In this report we present our vision of making the European Mittelstand Digital Industry pioneers. We describe the possible outcomes of the current digitalization of manufacturing, Europe's preparedness in both cases, how digitalization will change manufacturing and what Actyx is doing to make our vision a reality.

1. © Actyx. All Rights Reserved.
Version:
Published:
Release:
Making the European Mittelstand
Digital Industry pioneers
2.0.3
21/09/15
Public

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Why is it important?
Digital Industry (or Industry 4.0 or Industrial Internet)

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A backbone of the European economy
the highly-successful manufacturing Mittelstand
that through generations of continuous innovation
has developed the best processes and products and
kept the competition at bay on a global scale
is under threat by digitalization!
Europe’s manufacturing future is in danger

4. Slide 4
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With an impressive track record of redefining industries
Digitalization is a disruptive force
Retail:
Entertainment:
News:

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Two examples from traditionally European industries
Manufacturing disruption has already started
New paradigm of
intelligent material
handling
© Wired
One of the most
innovative cars
in the world
© Niels de Wit from Lunteren
Automotive Intra-Logistics

6. Slide 6
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Two possible outcome scenarios for Digital Industry
Disruption still a challenge for Europe
1) No disruption
• The Mittelstand successfully innovates
• European manufacturing remains competitive
• Established technology suppliers (Siemens, SAP, etc.) thrive
2) Disruption
• Is the Mittelstand taking enough initiative?
• Will manufacturers prevail in a disruptively digital world?
• Are technology suppliers providing digital base-technology?
Europe
prepared
Challenge
for Europe

7. Slide 7
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Europe should become a Digital Industry pioneer:
 Strengthening of the “Mittelstand”
 Manufacture new generation smart products
 Grow market-share in globalized world
 Develop key digital expertise
 Ensure sustainable success in the digital world
We must prepare. Let’s take the initiative!

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What does Digital Industry mean
for the manufacturing Mittelstand?

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Smart products & services will be brought to market with smart factories
The Mittelstand will undergo a digital transformation
2
1 Smart
Factories
Smart
Products &
Services
Digital Industry Solutions:
Real-Time
Data
Intelligence
Algorithms
Adaptive User
Interfaces
Connected
Devices
Connectivity and
internet
technology
Smart sensors
and actuators
(Private) cloud
processing and
storage
Big-data analytics
and artificial
intelligence

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Smart factories: simple and adaptive
A new paradigm built on connectivity and intelligence
Employees
Equipment
Processes
Old paradigm
applications
Data platform

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Smart products and services: individualized and quickly brought to market
A new paradigm built on connectivity and intelligence
Employees
Equipment
Processes
applications
applications
Data platform
Innovative and
quickly brought
to market
Smart,
connected
and updated
Rich and adaptive
customer
experience

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The positive impact of smart factories and smart products & services
Digitalization is a huge opportunity
 Complex
 Rigid
 Expensive
 Simple
 Adaptive
 Cheap
Example:
Steel manufacturer Hoesch
Hohenlimburg performed an
innovation project improving vertical
and horizontal integration of
production and business systems.
100% Productivity increase
40% Reduction in maintenance
Traditional
factories
Smart
Factories
Source: “Industrie 4.0: Von Daten zum Wissen”, A. Burghardt u. P Kiradjiev, MachinenMarkt, August 2015

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The positive impact of smart factories and smart products & services
Digitalization is a huge opportunity
 Standardized
 Static
 Individualized
 Adaptive
Example:
Schindler’s PORT technology combines
connectivity (incl. LTE), machine
learning, planning algorithms, sensors
and more to reduce elevator wait- and
downtimes.
50% Wait time reduction
22% Faster return to service
Traditional
Products
& Services
Smart
Product &
Services
Sources: “How Smart, Connected Products are Transforming Competition”,M. Porter et al., HBR, November 2014
“Schindler & Verizon are Redefining Reliability with Connected Monitoring Solution, Schindler, May 2014

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Actyx develops solutions to
transform the European Mittelstand
into Digital Industry pioneers

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Employees
Equipment
Processes
applications
applications
Data platform
Innovative and
quickly brought
to market
Smart,
connected
and updated
Rich and adaptive
customer
experience
Three areas where Actyx develops products
Smart product applicationsData platformsSmart factory applications1 2 3

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Co-operative innovation projects instead of ivory-tower approaches
But these products cannot be developed in the lab
Actyx develops products in
 co-operative (hand-in hand with manufacturers)
 on-site (real-world application scenarios)
 bottom-up (on the shop floor with on-site personnel)
 explorative (agile development methodology)
innovation projects.
Manufacturer
- Manufacturing expertise
- Application scenario
- Desire to innovate
Actyx
- Digital talent
- Agile development
- Change management
Appendix: Detailed
project approach
and example

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In co-operative innovation projects Actyx provides world-class digital talent:
 Connectivity Internet of Things, LTE-based edge connectivity, security, QoS, …
 Software Secure and reliable architectures, big-data management, visualization, …
 Artificial Intelligence Analytics, machine learning, optimization, planning, …
The Actyx talent network:
Our competitive advantages: 1 digital talent
And more…

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Strategy
Consulting
Technical
Consulting
Contract
Research
Strategic level
Process level
Technical level
(shop-floor)
The Actyx co-operative approach transforms from the bottom
Our competitive advantages: 2 bottom-up approach

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 Oliver Stollmann (CEO)
 Expertise in artificial intelligence, software, automation
 ABB, Xerox PARC, Fraunhofer
 Engineering Bachelor/Master from ETH Zurich
 Maximilian Fischer (COO)
 Co-Founder of HackZurich
 Patent holder, Caltech, EPFL, Duke Univ.
 Engineering Bachelor/Master from ETH Zurich
 Advisors/supporters/angels:
 Leading Industry 4.0 expert (Professor)
 Leading Digital Industry consultant (Partner-level)
 Experienced startup founder (with recent >1 Billion Euro exit)
 And more through extensive network…
A technical team and great advisor network

20. © Actyx. All Rights Reserved.
Get in touch!
Oliver Stollmann
oliver@actyx.io
www.actyx.io

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An example: digitally-enabled mass-customization of premium mattresses
Appendix: Co-operative innovation projects
Introduction
The goal of this appendix is to further detail Actyx’s co-
operative innovation projects. The general project
structure shown below is described in detail and
accompanied by an exemplary case-study.
Example
In this fictitious exemplary case-study, a premium
mattress manufacturer decided to work with Actyx to take
first steps towards a digital transformation.
Note
Actyx’s co-operative innovation projects actually follow an
agile methodology, meaning projects are not pre-planned
such as in this example.
Hypothesis
Definition of project’s
digital innovation
hypothesis
Connectivity
Establishment of
base-enabler
connectivity
Digital Potential
Identification of
digital potential in
your business
Solution
Implementation of
digitally-enabled
solution

22. Slide 22
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Identification of digital potential
Co-operative innovation projects
In this phase the digital potential in the manufacturing partner’s business is identified.
Based on status quo analysis, market trend identification, and the evaluation of
potentially applicable digital enablers, digitalization hypothesis are developed.
Hypothesis Connectivity
Digital
Potential
Solution

23. Slide 23
© Actyx. All Rights Reserved.
Identification of digital potential
Co-operative innovation projects
In this phase the digital potential in the manufacturing partner’s business is identified.
Based on status quo analysis, market trend identification, and the evaluation of
potentially applicable digital enablers, digitalization hypothesis are developed.
Approach: Example:
Status quo
analysis
 Discussions with on-site personnel
 Analysis of production and business data
 Mapping of IT infrastructure
 …
 Inventory and supply-chain inefficiencies
 Low overall equipment effectiveness (OEE)
 Limited product innovation and differentiation
Hypothesis Connectivity
Digital
Potential
Solution

24. Slide 24
© Actyx. All Rights Reserved.
Identification of digital potential
Co-operative innovation projects
In this phase the digital potential in the manufacturing partner’s business is identified.
Based on status quo analysis, market trend identification, and the evaluation of
potentially applicable digital enablers, digitalization hypothesis are developed.
Approach: Example:
Status quo
analysis
 Discussions with on-site personnel
 Analysis of production and business data
 Mapping of IT infrastructure
 …
 Inventory and supply-chain inefficiencies
 Low overall equipment effectiveness (OEE)
 Limited product innovation and differentiation
Market trend
identification
 Customer preferences
 Material and labor costs
 Value networks
 …
 Mass-customization
 Rich customer experiences
 Data from health- and fitness-trackers
 Health awareness (ex: back problems, mobility)
Hypothesis Connectivity
Digital
Potential
Solution

25. Slide 25
© Actyx. All Rights Reserved.
Identification of digital potential
Co-operative innovation projects
In this phase the digital potential in the manufacturing partner’s business is identified.
Based on status quo analysis, market trend identification, and the evaluation of
potentially applicable digital enablers, digitalization hypothesis are developed.
Approach: Example:
Status quo
analysis
 Discussions with on-site personnel
 Analysis of production and business data
 Mapping of IT infrastructure
 …
 Inventory and supply-chain inefficiencies
 Low overall equipment effectiveness (OEE)
 Limited product innovation and differentiation
Market trend
identification
 Customer preferences
 Material and labor costs
 Value networks
 …
 Mass-customization
 Rich customer experiences
 Data from health- and fitness-trackers
 Health awareness (ex: back problems, mobility)
Digital
enablers
evaluation
 Technology research
 Applicability and maturity analysis
 Cost evaluation
 …
 Health data from smart devices
 Rich and interactive web-shops
 Intelligent product design algorithms
 Smart connected sensors and agile machinery
Hypothesis Connectivity
Digital
Potential
Solution

26. Slide 26
© Actyx. All Rights Reserved.
Identification of digital potential
Co-operative innovation projects
In this phase the digital potential in the manufacturing partner’s business is identified.
Based on status quo analysis, market trend identification, and the evaluation of
potentially applicable digital enablers, digitalization hypothesis are developed.
Approach: Example:
Status quo
analysis
 Discussions with on-site personnel
 Analysis of production and business data
 Mapping of IT infrastructure
 …
 Inventory and supply-chain inefficiencies
 Low overall equipment effectiveness (OEE)
 Limited product innovation and differentiation
Market trend
identification
 Customer preferences
 Material and labor costs
 Value networks
 …
 Mass-customization
 Rich customer experiences
 Data from health- and fitness-trackers
 Health awareness (ex: back problems, mobility)
Digital
enablers
evaluation
 Technology research
 Applicability and maturity analysis
 Cost evaluation
 …
 Health data from smart devices
 Rich and interactive web-shops
 Intelligent product design algorithms
 Smart connected sensors and agile machinery
Digitalization
hypothesis
development
 Technological viability
 Risk and complexity assessment
 ROI estimates (where possible)
 …
 Machine-learning for better supply-demand match
 Efficiency increase through supplier ERP-integration
 Individualized mattresses based on health-data
 Sleep-as-a-Service for hotels/motels
Hypothesis Connectivity
Digital
Potential
Solution

27. Slide 27
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Definition of project hypothesis
Co-operative innovation projects
In this phase developed digitalization hypotheses are analyzed in more detail regarding
Return-on-Invest (ROI), feasibility, risk, implementation cost and duration, and impact. Based
on this a project hypothesis is chosen and refined and the project continuation specified.
Hypothesis Connectivity
Digital
Potential
Solution

28. Slide 28
© Actyx. All Rights Reserved.
Definition of project hypothesis
Co-operative innovation projects
In this phase developed digitalization hypotheses are analyzed in more detail regarding
Return-on-Invest (ROI), feasibility, risk, implementation cost and duration, and impact. Based
on this a project hypothesis is chosen and refined and the project continuation specified.
Approach: Example:
In depth
analysis
In depth analysis of digitalization hypotheses based on:
 Return-on-Invest (ROI) estimates
 Feasibility and risk
 Implementation cost and duration
 Impact estimates
Data-centric tools including modelling and simulation may be
leveraged.
In-depth analysis of digitalization hypotheses:
 Individualized mattresses based on health-data
 Efficiency increase through supplier ERP-integration
 Machine-learning for better supply-demand match
 Sleep-as-a-Service for hotels/motels
Hypothesis Connectivity
Digital
Potential
Solution

29. Slide 29
© Actyx. All Rights Reserved.
Definition of project hypothesis
Co-operative innovation projects
In this phase developed digitalization hypotheses are analyzed in more detail regarding
Return-on-Invest (ROI), feasibility, risk, implementation cost and duration, and impact. Based
on this a project hypothesis is chosen and refined and the project continuation specified.
Approach: Example:
In depth
analysis
In depth analysis of digitalization hypotheses based on:
 Return-on-Invest (ROI) estimates
 Feasibility and risk
 Implementation cost and duration
 Impact estimates
Data-centric tools including modelling and simulation may be
leveraged.
In-depth analysis of digitalization hypotheses:
 Individualized mattresses based on health-data
 Efficiency increase through supplier ERP-integration
 Machine-learning for better supply-demand match
 Sleep-as-a-Service for hotels/motels
Ranking and
choice
Based on the results of the in-depth analysis, overall business
strategy, resource availability, etc., the hypothesis are ranked
according to the manufacturing partner’s preferences and a
project hypothesis is chosen.
1. Individualized mattresses based on health-data
2. Efficiency increase through supplier ERP-integration
3. Machine-learning for better supply-demand match
4. Sleep-as-a-Service for hotels/motels
Hypothesis Connectivity
Digital
Potential
Solution

30. Slide 30
© Actyx. All Rights Reserved.
Definition of project hypothesis
Co-operative innovation projects
In this phase developed digitalization hypotheses are analyzed in more detail regarding
Return-on-Invest (ROI), feasibility, risk, implementation cost and duration, and impact. Based
on this a project hypothesis is chosen and refined and the project continuation specified.
Approach: Example:
In depth
analysis
In depth analysis of digitalization hypotheses based on:
 Return-on-Invest (ROI) estimates
 Feasibility and risk
 Implementation cost and duration
 Impact estimates
Data-centric tools including modelling and simulation may be
leveraged.
In-depth analysis of digitalization hypotheses:
 Individualized mattresses based on health-data
 Efficiency increase through supplier ERP-integration
 Machine-learning for better supply-demand match
 Sleep-as-a-Service for hotels/motels
Ranking and
choice
Based on the results of the in-depth analysis, overall business
strategy, resource availability, etc., the hypothesis are ranked
according to the manufacturing partner’s preferences and a
project hypothesis is chosen.
1. Individualized mattresses based on health-data
2. Efficiency increase through supplier ERP-integration
3. Machine-learning for better supply-demand match
4. Sleep-as-a-Service for hotels/motels
Refinement
of the project
hypothesis
and
continuation
The project’s key hypothesis is refined, and the project’s
continuation (scope, resources, focus) defined:
 In-depth hypothesis specification
 Project goals, scope, resources, and focus
 Application sites (factory, cell, value network, etc.)
Hypothesis: we can define a new market of highly individualized
mattress through data-driven customization, a rich and
interactive customer experience and adaptive manufacturing
technology.
 Project continuation: 1-year, 4-experts, 6-developers, etc.
Hypothesis Connectivity
Digital
Potential
Solution

31. Slide 31
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Establishing connectivity
Co-operative innovation projects
In this phase the base enabler of digital industry, connectivity, will be established. The project vision’s connectivity and data
requirements will be specified, suitable technologies identified and deployed at the project’s application site. This step provides
the basis for the solution implementation, and, as a by-product, provides decision makers valuable data-based transparency.
Hypothesis Connectivity
Digital
Potential
Solution

32. Slide 32
© Actyx. All Rights Reserved.
Establishing connectivity
Co-operative innovation projects
In this phase the base enabler of digital industry, connectivity, will be established. The project vision’s connectivity and data
requirements will be specified, suitable technologies identified and deployed at the project’s application site. This step provides
the basis for the solution implementation, and, as a by-product, provides decision makers valuable data-based transparency.
Approach: Example:
Connectivity
and data
requirement
specification
Connectivity and data requirements will be specified
according to the project hypothesis, including:
 Data sources and schemas
 Parameter specification
 Saftey, Security and Quality-of-Service (QoS) requirements
Hypothesis Connectivity
Digital
Potential
Solution

33. Slide 33
© Actyx. All Rights Reserved.
Establishing connectivity
Co-operative innovation projects
In this phase the base enabler of digital industry, connectivity, will be established. The project vision’s connectivity and data
requirements will be specified, suitable technologies identified and deployed at the project’s application site. This step provides
the basis for the solution implementation, and, as a by-product, provides decision makers valuable data-based transparency.
Approach: Example:
Connectivity
and data
requirement
specification
Connectivity and data requirements will be specified
according to the project hypothesis, including:
 Data sources and schemas
 Parameter specification
 Saftey, Security and Quality-of-Service (QoS) requirements
Enabling
technology
identification
Based on the connectivity and data requirements suitable
connectivity and data management technology will be
identified.
 IoT platforms: 2elemetry, Predix, home-grown
 Transfer protocols: OPC UA, MQTT, ZeroMQ
 Data management: Cassandra, CouchDB
Hypothesis Connectivity
Digital
Potential
Solution

34. Slide 34
© Actyx. All Rights Reserved.
Establishing connectivity
Co-operative innovation projects
In this phase the base enabler of digital industry, connectivity, will be established. The project vision’s connectivity and data
requirements will be specified, suitable technologies identified and deployed at the project’s application site. This step provides
the basis for the solution implementation, and, as a by-product, provides decision makers valuable data-based transparency.
Approach: Example:
Connectivity
and data
requirement
specification
Connectivity and data requirements will be specified
according to the project hypothesis, including:
 Data sources and schemas
 Parameter specification
 Saftey, Security and Quality-of-Service (QoS) requirements
Enabling
technology
identification
Based on the connectivity and data requirements suitable
connectivity and data management technology will be
identified.
 IoT platforms: 2elemetry, Predix, home-grown
 Transfer protocols: OPC UA, MQTT, ZeroMQ
 Data management: Cassandra, CouchDB
Connectivity
technology
deployment
A set of enabling technologies will be combined and
deployed in order to efficiently meet the specified
requirements.
A data management platform is configured and deployed.
Edge devices (machinery) and business objects (incoming
orders) are connected to the platform via suitable protocols.
Hypothesis Connectivity
Digital
Potential
Solution

35. Slide 35
© Actyx. All Rights Reserved.
Establishing connectivity
Co-operative innovation projects
In this phase the base enabler of digital industry, connectivity, will be established. The project vision’s connectivity and data
requirements will be specified, suitable technologies identified and deployed at the project’s application site. This step provides
the basis for the solution implementation, and, as a by-product, provides decision makers valuable data-based transparency.
Approach: Example:
Connectivity
and data
requirement
specification
Connectivity and data requirements will be specified
according to the project hypothesis, including:
 Data sources and schemas
 Parameter specification
 Saftey, Security and Quality-of-Service (QoS) requirements
Enabling
technology
identification
Based on the connectivity and data requirements suitable
connectivity and data management technology will be
identified.
 IoT platforms: 2elemetry, Predix, home-grown
 Transfer protocols: OPC UA, MQTT, ZeroMQ
 Data management: Cassandra, CouchDB
Connectivity
technology
deployment
A set of enabling technologies will be combined and
deployed in order to efficiently meet the specified
requirements.
A data management platform is configured and deployed.
Edge devices (machinery) and business objects (incoming
orders) are connected to the platform via suitable protocols.
Enablement
of data-based
transparency
Based on the newly available connectivity, transparency is
achieved through the development and deployment of a real-
time data exploration and visualization tool.
A web-based visualization of current machine utilization,
material inventory, incoming orders and real-time order
fulfillment is built onto the data management platform.
Hypothesis Connectivity
Digital
Potential
Solution

36. Slide 36
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Creating value through solutions
Co-operative innovation projects
In this phase the actual digital solutions validating the
project hypothesis are implemented on top of the
connectivity and data management platform. This project
phase is highly dependent on the solution and is thus not
generically specified. In general Actyx follows an agile
development methodology, whereby data and new
insights constantly flow into iterative project cycles.
LEARN BUILD
MEASURE
IDEAS
CODEDATA
Hypothesis Connectivity
Digital
Potential
Solution

37. Slide 37
© Actyx. All Rights Reserved.
Creating value through solutions
Co-operative innovation projects
In this phase the actual digital solutions validating the
project hypothesis are implemented on top of the
connectivity and data management platform. This project
phase is highly dependent on the solution and is thus not
generically specified. In general Actyx follows an agile
development methodology, whereby data and new
insights constantly flow into iterative project cycles.
Example:
Building on top of the deployed connectivity and data management
platform, the mattress manufacturer’s development team and Actyx work
together to implement:
 An algorithm for designing mattresses based on Apple HealthKit data
available to iPhone users (incl. compliance provisions for dealing with
private health data)
 A mattress specification schema and API-based web-accessible incoming
order system
 A web-shop and iPhone App for designing and ordering individualized
mattresses based on Apple HealthKit data
 An after-sales iPhone App where customers can follow the production
and logistics of their order, provide feedback regarding the product and
share the achieved sleeping experience through social media.
Beside the success of the individualized mattress offering, the manufacturer
profited through the newly available transparency which spurred a number
of further projects and initiatives. Additionally, the project experience led to
significant digital spill-over with on-site personnel, who are now developing
digitalization hypotheses and solutions autonomously.
LEARN BUILD
MEASURE
IDEAS
CODEDATA
Hypothesis Connectivity
Digital
Potential
Solution

38. © Actyx. All Rights Reserved.