Connected Manufacturing

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1 Connected Manufacturing The Internet of Things: Connecting the Unconnected Robert Dean, Executive Director, Business Transformation, Manufacturing Industry May 14, 2015

2 The Internet of Everything (IoE) in Manufacturing Business Relevance for the Internet of Everything Manufacturing Trends and Business Imperatives Vision: The Connected Factory Introduction Business Outcomes to Cisco Nexus 7700 Platform Next Steps and Connected Factory Starter Kit Cisco Confidential 2

3 The Internet of Things Is Already Here Billions of Devices Inflection Point Billion Smart Objects Rapid adoption rate of digital infrastructure: Five times faster than electricity and telephony Timeline World Population Cisco Confidential 3

4 Global Leaders Focus Germany Japan United States South Korea Brazil Industrie 4.0 Government incentives for manufacturer $3.7B: Advanced Manufacturing /innovation 7 manufacturing flagship areas for investment Brazil Major (bigger Brazil) -20% payroll tax Cisco Confidential 4

5 Trends in Manufacturing: Industrial Renaissance Is Leading the Adoption of IoE Manufacturing On-shoring Manufacturing growth is 2 times the GDP Robotic, Automation Advancements Manufacturing Right-shoring Additive Manufacturing, Materials Advancements Supply Chain Demand Chain New Product Introduction Acceleration Cisco Confidential 5

6 Connected Factory - What s On Your Mind Asset Optimization Improving Flexibility, Uptime, Efficiency Faster Time to Market and New Product Introduction (NPI) Workforce Productivity, New Skills, Safety-Aging Introduction Workforce Dilemma to Cisco Nexus 7700 Platform Business Analytics Security, Security, Security Cisco Confidential 6

7 IoE Manufacturing Value at Stake R&D/ Innovation Dealerships/ Customer Experience Supply Chain/ Logistics Workforce Enablement/ Mobility Plant Automation/ Output Smart Grid $503B $164B $931B $222B $2.086B $94B Cisco Confidential 7

8 Enabling Connected Factories of the Future Sensors Real-Time Analytics Personal Devices Robots and Machines Security Devices Sensors Everywhere Machine-to- Machine Pervasive Intelligence Automation Ruggedized Wireless AP Industrial Routers and Switches User- and Control- Level Factory Security Hardened Mobile M2M Gateway Fast Time to Market Improved Asset Utilization Business Analytics Risk Management Cisco Confidential 8

9 The Smart Manufacturing Journey: How to Get There Phase 3 Starting point: Proprietary serial islands Phase 1 Unmanaged, unconverged Ethernet Richer sensor data Still siloed No security Phase 2 Converged plant-wide network Converge siloed networks for IoT visibility and cost savings Flexible, multicapability platform Controls security Controls mobility Video and collaboration Remote monitoring Cloud, Fog Computing Software-defined factories Increasing Value Cisco Confidential 9

10 What are the top barriers in implementing your factory-of-thefuture strategy? Processes not consistent across multiple sites 74% Low maturity/lack of production technology Change management Finding skilled people No factory-of-future strategy Difficulty demonstrating ROI/cost 73% 73% 71% 61% 58% PERCENTAGE OF COMPANIES Source: IDC Manufacturing Insights N=81 Cisco Confidential 10

11 Enabling IoE in Manufacturing Connected Factory Factory Automation Factory Wireless Factory Security Factory Energy Management Cisco Confidential 11

12 Business Outcomes Factory Automation Connected Factory Automation Security Wireless Energy Management Connected Factory Automation Faster diagnostics = lower downtime Flexible manufacturing = higher revenue Converging motion, safety, data, video, and wireless = higher productivity Source: Cisco customer-validated business outcomes Increase OEE (equip. utilization) by 7-12% (1% OEE = 3-4% profitability) 1 10X improvement in build-to-order (BTO) cycle times (ex: months weeks) 1 Cisco Confidential 12

13 Dave Gutshall Infrastructure Design Manager Harley-Davidson Motor Company What used to take hours or days to triage and troubleshoot now takes minutes or seconds. Source: IOT World Forum Panel Discussion. October Cisco Confidential 13

14 Business Outcomes - Wireless Connected Factory Automation Security Wireless Energy Management Connected Factory Wireless Workforce enablement 82% faster retrieval time 80% faster decision making Wireless tools and assets reduced cabling costs and setup time Continuous asset management Reduce cabling and other costs for machines that move 95% Source: Cisco & AeroScout validated customer experience 7% production throughput increase Cisco Confidential 14

15 Gary Frederick CIO Industrial Division Stanley Black & Decker. We are on our way toward realizing our vision of a virtual warehouse and fully connected factory, with complete visibility and traceability. Watch the video Cisco Confidential 15

16 Business Outcomes - Energy Management Connected Factory Automation Security Wireless Energy Management Avoid peak energy charges (up to 10X base load cost) Connected Factory Energy Management Reduce variable costs (energy is the largest variable cost) Monitor machine-level energy consumption Demand response - receive alerts and take action to avoid peaks Optimize energy by matching machine energy utilization with activity (e.g. idle machines) Reduce energy consumption 10-20% Cisco Confidential 16

17 Connected Factory Business Outcomes - Security Automation Wireless Security Energy Management Connected Factory Security Fundamental enabler of the Connected Factory Securely connect factories to the enterprise Physical security Cybersecurity Identity/role-based access control Secure remote access - use machine builder expertise to reduce downtime Securely monitor and respond to cyber and physical incidents Reduce internal and external risks (Manufacturing is the most attacked industry) Reduce downtime Increase MTBF and reduce MTTR Cisco Confidential 17

18 Customer IoE Roadmap Cisco Value Capture Automation Network Lower network TCO Rapid fault isolation network Plant-Wide Wireless Reduced cabling costs Flexible manufacturing Workforce productivity Security Secure remote access Cyber and physical Identity and policy Collaboration/ Visual Factory Remote Expert Faster problem solving Paperless factory Factory in a box Local processing/ Fog Analytics Video storage App and data integration Cloud/ Virtualization Cloud management Factory app and data virtualization Enterprise asset auto updates Applications Machine as a service (near-zero downtime) Higher OEE Energy management New customer experiences $1M $2M $5M $10M $15M Customer Value Created Cisco Confidential 18

19 Cisco Can Help You Capture IoT Value Opportunities in the Factory TCO or OEE Opportunity Quantification Quantify top value opportunities for senior management (TCO, OEE, and overall benefit models) POV Design Run POVs in a showcase manufacturing facility to prove the value and technology End-State Architecture Assessment Document future state architecture (3 to 5 years out), gaps that exist today, change management, and a phased plan to reach goals Cisco Confidential 19

20 Conclusion: Benefits of IoE and a Cisco Connected Factory Less downtime and higher overall equipment effectiveness Faster new production introductions (NPIs) Strengthened security Introduction to Cisco Nexus 7700 Platform A culture of innovation Abundant data from the IoT Cisco Confidential 20

21 Thank you.

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