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Big Data and the Internet of Things (IoT) How Manufacturers are Driving Competitive Advantage Manufacturing Forum

April 15-16, 2014

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2 © 2014 SAP AG or an SAP affiliate company. All rights reserved.

Sustainable Global Growth

Out Innovate Competitors

Rethink the Business Model

Driving Manufacturing CEO Objectives

Attract and Retain Talent

Deliver manufacturing

excellence and

superior supply chain

management

Provide seamless

customer experience

across all channels

Improve global

footprint while

growing profitably

© 2014 SAP AG or an SAP affiliate company. All rights reserved. 3 Public

A shift from using intuition to

make decisions, to using data to

drive greater growth, increased

productivity, and sustained

competitive advantages

…Resulting in Data analysis techniques

Visualization methods

Big data technologies

What is Data-Driven Decision-Making?

It is the employment of …

#1 Manufacturing industry

rank (across all

industries), in terms of

amount of data

captured and stored

10% estimated increase

in revenue through

Big Data

29% average ROI from

Big Data projects

in Manufacturing

industry

20-50%

reduction in product

development time in

Manufacturing by

using Big Data

Man

ufa

ctu

rin

g

Achieved IF more data could be accessed and analyzed

Customer Data

Competitive Prices GPS

Risk/Financial Management

Campaign Performance

Hot Trends

Production

Supply Chain Logistic

Employee Records

Supplier Sentiment

Purchase Orders

Sensor Emails

Tweets

Planning

Social Media

Mobile

Instant Messages

* “Big Data: Next frontier for innovation, competition, and productivity” McKinsey study

Opportunity to unlock value from Big Data


Big Data Examples Information Driving Business Insight, Innovation & Value

Improved decision making via real-time monitoring 20k continuous

equipment data points (what vital are & what they should be)

$120M savings year 1, $200M in year 2 via optimizing parameters

Continuous Operator Improvement via Network effect

Valero

Life Science [GENERAL]

Remote monitoring

Equipment Provider - complex machines that are connected to a central monitoring

source

Initial interest was around Predictice Maintenance

Evolving to include Usage Based Billing - usage data updates a central repository

(cloud) with minute by minute (big data) information enabling various Consume-To-Cash

billing options (hourly, consumption, etc.)

Medtronic

Implantable Devices - example Pace Maker and Device that connects to internet

Patient can see

Physician can check if it has been firing correctly and compare against vitals to direct

patient visits, device fine tuning etc.

http://events.sap.com/sapphirenow/en/session/2438

http://www.youtube.com/watch?v=g8UH0wyqx6s

Mining Equipment

Mining Real time data via Embedded Sensors for info, alerts, etc

Track trends and Predict Future events incl. associated equip

failures, conditions etc.

Private

Coca-Cola

Freestyle reinvented the fountain business (consumer experience,

real-time data driven supply chain)

What people are putting in their cups, how much and even when each

combination is being poured

Supply Chain collaboration embedded in every machine enabling Real-time

analytics –for understanding real-time inventory information and how customers

consume the products

> $30M in Savings via Sense, Predict, Act better design quality, lower warranty costs, reduce field repairs, improved service parts

forecasting and parts stocking

Harvest Optimization (when to start harvesting)

Cloud Learning / Certification for distributors and 3rd party technicians

Farming Equipment

Private

“I remember when energy was cheap and data

was expensive”

“With new technology from SAP, we can

leverage unstructured as well as structured

data - take all operating parameters, contracts,

disti networks, all forecasts, raw material

prices, etc and every possible permutation…

before you were lucky to get 1 done in weeks

now dozens in seconds… now you can

determine optimization for every condition -

that was never before possible”

~Hal Zesch, Valero CIO and CTO


Products are Becoming More and More Complex Simple products of the past will be complex solutions in the future

© 2013 SAP AG or an SAP affiliate company. All rights reserved. 6

Mechanics

Electronics

SW

Source: Adapted from „Software gibt den Takt vor“, C.Kühnl in „Mechatronic & Fertigung“, 2010

Software

Mechanic

s

Electronics Mobile

Comms

System Thinking

Services

Harness Transformational Business Opportunities Capitalize on the new technology frontier

Kevin Conti Director, Strategic Consulting

Chicago, Il

[email protected]

• 20+ years track record designing and

delivering client value in enterprise

technology and process innovation

• Expertise in business solutions with

Location Intelligence, Customer Data

Management, and enterprise Customer

Engagement

• Formal background in technology

development, product management,

financial business modeling, with 9

years international business

development success

© 2013 Cisco and/or its affiliates. All rights reserved. Cisco Confidential 10

IoT SOLUTIONS ARCHITECT -

Manufacturing & Energy

New York, New York

[email protected]

Bryce Barnes

• With Cisco Systems since 1999

• Architect - Manufacturing

• Technical Business

Development

• Consulting Systems Engineer II

• 20+ years of experience spanning

high technology solutions and

various manufacturing

environments

• Formal background in mechanical

engineering and technology

solutions

mailto:[email protected]


The Internet

of Things

Growth of the Digital Universe

10^27

10^24

2012

Digital Universe

2030

Digital Universe

1,000x

Big data is doubling the digital

universe every 2 yrs, reaching a

Brontobyte of data - 1,000x in size by

2030

By 2030, there will be 1 Trillion

sensors —

150 for every person on Earth

Big Data will require 1 million times

more storage capacity and

processing power than we have

today

Intelligent products will double in

revenue from

2013 — 2015 to $2T

Connected Assets, Big Data, and Analytics drive new business models

Matthew Littlefield

• Matthew Littlefield co-founded

LNS Research in 2011 and now is

President and Principal Analyst

• Five years as Senior Analyst at

Aberdeen Group where he led

Manufacturing research practice.

• Five years working for global

manufacturers, including Unilever

and HP Hood, in production and

continuous improvement team

roles.

• Holds a BA in Economics and an

MS in Industrial Engineering and

Operations Research from the

University of Massachusetts,

Amherst.

©LNS Research 2014

Matthew Littlefield President and Principal Analyst

[email protected]


Where Will Big Data Impact Manufacturing?

©LNS Research 2014


Paul Boris

15 Years - Technology-enabled Operations Excellence

• 9 years at SAP focused on Operations, Mobility and

Continuous Improvement Solutions

• 6 years in boutique firms leading technology delivery

17 Years - Manufacturing Operations

• Managed various manufacturing operations

• Batch/Process/Discrete, Union/RTW

3 Years - Psychological Services

• Bartender in Northeast PA

Global Vice President Manufacturing & Operations Mobility

SAP

[email protected]



• $100M in Annual Benefit

• 21 days to 6 hours

• FPY UP

• Operating Margin UP

• Profits UP

• IW Best Plant for 2014

• $200M+ in Annual Benefit

• 8 Clicks COO to machine

• TCO Down

• Enabler for PSM, EHS, CI

• Best of the Best Practices


Big Data Bus

Time Pillar and Group Focus Subject

5:00- 5:30 pm Open Tours OPEN

5:30-6:00 pm Sustainable Innovation Project Systems on Hana

6:00-6:30 pm Responsive Manufacturing MRP on Hana

6:30-7:00 pm Operational Excellence SAP VE 3D Work Mgr.

7:00- 7:30 pm Operational Excellence OEE on Hana

7:30-8:00 pm Operational Excellence Windfarm PM/ Airplane PM On Hana

8:00-8:30 pm Operational Excellence cross

8:30- 9:00 pm Supply Chain Management cross

Time Pillar and Group Focus Subject 8-8:30 am Open Tours Cross

8:30-9:00 am Operational Excellence EERM on HANA

9:00- 9:30 am Sustainable Innovation Project Systems on Hana

9:30-10:00 am Responsive Manufacturing MRP on Hana

10:00-10:30 am Operational Excellence SAP 3D VE/Work Manager

10:30-11:00 am Operational Excellence OEE on Hana

11:00-11:30 am Operational Excellence Windfarm PM/ Airplane PM

11:30- 12:00 pm Operational Excellence EERM on Hana

12:00-12:30 pm Open Tours Cross

12:30- 1:00 pm Open Tours Cross

1:00 – 1:30 pm Supply Chain Mgmt SCM on Hana

11:30- 12:00 pm Operational Excellence EERM on Hana

12:00-12:30 pm Open Tours Cross

12:30- 1:00 pm Open Tours Cross

1:00 – 1:30 pm Supply Chain Mgmt SCM on Hana

Day 1 Day 2

Appendix


Apps Rule

Smart things in dumb systems deliver nothing

Connected Things - Connected World Capitalize on Internet of Things

By 2020 50 BILLION connected things

0

10

20

30

40

50

60

70

80

90

Mechanic

Electronic & Software

1980 1990 2000 2020 2010 Source: A&D April 2005, Germany

By 2020 Trillions sensors


Enabling Connected Equipment

OEM Systems (SAP / Non-SAP)

Smart devices

SAP HANA Cloud / On-premise / Hybrid

Service Provider Management Systems

• Service Provider Enablement

• Service Discovery

• Request routing

• Consolidated Billing

• Analytics

• Financial Transactions

• Insurance

• Preventive Maintenance

• Fleet Management

• Tracking & Tracing

• Real Monitoring of Assets

Connected Infrastructure


Smart Devices

Multi-structured Data Sources

Social & Mobile

Analytics Data Warehouses

Data Mining

External Systems

Requirements for Transformation Sense, Predict & Act

Visualization

Mobile Users

Analyze & Process

in Real-time

Integrate & Decide

in Real-time Collect & Store

SENSE

SAP HANA (Main Memory)

PREDICT

ACT

Big Data and the

Internet of Things

Driving Competitive Differentiation

for today’s High Tech

Manufacturers

Matthew Littlefield President and Principal Analyst

Thank You!!

For More Information -

Contact: Matthew Littlefield President and Principal Analyst

[email protected]



10TB of Data for Every 30 Minutes of Flight

Energy Utility Companies Process

1.1 BILLION Data Points (.5TB) per Day

A Large Offshore Field Produces

0.75TB of Data Weekly

A Large Refinery Generates

1TB of Raw Data per Day

Sources: http://www.kurzweilai.net/sin-charts#!prettyPhoto; http://blog.backblaze.com/2011/06/22/price-gap-storage-vs-bandwidth/

The World Generates 2 Exabytes of Data Every Day


Source: Cisco Internet Business Solutions Group, 2012

Delivering the

right information

to the right

person (or

machine) at the

right time.

Leveraging data

into more useful

information for

decision making.

Physical devices

and objects

connected to the

Internet and

each other for

intelligent

decision making.

Connecting

people in more

relevant and

valuable ways.


ENERGY/UTILITIES TRANSPORTATION +

LOGISTICS

SERVICE PROVIDER MINING OIL AND GAS GOVERNMENT/SMAR

T CITIES

Security Big

Data/Analytics Scale Real-Time

DEFENSE MANUFACTURING


"The latest planes we are

getting, the Boeing 787s, are

incredibly connected. Literally

every piece of that plane has

an internet connection, from

the engines, to the flaps, to

the landing gear.” "If there is a problem with one

of the engines we will know

before it lands to make sure

that we have the parts there.”

Virgin Atlantic IT director David Bulman

“We can get upwards of half

a terabyte of data from a

single flight from all of the

different devices which are

internet connected,"

big data and the internet of things (iot) - sapfm.sap.com/data/upload/files/big data iot...

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