Next Dimension + Cisco Smart Manufacturing

Smart Manufacturing Discussion
Mike Killian
December 4, 2018

© 2017 Cisco and/or its affiliates. All rights reserved
“Digital Transformation” is an Umbrella Term
Digital Transformation
(Digitization – Digitalization)
All These technologies can be Key Enablers of Performance

Companies want to
derive value from data
IoT exponentially increases
the amount and types of data

App
App
App
App
App
To get value from data

An IoT platform is needed to drive business outcomes
App
App
App
App
App
App
App
App
App
App
Scalable / Distributed Secure End to End

Obstacles to IoT adoption

Insights –
 B2B, Not B2C, IoT Use Cases Will Drive IoT Deployment In 2019
 IoT Momentum Will Drive Demand For Security, Platform, And
Managed IoT Solutions
 A market for IoT managed services will emerge in 2019

© 2017 Global Center for Digital BusinessTransformation.All rightsreserved.
#1 enabler of
digitization
#1 in executive
education
globally*
A Unique Research Partnership
 Real-world research
 Digital transformation
roadmaps
 Executive events and
workshops
*Financial Times Business School Rankings, 2008-2015
Digital Vortex book available @ https://www.amazon.com/Digital-Vortex-Leaders-Disruptive-Competitors-ebook/dp/B01I0H39ES

We Studied Digital Disruption to Understand
How Companies Can Fight and Win
Quantitative survey of 941 senior business leaders globally
In-depth discussions with dozens of start-up founders
and senior execs
Analysis of >100 digital disruptors to understand mechanics of
how and why disruption occurs
Workshops and events with >1000 execs from leading
companies on their challenges and approaches

Hyper-
awareness
Informed
Decision-
MakingDigital
Business
Agility
Fast
Execution
Digital Business Agility: The Disruptor Advantage
Digital business agility
enables companies to
counter and capitalize
on digital disruption
Hyperawareness
A company’s ability
to detect and monitor
changes in its
business environment
Informed
Decision-Making
A company’s ability to
make the best decision in
a given situation
Fast Execution
A company’s ability
to carry out its plans
quickly and effectively

Key Manufacturing Drivers of Digital Disruption
Improve business operations
• Maximize uptime and quality
• Cost & delivery performance
• Visibility across operations
Innovate
• Faster time to market
• Increased product customization
• Value Chain Process Improvements
Reduce risk
• Prevent/Detect/Remediate
Cyber Attacks
• Plant floor agility
• Supply chain resiliency

IT and OT have different priorities
Confidentiality
Integrity Availability
Availability Integrity
Confidentiality
1. Confidentiality
2. Integrity
3. Availability
1. Availability
2. Integrity
3. Confidentiality
Someof IT’s major
success metrics are:
Someof OT’s major
success metrics are:
Cybersecurity
Risk Reduction
Cost Savings
Data Visibility Quality
Uptime
Safety
Asset Utilization
99.99

Digital Transformation in Manufacturing
Reactive/Preventative =>
Predictive Maintenance
Asset Tracking & Management
Safety
OEE (Overall Equipment
Effectiveness)
Real-time Quality Validation
Predictive => Prescriptive
Maintenance
Remote Monitoring

Sample Business Outcomes of Digitization
Lower
downtime
Reduce defects
Faster
NPI
Maximize
OEE
Lower inventory
Reduce
energy
Reduce
risk
Increase revenue / improve operations Reduce costs Stay out of trouble
“$40 million
downtime
reduction for
customer”
“Reduced
labeling
error rate
by 16%”
“Shaved
10-20% off
NPI cycle time”
“Increased
OEE mid 70s to
high 80s”
“Reduced
breaker
component tire
loss by 20%.”
“Achieving 20%
energy reduction
with real time
visibility.”
“No unplanned
downtime for a
year, 9 month
ROI”
Ransomware
attack thwarted
Discrete Mfg
Client

Start with Business Justification / Prioritization

BI Applications
Cloud and On Prem
Cisco IoT
IoT devices
Secure and manage connectivity
Data extraction
Edge & fog processing
Visualization
Define and enforce data policy
Move data
End-to-end
security
Understand the entire IoT “Stack”

It Takes a Vertical Ecosystem
MANUFACTURING
A&E Consultants / Digital Solution
Integrators (OT/LoB Partner)
Role: Line of Business Facing Partners, Digital Experience,
Design/Engineer physical infrastructure
Care About: Expand consulting services
for delivering end-to-end solutions
Independent Software Vendors (ISV)
Role: Deliver analytics, IoT Platform and
LoB applications validated on Cisco network
Care About: Access to Cisco partner/sellers
and sell more SW licenses
Independent Hardware Vendors (IHV)
Role: Devices, embed sensors, SW
Insertion in solution
Care About: Sell their products/services
in our reference architecture
Value Added Resellers (VARs)
Role: Sell Cisco infrastructure & professional services
aligned to customer initiatives
Care About: Expand into new markets, align vertical
priorities, build IoT practices, build professional services
practice
Systems Integrators (SI)
Role: Deliver large-scale strategy and
business transformation services
Care About: Consulting services
engagement in IoT use cases
Global Industry Partners /
Strategy Partners / Service Providers
Role: OEM, Embed or Embrace Cisco
Technology as key component to
their offering, Industry thought Leader,
provide critical managed services
Care About: Grow vertical solutions, drive
consistent roadmap for customers

Manufacturing Digital Transformation Roadmap Framework
Development Optimized
Work Environment
Digital
Signage
Product Authenticity -
Blockhain
”Phone-Home”
Products
No-waste
Initiatives
Mobile Access
to Data
Real-time Asset
Tracking
Environmental
Monitoring
Knowledge
Management
Machine-as-a-
Service
Video
Analytics
Next-gen robotics– integrated
human-machine teams
Remote Monitoring
& Control
Remote
Expert
Cost, Quality &,
Delivery KPIs
Secure/Remote
CAD Model Access
Enhanced
Collaboration
Distributed
SCRUM sessions
Order
Visibility
Zero-Touch
Deployment
Secure Access
Control
Physical Security
(i.e Damage /Theft)
Cyber Risk
Assessment
GMP – Good Mfg
Practices
Automated Compliance
Validation
Monetizing
Buyer Insights
Over-the-Air
SW Updates
Self-Healing
Products
Out-of-stock
Reduction
Way-finding
Navigation
Fleet Visibility
& Mgmt
AGV in
Warehouse
Sustainable –
Circular Economy
Location-Based
Services
Enable
IT Agility and Operational Efficiency
Differentiate Your Brand
Provide Unique Capabilities and Services
Define New Business Models
Create True Disruption
Employee
Productivity
Mfg Plant
Efficiency
Product
Development
Customer
Experience
Supply Chain
and Logistics
Compliance/
Sustainability
Digital-ready
Foundation
Automation
(e.g. ASRS)
Real Time Tracking
(i.e Asset, Material)
Predictive Time of
Arrival for Shipments
Automated Process
Optimization
AR
Picking
Facility Energy
Management
Manufacturing Line
Agility
Predictive
Maintenance
Realtime Quality
Validation
Supply-Demand
Balancing
RT Optimized
ShipmentPath
Augmented
Reality Wearables
Drones – Warehouse
and Cust Delivery
Consolidated
Delivery
Adv Tracking to
Proof of Delivery
Adaptive Test
Plans
Ransomware
Prevention
Push-to-Talk
Communication
Increased
Customization
Additive
Manufacturing
System-Human
integrated Issue Mgmt
Connected
Parking
Managed
Community Help
Click-to-Chat
Help
Crowdsourcing
Innovation
AI/ML Issue
Resolution
Plant Floor
Safety Initiatives
Video and VR-
Based Training
Orchestrated Automation
of Business Systems
AI/ML network
traffic inspection
Connected
Building
Architectural Concepts:Intent-Based Networking,Converged Plantwide Ethernet,Software-DefinedWAN,Software-DefinedAccess,Smart& Connected,Cloud-Ready,Cloud-Managed
Additional Solutions/Technologies:ApplicationPerformance Management,Customer SupportCenter,SecurityOC,Network OC,Zero-trustauthentication,Virtual Desktop
Infrastructure
Track &
Trace
Mass
Customization
Inter-plant dynamic
balancing
Cyborg replacing
humans
Any product, any
order on-demand
Instant Job Skill
Enablement
ML Quality
Validation
Geo-fencing for
safety/security
Health
Monitoring
Wireless
Tools
Design for
Advanced Mfg
Connected Factory/Connected Warehouse Infrastructure:Wired,Wireless,Industrial Security,Collaboration,Data Management(Access,Compute,Transport,Storage,Integration)

Cisco’s Supply Chain Transformation

© 2017 Cisco and/or its affiliates. All rights reserved. Cisco Confidential
Diverse
Portfolio
Mass production
to highly
configured
Manufacturing Sites
Strategic Logistics Centers
25+
Locations
13
Countries
Cisco’s Supply Chain
30,000+
orderable items
1M+
orders annually
700+
active suppliers
20,000+
virtual teams
80M+
items shipped annually
62,000
components
Global. Complex. Diverse.

Development Fulfillment
Cisco’s End-to-End Supply Chain
Supply Chain Transformation
Acquisition Integration | Security | Sustainability
Plan Make DeliverQualitySourceInnovate
Product
Operations
Global Planning
& Fulfillment
Global Supplier
Management
Manufacturing
Operations
Technology
& Quality
Logistics
Operations

Foundation Data Analytics Orchestration
Data & Analytics
Foundation
Digitization &
Orchestration
FY16FY15FY14
Systems & Processes
Foundation
ERP & PDM Systems Upgrade
Collaboration,
IoT, Mobility, Big
Data, Cloud
Real time visibility
predictive &
prescriptive analytics
Machine learning, Automated
decision making End-end process
digitization Blockchain
The Digital Journey
Digital Supply Chain
Growth & Value. Visibility. Simplification.Automation.
FY13FY12FY11 FY18FY17

Technology Used to Digitize the Supply Chain
Real time, Accurate
& Accessible Data
Data & Analytics
More accurate
demand forecasting
Eliminates
communications silos
Collaboration
Greater capacity to
Share & see insights
Collaboration on key initiatives
to deliver outcomes
Teams work in conjunction
Smooth workflows
Connects the
Unconnected
Internet of Things
Preventive maintenance
Common business architecture/cloud-based network
Access to info
anywhere, anytime
Mobility
Instant access to critical data
Process improvements
Optimizes product delivery
Better packaging &
product quality
Better data = better decisions
Data query times drop
From days to seconds
Real-time status via
mobile devices

Development Fulfillment
Use Cases Enabled by Technology
3D Printing
Prototype
Portal
Supplier
Collaboration
Platform
Business Award
Analytics &
Optimization
Cisco Energy
Management
Remote Expert
Adaptive
Testing
Connected
Quality Cockpit
Universal Order
Visibility
Hyper Location
Pervasive Video
Plan Make DeliverQualitySourceInnovate
Product
Operations
Global Planning
& Fulfillment
Global Supplier
Management
Manufacturing
Operations
Technology
& Quality
Logistics
Operations

Overall Benefits of Supply Chain Digitization
Growth & Value. Visibility. Simplification. Automation.
Productivity
Increases
35%
Capital
Expense
Savings
40%
Delivery
Commitment
s Increased
5-10%

© 2017 Cisco and/or its affiliates. All rights reserved. Cisco Confidential© 2017 Cisco and/or its affiliates. All rights reserved. Cisco Confidential
Cisco’s lessons learned…
• Data foundation. Value of Business and
Technology architecture
• Build an OT team. Focused effort to increase
SMEs and Super-users
• Adoption of agile, self service model,
empowerment
• Analytics without giving up data control or
dependency on cloud service
• Increasing risk and importance of security
• Culture of experimentation, % of your portfolio
in disruptive investments

Cisco’s Approach to IoT Platforms

Logical Framework
Connected Factory Reference Architectures
• Validated Design
• Convergence of Industrial and IT
network technology
• Collaboration between Industrial Control
System and IT network engineers
Hierarchical segmentation
 Scalability
 Resiliency
 Traffic management
 Policy enforcement
• Structure and Hardening for Plant-wide
EtherNet/IP Architectures
• Security policies
 Defense-in-depth
 Secure remote access
Gbps Link
for Failover Detection
Firewall
(Active)
Firewall
(Standby)
MCC
Levels 0–2
HMI
Cell/Area Zone #1
Redundant Star Topology
Flex Links Resiliency
Cell/Area Zone #3
Bus/Star Topology
Cell/Area Zones
Industrial
Demilitarized Zone
(IDMZ)
Enterprise Zone
Levels 4 and 5
Rockwell Automation
Stratix 8000
Layer 2 Access Switch
Cisco
ASA 5500
Industrial Zone
Site Operations and Control
Level 3
Remote Access
Server
Catalyst
6500/4500
Phone
Controller
Camera
Controller
Robot
Soft Starter
Cell/Area Zone #2
Ring Topology
Resilient Ethernet Protocol (REP)
I/O
Plant Firewall:
 Inter-zone traffic segmentation
 ACLs, IPS and IDS
 VPN Services
 Portal and Terminal Server proxy
Physical or Virtualized Servers
• Patch Management
• Remote Gateway Services
• Application Mirror
• AV Server
• FactoryTalk Application Servers & Services Platform
• Network Services – e.g. DNS, AD, DHCP, AAA
• Remote Access Server (RAS)
• Call Manager
• Storage Array
Wide Area Network (WAN)
• ERP, Email
• Active Directory (AD), AAA – Radius
• Call Manager
Enterprise
WAN
Safety
I/O
Servo
Drive
Instrumentation

Logical Framework – Purdue Reference Model
Strong Segmentation
Level 5
Level 4
Level 3
Level 2
Level 1
Level 0
Terminal
Services
Patch Management AV
Server
Application Mirror Web Services Operations Application
Server
Enterprise Netw ork
Site Business Planning and Logistics Netw orkE-Mail, Intranet, etc.
Factory
Application
Server
Factory
Directory
Engineering
Workstation
Domain Controller
FactoryTalk
Client
Operator
Interface
FactoryTalk
Client
Engineering
Workstation
Operator
Interface
Batch
Control
Discrete Control Drive Control
Continuous
Process Control
Safety
Control
Sensors Drives Actuators Robots
Enterprise
Zone
DMZ
Manufacturing
Zone
Cell/Area
Zone
Web
E-Mail
CIP
Firew all
Firew all
Site Manufacturing Operations and
Control
Area Supervisory
Control
Basic Control
Process
PurdueReferenceModel,ISA-95

What is Connected Factory?

Connected Factory Network
• Lower Operations Downtime
• Rapid Assembly Line
Changeovers
• Improved Safety and Protection
from Cyber Threats
• Business Visibility and
Process Optimization
• 25% reduction in unscheduled downtime
• 7-12% improved OEE (1% higher OEE = 3-4% in profitability)
• 10-25x improvement in BTO (Build-to-Order)
cycletimes (e.g. 18 months 2 weeks)
• 20% lower TCO
• Agility to meet or beat market demand
Compelling Events
Business Needs
Business Outcomes
Cisco Products
Connected Factory Services
• Connected Factory Services
• Factory Network Strategy
• Factory Solution Identification,
Design and ROI Services
Services
Connected Factory Network
• New Plant (Green Field)
• Refresh Plant (Brown Field)
• Production Line Changeover
• Expand Plant Capacity
• IoT Pilot / Project
Cisco Partner
Cisco
IE2000
IE5000
Clocking
Cisco 9300
Micro Apps
Kinetic Data
Collection
Cisco
DNA/SDA
Machine and Robot
Manufacturers
Traditional VAR
with IoT Practice
PLC’s – Programmable
Logic Controllers
Connected Factory Architecture Poster
• Pilot Project Starter Kits
• Implementation and Integration
• Solution Optimization Service
• Product Training and Support
25X 36X 37X 48X
Catalyst 9300 48 PoE+
NETWORK
MODULE
C9300-
NM-8X
43 65 87 TE/G2101X 12X 13X 24X
C9300-48P
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PoE
SYNCE
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3
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14
15
16
17
18
19
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6
7
8
9
10
11
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SETUP
1X 7X
2X 8X
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PSU2
PSU1
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USB
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100-250V , 2A
100-240V~, 50-60Hz, 2A
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24-60V , 10A
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100-250V , 2A
100-240V~, 50-60Hz, 2A
+ -Lo
24-60V , 10A
PSU2
9X 15X
10X 16X
17X 23X
18X 24X
Cisco IE4000
IOx Micro Apps
Integration
platform

Connected Factory Wireless
• Enable worker mobility data,
voice and video
• Improve response through
collaboration, dashboards and
automation
• Mobile applications
(tablets/phones/RFID)
• Equipment/sensors telematics,
real-time decision making
• Improved equipment
performance (OEE)
• Improved labor productivity
(Turns per labor hour)
• Reduce time to resolution
(MTTR)
• Improved asset utilization
• Lower cabling and labor costs
• Increased productivity for
specialized resources
Compelling Events
Business Needs
Business Outcomes
Cisco Products
• Mfg ArchRoadmap Service
• Wireless Assessment
• Use Case/ Business value
Assessment
• Design and Built Service
• Dev Net Integration
Services
• Increase capacity and factory
performance
• Factory downtime
• Wireless tooling and AGVs
• Vendor and guest access
• Securing the network
• Connected factory to
enterprise
Cisco Partnerships
802.11 Wireless LAN within CPwE Arch. white paper
and Resilient Ethernet Protocol white paper
Connected Factory Wireless System Design Guide
(CVD)
CMX &
Operational
Insights
Indoor/Outdoor
APs
Cisco
Controllers
Cisco
Spark/Webex Kinetic
Cisco
DNA/SDA
Integration
platform
Apple
fastlane
Equipment
and material
tracking

Connected Factory Security
• The right access to the right
data at the right time
• Data integration of factory
machines and systems
• Protect critical business,
customer and supplier data
• Minimize Risk, Liability and
Downtime caused by cyber
attacks.
• Reduce risk of manufacturing
outages due to Ransomware
and Malware
• Prevent loss of Intellectual
capital and corruption of
products
• Enable Secure Cloud and Fog
Computing to lower overall IT
costs and enable IOT value
• Access Control within and
outside of the Industrial Zone,
from the IDMZ down
to Level 1
• Any-time secure and encrypted
access to the Industrial Zone
for Employees, Contractors
and Vendors
Compelling Events
Business Needs
Business Outcomes
• Risk Assessment and
Penetration Testing
• Security Design HLD/LLD
• Implementation Services
• Day-to-Day Operations
• Incident Response and
Remediation
Services
Connected Factory Solution
• New Plant (Green Field)
• Refresh Plant (Brown Field)
• After Security “event”
• Shift to Cloud Computing
• Remote vendor access for
tooling and robots
• Increased use of IOT devices
Cisco Partner
Rockwell Automation Controllers and Factory Talk Suite
Splunk – Security Incident Event Management
IBM QRadar - Security Incident Event Management
Securely Traversing IACS Data Across the Industrial
Demilitarized Zone
Whitepaper CVD
• Industrial Network Director
• StealthWatch
• Adaptive Security Appliance (ASA)
with Firepower Services
• Industrial Ethernet Switching with
SW defined segmentation
(TrustSec)
• Industrial Security Appliance (ISA)
• Identity Services Engine
• Cognitive Threat Analytics
• Umbrella
• AnyConnect
Cisco Products

Connected Factory Data
• Customer ownership of machine
data
• Reduce & manage the volumes
of machine data
• Consolidated view of machine
conditions (real time & historic)
• Securely and reliably get all
devices in your environment
connected
• Unlock data inside of these
devices – as devices all use
different protocols, processes,
and data formats
• The ability to put compute
power wherever it serves their
needs best (for decision
making at the right point and
optimizing network resources)
• As data is moved, enforce
policies about ownership,
privacy and security of data ---
in line with both the customer’s
own interest and any local
regulatory and compliance
Compelling Events
Business Needs
Business Outcomes
Cisco Products
Connected Kinetic Services
• Architectural Roadmap
Service
• Micro Engagement
• Design and Build Service
• Product Support
• Solution Support for 3rd party
components
Services
Connected Kinetic Solution
• C-level IIOT initiative
• Amazon, Microsoft, Google,
IBM cloud engagements
• Machine vendor data
ownership issues
• Deployment of Cisco IOx
switches/routers
Cisco Partner
Sensor Vendors (Panduit, iSockets, Monnit)
Visualization (Acuity, Qlik)
Legacy Connectivity (Telit, Kepware)
Cisco Kinetic helps your business get the right IoT
data to the right applications at the right times
At a Glance solution overview
• Cisco Edge Fog Module
• Gateway Management Module
• Data Connect Module
• Industrial Ethernet Switching
• Cisco IOx operating
environment
• Identity Services
Engine
• IoT Threat Defense

Challenges
Solution
Outcomes
“With the development of SmartBox, Mazak continues to drive toward its iSMART
Factory concept and connecting today’s shops to the Industrial Internet of Things
(IIoT) to achieve levels of efficiency and productivity never before realized.”
– Brian Papke, President of Mazak Corporation
Enable connectivity Mazak machines for predictive
maintenance and MaaS business model
Cisco-enabled iSmart Machines with imbedded network switch,
security and MTConnect Agent
300% Internal Rate of Return (IRR)
increased production and overall equipment efficiency
(OEE) by 10%
Case study
Mazak Corporation

Challenges
Solution
Outcomes
“Using Connected Asset Manager for IoT Intelligence, wehave been able not only to reduce our
energy consumption, but also to realize a continual increase in those savings. As wecontinue to
implement more of the capabilities of the software, weanticipate even greater operational
efficiencies."
– Caroline Dowling, President, Flex, CEC Communications Infrastructure & Enterprise
Compute
• Better track asset utilization, resources and manage power
consumption in plant floor
• Reduce environmental impact
• Need better visibility to identify usage patterns
• Produces better data analytics from manufacturing systems
• Cisco Kinetic -delivering ‘single pane of glass’ visibility across
multiple islands of automation
• Reduced carbon emissions
• Up to 30% savings inenergy consumption
• Projected $1M+ savings perfactory
Case study
Flex

Challenges
Solution
Outcomes
“We believe that Cisco offers the innovation and real-time visibility weneed to help achieve
our goals, while optimizing our operational efficiency across our plants.”
– Kenny Tsang, Vice President of Quality Foxconn FG Group
• Increase overall equipment effectiveness (OEE)
• Reduce environmental impact
• Improve operational efficiency and
reduce costs
• Energy and resource management, pervasive video, location-based
services for material and people location
• Enable Digitized Global manufacturingfor Factory of
Future/Industry 4.0
• Savings in energy and resource consumption
Case study
Foxconn

Challenges
Solution
Outcomes
 Secure, dependable wireless access in plants
 Lower than desired production throughput and
collaboration
 Other misc mobility challenges in plant-wide
operations (increasing use-cases)
 Started w/site survey and network design– mfg
LAN network discovery and assessment
 Supported client business case/justification
 Industrial Wireless Cisco and Wireless LAN
Products (+200 APs).
 Ford expects $1M+ /yr. re OEE improvement
 Establish secure foundation access layer
platform.
 Exploring scaling across 83 add’l manufacturing
locations.
Case study
Ford
Manufacturing Wireless Scope –
Objective – a full discovery assessment of Ford manufacturing’s current state, and proposed
high level design to support NextGen IoT principles in manufacturing environment.
Initiatives starting at Ford Motor Company’s complete retooling of their Woodhaven Stamping
Plant.

Challenges
Solution
Outcomes
FCA is phasing their wireless refresh throughout their NA manufacturing facilities. This is the
initial phase of a larger wireless refresh initiative, establishing methodology for assessment,
site-specific design and deployment approaches
• Secure, dependable wireless access in plants
• Increasing wireless demands including mobility use-cases regarding
plant-wide operations
• Performed Wireless Predictive survey, RF certification assessment
• Cisco’s Unified Wireless is being extended into Manufacturing
Production areas & Warehouses
 FCA expects to save +$250K plus per year in
costs and a net measurable improvement in OEE
 Exploring scaling across 17 additional FCO
operated locations.
Case study
Fiat Chrysler

 Trusted Manufacturing Partner
from Data Center and Cloud,
to Edge and Every Device
 #1 Industrial Managed Switches
 59% Market Share Switching
 40% Market Share Routing
 Market Share Leader in Security
 Market Share Leader in Collaboration
 #1 IDC-rated IoT Platform
Foundation Matters
Security
Network
Automation
Network Analytics
Orchestration
Intelligence
Tested and ValidatedSources: Various analyst reports, see notes.
Network

to DIGITIZE MANUFACTURING
INDUSTRY

Next Dimension + Cisco Smart Manufacturing

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