Mechanics Overview · Management (PLM), Manufacturing Execution System (MES) and Enterprise...

Mechanics Overview

May 2018

Market Highlights

1

Growth will stem from innovations on

the supply side with vendors

looking to save energy and

automate equipment

Packaging Machines

Flexibility, low costs and

safety/security are Key Success

Factors which are influencing the

make-up of the factories of the future

Industrial Plants

Demand from developed and

developing countries such as

Germany and Brazil will drive

the market forward

Machine Tools

The Non-Destructive Test segment

is amongst the most dynamic in

the total Test Equipment market

with a 7.1% CAGR

Test Equipment

Vendors are increasingly looking to

smart sensors as a means to serve

their customers and to access a

$123b market

Sensor Technologies

Source: Frost & Sullivan

Market Trend #1

Packaging Machines

2


Growth will stem from innovations with vendors looking to save energy and automate equipment; smart sensors are helping

customers to increase productivity and reduce costs

Trends Technologies

Key drivers, Europe Smart sensors

Drivers 1-2 Years 3-4 Years 5th Year

Increasing need for

energy saving

Focus on automation

Emergence of

intuitive applications

Impact: High Low

Packaging machine manufacturers have looked to

embed sensors in their solutions for years.

Historically, their impact has been limited by the

lack of an effective communication platform but

automation vendors have developed “smart”

sensors built with Ethernet protocols such as

CAN, Profibus and IO-Link

Sm

art

Se

ns

ors

Market Trend #2

Industrial Plants

3


Flexibility, low costs and safety/security are Key Success Factors which are influencing the make-up of the factories of the future;

automation and robots are ensuring manufacturers remain competitive

Factories Technologies

Key Success Factors Solutions under development

Manufacturing

Flexibility

Low-cost

Production

Safety and Security

Automation Robots

Market Trend #3

Machine Tools

4


Demand from both developed and developing countries such as Germany and Brazil will drive the market; software solutions which

enable data collection are making machine tools smart

Trends Technologies

Key drivers, Global Software solutions


Investment in

automobile in BRIC

Technological

prowess of Germany

Demand for

advanced materials

Impact: High Low

Manufacturers are developing software solutions that enable

programming and data collection, making machine tools more

intelligent. The seamless transfer, collection, and analysis of

data will make machines more productive in the future

Applicable Segments

✓ Metal Cutting

✓ Metal Forming

Metal Finishing

Market Trend #4

Test Equipment

5


The Non-Destructive Test segment is amongst the most dynamic in the Test Equipment market with a 7.1% CAGR; IIoT and big

data & predictive analytics are expected to create additional opportunity

Size Outlook

Revenues, Global, 2018-22 Additional Opportunities, Global, 2024

2,1

2,4

2,7

0,0

1,0

2,0

3,0

2018 2020 2022

7.1% CAGR 2018-25

Re

ve

nu

es

$ m

Industrial Internet

of Things (IIoT)

Big Data and

Predictive Analytics

~$4.5 Billion

by 2024

~$5 Billion

by 2024

Market Trend #5

Sensor Technologies

6

Vendors are looking to smart sensors as a means to serve their customers and to access a $123b market; minutarization is expected

to accelerate the penetration Consumer Electronics

Size Applications

Revenues, Patents and Funding, 2015-22 Consumer Electronics

Wearables Tablets

$121.6B

Cumulative

Market

2016-2022

$159.6M

Funding Raised

between 2015

and 2017

2600+ Patents

Published

Globally

`2015-2017


7

...

• TBC

Packaging Machines

Packaging Machinery Market: Revenue Forecast, Europe

In 2020, the European packaging machinery market is forecast to reach $17.5b,

up from $14.2b in 2015 which corresponds to a CAGR of 4.3%

8

0,0

0,5

1,0

1,5

2,0

2,5

3,0

3,5

4,0

4,5

5,0

0

2.000

4.000

6.000

8.000

10.000

12.000

14.000

16.000

18.000

20.000

2012 2013 2014 2015 2016 2017 2018 2019 2020

Revenue 12.681,82 13.127,63 13.625,58 14.181,51 14.772,74 15.398,16 16.060,02 16.768,09 17.525,95

Growth Rate - 3,5 3,8 4,1 4,2 4,2 4,3 4,4 4,5

Re

ve

nu

e (

$ M

illi

on

)


Size

Growth will stem from innovations on the supply side with vendors looking to

both save energy and automate equipment

9


Increasing need for greater energy saving applications H H H

Perpetual focus on automation of equipment operation H H H

Emergence of intuitive applications supporting next-generation technology M M H

Restraints 1-2 Years 3-4 Years 5th Year

Volatile economic condition hampering manufacturers’ growth margins H H M

Maturity of the European market limits growth prospects M M M

Increasing machine complexity restricts its adaptability to changing technologies M M L

Impact Ratings: H = High, M = Medium, L = Low


Packaging Machinery Market: Market Drivers and Restraints, Europe

Trends

The food industry is the largest application vertical while Filling, Closing and

Filling & Closing (FCFC) machines account for 37% of sales

10


FFS = Form Fill Seal Machinery

Other industries include confectionary and tobacco; Other machines include labelling, marking and cleaning

36,9%

35,1%

7,5%

2,5%

8,5%

FCFC Machinery FFS Machinery

Wrapping Machinery Palletizing Machinery

Others

45,4%

21,0%

14,0%

8,7%

3,7%7,2%

Food Chemical and Petrochemical

Beverage Pharmaceuticals

Cosmetics and Toilteries Others

Packaging Machinery Market: Percent Revenue Breakdown

Revenues by Industry, Europe Revenues by Machine, Europe

Segmentation

Krones is the leader but the market is fragmented with over 1,000 participants

and the top six holding a combined 55% share

11


Total Packaging Machinery Market: Competitive Structure, Europe

Number of Companies in the Market Greater than 1,000

Competitive Factors Cost, energy saving, performance, technical support, smart operation, and reliability

Key End-user Groups Food, beverage, chemicals and petrochemicals, pharmaceutical, toiletries, and cosmetics

Major Market Participants (share in

revenue terms)

Krones (19.9%), Tetra Laval (9.1%), Robert Bosch (8.5%), Salzgitter Klöckner-Werke

(8.2%), Coesia Group (5.6%), IMA (3.5%) and Others (45.2%)

Market Share of Top 6 Competitors 54.8%

Other Notable Market Participants Elopak, SASIB, Oystar Group and Bradman Lake

Distribution Structure Direct sales, distributors, and OEMs

Competition

Embedding smart sensors, using Ethernet protocols, in packaging machines is

helping customers to increase productivity and reduce costs

12


Sm

art

Se

ns

ors

The foremost challenge for every packaging machine manufacturer is to help customers improve their production

efficiency. The manufacturing process is typically highly complex, due to the diverse nature of each product which varies

according to colour, shape, size, raw material (e.g. PET, fibre glass, paper), texture and pattern.

To manufacture such products, many customers lay separate packaging lines side-by-side. These become cumbersome

to operate and manage. In addition, running multiple processes in parallel increases the risk of errors and stoppage with

workers required to manually monitor their performance

Packaging machine manufacturers have looked to address these challenges by embedding sensors in their solutions.

Historically, their impact has been limited by the lack of an effective communication platform but automation vendors

have developed “smart” sensors built with Ethernet protocols such as CAN, Profibus and IO-Link.

Digital platforms such as this enable communication at any time from any place, thereby creating opportunities for

analysing minute details of the packaging process and paving the way for performance enhancement. End-users have

greater control over quality, flexibility and therefore wastage.

The benefits of greater flexibility and improved communication can be illustrated by vertical Form Fill Seal Machines.

When EtherCAT is deployed in input/output devices and servo & cable motors, the production uptime can be increased

by 20-30%, wastage can be reduced by nearly 15%, and architecture costs can be lowered by ~50%.

Technologies

Leveraging automation solutions (PLM, MES, EMI) gives packagers greater

control over operations and allows faster assembly

13


Au

tom

ati

on

So

luti

on

s

Packaging is a dynamic market with a range of end-users. The major industries that it serves, such as food & beverages, pharmaceuticals and cosmetics, need to launch and supply products in a short time span, due to the high demand and intense competition.

In this context, many packaging lines are being integrated with automation solutions such as Product Lifecycle Management (PLM), Manufacturing Execution System (MES) and Enterprise Manufacturing Intelligence (EMI). These provide greater control over operations and, more importantly, enable faster assembling, inspection, wrapping and labelling for large volumes of products. Via automation, repetitive processes can be performed smoothly without any manual effort and with reduced error. Moreover, PLM, MES and EMI allow assemblers to meet safety and sustainability regulations effortlessly.

Automated solutions leverage data from smart sensors embedded in machines and equipment. This helps customers to enhance their decision-making processes relating to production planning and scheduling, order management and distribution channels.

Krones' in-house software solution, named SitePilot, is specifically designed for the food & beverage industry. This serves as a complete solution, offering MES, Process Control (PCS) and Warehouse Management Systems (WMS). The company has total control and visibility over its lines, which enables timely production, the flexibility to adjust activities to end-users’ needs, reduced inventories, and efficiently managed warehouse and logistics operations. Predictive and timely maintenance also contributes to making the production process more efficient whilst preventing the unnecessary shutdown of facilities.

Technologies

14

...

• TBC

Industrial Plants

F&B manufacturers

are focused on

developing new

plant designs that

incorporate

capacity expansion

flexibility, strategic

locations that

enable continuous

and reliable

suppliers and

sourcing, and

incorporating

advanced

technologies to

ensure bottom-line

efficiency.

Flexibility, cost and safety are the key concerns influencing the make-up of

factories for F&B producers and manufacturers in general

15

Source: foodprocessing.com; Frost & Sullivan

Key Success Factors (KSF) for Food

Manufacturers, Global

Trends

Flexibility in

Manufacturing

Low-cost

Production

Cleanliness, Safety,

and Security

While large F&B

end users may

have a mix of old

and new large

plants and small

plants, as well as

mega plants, there

is an increasing

requirement to

expand production

lines to produce

several types of

products at shorter

runs. Mega plants

were built with

fewer lines that can

produce at higher

frequencies.

Line flexibility

remains an

important

parameter in the

plant designs;

however,

throughput

efficiency and

sustainability

remain important

issues with current

models.

Future plants will

require the

implementation of

sustainable

measures to ensure

energy efficiency

and effective

resource utilization.

New project designs take into account the volume and portfolio of products

16


Trends

• Apart from plant flexibility,

efficiency and asset

optimization technologies

and techniques are crucial

components in the design

of future plants.

• New technology

developments and

increasing levels of

automated solution

adoption are driving the

demand for more managed

service offering models

that will support future

plant designs

• Enhanced site-location

detection based on

production processes

• Material selection

based on plant’s

sanitation

requirements

• Equipment based on

product type (e.g. dry

ingredients versus

semi-solids/liquids)

• Multiple operational

lines requirements

• Peak-demand

flexibility

• Equipment

redundancy

Product

• Site location based on

processes

• Material selection

based on sanitation

requirements

• Equipment based on

product type (e.g., dry

ingredients versus

semi-solids/liquids)’

Portfolio Volume

Design Factors for Food Manufacturers, Global

Changing operating models are also impacting production line configurations

17


Trends

Changing Operating Models, Global

Operating Model, 2016 Operating Model, 2020

When compared to the traditional linear model of operation where raw materials are input at one end and products are at the other, the

new plant designs follow a more interlinked network system with several separate areas of processes and operations

• Improved Equipment Efficiency: This operation model helps the plant continuously operate and improve equipment efficiency as

maintenance and cleaning processes can be addressed when required without disrupting the entire production line. Furthermore, it

enables plants to prioritize areas of the production line that require more flexibility

• Mobility Around the Plant: A flexible plant design enables solution providers to develop new equipment designs that can connect and

disconnect for the process, effective clean-in-place solutions, and mobility applications. The use of adaptable storage facilities for

products and standby equipment will be important in future plant designs

Stage 1

Stage 2

Stage 3

Stage 4

Process

Line

Siloed

Stage 1

Stage 3

Stage 4 Stage 2

Efficient production and consistent quality, crucial to ensuring that

manufacturers remain competitive, are being enabled by new technologies

18


Technologies

Evolving Technologies

Smaller and more nimble plants are starting to emerge, offering more automated and advanced solutions to address emerging

challenges in the industry.

• Automation: The increased requirements for streamlining processes and maintaining safety standards are driving the

adoption of automated solutions

• Robots: The harsh conditions of certain operations, such as food storage processes, make it difficult for humans to

continuously operate them. Robots have provided a solution to increase efficiency in food plants

• 3D Printing: Additive food manufacturing provides a quick solution to cater to variations in food demands

• Nanotechnology: Nanotechnology is aiding in improving the quality and freshness of food substances

Solutions already being developed

Solutions yet to be developed and adopted

New Plant Technology Developments, Global

Nanotechnology3D PrintingRobotsAutomation

Automation solutions support the development of new plant designs that can

effectively adapt and react to their manufacturing ecosystems

19


Technologies

Areas of Improvements for Manufacturers, Global

• Technology advancements enable operational efficiency and continual

incremental improvements that are essential to address the dynamic

demands in the F&B industry

Increase in outputs by improving

the overall equipment

effectiveness (OEE)

• Managing multiple product lines and changeover times is increasingly

becoming a pain point for manufacturers, resulting in decreased

productivity. Parameters such as the frequency of changeovers,

equipment reliability, and cleaning processes are essential attributes in the

production floor

Reducing production costs by

continuous monitoring and

process improvements

• As F&B manufacturers aim to expand product lines to cater to these

demands, opportunities to purchase new equipment or use existing

equipment to support the expansion of product portfolios will be adopted

Reduction of start-up times and

changeover times in both new

and existing lines

• While sanitizing equipment remains a critical part of food production, there

is an increasing requirement to develop systems to reduce the process

(and re-assembly) time and ensure continued production

Disparate systems can be compli-

cated and lead to employees

utilizing old or redundant data

The increased focus on improving cleanliness and reducing contamination is

driving the deployment of robotic applications in food facilities

20

Source: robotics.org; Robotics Business Review; RobotWorx; Frost & Sullivan

Technologies

• The need for fewer touch points to promote food

cleanliness and reduce contamination is driving the

requirement for robotic applications. Furthermore, these

food robots are capable of carrying out multiple tasks in a

more efficient and quick manner

• While packaging, wrapping, and palletizing are currently

using robotic solutions in the industry, grading and portion

control are two other applications that are encouraging

investments for robotic applications, especially in the meat

industry. The combination of vision and laser technology

with robotic applications enables a 3-D processing system

that can manage inconsistencies in food sizes and shapes

• Robotic solution providers are increasingly developing

more affordable robots that are designed with specialized

coatings and

food-grade grease to ensure minimal impact

on the food and beverages they handle

Food Robot Applications, Global

• Food robots help food manufacturers to

effectively address regulation and compliance

requirements pertaining to clean food

production.

Compliance

• Upstream robots come into direct contact with

the food (from handling pastries to slicing and

butchering meats, to name a few).

• Robots eliminate the risk of contamination and

offer a more hygienic processing and packaging

environment.

Healthier

Foods

Robots can carry out repetitive tasks in

environments that are cold or hot, effectively

addressing labor shortfalls.

Harsh working

Conditions

Portal, SCARA, Articulated and Delta robots are being used in both up- and

downstream applications to reduce the number of touch points

21


Technologies

Process

Primary

Packaging

Secondary

Packaging

Palletizing

Dir

ect

Co

nta

ct

wit

h F

oo

d

No

Co

nta

ct

wit

h F

oo

d

Upstream Applications:

• Growing potential for robotics

• Health and safety regulations

promoting adoption of robots

• Evolving technology of robotics: X-

ray vision, 3D vision, ultrasonic

cutting

• Ability to perform effectively

irrespective of work environment

Downstream Applications:

• No direct contact with food; hence more easy adoption of robots

• Extensive use in packaging, wrapping, and palletizing applications

already

• Speed and precision in repetitive tasks and minimized downtime by

advanced programming for multiple specifications

Types of Robots Used in Food Processing, Global

• Portal Robots: Portal robots have limited

movement along the horizontal and vertical axes

• They are widely used for material handling

applications

• SCARA: Selective Compliance Assembly Robot

Arm (SCARA) can be limited to 2-axis quick

movements

• Motion of this type of robot is similar to a human

arm, as it can perform extending and contracting

movements

• Articulated Robots: These robots are fit with

rotary joints that give them a full range of motion

• The capabilities of the robot increase and the

movements can be programmed to be more

precise

• Delta Robots: A type of parallel robot consisting

of 3 arms connected at the base

• Manipulate small and light objects at high

speeds for several applications

Sara Lee, Mayekawa and OSI Group are examples of end-users rolling-out

“Foodbots” from OEMs such as Adept, FANUC and Stäubli

22

Source: robotics.org; Robotics Business Review; RobotWorx; Frost & Sullivan

Food Robots End-user Examples

Adept Technologies

Product: Quattro

Robotic application: Hygienic product transfer for primary or secondary packaging

Advantage: Fast, hygienic, and accurate processes

FANUC Product: FANUC M-430iA/2F, LR Mate 200iB/5WP, and M-3iA

Robotic Application: Robots with specialized seals

Advantage: Reduce contamination

Stäubli Product: SCARA

Robotic Application: Robots with specialized seals

Advantage: Reduce contamination

Sara Lee

• Product—Sliced deli meats• Robotic application—Robotic system that ensures a no-touch

processing line• Advantage—Reduction of processing time by 50% and

reduction of the workforce required for operations

Mayekawa

• Product—Hamdas pork ham deboning system

• Robotic application—Robotic deboning systems

• Advantage—Increase in deboning yields

OSI Group

• Product—Meat products

• Robotic application—Robotic transportation to and from various processes

• Advantage—Hands-free capabilities and food safety

Robots in Food Plants, Global

Use cases

Fanuc's Zero Down Time (ZDT) application

collects data generated from robots to

determine the optimal approach of GM’s

manufacturing systems by reducing energy

consumption, extending equipment life, and

improving cycle time and product quality.

Fanuc uses algorithms that have been tailored to factory robots

to create insights for GM.

GM will leverage cloud-

based IoT analytics to

factories across the globe

in the next 5 years.

GM leverages Cisco Intercloud Fabric, robotics

manufacturer Fanuc ZDT, and hardware maker

Rockwell Automation to collect data from 800 robots

and external devices and send it to a cloud network

setup by Cisco for further analysis primarily to reduce

downtime.

Fanuc

Cisco

Rockwell

Automation

GM’s Future Factory Robots

Connected through Cloud

• Unplanned downtime costs $15,000–$40,000 per minute

• Factory workers often learn about issues with their production machinery too

late, after the line shuts down

Partnership

GM has deployed ZDT in 27 factories in 5 countries, analyzing 5,000 robots.

ZDT has successfully detected over 45 cases of potential failure over the past

year and saved customers $40 million.

The deployment of robots is also prevalent in other industries with General

Motors leveraging them to reduce unplanned downtimeUse cases

23

Robots in Automotive Plants, Global

Source: GM; Frost & Sullivan

What was Airbus able to achieve?

+ =

Workforce

Robotic Smart

Tools

IoT PLATFORM

Efficient

Manufacturing

Work Case Example:

Smart Tools on the Factory Floor

An Airbus worker on the factory floor is equipped with smart gadgets like the

tablet and smart glasses. These gadgets help workers scan an airplane’s

metal surface, determining which bolt will fit a given hole and the torque that

is required to install it.This information is then sent to the robotic tools which

then completes the task of fitting the bolt in the hole.

What was Airbus able to achieve?

1. Efficient streamlining of aircraft assembly process which involves

millions of bolts and screws and more than a thousand types of tools

2. Quicker process of bolt installation

3. Higher accuracy rates than manual installation

A huge portion of factory processes still need automation. Manual tasks are tedious and are prone to errors. Airbus is making use of

IoT to add intelligence to its tools and shop floor systems. Equipped with situational awareness, these tools have the capability of

communicating with each other and with a central management system.

Key Enablers of Airbus’ Smart Tools

1. Key Technologies – National Instruments / LabView

2. Transformation from passive to live data

3. Central manufacturing execution system

4. Distributed device intelligence

Airbus is also investing in “Factories of the Future” using wearables and smart

robotic tools to effectively streamlining its processesUse cases

24

Source: Airbus; Frost & Sullivan

25

...

• TBC

Machine Tools

The machine tools market is being driven by the demand side with pockets of

growth in the both developed and developing geographies

26

Trends

Machine and Cutting Tools Market: Market Drivers and Restraints, Global

Market Drivers 1-2 Years 3-4 Years 5th Year

Investment in automobile and A&D industries in BRIC nations increases the demand for machine tools

Technological prowess of Germany is likely to increase the demand for high precision cutting tools

Demand for advanced materials like nickel and titanium alloys drives the market towards technological

progression


Low oil prices prevent O&G companies from investing in the new projects, thus

hampering demand for NDT equipment

Lack of expertise curtails the growth of the NDT equipment market

Complex geometry of parts introduces additional difficulties to standard inspection

methods, thus restraining adoption

Impact: High Medium Low


Heavy industries (such as mining, power generation and engineering) account

for 57% of revenues and metal cutting solutions make up 61% of sales

27


Segmentation

Others include marine, food and beverages, medical and health care, printing and packaging and textile industries

61,3%21,3%

17,4%

Metal Cutting Metal Finishing Metal Forming

57,3%

12,0%

9,4%

5,3%

4,6% 11,4%

Heavy Industries Automobile Industries

Aerospace and Defence Construction

Oil and Gas Others

Revenues by Industry, Global Revenues by Tool, Global

Each segment has a distinct competitive set with Sandvik Coromant, Trumpf

and Saint Gobain leading cutting, forming and finishing

28


Competition

Rank Cutting Finishing Forming

Others

Agie Charmilles, Dapra, Hannibal

Carbide Tool, Komet of America,

Kyocera Tycom, Lovejoy, Mori

Seiki, Mitsubishi Materials, Seco

Tools, Walter (Part of Sandvik)

NAGEL, Radiac Abrasives,

Sunnen, Tyrolit , Noritake

ASKO, LVD Strippit, Wilson Tool,

Zenith Cutter, Horn USA, BART

Machine and Cutting Tools Market: Top 3 Players in Revenue Terms, Global

https://www.google.com/url?sa=i&source=images&cd=&cad=rja&uact=8&ved=2ahUKEwjkvYbzyKjbAhXJNxQKHbLSBaMQjRx6BAgBEAU&url=https://en.wikipedia.org/wiki/Saint-Gobain&psig=AOvVaw2OLzq3QCr3EAj_T2tJRYXT&ust=1527602495302885

Hybrid machine tools use additive and subtractive technologies to produce

parts that cater to specific requirements without secondary operations

29


Technologies

• Metal additive manufacturing is gaining

popularity and presents new opportunities for

more flexible and customized design for

manufacturers.

• Manufacturers are suffering because of

secondary machining operations that are

needed to address the problem of substandard

surface finish.

• Innovative hybrid machine tools can perfectly

solve this problem by using additive and

subtractive technologies to complete parts that

cater to speicific requirements without

secondary operations.

Context and Opportunity Call to Action

• Key machine tool manufacturers are offering

innovative hybrid machine tools to leverage

this opportunity.

• Example 1: The SAUER LASERTEC 65 3D

hybrid machine from DMG MORI combines

laser deposition welding and 5-axis milling to

make complex parts in a single setup.

• Example 2: The VC-500 AM HYBRID

Multitasking Machine from Mazak combines

5-axis capability and additive technology to

renovate product design, shorten the time to

market, and cut R&D costs.

Applicable Segments

Metal Cutting

Metal Forming

Metal Finishing

✓

✓

Manufacturers are developing software solutions which enable programming

and data collection, making machine tools “smart”

30


Technologies

• The key objective behind the smart factory

initiative is to enable data collection. This

involves the inclusion of intelligent sensors,

motors, and robotics in the manufacturing

processes.

• The structure of smart factory includes

production and use of information and

communication technologies across the whole

manufacturing process from planning, supply

chain logistics, and even product

development.

• The benefits of smart factory lies in making the

manufacturing process more intelligent,

producing high-quality output at lower costs.


• Manufacturers are developing software

solutions to be installed into systems that

enable programming and data collection,

making the machine tools more intelligent.

• The seamless transfer, collection, and

analysis of data will make machines more

productive in the future, which is attracting

manufacturers’ attention in terms of making

progress on the tolerance and speed of

machine tools.

• Connectivity among machines can be

enhanced by applications developed to

monitor machine conditions and processes.

Applicable Segments

Metal Cutting

Metal Forming

Metal Finishing

✓

✓

Schaeffler in Germany is using sensors and IT as part of a Machine Tool 4.0

project aimed at adding value for suppliers, customers and operators

31

Source: Schaeffler, Frost & Sullivan

Use Cases

Machine 4.0

• To gain insights into how Industry 4.0 can add value in practical applications, Schaeffler Technologies

AG & Co. KG, a manufacturer of drive engineering components for machine tools, collaborated with

DMG MORI and exceet Secure Solutions GmbH to develop an innovative Machine 4.0 pilot project

that can add value for machine tool manufacturers, suppliers, and operators along the supply chain.

The product was showcased at EMO MILANO 2015.

Sensors and

IT add value

to machine

tools for IoT

Features

• The pilot project aimed to accommodate the requirements of component suppliers, machine

manufacturers, and machine operators. In the pilot project, a connected DMG MORI machine tool was

used at the Schaeffler plant in Höchstadt, Germany, in the production of precision bearings. To gain

value-added data, the machine tool was equipped with many additional sensors providing information

on vibration, force, temperature, pressure. exceet Secure Solutions developed the IoT solutions for

intelligently linking the data sources in the pilot demonstrator into an Industry 4.0 environment.

• The improved use of data provided by the machine can provide key benefits, such as automatic re-

lubrication of plant machinery when required (due to sensors inside the bearing monitoring lubricant

level), improved customer service (due to continuous data about machine use, specific functions,

bearing life cycle), and prediction of remaining life of a component (enabling efficient manufacturing of

products).

32

...

• TBC

Test Equipment

The Non-Destructive Test (NDT) segment is amongst the most dynamic in the

total Test Equipment market with a 7.1% CAGR for 2018-2022

33


Size

NDT Equipment Market: Revenue Forecast, Global]

0,0

1,0

2,0

3,0

4,0

5,0

6,0

7,0

8,0

9,0

0,0

500,0

1.000,0

1.500,0

2.000,0

2.500,0

3.000,0

2014 2015 2016 2017 2018 2019 2020 2021 2022

Revenue 1.714,0 1.787,3 1.861,1 1.955,1 2.070,0 2.199,5 2.349,2 2.522,9 2.718,7

Growth Rate - 4,3 4,1 5,1 5,9 6,3 6,8 7,4 7,8

Gro

wth

Rate

(%

)

Rev

en

ue (

$ M

illio

n)

Year

Revenue growth will be fueled by stringent safety regulations and a shift to

advanced technologies (e.g. composites) which require new testing protocols

34


Trends


Stringent safety regulations by governments drive the the need for NDT inspection H H H

Technology shift to composite materials in the aerospace industry means new protocols are required for testing H H H

Continued investments in the nuclear power sector boosts demand for NDT inspection H H M


Low oil prices prevent O&G companies from investing in the new projects, thus hampering demand for NDT

equipmentH M M

Lack of expertise curtails the growth of the NDT equipment market H M L

Complex geometry of parts introduces additional difficulties to standard inspection methods, thus restraining

adoptionM M L


NDT Equipment Market : Market Drivers and Restraints, Global

The IIoT, big data & predictive analytics and artificial intelligence are expected

to create $14.5 billion worth of additional opportunity by 2024

35


Outlook

Additional opportunities for NDT equipment above and beyond the market $2.8b in 2022 as shown on slide 33

Please note that there may be overlap between one or more growth opportunities

~$4.5 Billion by 2024 ~$5 Billion by 2024 ~$4 Billion by 2024 ~$4.5 Billion by 2024 ~$4.5 Billion by 2024

Industrial Internet

of Things (IIoT)

Big Data and

Predictive Analytics

Artificial

Intelligence (AI)

Drones in Wind

Power Energy

Smart

Factories

• Connected vehicles

• Operational efficiency

• Advanced communication

and monitoring systems

• Better customer-centric

service offerings

• Predictive model- based

inspection

• Efficiency improvement

• Real-time data visualization

• Intelligent algorithms for

finding correlations in data

• Cost optimization

• Process optimization

• Automated inspection

• Better Return on

Investment (RoI)

• Safer workplace

• Skilled workforce

• Labor productivity and

effectiveness enhancement

• Remote inspection

• Fully integrated asset

management in confined

spaces

• Reduced downtime and

costs

• Rapid mobilization

• Smart buildings

• Smart metering

• Digital transformation of

manufacturing

• Data sharing ecosystem

• Cyber-physical production

systems

• Smart warehousing

GE is the leader, closely followed by Olympus, YXLON, Karl Storz and Zetec

with the top five players holding a combined 61% of the market

36


Competition

NDT Equipment Market: Competitive Structure, Global

Number of Companies in the Market 60 to 75 with revenue greater than $5 M

Competitive Factors Cost, performance, support, technology, reliability, distributor relationships, customer relationships, customer service

Key End-user Groups Power generation, oil and gas, aerospace, defense and military, automotive and transportation

Major Market Participants

(share in revenue terms)

GE Measurement and Control Solutions (26.5%); Olympus NDT (20.4%); YXLON International (5.5%);

Karl Storz (3.8%), Zetec (4.3%)


Other Notable Market ParticipantsInstitut Dr. Foerster, Eddyfi Technologies, Sonatest, Sonotron NDT, Carestream, Nikon Metrology,

Fujifilm NDT, Magnetic Analysis, Technology Design

Distribution Structure Direct sales and indirect sales through distributors, web sales

Notable Acquisitions and MergersSilverwing acquired by Eddyfi Technologies, TSC Inspection Systems acquired by Eddyfi Technologies, Plant

Integrity Ltd., a wholly owned subsidiary of The Welding Institute (TWI) acquired by Eddyfi Technologies

From a technology perspective, leveraging big data analytics will allow vendors

to offer NDT equipment which is significantly more sensitive than today’s

37


Technologies

• Currently, the analytics is limited to phase 1, 2 and 3, which involve basic evaluation of the data. This is typically a reaction to the failure-based approach.Simple

statistical tools, such as forecasting, are used to pinpoint the reason for the failure of the asset.

• The true value of Big Data will be realized when analytics service providers are able to offer solutions by combining various conditions and process data to prevent

failure in advance.

• The future of data analytics in maintenance of applications is predictive. It uses complex statistical algorithms and machine-learning techniques to benchmark

historical data with real-time sensor data.

• According to industry experts, just by extracting trends from historic data, the sensitivity of NDT equipment can be increased by at least one order of magnitude.

2000 2005 2010 2016 2022

12

3

4

5

Asset Monitoring

Asset Monitoring

and Data Reporting

Data Analysis, Mining,

and EvaluationPredictive

Analytics

Prescriptive

AnalyticsPhase 1Phase 2

Phase 3

Phase 4NDT Equipment Market: Evolution of Big Data, Global

Prescriptive analytics will help end-users with smart and interconnected

manufacturing facilities across many industries to reduce downtime

38


Use Cases

Power plants are keen on early

detection of shut downs or

faults in systems to avoid

catastrophic failure or the high

cost of repair

Wind energy was responsible for approximately 4.8%

of the total world’s energy in 2017.With the help of

Big Data analytics, OEMs can get accurate energy

production forecasts regarding the places that offer

the maximum potential for renewable plant operations

The implementation of

prescriptive analytics in

oilfields could help companies

to improve production by

approximately 7.3%

A single, twin engine aircraft with approxiamtely13

hours flight time can produce more than 800 Terabytes

of valuable data. This data is used to build AI and

predict the demands of the engine to adjust to the

thrust levels. This can demonstrates a reduction in fuel

consumption by 9% to 14%

Monitoring of some important parameters in high speed

trains to facilitate fuel efficiency, and along with the

innovations in V2X connectivity, smart cards and

mobile phones are disrupting the automotive industry

With the advent of smart manufacturing, an

improvement in manufacturing operations through

system integration up and down the supply chain, and

integration of physical and cyber capabilities can be

achieved, along with the added benefit of advanced

information for increased flexibility and adaptability

Aerospace

Automotive

Manufacturing

Image Sources: Green-grassroots, BP, EIA, Boeing, IBM, ARAI India

The Radio Frequency (RF) segment is amongst the largest in the total Test

Equipment market and will be valued at $4.6 billion in 2023

39


Size

RF T&M Market: Revenue Forecast, Global

(10,0)

(5,0)

0,0

5,0

10,0

15,0

20,0

25,0

0,0

500,0

1.000,0

1.500,0

2.000,0

2.500,0

3.000,0

3.500,0

4.000,0

4.500,0

5.000,0

2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023

Revenue 3.367,4 3.375,0 3.148,3 3.151,5 3.262,0 3.284,8 3.439,1 3.681,3 4.500,5 4.563,9 4.611,0

Growth Rate 0,2 (6,7) 0,1 3,5 0,7 4,7 7,0 22,3 1,4 1,0

Rev

en

ue (

$ M

illio

n)

The next wave of growth will stem from the advent of 5G and pre-5G technologies

and increased demand for RF solutions from the automotive industry

40


Trends


RF Market: Key Market Drivers, Europe


Demand from Automotive Industry H H H

5G and Pre-5G Technologies M H H

802.11ax Wi-Fi Standard M M M


Subdued Wireless Manufacturing Market H H H

Intense Price Pressure H H L

Move to Millimeter-wave Frequencies L M H

The Asia-Pacific region and further testing of IoT devices are expected to create

$13.0 billion worth of additional opportunity by 2023

41


Outlook

Additional opportunities for RF equipment above and beyond the market $4.6b in 2023 as shown on slide 39

Please note that there may be overlap between one or more growth opportunities

~$2 Billion

from 2017 to 2023

~$10 Billion

from 2017 to 2023

~$12 Billion

from 2017 to 2023

~$1 Billion

from 2017 to 2023

~$6 Billion

from 2017 to 2023

Automotive

Test

Pre-5G and

5G TestAsia-Pacific

IoT Devices

Testing

Modular

Instrumentation

• Connected Car

• Autonomous

Driving

• LTE and Wi-Fi

standards

• 4.5G / LTE-

Advanced Pro

• 4.9G

• 5G

• China

• Japan

• South Korea

• India

• Southeast Asia

• NB-IOT

• BLE

• LTE-M

• LoRA

• PXI-based

instrumentation

• AXIe-based

instrumentation

Keysight is the leader, closely followed by Rhode & Schwarz, Anritsu, Teradyne

and NI with the top five players holding a combined 79% of the market

42


Competition

RF Equipment Market: Competitive Structure, Global

Number of Companies in the Market Fewer than 50

Competitive FactorsPrice, technological development, customer service, quality, services and solutions integration, total cost of test,

ease of upgradability, performance, speed, scalability, high throughput, simple user interface

Key End-user Groups Communications, aerospace and defense, consumer electronics, industrial and automotive

Major Market Participants

(share in revenue terms)

Keysight Technologies (28.3%), Rohde & Schwarz (21.4%), Anritsu (10.7%),

Teradyne (9.6%), National Instruments (9.4%),


Other Notable Market Participants Advantest, LTX-Credence, Cobham Wireless

Distribution Structure Direct sales, sales representatives, distributors

Notable Acquisitions and Mergers National Instruments acquired Cobham Wireless’ PXI line of hardware (2015

From a technology perspective, modular instrumentation will continue to gain

ground, leveraging its cost advantages to make greater inroads into R&D

43


Technologies


• Modular instrumentation has made

significant inroads in T&M over the

past decade, especially PXI-based

test equipment, which reached

$702 million in 2016.

• Since 2012, PXI penetration in the RF

T&M market for production test is

impressive; the greater complexity and

multi-channel nature of products will

further increase demand for modular

instrumentation over the next 5-7 years.

• In semiconductor ATE, demand for modular

instrumentation is also increasing in

evaluation and low volume manufacturing.

• With strong penetration in manufacturing,

modular instrumentation vendors must

expand beyond this space and capture

more of the R&D portion of the market.

• Although modular instrumentation yields

a lower cost of test than traditional

instrumentation, acquisition costs are

still a challenge and vendors must

innovate to increase performance,

while controlling costs.

• Many customers have a high level of RF

expertise but others lack resources and/or

time; vendors must devise strategies to

cater to all to ensure maximum success.

Applicable Segments

Traditional Instrumentation

Modular Instrumentation

Semiconductor ATE

✓

✓

The manufacturing space is also ripe for the increase potential of modular

instruments due to the exponential growth in testing costs

44


Use Cases

Increased demand

for modular

instrumentation to

avoid developing

hardware

Increased demand

for complete

solutions and RF

expertise

Move to contractors

drives market toward

rentals and leasing

Cost of ownership

increases interest in

asset management

IoT enables remote

maintenance

Multi-channel nature

of products drives

automation and

demand for modular

instrumentation

Emergence of PXI-

based systems for

semiconductor ATE

Continued push for

higher throughput

drives demand for

modular

instrumentation

Automation, lower

cost, and ease of use

drive demand for USB

instrumentation

New approaches are

required for HVM

45

...

• TBC

Sensor Technology

Traditional sensors are facing a number of challenges in the form of physical

attacks, compatibility issues, fault tolerance and power issues

46


Context

01

03

04

02

Physical Attacks

Compatibility Issues

Fault Tolerance

Power Hungry

Sensor devices are vulnerable to external attacks as they may be deployed in remote areas,

allowing hackers to replace them with malicious or dummy sensors

Sensor compatibility issues exist as the hardware and its related software platforms vary

according to different sensor manufacturers and vendors

Sensors do not have self-diagnostic or management features when a repair or fault occurs.

Human intervention is always required to ensure operational continuity

Sensors consume high power for various operations, such as data gathering, data processing,

and data transmission across various channels

Vendors are increasingly looking to “smart sensors” as a means to better serve

their customers and to access a $123b market

47


Definition

$121.6B

Cumulative

Market

2016-2022

$159.6M

Funding

Raised

between 2015

and 2017

Impact on 8+

Industries and

Applications

2600+ Patents

Published

Globally 2015-

2017

A smart sensor comprises …

• a sensing element,

• an analog to digital converter (ADC),

• an analog interface circuit and

• a bus interface

Smart sensors are built with one or numerous smart

functionalities in mind such as self-identification, self-

testing, self-validation and self-adaptation

Smart sensors are applicable for sensing temperature,

pressure, humidity, image signals, vibration, and other

key parameters depending on the nature of application

Smart sensors are attractive due to their ability to

provide real-time measurements of complex

phenomena and form diagnoses or make corrections

The space is being driven by the advent of the Internet of Things, increasing

application areas and strong financial support from governments

48


Trends

Smart Sensor Market: Key Market Drivers and Restraints, Global

Advent of the “Internet of Things”

Increasing application areas

Support from government funding

1-2 Years 3-4 Years 5th Year

Ma

rke

t D

rive

rs

Lack of technical know-how

Standards and regulatory hurdles

Development and R&D costs

Ma

rke

t R

es

tra

ints

Impact: High Medium Low

In Europe, companies such as NXP, STMicroelectronics and ABB are amongst

the key innovators in the smart sensor industry

49

Source: ABB, NXP, STMicro, Frost & Sullivan

Competition

NXP Semiconductors has developed the NTAG® Smart Sensor. The device is an easy to use, single chipsolution which combines NFC (near field communications)-enabled smartphone connectivity withautonomous sensing, logging and data processing. The data communication between the NTAGSmartSensor device and reader ICs is executed through NFC Data Exchange Format (NDEF) formatteddata. The NTAG SmartSensor, which is equipped to provide temperature sensing, is compatible with IoT-enabled products.

STMicroelectronics has developed the LIS2DS12 six-axis accelerometer, the LSM6DSL and LSM6DSM

inertial modules (with a 3-axis digital accelerometer and 3-axis digital gyro), and the LSM303AH e-

compass module that includes a 3-axis accelerometer and 3-axis magnetometer. The smart motion or

orientation sensors can be integrated in smartphones and wearables such as fitness bands, medical

monitoring devices, personal navigation systems or Internet-of-Things (IoT) connected devices.

ABB has developed the ABB Ability™ smart sensor system that monitors the health status of a low-

voltage motor and provides the performance status of the motor to the end-user via a dedicated Web

portal or smartphones. This remote monitoring solution leveraged by the ABB Ability will optimize uptime

and improve efficiency and predictive analysis maintenance of the low-voltage motors in the

manufacturing industry sectors.

There are also a wide range of VC-backed start-ups which are developing smart

sensor solutions notably for the healthcare sector

50

Source: Market participants, Frost & Sullivan

Start-Ups

Smart Sensor Market: Selected Start-Ups, Global

Company Backers Description

KonuxMIG, New Enterprise Associates, Andreas Bechtolsheim,

Unternehmer TUM, Warren Weiss, Founder.org

In 2016, Konux., an IoT-based start-up company, raised $7.5 million for developing smart

sensors for industrial efficiency and safety applications.

HeliumGoogle Ventures (GV), Khosla Ventures, FirstMark, and Munich

RE/Hartford Steam Boiler Ventures

In 2016, Helium, a developer of industrial IoT smart sensing solutions, raised $20 million for

developing the smart industrial sensor Helium Green.

Notion Draper Nexus,TransLink Capital, XL Innovate, Mesh VC

From June 2016 to June 2017, Notion, a US-based company, focusing on the development

a smart home security solution, raised a total of $13.2 million for expanding its business and

marketing strategy.

Enlighted

Tao Capital Partners, Kleiner Perkins Caufield & Byers,

RockPort Capital, Draper Fisher Jurvetson (DFJ), Draper Nexus

Ventures

In 2016, Enlighted, provider of an IoT-based digital sensor and analytics platform for energy

savings, raised $25 million in a Series D funding round. The company utilized this grant to

expand its business globally in France, Germany, and the UK.

PointGrabABB Technology Ventures, Mitsubishi UFJ Capital, Philips

Lighting

At the end of 2016, PointGrab Ltd. raised $7 million for wider commercialization of its

optical smart sensing solution that includes deep learning and turns off lights when an area is

unoccupied.

Verdigris

TechnologiesVerizon Ventures, StartX, Jabil, FOUNDER.org Capital, DCVC

As of October 2016, Verdigris Technologies raised a total of $15.7 million in funding for scaling

up its smart sensors (which include a custom magnetic sensor powered by machine learning

algorithms) for energy efficiency in large buildings.

Nanotechnology, wireless sensors and minutarization are key technologies

which are enabling their adoption in a wide range of applications

51


Technologies

Wide adoption of

wireless sensors will be

possible only if smart

sensor technology is

integrated into devices.

The wireless sensor

node includes a smart

sensor, signal

conditioning and

processing electronics,

data acquisition, power

supply, and

communications

Wireless Sensors

Smart sensors leverage

the trend toward

miniaturization in

electronics. Smart

sensor devices should

also fit into small spaces

so that the final

integrated device is of a

small form factor

Minutarization

Integration of smart

sensors with flexible

electronics components

provides more

ubiquitous, wide-scale

adoption in healthcare,

consumer electronics,

and textile segments,

with opportunities in

smart and connected

devices and diagnostic

tools

Flexible Electronics

Smart sensor devices

leveraging the

transduction properties

of silicon materials

provide a low-cost, small

form factor single-chip

solution empowering a

wide range of

applications

Silicon Technology

The growing interest in

nanomaterials has

opened the doors for

higher accuracy in smart

sensing technology.

Nano-scale manipulation

of devices and

nanomaterials are key

emerging focus areas in

smart sensor research

Nanotechnology

The consumer electronics, homes & buildings, healthcare and automotive

industries are among the early adopters of smart sensors

52


Applications

Consumer Electronics Homes & Building

Healthcare Automotive

HIGHLOW

2018

HIGHLOW

2019

HIGHLOW

2021

HIGHLOW

2021

In the Consumer Electronics segment, further minutarization is expected to

accelerate the penetration of smart sensors in activity wearables

53


Key advances in smart sensor technology are anticipated in the future, such as further miniaturization enabling a faster response and lower power; more sophisticated signal processing; enhanced multi-sensor data fusion; and calibration-free sensors. There have been

considerable advances in recent years in terms of materials, manufacturing processes, and device integration. The increase in adoption of smart sensors can create opportunities for new product development in CE

Smartphones

Tablets IoT Connected Devices

Wearables

Applications

• Activity Monitoring Wearables – Fitness tracking, advanced health

monitoring, and activity recognition

• Voice Commands – Non-contact interaction for controlling and

operating external devices

• Contextual Awareness – Provides context-enabled functions such as

increasing/decreasing the volume in noisy environments

• Gesture Recognition – Sensor fusion for recognizing user gestures

(for example, hand gestures) for unlocking smartphones

• Navigation and Positioning– Sensors assisting in indoor and outdoor

navigation performing dead-reckoning operations.

53

Consumer Electronics

In the Home & Building segment, smart sensors are being deployed in HVAC

units to improve energy efficiency and air quality

54


Home & Building

In building automation infrastructures, HVAC units can run inefficiently, and may provide more

ventilation than necessary based on the number of occupants, resulting in high energy costs that

indirectly affects the building’s financial performance. Moreover, this high cost of energy incurs higher costs of products and services, which makes a

business less competitive. There are some strategic energy optimization methods that lower the

operational costs. Smart sensors can turn some of these solutions even smarter. Infrared thermal

sensors can offer high accuracy in low-light conditions. They also require very little energy and are flexible in capturing, integrating, and delivering

data to any number of building automation systems. Smart, Internet-enabled indoor air quality monitors

can detect such parameters as temperature, humidity, carbon dioxide, and volatile organic compounds (VOCs) and send alerts to one’s smartphone about environmental conditions.

Key Challenges

Adoption of building automation and control in large

commercial buildings and enterprises promotes

high building energy efficiency. Through

implementing building automation, operating costs

can be lowered, saving energy resources, and

pollutants can be reduced Smart CO2 sensors

facilitate demand-controlled ventilation, providing

the ventilation required based on the number of

occupants in a space.

Significant Impacts

The emergence of Building Internet of Things

(BIoT) has opportunities to deliver full connectivity

across various locations in the enterprise. Using

Big Data analytics software in connection with

sensors, fully automated and optimized building

performance can be achieved and more

effective coordination and management of

information can be achieved within the building

enterprise.

Future Scenario

In the Healthcare segment, prevention, management and delivery are all areas

which are benefitting from the introduction of smart sensors

55


Healthcare

Managing patients’ chronic conditions

Smart sensors enable remote monitoring and self-management

of aging patients with chronic diseases.

Smart medical device automation

By integrating smart sensors and communication technologies into

medical devices, OEMs can monitor equipment status to

improve efficiency and reduce equipment downtime.

Enabling neural technologies

Smart neural sensors with deep learning techniques allow

patients to manage chronic diseases, such as Parkinson's disease, rheumatoid arthritis,

and paralytic attacks.

Early prediction of health problems

Smart sensors in conjunction with AI-based predictive

analytics provide an end-to-end IoT solution for healthcare and medical applications. Through

predictive data analytics, precision medicine can be given

to an individual patient.

In the Automotive segment, smart sensors such as LiDAR and CMOS are

enabling the development of autonomous vehicles

56


Automotive

Enabling Technologies for Smart Sensing in Automotive Sensor Smart Sensor Demand in the Automotive Market

Automotive applications are hostile environments where sensors need to endure high temperatures, vibration, and

extreme shock. Achieving high reliability and peak performance is a critical task. Smart contactless sensing technologies

are becoming the preferred choice of original equipment manufacturers and vehicle designers.

Smart sensors with enhanced signal conditioning, processing, and

communication capabilities have been and continue to be very

appropriate for automotive applications, where the investment in

developing and manufacturing sensors with smart capabilities is

justified by the high-volume demand.

LiDAR and CMOS image sensors are some of the new types of

sensors that will increasingly be used in emerging automotive

applications, including self-driving vehicles. Moreover, smart MEMS

accelerometers and gyros are widely used in vehicles for

applications such as stability control or rollover detection.

Anisotropic magnetoresistive (AMR) magnetic sensors and giant

magnetoresistance (GMR) have opportunities to erode more

conventional sensor technologies, such as potentiometers or Hall

Effect sensors, owing to such issues as durability, packaging

flexibility, and cost. Systems, such as ACC (automatic cruise

control), park/reverse assist, and night vision use advanced sensors,

such as radar, ultrasonic sensors, image sensors, infrared sensors,

or laser sensors. Installation of these systems in light vehicles is

forecast to increase rapidly throughout the decade. Other systems

are also finding opportunities, such as camera-based driver

assistance (including lane departure warning and intelligent adaptive

cruise control), and infrared and image sensors for driver fatigue

monitoring.

57

...

• TBC

Appendix

Circular economy: T&M services (1/3)

A number of factors have come together to both “push” and “pull” vendors in the T&M

towards providing expanded service offerings to customers

58


Traditional OfferingsConsensus Points

Advanced Services Market in T&M: Market Trends, Global

Expanded Offerings

Cloud is the Key Enabler

Approximately 90% of new business models in 2021 will be driven by the

cloud.

1

Move towards Service-based Business Models

More than 70% of the top Fortune 500 companies have plans to offer

their product as a service by 2021. Platform-as-a-service, and data-as-a-

service are few business models with potential for future revenue streams

beyond sale of the “hard asset.”

2

Software-oriented for Future Scalability

Every company could be a software company in the future,

as most of the best business models involve using a

software-defined integrated delivery platform in the future for all test

products.

3

Subscription-based Revenue Models

Increased focus on service-based business models opens up new

revenue models based on subscription (monthly or annual).

4

ReactiveMaintenance

Predictive and Prescriptive Maintenance

Pre-sales ConsultingIntegrated Service

Delivery

Test Equipment Tracking Asset Management

Traditional Monetization Alternate Monetization

Worker (Expensive Third-Party Technical Support)

Digital Workforce (Immediate Technical

Support)

On-site Monitoring Remote Monitoring


Historical repair, calibration and rental services are being superseded by advanced asset

management, test data analytics and prototyping services

59


Advanced Services Market in T&M: Business Service Evolution, Global

Repair:

A variety of repair

service options are

offered, including

warranty

support for selected

test equipment

models.

TEXT

HEREText here Text here

Text here Text here

Text here Text here

TEXT

HEREText here Text here

Text here Text here

Text here Text here

Level 1 Level 3

Calibration:

OEMs are able to

provide a full set of

options for calibration

service support.

.

Optimized offering

Asset Management

Services:

Integrated service

package delivery

model (asset

tracking, usage

optimization, repair

and calibration

management,

logistics

management, and

sale of unused

equipment) will

provide new revenue

streams and a

platform for long-term

sustainable growth.

Strategic Selling Services

Test Data Analytics

and Management

Services in

Manufacturing:

Data analytics solutions

are based on strong

expertise in

manufacturing tests.

These solutions

leverage the vast

amount of untapped test

data being collected by

manufacturers. Cloud

analytics applied to

manufacturing is

focused on

production yield and

product quality.

Multi-vendor

Business for Repair

Support and

Calibration:

Leading companies

are providing multi-

brand support for test

equipment calibration.

Level 2

Prototyping and

Consulting Services:

Test consulting services

are offered for assembly

and test design, and

system integration. There

is an increasing focus on

simulation services

based on test assembly,

digital and power design.

Services at the

manufacturing level are

embedded together with

assembly and

automation.

Companies are looking to expand the scope of their traditional

test-equipment services.

Standard and Traditional Services

Addressable Market with New Advanced Services


Asset management services go beyond traditional instrument tracking to deliver proven

financial and commercial benefits to customers and suppliers

60

Asset Management Services Market in T&M: Benefits Analysis, Global

Optimized Asset Utilization

and Reduced Cost

• More efficient usage and

deployment of existing portfolio

of test assets. While maximum

asset utilization for test

equipment is in the range of

85% due to calibration and

repair needs, the typical

utilization of test assets at many

companies is in the 30% range.

• Improved visibility of existing

assets on an individual basis

and their utilization reducing

non-essential purchases.

• Optimization of savings (around

25%) in annual equipment

spend through analytics and

controlled procurement.

New Revenue

• New revenue coming from

the sale or rental of assets

that are not utilized or

under utilized internally.

• Potential sale increase

from disposal of unused

assets.

Reduced OPEX

• Reduced costs associated

with logistics, calibration,

repair and asset

management.

• Improved control over

inventory of assets that

were previously not known

about.

• Reduced waste time to

look for a particular piece

of equipment.

Faster Access to Test

Equipment

• Reduced access time to

assets with right allocation

of equipment based on

project assignments and

timelines.

Contact with Ultimate

Technology

• Improve access to

the latest technology by

freeing up CAPEX

budgets.


Industry 4.0 (1/3)

Bosch and Siemens are leading a consortium developing self-powered smart sensors for

machine condition monitoring

61

• A consortium of 7 organizations, led by Bosch and including Siemens AG and Fraunhofer Institute

for Production Systems and Design Technology IPK, is developing a sensor system to detect

anomalies in machines and avoid unplanned downtime.

• The researchers will develop a self-sufficient sensor system based on MEMS acoustic emission

sensors and MEMS microphones. The project, which received €3.84 million (about $4.5 million at

the current exchange rate) from the German Federal Ministry of Education and Research (BMF),

started in December 2015 and is slated to conclude at the end of 2018.

• The sensor system will measure structure-borne sound (vibrations within a machine) and acoustic

sound noise form a machine). A malfunctioning machine will emit different vibrations and sounds

than a healthy machine. The system compares measured signals with stored profiles; and

continues learning so it will take action only when signals indicate a defect or wear and tear.

• The MEMS (Microelectromechanical systems) sensor system will use power generated from kinetic

energy harvesters and adaptive, self-learning algorithms. The system will provide self-diagnostics

and self-configuration capabilities, along with energy-efficient signal pre-processing at the sensor

level and high robustness. An integrated gateway ensures a secure connection to Industry 4.0

topologies.

Project and

Product


Functionality

and Attributes

Industry 4.0 (2/3)

Celtic-Plus, an ICT cluster (Germany), and Netas (Turkey) are behind a wearable IoT network

solution for worker safety

62

• In areas where no mobile communication such as GSM (Global System for Mobile

Communications/UMTS (Universal Mobile Telecommunications System),the Celtic-Plus WINS@HI,

Wearable IoT Network Solution for Work Safety in Hazardous Industrial Environments project, from

October 2016-September 2019, aims to create an ad-hoc, agile and reliable communications solution

for condition monitoring of worker safety in hazardous Industry 4.0 work environments to prevent

unpredictable failures and work accidents.

• Different types of IoT sensors, such as wearable devices that are able to capture data from the work

environment and vital parameters related to work safety will be exploited to extract the optimal amount

of information from hazardous production sites.

• The solution will focus on underground coal mines and tunnel or underground construction sites, which

exemplify hostile Industry 4.0 production sites that present challenges to radio communication. A key

aspect of the solution will be the ability to locate and track workers or monitored objects in hostile

environments such as coal mines and tunnels or underground construction sites using ad hoc

communications.

• The safety and operation management in mines will be improved and mine accidents will be more

accurately understood using wearable sensors that collect information such as vibration and heat from

mining equipment and detect gases such as methane and carbon monoxide from mine galleries. The

sensors will also track the health status and location of workers and allow prediction of failure for

continuous operation.

Wearables


Applications and

Attributes

Industry 4.0 (3/3)

Zeiss and Fraunhofer are participating in the RoMulus Multi-Sensor Systems project for

measuring mechanical parameters

63

• 11 organizations are participating in the RoMulus (robust multi-sensor technology for status

monitoring in Industry 4.0) project to accelerate development of multi-sensor systems. The

collaborators include Zeiss, Fraunhofer Institute IIS/EAS, Reutlingen University, microsensys,

Robert Bosch, Technical University of Munich, TETRA, University of Bremen, University of

Freiburg, X-FAB Semiconductor Foundries.

• Multi-sensor systems, which record, process and transmit data about key parameters such as

pressure, temperature, and acceleration are vital for Industry 4.0 applications. Intelligent sensor

systems fitted on machines and work pieces can increase production by monitoring the

manufacturing status of the machine or product. The RoMulus project was launched in October

2015 and is slated to run for three years.

• The researchers face the challenge of combining MEMS technology for measuring mechanical

parameters and microelectronic components for determining variables such as light intensity or

chemical concentration in a compact area.

• The intelligent MEMS sensor systems will be designed to process vast quantities of data in a highly

energy-efficient manner. Such sensors need to be sufficiently robust to operate in an industrial

environment.

Project and Product


Functionality and

Attributes

Principal abbreviations

64

A&D Aerospace & Defence MES Manufacturing Execution System

AI Artificial Intelligence NDT Non-Destructive Test

B Billion NFC Near Field Communication

BRIC Brazil Russia India China O&G Oil & Gas

CAGR Compound Average Growth Rate OEE Overall Equipment Effectiveness

CAPEX Capital Expenditure OEM Original Equipment Manufacturer

EMI Enterprise Manufacturing Intelligence PCS Process Control System

F&B Food & Beverage PET Polyethylene Terephthalate

FCFC Filling, Closing and Filling & Closing PLM Product Lifecycle Management

FFS Form Fill Seal Machinery R&D Research & Development

IIoT Industrial Internet of Things RF Radio Frequency

IoT Internet of Things SCARA Selective Compliance Assembly Robot Arm

KSF Key Success Factor T&M Test & Measurement

M Million WMS Warehouse Management System

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...

• TBC

For further details on Frost & Sullivan’s coverage and services,

please contact Livio Vaninetti, Director of Frost & Sullivan Italy

[email protected]

May 2018

[email protected]

for further information about this report please contact

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