IoT Co-Creation for Digital Transformation Outcomes Nick Chang - - PowerPoint PPT Presentation

IoT Co-Creation for Digital Transformation Outcomes

Nick Chang Head of Global IoT and Analytics Practice

Every industry, every business is under pressure

DIGITAL REVOLUTION

DIGITAL TRANSFORMATION

Accelerate cost-efficiency and time to market by automating

• perations and

processes

PROCESS AUTOMATION WORKFORCE MOBILITY SUPPLY-CHAIN EFFICIENCY

Increase loyalty and grow revenue by improving customer experience

MOBILE COMMERCE REAL-TIME INFORMATION PERSONALIZED ENGAGEMENT

Unlock new revenue streams by adopting new business models

DATA-CENTRIC SERVICES GLOBAL EXPANSION DIGITAL COMMERCE

DATA STRATEGY FOR DIGITAL TRANSFORMATION

DATA ANALYTICS DATA GOVERNANCE DATA MANAGEMENT

Abstract Automate Accelerate Access

DATA MOBILITY

Any cloud Any app Anywhere Any use

DATA SOURCES

Structured data Unstructured data

Mobile

101100101010010101010 011010101001001100101

IoT data

IT

IT SYSTEMS ARTIFICIAL INTELLIGENCE COMMUNICATIONS BIG DATA ANALYTICS CLOUD

IoT

INSIGHT

CONSUMER BUSINESS CITY

OT

INDUSTRIAL

The Physical (OT) and Digital (IT) Worlds Are Merging

The Skills and Resource Gap

Source: 451 Research, Voice of the Enterprise: Internet of Things, Budgets and Outlook 2016

19.2% 20.5% 24.7% 28.8% 35.6% 38.4% 41.1% 45.2% 54.8% 54.8% 69.9% Distributed Computing Compliance/Licensing General Management Storage Management Standards & Protocols Virtualization Software Development Network Edge/Perimeter Security Cloud Computing Data Analytics

Skills needed by new staff for IoT projects

Will your IT department add dedicated staff to support IoT-related initiatives in 2017?

26.8% 73.2%

Yes No

The case for collaboration: “Most of the bright people don’t work for you, no matter who you are.” - Bill Joy

Challenges With Product/Solution Approach

“Firms today must contend with more complex projects, intertwined consumer markets, greater competition and the trend towards instant, and constant, customer feedback. Traditional approaches to business cannot adequately address these challenges.”

Longitude Research, “Co-creating the Future” 2017

§ Inflexibility

• ne size does not fit all

§ Ambiguity

around the scope of the problem

§ Complexity

many sources of innovation

• utside of single business

Challenges of Doing It Yourselves

“Finding the right partner with domain expertise in your business area is essential, as is that partner’s ability to collaborate with key stakeholders to identify technologies, skill gaps and opportunities for organizational process improvements.”

451 Research: Voice of the Enterprise 2016

In the digital world:

§ Pace of change is relentless § Problems span across multiple domains § Blurring of industry domains and boundaries

Collaborative Creation (Co-Creation)

§ Definition: The process of collaborating with customers and ecosystem players in

• rder to innovate and create

new value for business stakeholders, customers and society at large § Co-creation - Innovation Turned Inside Out!

Co-Creation is Transforming Solution Creation

Source: Longitude Research, “Co-creating the Future” 2017 0% 20% 40% 60% 80% 100%

Manufacturing Transport Automotive Technology Financial Services Healthcare Infrastructure/City … Energy Not for profit Total All of the time Often Occasionally Sometimes Never How often has your organization worked with customers on co-creation? Co-creation transforming innovation 48.5% 73.4%

61% 48% 83% 60% 61% 55% 57% 49% 61% 57% 0% 20% 40% 60% 80% 100%

Manufacturing Transport Automotive Technology Financial Services Healthcare Infra planning Energy Not for profit Total Agree

Hitachi Co-Creation Approach

T H O M S O N R E U T E R S :

“Top 100 Global Innovators” 119,000

Patents

H E R I TA G E O F I N N O VAT I O N A W A R D - W I N N I N G C U LT U R E

Co-Creation

Innovation through collaboration Challenges

Customer

Partners

Software vendors System integrators

Hitachi R&D Hitachi “NewCo name”

Lumada

Global Center for Social Innovation (CSI) NEXPERIENCE

Hitachi Business Units

Power and energy Urban Industrial Water Financial Healthcare Government

Hitachi Co-Creation Ecosystem – Getting Various Elements Together

Note: need NewCo name in final version

Different Levels of Co-Creation

Enablement Innovation Execution

CUSTOMER RESOURCES HITACHI RESOURCES

We do it WITH you We SHOW you how We do it FOR you

Hitachi Co-Creation Methodology

List of use cases Analytical model Proof of concept Proof of value

Hitachi collaborates with customers to co-create unique solutions to specific customer challenges and data.

Engage Build model Create solution Validate

Deployment @ scale HITACHI Customer

Iterate as needed

Life Cycle of Co-Created Solutions

Prioritized list of use cases Analytical model Proof of concept Proof of value Engage Build model Create solution Validate

Co-create solution Operationalize

Business Integration Delivered Business Value Deploy @ scale Operate and manage

HITACHI Customer

HITACHI Customer Iterate as needed

Engage Prioritized use cases

• 2. Understand data model
• 1. Understand customer

business and challenges

• 4. Define use cases
• 3. Conduct interviews, hold

workshops, share vision

• 5. Garner Consensus and agree
• n IP ownership

Build Model

• 1. Define Use cases in detail
• 2. Explore Data by sifting

through various sources

• 3. Prepare data model
• 4. Develop analytical model

Analytical Model

Create Solution Proof of outcome

• 1. Deploy IoT analytics platform
• 2. Build solution-model code

and algorithms

• 3. Build UX wireframes/UI

design model

• 4. Perform functionality testing

with sample data

Validate Proof of value

• 4. Validate business outcomes

and KPIs

• 3. Test robustness
• 2. Update data and analytical

pipeline

• 1. Integrate with customer IT and

OT ecosystems

Case #1: Predictive Quality at Daicel Corporation

Case study: Predictive Quality at Daicel Corp.

Daicel is a global manufacturer of chemical and pyrotechnical products.

• HQ: Osaka, Japan
• FY2016 Revenues – ¥ 440 B ($4 B)
• Employees:11,556

Automotive airbag inflator is one of Daicel’s core business.

Issues: Globally improving product quality, increasing productivity and improving worker’s field of operation in automotive airbag inflator production processes

Activities

• Interview stakeholders and research to identify, evaluate

and prioritize IoT/Analytics opportunities

• Explore the possibility of co-creation bringing IoT/Analytics

expertise and image analysis technologies to the table Outcomes

• Defined scope of project: Enhance Manufacturing Execution

System (MES) by incorporating IoT technologies; first at Harima plant and then scale to other plants

• Specific use cases: Improve quality and increase productivity

by accurate traceability, detecting signs of operational failures and deviations in worker activities on the front lines

Engage to define specific use cases

Feature value extraction Judgement Pre-processing High level system view of irregular movement detection algorithm

Smoothing Normalization Head movement Waist movement Arm movement

Joint position information

Model selection

Judgment result

• abnormal

type

• Degree of

abnormality

Activities

• Collect the manufacturing performance data captured from

the perspective of 3M - Man, Machine & Material

• Capture human joint position information in 3D via

cameras and distance image sensors

• Identify and list all possible deviations by questioning

workers at great length and identify all work processes

• Use algorithms & pattern recognition to detect worker

irregular movement compared to standard movement. Outcome

• Analytical model

Analysis targets and sensing methods

Category Analysis Targets Sensing methods Man Worker activities Depth cameras Position of supervisor & parts suppliers Omni-directional camera Machine Location of work abnormalities, welding defects Fixed Camera, High speed camera Material Parts supply PTZ camera*

* PTZ (Pan, tilt, zoom): captures subjects in high resolution & pin-point accuracy

Build an analytical model with data

Create Solution to generate outcomes

Activities

• Introduce cameras as new sensing data

sources combined with advanced analytics

• Blend 3D image analysis with data from MES,

IT systems & IoT feeds

• Build data pipeline and analytical workflow
• Continuous data monitoring and refinement
• f man, machine & materials assets

Outcomes

• Initial results of identification & removal of

defective parts improves the overall non-defective product ratio

• Analytics solution ready for pilot

Validate the delivered value

Outcomes

• Reduced the time to discovery of man, machine & materials defects
• Reduced number of product recalls and quick elimination of defect

root causes

• Ready for multi-site deployment

The role of supervisor shifted from ‘After the fact’ to ‘Prevention of failure’ Activities

• Joint verification in Pilot tests at Daicel's Harima Plant (Tatsuno

City, Hyogo Prefecture)

• Detect signs of operational failures in production line facilities &

deviations in worker activities

Case #2: “City of Innovation” Campus Strategy

Smart Campus: Curtin University, Perth, Australia Goal:

§ Transform into a major innovation area in APAC § Formed ‘Innovation Central Perth,’ an industry and research collaboration center to accelerate innovation around “big data”

Expected outcomes:

§ Better student experience, increased efficiency and safety § Insights about the life cycle of a student, day-to-day reality of students and staff members and prevention of testing fraud § Environmental health and utilization of the campus and classrooms

60,000

students

4,000 staff

Evolving from a learning center to a ”living laboratory"

3 Use Cases

Objective: § Understand student activities Outcomes achieved: § Tracked registered-student classroom activity § Identified presence of unregistered students How: § Evaluated performance of video and video analytics (live face matching, people counting, and Hitachi Visualization Suite)

# 1 – Student registration mgmt. # 2 – Room environment optimization

Objective: § Optimal utilization of space Outcomes achieved: § Optimal utilization of room § Minimize energy costs and enhanced student comfort How: § Hitachi video analytics § Real-time and historical room data (temp., humidity and lighting) and visual correlation with room occupancy Objective: § Monitor exam fraud Outcomes achieved: § Exam attendees matched by face against the schedule How: § Took RFID scan of student ID then attempted live face matching

# 3 – Exam fraud monitoring

On the Horizon: A Marketplace to Exchange IoT Solutions

Co-creation

Know-How Technology Service

Partner Customer Developer

Service Technology Technology Know-How Know-How Technology

§ Connecting Customers, Partners and Developers for Innovation

‒ One place to:

‒ Exchange services, know-how and technologies ‒ Foster collaboration and accelerate co-creation ‒ Assemble solutions and find new business opportunities

‒ Stay tuned for more news (Spring 2018)

Co-creation leverages the expertise and perspectives of an enterprise, its technology partners, and its end users. Together they are better able to envision, develop, deploy and operate the best possible solutions.

Co-Creation – Innovating Innovation!

52% said co-

creation has reduced the cost of developing products and services

Source: Longitude Research

61% used co-creation

to produce successful new products, services and commercial opportunities

57% said co-creation

has transformed their

• rganization’s approach

to innovation

51% said that co-

creation has improved financial performance

Thank You