Driving Growth and

Staying Relevant in the

Era of Industry 4.0

© Hitachi Solutions, Ltd.

 Adapting to the Changing Manufacturing Landscape

Manufacturing Employees

Largest technology
company in the world
Manufacturing Facilities

Largest manufacturing
company in the world Countries with Manufacturing Facilities

© Hitachi Solutions, Ltd.

END OF THE 18TH START OF THE 20TH START OF THE PRESENT
CENTURY CENTURY 1970S

Introduced mechanization Introduced labor-based Introduced electronics

of production by using mass production and computers to replace The convergence of
water and steam to (assembly lines) powered manual work by stand- physical, digital, and
increase production by electrical energy alone robotic systems virtual environments
capacity and productivity, through Cyber-Physical
versus manual craft work Systems (CPS) and the
Internet of Things (IoT)

© Hitachi Solutions, Ltd.

 Global Lighthouse Network

Source: McKinsey/World Economic Forum partnership findings February 2020, identifying value captured at top 44 lighthouses
where specific KPI was targeted
© Hitachi Solutions, Ltd.
 Manufacturing & Supply Chain Framework

Worker Enablement & Enhanced Customer

Digital Innovation Digital Operations Sustainability
Transformation Experience

Learning & Knowledge

Always On-Service New Business Models Smart Manufacturing Energy Optimization
Management

Connected Frontline Chatbots & Virtual

Digital Services Resilient Supply Chain Waste Reduction
Workers Assistants

Remote Work &

Social & Digital Selling Advanced Customization Digital Engineering Carbon Management
Collaboration

Personalized Messaging Personalized Messaging Connected Products Going Paperless Reporting

Skills Training & Predictive Response

As-A-Service Predictive Maintenance Recording
Development Resolution

Digital Thread Digital Thread

© Hitachi Solutions, Ltd.
 IoT Fuels Digital Transformation…

Video uploaded on YouTube Text Messages sent

EVERY
Pieces of content shared on Facebook
minute of Emails sent
the day…

Tweets posted Google Searches

Source: DOMO- Data Never Sleeps

© Hitachi Solutions, Ltd.

 IoT and Digital Twins Enable Digital Feedback Loops

Deeper Relationships More Efficient Ops

Customer Signal Operational Data

Product Telemetry
Employee Signal
Better Products
More Effective Employees

© Hitachi Solutions, Ltd.

 Components of the Metaverse

What it takes to What it takes to What it takes to

build the navigate the experience the
metaverse… metaverse… metaverse…

3D data capture Cloud/ Edge computing Virtual reality

User interactivity (UX/UI) Digital twins Augmented reality

Geospatial mapping Avatars Legacy devices (e.g., PC & phone)

Digital twins 5G (or other low-latency/high-bandwidth connectivity)

AI 3D graphics visualization

IoT Digital currency/ virtual economy

Source: IoT Analytics Research, Enterprise Augmented/Mixed Reality Market Report 2022-2027. https://iot-analytics.com/

© Hitachi Solutions, Ltd.

Image source: Microsoft
 Technology Adoption Shift

Past Present
25%

30%
34% 34%
20%
13.5% 16%
20% 5%
2.5%

Early Early Late Early Early Late

Innovators Laggards Innovators Laggards
Adopters Majority Majority Adopters Majority Majority

Source: Journal of the Midwest Association for Information Systems, Technology Adoption and Disruption – Organizational Implications for the Future of Work

© Hitachi Solutions, Ltd.

 Trends Driving Digital Engineering
All of them impacting your digital transformation journey

Designing Products enhanced customer experience

Product lifecycle ending at point of sale maintaining continuous customer connectivity

Capturing profit via hardware/products software and digital services

Integrating with the Supply Chain entire value chain

© Hitachi Solutions, Ltd.

 Digital Product Innovation
DIGITAL THREAD

DIGITAL THREAD
Supplier… Manufacturer… Customer…
As-Designed As-Manufactured As-Maintained
FEEDBACK LOOP

Design Engineering
DIGITAL THREAD

Supplier Production Manufacturing Install Base

Supply chain | Collaboration | Planning | Execution

DIGITAL THREAD

KEY OUTCOMES: Cost Savings Safety Efficiency Performance Quality Traceability Product As a Service

© Hitachi Solutions, Ltd.

 • All digital presentation of B-52 CERP proposals
• Digitally engineered the wing, pylon, nacelle, engine
integration, gearboxes, fuel flow, electrical systems, thrust,
weight, circumference of the engine and nacelle diameter
• $2.6B contract win based on digital engineering verification
and validation driving down maintenance, sustainment
costs and improving efficiency
The digital model approach is exciting in that it
becomes the collaboration tool that unlocks the clock
and unlocks the speed with which we can bring these
products to market.”
– John Bell
Rolls-Royce North America President and CEO

© Hitachi Solutions, Ltd.

 Connected Products Provide the Foundation For…

Remote Monitoring Customer Usage Analytics Digital Services

Asset Health Design & Engineering insights Upsell & Cross sell opportunities

Remote Diagnostics Remaining Useful Life Product-as-a-Service

OTA Updates Predictive Maintenance

Geofencing & Security Connected Field Service

© Hitachi Solutions, Ltd.

 The Journey to Product as a Service

Outcome based By charging for the outcome, the revenue models can
Contracts benefit from customer’s business upside.

Subscription models allow customers to switch from

Subscription
CAPEX to OPEX. They also provide an opportunity to stay
Model connected with the customer and their use of your assets.

Gain customer insights through connectivity to your

Digital Services products. Create new business opportunities and models.

© Hitachi Solutions, Ltd.


• Implemented a model–based system integrating PLM & IoT
• Reduced equipment failures by 13%, Improved product quality
by 27%, predictive maintenance reduced service costs by 10%
• Integrating PLM & engineering added benefits: 5% in Capex
reallocation, 20% increase in remote monitoring and
diagnostics resolution, 8% increase in planned interventions
© Hitachi Solutions, Ltd.
Our goal was to change the way we serve customers
in our industry, and our long-term vision was to create
services around our equipment. IoT was a key pillar to
support our strategy.
– Paolo Cavalsassi,
Global Commercial Director, Celli Group
 What are
YOU doing to
unlock
innovation?

© Hitachi Solutions, Ltd.

 .
© Hitachi Solutions, Ltd.