SAP Digital Manufacturing Industrial Iot

Fujitsu World Tour 2017 shaping tomorrow with you

Fujitsu North America Technology Forum 2017

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 Stafford Bond, Fujitsu Digital  Mike Lackey, SAP  Nabil Lodey, GlobeRanger

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4th Wave AI and Robotics Knowledge & automation 3rd Wave The Internet of Things Convergence of physical & digital – 100bn (2021) 2nd Wave The Mobile Internet 1st Wave Real-time, anywhere – 10bn (2010) The Internet Connected, online – 1bn (2000) Online consumer business Hyperconnected World A huge impact to every industry

Intel Inside®. Powerful Productivity Outside. Creative Destruction Whips through Corporate America, Innosight

 A future where digital technology is…

Overwhelming Empowering Technology is Technology is connected but not connected and human centric human centric

Undeveloped Uneven Technology is not Technology is connected nor is human centric human centric but not connected

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“$2.5m spent per minute on IoT in 2016” Gartner

“Consumer IoT devices will reach 3 billion in the next 4 “By 2021, 1 million devices years, industrial IoT devices will be connected every will reach 100 billion” single hour” Gartner Gartner Intel Inside®. Powerful Productivity Outside. Growth within: A circular economy vision for a competitive Europe, McKinsey

Efficiency Services Congestion avoidance, Ecology

Vehicle Services Fees & Charges Diagnostics, servicing, Road using, taxes, upgrades, telemetry insurance

Social Collaboration Information Services Ride sharing, car Connected car Entertainment, sharing, taxi driving navigation, fuel/energy location Safety Health monitoring, autonomous driving Intel Inside®. Powerful Productivity Outside.

. Better understanding of individual customers Customer . Maximizing Customer Intimacy Experience

. From goods-selling to service-provision . Empowerment of . Fast value realization to employees Business model meet individual Operational . Autonomous operation transformation customer’s need Excellence (Mass customization)

. Intelligence in product and service Product . Co-creation of

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Digital Project Digital Business Digital Arenas  Apply digital to a  Apply digital to the heart of  Co-create greater value with partners function or a product and business service

Idea

Digitalized Mobile IoT Product or Service Digital Mobility Quality of Life Cloud Business Analytics Evaluation Digital Prototype Platform Technology Customer Interface Security AI

Trial

Operation Marketing Safety

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Product and Service

Digital Business Platform

API

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 Now think about your organization;  Run through four hyper-connectivity adoption scenarios 1. No interest in becoming a hyper-connected business 2. Adopting hyper-connectivity solutions in small unrelated projects (Digital Projects) 3. Integrating hyper-connectivity into the DNA of the organization (Digital Business) 4. Adopting Digital Arenas and considering the API economy (Digital Arenas)  Roll forward 5 years  What is your prediction of the outcome?

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Scenario 1 – Financial Performance Customer Experience Financial Performance Customer Experience Scenario 2 –

Do Nothing Revenue declining Customer satisfaction Revenue flat Customer satisfaction Digital Project

Cost base increasing Customer Expectations Cost base flat Customer Expectations

Organization Innovation Organization Innovation

Engineering culture Product innovation Engineering culture Product innovation

Redundancies New revenue streams Stagnant New revenue streams

Scenario 3 – Financial Performance Customer Experience Financial Performance Customer Experience Scenario 4 –

Digital Business Revenue growth Customer satisfaction Revenue growth Customer satisfaction Digital Arenas

Cost base decreasing Customer Expectations Cost base decreasing Customer Expectations

Organization Innovation Organization Innovation

Customer centric Product innovation Customer centric Product innovation culture culture Intel ExpansionInside®. / recruiting New revenue streams Expansion / recruiting New revenue streams Powerful Productivity Outside.

Mike Lackey, Global VP of Digital Manufacturing March 09th, 2017 INTERNAL

Digital Supply Chain, powered by SAP Leonardo Digital Transformation Impact

Business Processes

Business Models Work Environment

Customer satisfaction Competitive advantage Higher profit

Higher uptime and productivity

Lower Risk, through predictive maintenance. Fix it before it break

Flexibility Through pay per use

Customer satisfaction Competitive advantage Higher profit

Higher uptime and productivity

Lower Risk, through predictive maintenance. Fix it before it breaks

Flexibility Through pay per use

Customer satisfaction Better performance Optimized Service

8%-10% Reduction in maintenance costs

Improved Reliability and availability of trains

Higher Passenger satisfaction thanks to more reliable services

Customer satisfaction Better performance Optimized Service

Condition reporting Best performing

Remote support Reliability and availability of engines

Trend analysis Predictive Maintenance

Reduce costs Improve productivity High quality

Role Expansion Work across disciplines, design and manufacture smart products

Process Change Collaboration, Networking

Business Modell Customer Centricity

Physical World Business World Digital World

Digital Twin Vending DCS/PLC Auto Chemicals Machine General Ledger “As Designed” Procure to Pay Order to Cash

Engineer to Order “As Built” LIMS/Inspection/ CPG Configure to Order Sensors Weigh Scales Equipment Testing Make to Stock Inventory Controls Costing “As Maintained” CRM SRM Materials ¥ “Performance” Robots CNCs Engine Batteries € £ $

Motors Drinks Pumps AGVs

© 2017 SAP SE or an SAP affiliate company. All rights reserved. ǀ INTERNAL 19 Trends Impacting Connected Manufacturing Internet of Things and Industry 4.0 SAP Connected Manufacturing runs industrial IoT with Industry 4.0 scenarios

Internal INDUSTRIAL scenario External scenario

Internet of Things

» All industries » All things and devices ERP (PLM, PP) Industry 4.0 » Manufacturing industries » Ubiquitous

MES » OT-IT convergence » Personalized

Systems, things, and devices SCADA / HMI » on the shop floor

Machine Layer SMART Industrial THINGS & DEVICES Trends Impacting Connected Manufacturing Internet of Things and Industry 4.0 SAP Connected Manufacturing runs industrial IoT with Industry 4.0 scenarios

Internal INDUSTRIAL scenario External scenario

SAP Solutions for Industrial IoT Internet of Things SAP Connected Manufacturing » SAP Manufacturing Execution on HANA » All industries » SAP Manufacturing Integration and Intelligence on HANA SAP Plant Connectivity » All things and devices » ERP (PLM, PP) Industry 4.0 » Manufacturing industries » Ubiquitous SAP Solutions for External IoT SAP HANA Cloud Platform MES » OT-IT convergence » Personalized » SAP HANA Cloud Platform (HCP) » Systems, things, and devices SCADA / HMI » SAP IoT Connector on the shop floor » SAP Plant Connectivity Machine Layer SMART Industrial THINGS & DEVICES SAP Digital Manufacturing Industrial IoT

Distributed Manufacturing Network S/4 HANA Asset Intelligence OEM Cloud Enterprise Management Network (Mindsphere)

Connected Manufacturing

SAP ME SAP ME SAP QIM » Business Context » Multiple vendors SAP MII SAP CAMS » OEE, Energy Management SAP MII » Multiple machines SAP PCo SAP OEE SAP PCo SAP Leonardo, Connecting Things with People and Processes

Digital Supply Chain SAP Leonardo (Business Process View) (“Things” View)

• Digital Business Planning • Connected Products Industry view • Digital Response & Supply • Connected Assets

• Digital Logistics • Connected Fleet

• Digital Product Innovation SAP • Connected Infrastructure Leonardo • Digital Manufacturing • Connected Markets Portfolio • Digital Operations • Connected People

Line of Technology Business view view

Supply Manu- After Sales Procurement R&D Chain Logistics Sales PROCESSES facturing Service Planning

UI Layer (SAP Leonardo Bridge) PEOPLE

Enterprise Management – The Digital Core

FROM After Sales R&D Manufacturing Service PROCESSES Sales TO NETWORKS Procurement Logistics Supply Chain Planning NEW BUSINESS MODELS

SAP Leonardo Apps

Network Log. Hub Connected Goods Track & Trace Connected Mfg. Vehicle Insights Predictive Main. Asset Intelligence Network

SAP Leonardo Edge SAP Leonardo Foundation Computing SAP Cloud Platform / SAP HANA Platform

Things / Physical Layer

PRODUCTS

Connect Transform Reimagine Your Global Plant Network Manufacturing Operations Business Models

Connect to people & things Deliver Real Time KPIs

• Enterprise Systems

Improve Asset Efficiency • Manufacturing Systems

• Automation and Control SAP HANA Manage Energy SAP HANA • Shop Floor Workers Platform Top Floor • Management Embed Track and Trace

Shop • Sensors, Machines, RFID Floor Tags, Scanners, Printers Drive Cost, Quality, and Overall Performance

Monitor and send real-time alerts to and SAP Manufacturing SAP Manufacturing SAP Manufacturing from intelligent devices Extend Your Product Networks The GlobeRanger Perspective

Key Market Trends Customer Challenges How to adopt IOT

1. Pace of Innovation 1. Monetization 1. Land/Expand

2. Data Driven Economy 2. Culture Change 2. Real time visibility

3. New business models 3. Ownership 3. Automation

4. The new “lean”? 4. Security 4. Analytics

5. Changing Demographic

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This provides real-time end-to-end visibility of our customer’s business

Supply Chain WIP Warehouse Operations

Connected Supplier 1 Connected Factory Inward Goods Manufacturing Connected Warehouse WIP Outbound Goods Asset Tracking Supplier 2 Connected Factory Connected Machine Inbound Goods Inward Goods Connected Workers Real time putaway WIP Automate manual activity Outbound Goods Supplier 3 Connected Factory Outbound Goods Tool Tracking Inward Goods ERP Integration WIP Warehouse Management Outbound Goods

Which enables better decisions made based on accurate real time information. No missing or inaccurate data

Intel Inside®. Powerful Productivity Outside. Can then add analytics to optimise supply chain, reduce cost and open new revenue opportunities

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 Develop an hyper-conncected business strategy focused on business value

 Integrate it into the DNA of the IoT Analytics organization and establish the Mobile AI organizational units to maximize Human Centric the value it brings Innovation  Choosing a partner who participates Cloud Security in a comprehensive eco-system is SDCI Integrated key Computing

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