Digital Transformation with IoT

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1 Digital Transformation with IoT

2 Digitization Trends Across Major Industries Where is the value Smart Manufacturing Grid Modernization Shopper Insights Connect the Unconnected 50Billion Smart Connected Devices by 2020 Hyper-connectivity, IT and OT convergence Smart Cities Connected Transit Smart Space IoT Enabling Transformation TRANSFORM BUSINESS PROCESSES Higher productivity by predictive maintenance and better asset utilization ENABLE NEW BUSINESS MODELS Create recurring revenue models with increased customer intimacy Over 60% of the IOT value will be generated in Enterprise deployments <1% of data currently used, more can be used for optimization and prediction Interoperability across silo ed systems required to capture 40% of IOT value Source - McKinsey: The Internet of Things: Mapping The Value Beyond The Hype

3 Where Are You on the Digital Journey? Predictive mainte- Rapid nance experimentation and simulation Remote maintenance Virtually guided selfservice Smart energy consumption Intelligent lots Real-time yield optimization Routing flexibility Concurrent engineering Customer co-creation/ open innovation Data-driven design to value Data driven demand prediction Digital quality management Advanced process control (APC) Statistical process control (SPC) Time to market Supply/ demand match Quality Batch size 1 Service/ after-sales Inventories Realtime SC optimization Resource/ process effectiveness In situ 3D printing Labor efficiency Asset utilization Machine flexibility Remote monitoring and control Predictive maintenance Augmented reality for MRO 1 Human-robot collaboration Remote monitoring and Digital control performance Automation of ment manageknowledg e work Asset visibility Asset utilization Employee productivity Automation

4 Digitization Is the Key to Leapfrogging the Industry Lower operational costs productivity increase Faster time to market Savings with accurate forecasts Time to market Supply/ demand match Quality Service/ after-sales Inventories Resource/ process effectiveness Labor efficiency Asset utilization lower downtime Asset visibility Asset utilization Employee productivity Automation Higher quality Lower inventory costs Faster time to completion

5 Common Phases of IoT Journey Common IoT capabilities Asset Management Predictive Maintenance Field operations Supply Chain Optimization Safety & Compliance

6 Complexity Stands in the Way Connectivity & Security Data Aggregation Real Time Visibility Automation & Management Value Monetization Ecosystem Interoperation

7 We Can Solve These Problems By New Innovations in Connectivity Cloud-Based Infrastructure Management Analytics & Actuation

8 Infrastructure Capabilities Outcomes IoT Made Simple -- Cisco Solution Framework for the Digital Journey Transformation Integrated Business Processes Vertical-Specific Digital Solutions Analytics and Applications Analytics & Automation + Industry-Leading Partner Ecosystem Manage Data from Edge to Cloud End-to-End Security Unified Connectivity Fog Compute Network as an Enforcer Open Standards Network Sources: Cisco IoT Purchase Process Global Study January 2015, Forrester Research study commissioned by Cisco November 2014, IDC Futurescape: Worldwide IoT Predictions Dec 3, 2014

9 Vertical Solution -- Manufacturing

10 Immense Business Benefits Expected Reduced Downtime 48% Reduction in Defects 49% New Product Introduction 23% OEE Improvement 16% Improved Inventory 35% Reduction in Energy Use 18% Unplanned downtime down from 11% to 5.8% Defect rate down from 4.9% to 2.5% New product introduction cycle time reduced from 15 to 11 months Average OEE improved from 74% to 86% Inventory turns increased from 14 to 19 Annual energy cost down from $8.4M to $6.9M What business benefits do you expect to derive from Digital Manufacturing? Source: SCM World/Cisco Smart Manufacturing and the Internet of Things 2015 survey of 418 Manufacturing Business Line Executives and Plant Managers across 17 vertical industries.

11 Solutions Driving Manufacturing Value Process Optimization Supply Chain Factory Security Control Network

12 ZDT Data Collector Process Optimization Process Optimization at FANUC Challenge No visibility on how machines are utilized Machine downtime cost millions Data collection and edge compute Cloud managed service across plants Solution ZDT Service Center Portal Alert Monitoring, Schedule Parts and Maintenance, Enhanced Customer Service Tools ZDT Customer Portal Track alerts, View ZDT network status, Access ZDT reports, Authorize users, Web Services Customer Business Intelligence/ Reporting Area Data Analytics Plant 1 Plant 2 Plant X Cisco Security Machine Learning FANUC CLOUD Persistent, Secure Encrypted Cisco Customer Security ZDT D/C Data Visualization Data Receive ZDT data collector with UCS on-prem Streaming machine data to Cisco Cloud service and perform data analytic with Cloudera cluster Business Outcomes Save estimated $40M in machine downtime Provide visibility on machines are utilized and increased the overall equipment efficiency (OEE)

13 Process Optimization at Mazak Challenge Process Optimization Enable connectivity Mazak machines for predictive maintenance and MaaS business model Solution Cisco-enabled ismart Machines with imbedded network switch, security and MTConnect Agent Business Outcomes 300% Internal Rate of Return (IRR) increased production and overall equipment efficiency (OEE) by 10%

14 Solutions Driving Manufacturing Value Process Optimization Supply Chain Factory Security Control Network

15 Supply Chain Use Cases Supply Chain Material Flow Lean manufacturing ekanban & Kaisan principles Manufacturing Flexibility Engineered to order Customer commitments schedule adherence Supply Chain Visibility Pallet tracking factory to customer for end to end traceability Inbound inventory visibility Freight verification and real time visibility Production Optimization Asset management Increased margins

16 Cisco Supply Chain Organization Transformation for Improved Resiliency and Agility For seven consecutive years, Cisco has placed in the Top 10 of Gartner s prestigious ranking! Led by Cisco Senior VP John Kern, the supply chain operations team here at Cisco has undergone an extensive transformation and continues to be recognized globally as a best-in-class practitioner. Chet Namboodri in Cisco Manufacturing Blog Challenge Business agility constrained by highly customized supply chain system and multiple ERP instances Country enablement and ability to introduce new business models hampered Few industry-standard processes and automation efficiencies in the supply chain Solution Simplified operations using out-of- the box Oracle functionality Incorporated build-to-stock model into supply chain; integrated industry-standard business practices Results Time to add new node (factory) shrunk from 18 to 6 months 30-50% reduction in time to market Up to 73 percent reduction in order cycle times About 25 percent reduction in product touches Eliminated redundancies and duplicate transactions

17 Sub-Zero Wolf Premium Appliance Manufacturer Innovates with IoE With this solution, we found a way to see and discuss very detailed video and images from afar in a highly secure manner. We are now using video collaboration on a daily basis to finalize designs, correct production line issues, work with suppliers, and train installers and servicers. -Paul Sikir VP of Engineering Challenge Meet launch schedule for 60 new products Adhere to stringent quality requirements and manage issues from new supply-chain partners Increase staff productivity time and collaboration while reducing travel and costs (engineering was not in same location as manufacturing Solution: Integrated manufacturing mobile video capabilities into daily workflows and processes Upgraded wireless networks to support mobile devices and video streaming and conferencing within manufacturing facilities Integrated solution into existing video infrastructure and tools Results Shaved 10-20% off new product introduction cycle time Estimated internal savings in downtime costs of $2,500 per production line per hour through faster resolution of design or manufacturing issues. For one project, Sub-Zero estimates an annual travel savings of more than $40,000. Over $100,000 savings in field testing costs.

18 Solutions Driving Manufacturing Value Process Optimization Supply Chain Factory Security Control Network

19 Factory Security Challenge Factory Security Today s control s environments have soft middles Remote Access Open Port Today s solutions not geared to protect against threats like APTs Physical Plant Proximal Malware

20 Factory Security Solution Factory Security Layers Secure Zones Cells Zones Internet Plants Internet Enterprise Network Enterprise Network VPN Remote Services Segmented Access (Role-Based) Cloud Systems Security Policy, AAA and Identity Services Physical Security Cloud Systems Let s do some maintenance! Smart, Programmable Cameras Industrial Cyber Security Security Monitoring, Threat Detection, Incident and Event Monitoring IEDs, PLCs, Sensors, IEDs, IEDs, PLCs PLCs Sensors, Sensors, Actuators Actuators Actuators DMZ Web Web Server Server App App Server Server Supervisory Network Database Database SCADA/DCS Historian SCADA/DCS SCADA/DCS Historian Historian Control System Network Historian Historian Historian VPN VPN Remote Facility Remote Facility Field Network Actuators Actuators Sensors Sensors Actuators Sensors Application Visibility, IPS/IDS Switching Routers Network and Security Mgmt. Identity Services Engine Video Surveillance Manager Firewalls Access Points

21 Solutions Driving Manufacturing Value Process Optimization Supply Chain Factory Security Control Network

22 Control Network Use Case Control Network Networking the Factory of the Future Reduced Network IT TCO by 18% Increase Line Uptime Flexibly Meeting Demand Shifts

23 Sugar Creek Packaging Food Manufacturer expands product portfolio With the help of the Cisco and Cisco Services, we have been able to expand our product portfolio by adding a new plant. This has also allowed us to add additional insight into our operations that was not possible before. -Rob Daley CEO Sugar Creek Challenge Get better transparency of real-time production to schedule Expand into a new product portfolio that needs sensors everywhere (Sous-Vide) for ideal production Need to understand effects of emergency issues and help first responders in case of issues Gain better visibility to real-time OEE for all users in all locations Solution: Leverage Cisco Connected Factory Architecture in the plant Combine with AeroScout RFID tags, Cisco Wireless Integrate machine data to digital signage and mobility applications Results Met new factory schedule for implementation Reduced labeling error rate by 45% Improved labor utilization from 65% to 88% Improved visibility of workers on job at hand to speed product introductions New sensor visibility

24 Nestle Reduces Downtime Wireless Network Increases Visibility to Production Processes IT now truly supports Nestlé s business-critical production processes, because we have full visibility of connectivity to networks across all our manufacturing facilities. -Kavi Garrib, senior systems engineer Nestlé Southern Africa Region Challenge IT team had to physically travel to support 10 geographically dispersed manufacturing facilities Needed to improve uptime of the network for the tracking of business-critical production processes Solution Cisco Prime Network Control System provides full visibility of connectivity across sites Cisco solution allows for remote monitoring and management Results Reduced business risk of downtime with network visibility Reduced requirement for SLAbased service, thereby saving on operational costs Allows for mobile workforce in new head office building and manfufacturing facilities

25 Is Your Digitization/IoT Strategy Ready? Connectivity Security Fog Computing Data Analytics Management & Automation Application Enablement Can you support the growing number of devices in different environments? Can you provide the secure connectivity for IT & OT convergence and support standard protocols for interoperability and scale? Can you efficiently analyze and manage data from the edge to the cloud? Can you provide the infrastructure and tools necessary to combine IoT analytics with business analytics? Can you enable convergence of OT and IT networks to create and enforce a consistent policy across the entire Enterprise? Can you assist in the creation of highly sophisticated applications needed for your business?

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