.0

at Hanover Fair 2013http://www.plattform-i40.de/

23February 20, 2015

Page 24: Smart Ecosystems - IPA...© Fraunhofer IESE SEC Special Seminar: Software Engineering and Business Innovation at the Era of IoT Tokyo, February 20, 2015 Prof. Dr. Dieter Rombach Dieter

© Fraunhofer IESE

Example: Smart Production in Industry 4.0

24

[agendaCPS]

FUTURE

Machine-to-machine communication

Analysis of machine and surrounding data

Estimation of machine‘s condition

Predict errors & maintain machine

Avoid downtime

Avoid unnecessary maintenance

REACTIVE

80%FALSE ALARMS

TODAY

Which events can be isolated and handled by a service employee?

Which errors influence the operation of a complete industry plant?

Is there a correlation between the errors?

PROACTIVE

20%QUALIFIED SIGNALS

Compare to history, identify trends, and

predict errors

February 20, 2015

Page 25: Smart Ecosystems - IPA...© Fraunhofer IESE SEC Special Seminar: Software Engineering and Business Innovation at the Era of IoT Tokyo, February 20, 2015 Prof. Dr. Dieter Rombach Dieter

© Fraunhofer IESE

Industry 4.0History

Software is the key to innovation and productivity boost

25

Mechanical production facilities, hydropower, steam engines

Assembly-line organization, electrical drives

SPS-based automation technology

Smart ecosystems and integrated cyber-physical systems

1.02.03.04.0

February 20, 2015

Page 26: Smart Ecosystems - IPA...© Fraunhofer IESE SEC Special Seminar: Software Engineering and Business Innovation at the Era of IoT Tokyo, February 20, 2015 Prof. Dr. Dieter Rombach Dieter

© Fraunhofer IESE

The focus of Industry 4.0 is on

real-time capable,

comprehensive,

intelligent,

horizontal and vertical

networking of

people,

machines,

objects and

IT systems

for dynamic management of complex systems

Industry 4.0Characteristics

[Plattform Industrie 4.0; www.plattform-i40.de]

[Siemens]

We must be able to control a network of plants distributed all

over the world as one global factory

Vertical Integration throughout control levels

Horizontal Integration across enterprises

26February 20, 2015

Page 27: Smart Ecosystems - IPA...© Fraunhofer IESE SEC Special Seminar: Software Engineering and Business Innovation at the Era of IoT Tokyo, February 20, 2015 Prof. Dr. Dieter Rombach Dieter

© Fraunhofer IESE

Industry 4.0Vertical Integration

27

Distribution

Product Development /R&D)

Planning

Service

IT, Shared Services

Acquisition Production Logistics

Finance, Tax, Legal

Enterprise

Vertica

l Valu

e C

reatio

n

[PwC 2014]

20%

2014 2019

80%

Digitalization of value chain

February 20, 2015

Page 28: Smart Ecosystems - IPA...© Fraunhofer IESE SEC Special Seminar: Software Engineering and Business Innovation at the Era of IoT Tokyo, February 20, 2015 Prof. Dr. Dieter Rombach Dieter

© Fraunhofer IESE

Industry 4.0Horizontal Integration

28

Supplier Chain

CooperationPartners

Planning

Acq

uis

itio

n

Pro

du

ctio

n

Log

isti

cs CustomersNetwork

Horizontal Value Creation Chain/Network

Supplier Enterprise Customer

[PwC 2014]

24%

2014 2019

86%

Digitalization of value chain

February 20, 2015

Page 29: Smart Ecosystems - IPA...© Fraunhofer IESE SEC Special Seminar: Software Engineering and Business Innovation at the Era of IoT Tokyo, February 20, 2015 Prof. Dr. Dieter Rombach Dieter

© Fraunhofer IESE

Industry 4.0Vision: Industry 2025

29

[BMBF: Zukunftsbild Industrie 4.0]

Flexible and individualized manufacturing

Connected enterprises

Competitive advantages of flexible value-creation networks

Coexistence of open and closed production networks

Work comfort through intelligent assistance systems

New business opportunities in connected industry

February 20, 2015

Page 30: Smart Ecosystems - IPA...© Fraunhofer IESE SEC Special Seminar: Software Engineering and Business Innovation at the Era of IoT Tokyo, February 20, 2015 Prof. Dr. Dieter Rombach Dieter

© Fraunhofer IESE

The first challenge is to pull together the perspectives represented by different industries and to establish a common approach

Industry 4.0Example Perspectives

30

Manufacturing ProcessProcessing and transport functions

Software ApplicationsBusiness management, production management, control and regulation software

Networked DevicesProgrammablelogic controllers, mobile devices, servers, workstations, etc.

Product EngineeringProduction design & dev., planning, engineering, and services

Reference ArchitectureIndustry 4.0

[Plattform Industrie 4.0; www.plattform-i40.de]February 20, 2015

Page 31: Smart Ecosystems - IPA...© Fraunhofer IESE SEC Special Seminar: Software Engineering and Business Innovation at the Era of IoT Tokyo, February 20, 2015 Prof. Dr. Dieter Rombach Dieter

© Fraunhofer IESE

Industry 4.0Expected Benefits

31

[PwC 2014]

46%

49%

54%

62%

67%

80%

34%

35%

32%

27%

27%

15%

20%

16%

14%

11%

6%

5%

0% 20% 40% 60% 80% 100%

Individualization of products

Improvement of quality

Short Time-to-Market(in the product development)

Large flexibility in the products

High customer satisfaction

Better planning and control(in the production resp. logistics)

High Medium Low

February 20, 2015

Page 32: Smart Ecosystems - IPA...© Fraunhofer IESE SEC Special Seminar: Software Engineering and Business Innovation at the Era of IoT Tokyo, February 20, 2015 Prof. Dr. Dieter Rombach Dieter

© Fraunhofer IESE

Industry 4.0Potential Growth (Germany)

32

Industry Sector

Gross Added Value[Bn. €]

Potential through Industry 4.0

Yearly Increase

2013 2025* 2013-25 2013-25

Chemical Industry 40.08 52.10 +30% 2.12%

Automotive andCar Parts

74.00 88.80 +20% 1.53%

Machine and Plant Construction

76.79 99.83 +30% 2.21%

Electrical Equipment 40.27 52.35 +30% 2.21%

Agriculture and Forestry 18.55 21.33 +15% 1.17%

Inform. and Comm. Tech. 93.65 107.70 +15% 1.17%

Total Potential 343.34 422.11 +23% 1.74%

[BITKOM 2014]* Growth due to Industry 4.0 only (economic growth excluded)

February 20, 2015

Page 33: Smart Ecosystems - IPA...© Fraunhofer IESE SEC Special Seminar: Software Engineering and Business Innovation at the Era of IoT Tokyo, February 20, 2015 Prof. Dr. Dieter Rombach Dieter

© Fraunhofer IESE

Industry 4.0Key Challenges of Implementing Industry 4.0

30

42

64

70

78

85

98

129

147

0 20 40 60 80 100 120 140 160

Regulatory framework

Training and CPD

Research

Lack of specialist staff

Security know-how protection

New business models

Product availability

Process/work organisation

Standardisation

33Survey (BITKOM, VDMA, ZVEI 2013): 278 companies mainly from the machinery and plant manufacturing industry. 205 companies < 500 employees.

February 20, 2015

Page 34: Smart Ecosystems - IPA...© Fraunhofer IESE SEC Special Seminar: Software Engineering and Business Innovation at the Era of IoT Tokyo, February 20, 2015 Prof. Dr. Dieter Rombach Dieter

© Fraunhofer IESE

Applied Research: The Fraunhofer-Gesellschaft

On the way to the Digital Society 2.0

Challenges for Software and Systems Engineering

AGENDA

Page 35: Smart Ecosystems - IPA...© Fraunhofer IESE SEC Special Seminar: Software Engineering and Business Innovation at the Era of IoT Tokyo, February 20, 2015 Prof. Dr. Dieter Rombach Dieter

© Fraunhofer IESE

Trend in Digitalization of Product- and Service PortfoliosThe Key to Sustainable Success

35

[PwC 2014]

29%

34%

37%

2014

high

medium

low

79%

14%7%

2019

+ 50%

Digitalization Level

February 20, 2015

Page 36: Smart Ecosystems - IPA...© Fraunhofer IESE SEC Special Seminar: Software Engineering and Business Innovation at the Era of IoT Tokyo, February 20, 2015 Prof. Dr. Dieter Rombach Dieter

© Fraunhofer IESE

Smart EcosystemsKey Challenges for Software and Systems Engineering

36

Smart Data Usage

Complexity Uncertainty

DiversitySafety & Security

February 20, 2015

Page 37: Smart Ecosystems - IPA...© Fraunhofer IESE SEC Special Seminar: Software Engineering and Business Innovation at the Era of IoT Tokyo, February 20, 2015 Prof. Dr. Dieter Rombach Dieter

© Fraunhofer IESE

Key Challenges of Smart EcosystemsComplexity

Smart Ecosystems are the most complex artifacts created by a human being: dynamics and long lifetime require a high degree of complexity reduction

This requires:

Model-based engineering approaches

Scalable architectures

Mature development processes

37February 20, 2015

Page 38: Smart Ecosystems - IPA...© Fraunhofer IESE SEC Special Seminar: Software Engineering and Business Innovation at the Era of IoT Tokyo, February 20, 2015 Prof. Dr. Dieter Rombach Dieter

© Fraunhofer IESE

Key Challenges of Smart EcosystemsDiversity

Smart Ecosystems comprise and integrate diverse systems and stakeholders across companies and domains

This requires:

Interoperable architectures

Standardization

Quality of Service (QoS) guarantees

38February 20, 2015

Page 39: Smart Ecosystems - IPA...© Fraunhofer IESE SEC Special Seminar: Software Engineering and Business Innovation at the Era of IoT Tokyo, February 20, 2015 Prof. Dr. Dieter Rombach Dieter

© Fraunhofer IESE

Key Challenges of Smart EcosystemsUncertainty

A system within a Smart Ecosystem must be able to deal with an uncertain environment: players and how to interact with them may change

This requires:

Flexible architectures

Adaptable systems

Certifiable runtime qualities

Simulation approaches for connecting development and runtime

39February 20, 2015

Page 40: Smart Ecosystems - IPA...© Fraunhofer IESE SEC Special Seminar: Software Engineering and Business Innovation at the Era of IoT Tokyo, February 20, 2015 Prof. Dr. Dieter Rombach Dieter

© Fraunhofer IESE

Key Challenges of Smart EcosystemsSafety & Security

In Smart Ecosystems, highly critical embedded systems are integrated with sensible information systems: the resulting ecosystem needs to address safety and security issues

This requires:

Integrated security/safety models

Context-dependent, integrated data usage control (trust and acceptance)

Isolation of critical system parts (e.g., “software cages”)

40February 20, 2015

Page 41: Smart Ecosystems - IPA...© Fraunhofer IESE SEC Special Seminar: Software Engineering and Business Innovation at the Era of IoT Tokyo, February 20, 2015 Prof. Dr. Dieter Rombach Dieter

© Fraunhofer IESE

Key Challenges of Smart EcosystemsSmart Usage of Big Data

41

Opportunities are huge!

How are your capabilities?

February 20, 2015

Page 42: Smart Ecosystems - IPA...© Fraunhofer IESE SEC Special Seminar: Software Engineering and Business Innovation at the Era of IoT Tokyo, February 20, 2015 Prof. Dr. Dieter Rombach Dieter

© Fraunhofer IESE

Key Challenges of Smart EcosystemsSmart Usage of Big Data

In Smart Ecosystems, big data needs to be processed across companies to enable joint value chains and business models

This requires:

Innovative business models

Big data strategies (goals, competencies, and technologies)

Approaches for managing data quality (“garbage in, garbage out”)

Integrated data usage control

42

DataVolume

DataVariety

DataVelocity

MB GB TB PB

[from http://www.gi.de/service/informatiklexikon/detailansicht/article/big-data.html]

February 20, 2015

Page 43: Smart Ecosystems - IPA...© Fraunhofer IESE SEC Special Seminar: Software Engineering and Business Innovation at the Era of IoT Tokyo, February 20, 2015 Prof. Dr. Dieter Rombach Dieter

© Fraunhofer IESE

Companies and society can strongly benefit from Smart Ecosystems

Opportunity and threat at the same time for companies

Software is the USP

Context sensitivity, intelligence, and added value are delivered by software

Processing power and communication bandwidth are mandatory prerequisites

Software Engineering is the key to success

Achieve the right goals at the right time with the right level of quality

At development time and at runtime

Challenges in Smart Ecosystems require guaranteed qualities

Fraunhofer IESE provides strong competencies for these challenges

TAKEAWAYS

Page 44: Smart Ecosystems - IPA...© Fraunhofer IESE SEC Special Seminar: Software Engineering and Business Innovation at the Era of IoT Tokyo, February 20, 2015 Prof. Dr. Dieter Rombach Dieter

© Fraunhofer IESE

THANK YOU!