20150702 - strategy and business value for connected appliances public version

July 2015, Boeblingen, Germany

Thorsten Schroeer, Director Electronics Industry Europe

Strategy and Business Value for IoT in Appliance Industry“A Business Perspective”

www.ibm.com/electronics/iot

#ThorSchroeer

© 2015 IBM Corporation2 Electrolux and IBM Confidential June 25th, 2015

View on the IoT Market – It’s a mess

© 2015 IBM Corporation

http://www-03.ibm.com/press/us/en/pressrelease/46453.wss

http://www-03.ibm.com/press/us/en/pressrelease/46557.wss

http://www-01.ibm.com/software/info/internet-of-things/iot-prod/iot-announcement.html

© 2015 IBM Corporation4

Devices, Data, Cloud, and Insights converge to enable industry transformation

OperateOperate

Security

MakeMake

EngageEngage

INSIGHTS


Simplified IoT architecture framework

Data PipelineContent based message routing, filtering, and transformation, msg monitoring,

Applications

General analyticsHistorical reporting, smart

ad-hoc queries

Real time analyticsStreaming

Command & Control

Actions / feedback to devices

Cloud

Historian Time series DB, object DB

ConnectivityMessaging, registration, device mgt

GatewayEdge computing, analytics



GatewayEdge computing,

analytics


analytics

DevicesSensors & actuators


analytics


analytics

DevicesSensors & actuators

Un

ifie

d s

erv

ice

ma

na

ge

me

nt

Deplo

ym

ent, r

esourc

e m

gt,

orc

hestr

ation, m

onitoring, S

LA

s,

security

, m

ete

ring, serv

ice b

ased c

harg

ing

MobileMobile apps, connect to mobile web

VisualizationDashboards, queries, no-code app-gen

Enterprise Integration

eCommerce

SAP

Content

Data Warehouse

CRM

PLM


IoT Consortia, Standards and Open Source – Our Experience

Standards and Openness are essential to the growth of IoT

IBM Strategy

• Build on open standards and open source where appropriate

• Participate and lead in relevant initiatives• Pick carefully, as there are plenty to choose from

The principal groups working on standard interfaces are:

• Smart TV Alliance • AllSeen

• Open Interconnect Consortium

• Apple Homekit• Google Weave / Brillo

• Others (HGI, Zigbee)

• Industrial Internet Consortium• IBM & AT&T

AllSeen Alliance Premier Members


„Connected Devices should be an integrated play within manufacturers

digital transformation agenda“

“In IoT what matters most is the data and insight… not the connected

devices”


valu

eConnected Products Maturity Model

Connect to form ecosystem

2. User focus

Extend device function & UI through connectivity,

commerce, product extensions, service

transition

Closing the loop: Device control from the cloud

3. Connected ecosystem

Integrate connected products into smart home

ecosystems, make platform available to 3rd parties,

enable P2P relationships

Devices interact with each other, and with multiple

clouds

4. Intelligent ecosystem

Use cognitive technologies to integrate connected products into users’ smart

ecosystems, acting intelligently within a broad device and sensor context

Transform & automate the processes for which the devices are used.

1. Manufacturer focus

Use analytics to reduce costs, support R&D,

enhance marketing & sales, reduce after-sales

service cost

Data flows into cloud for analytics

Extend product function

Transform & automate living / business processes

Optimize business operation

leadingexploring

maturity over time

Vision:

Connected intelligent ecosystem


Connected Appliance

CA-informed customer service

Messaging

Platform

Accelerate detection of production & quality issues

Diagnostics

& repair

Analytics

Increase first call complete %

Production

Analytics

Avert unnecessary part replacement

Partner Consumables

Warranty Extensions

Replacement Appliances

Customer

Analytics

•eComm Platform (partner

vendor capable)

•Campaign execution &

management

•Next Best Action

•Price optimization

•Etc.

Customer Interface

Understand End Customers

Call Center

Solution

Design based on extensive use data

Use &

Design

Analytics

Sales to owners

Portals

Connected Appliances example use cases


Time to Market

Ris

k/C

om

ple

xit

y/E

ffo

rt

Low

Long-term Near-term

High

Related Products Sales Legend

Warranty Claims Reduction

10

Predictive Issue Detection

First Call Complete

Device as a Service

Consumables Sales

Service Contracts

Call Center Efficiency

Unnecessary Replacement

Size of circle represents size of opportunity

New Business Models

Service & Support Efficiency

Increased Sales

Data as a Service

Examples of Value Opportunity


Smart phones and tablets are already the center of our livesOEM’s connected app can become the center for all home appliances.


90% of aftersales use cases can be covered in-appIncreased efficiency of all customer communication + added value

Repair & Maintenance scheduling based on location and error codes

Proactive customer Service based on error codes

Sensor-based

pushnotifications

Equipment & Replacements based on error and usage

Cross- & Upselling based on

usage

Remote control all devices

View usage statistics

Marketing campaigns,Product launches


IBM Strategic Partnerships on consumer domain support IoT ecosystem

TP Vision, what does IBM deliver?

IBM delivers today:

• App Store / Service Portal Development: – App Store (Legacy / Native Android) development

– Service Portal (Management Portal) development

– Hotel TV Portal development

– OEM Brands: Bang & Olufsen / AOC / Sharp / Gibson

• Platform-as-a-Service App Store - Pay-as-you-Go model, cost per year per Connected Device (currently running 4M+ Connected Devices) (=Cloud+Middleware+Application Software+Full Services)

Tomorrow:

– Full Device Management Services with Real Time Data Gathering


Diehl Controls and IBM extend plattform partnership für device mgt.

www-03.ibm.com/press/de/de/pressrelease/47128.wss


Big data: unstructured, semi-structured and structured

Analytics-driven Service & Product Innovation with white goods manufacturer

Review & rating Click-through Feedbacks via pads/phonesSales records Consumer master data

Product master data

Monitoring & maintenance

logs

Big data: unstructured, semi-structured and structured

Online data Offline data Connected data

Data Types

Social media…Call center records…

B2C

e-commerce

Forum, Forum,

Microblog,

Facebook…

ERP CRMConnected

devices

Data sourcesSensors

User 360 Product 360• Demographic• Geographic

• Socialgraphic• Behavioral

• Psychological

• R&D• Production

• Transactional• In-use

• Maintenance

Indexed information

FOAK applicationsVoice of

Customer

(VoC)

Targeted Marketing & Sales

OptimizationPreventive

Maintenance

R&D Marketing and Sales After Sales Service


User data entry to Chef-Watson for recipe creation, using iPad

The Chef-Watson recipe selected by the user, along with cooking instructions and the best appliance settings, is sent by the IoT Foundation to the Miele range, via a laptop for protocol conversion.

Automatic or manual start of the cooking program

Bluemix

WatsonIoT Foundation

European White Goods OEM - Watson case study


IBM Research - Connected Home Analytics Service

Hangout H1Refrigerator

open / closed

3 times in 10 mins.

Kitchen Cabinet

open / closed

7 times in 15 mins.

Toilet flushed

1 time in 10 mins.

Hangout H2

Bathroom Sink used

1 time in 10 mins.

Microwave

open / closed

4 times in 20 mins.

Refrigerator

open / closed

5 times in 20 mins.

Hangout H3

9:00 AM 10:00 AM 11:00 AM 12:00 PM 1:00 PM

Eating Daily Hygiene Eating

Model refinement (ensemble methods: bagging, rule minimization/shadowing)

Auto-Regressive / Granger Causality

Clustering Frequent Item Set MiningRandom Forests /

Decision Trees


How should White Goods companies proceed in order to best capitalize on this opportunity

1. Begin to engage the end consumer in a meaningful way

2. Figure out how they fit into the emerging smarter home user experiences

3. Robust systems engineering to enable remote diagnostics, updates and control of appliances through “smarts” in the cloud

4. Ensure security to protect brand(s)

5. Select proven partners with IoT breadth and depth


Define architecture, create detailed designs, conduct testing, and deploy the

platform

IoT Platform Design and

Implementation

Identify key IoT opportunities within enterprise functions and across the value

chain

IoT Opportunity Assessment

Identify IoT capabilities, assess business value, and create realization plan

IoT Strategy Accelerator1 2 3

• Core understanding

• Opportunity assessment

• Opportunity prioritization

• Requirements

• High-level architecture

• Detailed design and build

• Testing

• Operations and support

• Industry context

• Current state assessment

• Business value and strategy

• Solutions and technology

• Realization plan

IoTAssessment

IoTAssessment

IoT Strategy AcceleratorIoT Strategy Accelerator

IoT Platform Design and ImplementationIoT Platform Design and Implementation

Business Value Assessment


Jump into IoT but watch......

1. Strong IT & Application Plattform

2. Consumer centric and business value driven

3. Openness

4. Standards, Security, Compliance, Integrity,

Governance

5. Global strategy with local deployments

6. Lean and Grow


My offer @ IFA, 4 - 9 September 2015 in Berlin, Germany.

July 2015, Boeblingen, Germany

Thorsten Schroeer, Director Electronics Industry Europe

Strategy and Business Value for IoT in Appliance Industry“A Business Perspective”

www.ibm.com/electronics/iot

#ThorSchroeer

20150702 - strategy and business value for connected appliances public version

Documents

connected devices

ibm corporation4 devices

use analytics

ibm confidentialjune

ibm corporation7

ibm corporation http

ibm corporation6 iot

ibm corporation2 electrolux