The Digital Enterprise What, Why and How? SIMATIC IT R&D Suite Community, June 9 th 2015 Utrecht

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1 The Digital Enterprise What, Why and How? SIMATIC IT R&D Suite Community, June 9 th 2015 Utrecht Realize innovation.

2 Siemens Digitalization - Page 2

3 41_84 44_84 47_84 14_84 Challenges Manufacturing is changing faster than ever before Page 3 Customer Internet Usage

4 41_84 44_84 47_84 14_84 Challenges Manufacturing is changing faster than ever before Reducing time to market Shorter innovation cycles More complex products Larger data volumes Enhancing flexibility Individualized mass production Volatile markets and changing regulations High productivity Increasing efficiency Energy and resource efficiency as key competitive factors Page 4 Customer Internet Usage

41_84 44_84 47_84 14_84 Challenges Manufacturing is changing faster than ever before Increasing competitivenes Reducing time to market Shorter innovation cycles More complex products Larger data

5 41_84 44_84 47_84 14_84 Challenges Manufacturing is changing faster than ever before Increasing competitivenes Reducing time to market Shorter innovation cycles More complex products Larger data volumes Enhancing flexibility Individualized mass production Volatile markets and changing regulations High productivity Increasing efficiency Energy and resource efficiency as key competitive factors Page 5 Customer Internet Usage

6 41_84 44_84 47_84 14_84 Innovative Companies have already Reacted with Strategic Investments Increasing competitivenes Reducing time to market Rapid consolidation driven by mergers and acquisitions Integration of existing solutions and systems Standardization across plants Digitalization Enhancing flexibility Premium brands Customized products Process reliability Transparency in production Digitalization Increasing efficiency Less Downtime better asset utilization High productivity Traceability of process steps Digitalization Manufacturers must respond with significant improvements in Speed, Flexibility and Efficiency Page 6

Challenges for the industry are growing continuously Technology Society Market Image Digitalization and new technologies are permanently changing the face of manufacturing With its technological and

7 Challenges for the industry are growing continuously Technology Society Market Image Digitalization and new technologies are permanently changing the face of manufacturing With its technological and economic benefits, manufacturing contributes to the stability and development of societies Customer requirements are increasing. One key factor is the rapid realization of individual customer wishes Increasingly sustainable, highly productive and innovative forms of production are transforming the image of manufacturing Manufacturing is evolving as a result of accelerated technological and social changes Page 7

8 How Prepared Are You to Change Your Business? The products, business models and legacy positions that once gave companies their competitive edge are no longer secure. Page 8

9 In today's markets, only the pace of innovation keeps competitors at bay and this is the sole contributor to growth. Roland Berger Page 9

10 What Does it Take to Compete? Some companies focus on customer utilization, feeding data back to ideation Ideation Utilization INNOVATION Page 10

11 Leveraging Utilization Data to Fuel Innovation is Important, But Even if you knew what you needed to do, could you do it efficiently, flexibly and fast? Page 11

12 What Does it Take to Compete? Fully digitalized businesses deliver both product and process innovation Ideation Realization Utilization SMART INNOVATION Page 12

Speed of traffic measured Vehicle behavior

13 Digitalization and Smart Products Applying connectivity and intelligence 360º object scanning Speed of traffic measured Vehicle behavior processor Motion and balance sensor Vehicle location sensor Page 13

14 Siemens Vision 2020 Innovating in the 21 st Century GLOBAL TRENDS Digital Transformation Globalization Urbanization Market Development (Illustrative) Digitalization Automation Electrification Market Growth: ~7-9% Market Growth: ~4-6% Market Growth: ~2-3% Demographic Change Today Mid-term 2020 Climate Change Digital model-based designs Simulation linking product and production Digital models of complete lifecycle Self-optimizing cyber-physical systems Page 14

15 Research and development Innovation has always been the foundation of our success Employees in R&D 28,800 13,200 15,600 R&D employees worldwide R&D employees in Germany R&D employees in approximately 30 other countries worldwide Ranking in patent applications No. 4 Germany (2013) No. 13 USA No. 2 Europe (2013) (2013) Siemens currently holds approximately 56,100 patents granted worldwide R&D spending as % of revenue FY billion Partnerships partnerships with universities, research institutes and other 1,000 organizations around the world FY 2013 FY 2014 Page 15

Siemens Structure Flat market driven organization Go-to-market Americas Middle East,

Power and Gas Wind Power and Renewables Energy Management Building Technologies

Divisions (Global P&L) PG WP Power Generation Services PS EM BT MO DF PD HC SFS

16 Siemens Structure Flat market driven organization Go-to-market Americas Middle East, CIS 1) Europe, Africa Market Asia, Australia Global Healthcare Separately managed Power and Gas Wind Power and Renewables Energy Management Building Technologies Mobility Digital Factory Process Industries and Drives Healthcare Financial Services Divisions (Global P&L) PG WP Power Generation Services PS EM BT MO DF PD HC SFS Corporate Services Managing Board Corporate Core 1) Commonwealth of Independent States Page 16

17 Digital Factory DF PL is one of the largest Software companies in the world We are the first company worldwide to bundle all the capabilities for the digital factory under one roof. Joe Kaeser, Siemens AG President, CEO Page 17

18 All Industry Software comes together in DF PL business unit Realize the Digital Enterprise for our Customers Product Lifecycle Management Manufacturing Operations Management Plant Engineering Totally Integrated Automation Page 18

19 Digital Enterprise Realization Page 19 The Customer s Digital Enterprise PLM Core Product Formulation Manufacturing Engineering Quality Mgt Manufacturing Execution SCADA Manufacturing Intelligence R&D and Manufacturing Operations Management brings Realization to the Innovation Platform Reducing Time-to-Market is the combination of an efficient product design and optimized manufacturing Industry Software allows customers to put their best laid plans to practice : Execute product development Execute production Enforce quality Reduce waste Provide transparency

Digitalization is Transforming the Manufacturing Industry Smart Model The product model sets the objectives needed to produce itself Digital Twin

20 Digitalization is Transforming the Manufacturing Industry Smart Model The product model sets the objectives needed to produce itself Digital Twin Full digital product definition that simulates reality Optimized, Distributed Production Autonomous production with embedded intelligence. Page 20

Digitalization is Transforming the Manufacturing Industry Smart Model The product model sets the objectives needed to produce itself During Execution, the Digital Twin is used as a reference by the

21 Digitalization is Transforming the Manufacturing Industry Smart Model The product model sets the objectives needed to produce itself During Execution, the Digital Twin is used as a reference by the operations system to place manufacturing events into context. Realtime values breathe life into the model and make it an invaluable reference for decision making During Design, the Digital Twin is used to identify & resolve conflicts between product characteristics and manufacturing process, allowing global NPI without costly ramp-up Digital Twin Full digital product definition that simulates reality Page 21

22 Digitalization is Transforming the Manufacturing Industry Smart Model The product model sets the objectives needed to produce itself Digital Twin Full digital product definition that simulates reality Optimized, Distributed Production Autonomous production with embedded intelligence. Page 22

Blending Virtual and Real Virtual commissioning in

Tool Using Virtual Commissioning, we just need three

of programming three weeks on the real machine we can do

23 Blending Virtual and Real Virtual commissioning in Industrial Machinery Virtual Machine Tool Real Machine Tool Using Virtual Commissioning, we just need three days on the real machine instead of three weeks Instead of programming three weeks on the real machine we can do that in one week in the office without any risk of collisions. Page 23

24 Process Industries Product Development and Innovation Many Facets & Challenges Page 24

25 Siemens Industry Software Strategy Management of Product and Production Lifecycle Page 25

26 Siemens Industry Software Strategy Management of Product and Production Lifecycle Page 26

27 Digitalization and Smart Formulated Products Software is the main enabler Ideation Product Design General Recipe Management Production Execution Manufacturing Intelligence Accurately represent what is real and simulate what is possible. Based on a consistent model of the product and production assets. Page 27

28 Digitalization and Smart Products Applying connectivity and intelligence Page 28

The Importance of Engaged Users Customer Challenge Give everyone in the innovation process the most up-to-date information to make the best decisions in the shortest time.

29 The Importance of Engaged Users Customer Challenge Give everyone in the innovation process the most up-to-date information to make the best decisions in the shortest time. Digital Enterprise Software Suite Clear, intuitive UI to simplify understanding Personalized user experience for role and task Available anytime, anywhere, through any delivery model Information that finds you; you don t have to find it Page 29

training requirements State of the art technology Easy to

30 Industry Software Emerging Customer Demands Modern look of User Interface Wireless Devices Modern User Experience Limited training requirements State of the art technology Easy to Install, Manage, Roll-out # Devices Runs in a browser MS SqlServer - Oracle Page 30

Example SIMATIC IT Unilab V7 User Interface & User Experience New, state of the art look & feel Integrating applications in a single Web environment

31 Example SIMATIC IT Unilab V7 User Interface & User Experience New, state of the art look & feel Integrating applications in a single Web environment Designed for web, multiple devices, browsers & platforms Support of multi touch and gestures Created by designers Future proof to SCADA & MES UI integration Page 31

Digitalization in the Industry Real and virtual worlds are converging with Industry Software By combining innovative industry software and powerful industrial hardware, virtual and real worlds of

32 Digitalization in the Industry Real and virtual worlds are converging with Industry Software By combining innovative industry software and powerful industrial hardware, virtual and real worlds of production are connected Software optimizes the entire product lifecycle from product design to production execution and service Shorter time-to-market of new products, more flexible R&D and production to increase your productivity Page 32

Siemens: Realizing Our Own Digital Enterprise Today Electronic Works Amberg 1,000 - different products manufactured 1

Manufacturer experiments with smart factory At a Siemens factory in Amberg, machines have begun to self-replicate.

33 Siemens: Realizing Our Own Digital Enterprise Today Electronic Works Amberg 1,000 - different products manufactured 1 million - monthly production of SIMATIC products 50 million - process items entered in SIMATIC IT each day 75% - automation level 12 dpm % quality rate 1,000 Teamcenter managed product variants shipped to 60,000 - customers worldwide each year Manufacturer experiments with smart factory At a Siemens factory in Amberg, machines have begun to self-replicate. Regulating the ultra-efficient production lines are the very same automation devices that are spat out at the end. One line, which operates 24 hours a day, requires no human intervention at all. Financial Times, April 10, 2014 Page 33

34 Thank You! Page 34 Siemens Digital Factory

Driving the Digital Enterprise Siemens in Context of Industrie 4.0. Restricted Siemens AG 2016

Driving the Digital Enterprise Siemens in Context of Industrie 4.0 Page 1 Contact The image cannot be displayed. Your computer may not have enough memory to open the image, or the image may have been corrupted.