A new age of industrial productionThe Internet of Things, Se.docx

A new age of industrial production
The Internet of Things, Services and People
2 A new age of industrial production A new age of industrial
production 3
The industrial Internet
and cloud services bring
world-class analytics within
reach of smaller production
facilities.
In the coming decades, the Internet will change the methods and
processes of industry – just as it has changed the behavior of
con-
sumers in recent decades. Nearly a third of the turnover of
indus-
trial companies in Finland, €39 billion, is generated by products
that depend on software.
ABB and our products and solutions – frequency converters,
robots, and industrial automation and energy systems – have
been
improving the processes of our customers for decades. The
gains
in capacity, productivity and energy use have been dozens of
percent. As a result, our customers have improved their
competi-
tiveness and their production has become more environmentally
friendly and energy efficient. The Internet of Things, Services

and
People is about more than just improving productivity by using
intelligent products, sensors and analysis of measurement data.
The industrial Internet is a shift from factory-level solutions to
the
Internet. In practice, this means connecting people, services and
things over the Internet, which opens up entirely new opportuni-
ties, including the development of the service business.
Immense industrial opportunities
1712 – Industry 1.0
Thomas Newcome builds the
first steam engine.
Industry 4.0
From steam engines to smart factories
Electricity is used for
industrial production.
Programmable logic.
So what role will people play in this industrial paradigm shift?
Increasing automation has freed people from backbreaking,
dangerous and tiresome routine tasks. This trend will continue
as people, services, and things become interconnected through
the Internet: people’s responsibilities will shift to knowledge
work
requiring expertise, process control, and decision-making. Next-
generation robots, such as the ABB's YuMi, will be able to work

side-by-side with people.
The Internet of Things, Services and People still has its
challenges,
with the main ones being the massive amount of sensor data and
the need for data security. All parties will have to cooperate to
overcome these challenges. ABB participates actively in the
Finn-
ish FIMECC research program, which is developing expertise
and
practices for future industrial service businesses.
The new age of industrial production has arrived.
Marjukka Virkki
Country Service Manager
ABB Finland
Today – Industry 4.0
Communication between people,
services, and things.
production 5
Things
Intelligent things and smart data
Industrial things are intelligent machines, devices, and systems
that generate copious amounts of measurement data; from the
operation of single devices to entire production processes,
energy
consumption, operating environment and production quality.
Measurement data analysis allows functions to be controlled,

prepared and automated.
Frequency converters not only adjust motor speeds, but also
monitor the
status of the equipment or system that they control.
The EMMA energy management system used on board the
Viking Grace
reduces the ship's fuel costs and emissions by about 5 percent.
Remote
relay monitoring
ABB provides support services for Savon Voima
Verkko Oy and can access their customer infor-
mation system remotely, enabling remote
troubleshooting, guidance and minor expan-
sions and alterations to the MicroSCADA Pro
system and protective relays.
Machine condition
monitoring
ABB’s machine condition monitoring solution is
based on a PLC and generates time-synchro-
nized and analyzed measurement data, be it
from the equipment of a single production line or

dozens of facilities. This system can be seam-
lessly integrated with any data collection system.
Energy savings
in Kalasatama
The Fregatti and Fiskari apartment buildings
in Helsinki's Kalasatama district use the lat-
est building services. Residents are provided
with real-time consumption figures for water
and electricity, which can be viewed on mobile
devices as well. An open, standardized data
exchange interface allows flexible demand and
capacity management. By using real-time mea-
surement data, water and energy consumption
can be reduced by up to 15 percent.
Smart mine
management
The Kiiruna, Malmberget, and Svappavaara
mines of LKAB all rely on ABB’s energy man-
agement system. The system refines useful data
from the information collected from various

information systems. The system gives an over-
view of energy consumption, along with the
related costs and carbon dioxide emissions.
This overview is then used to optimize the pro-
cesses at the mines.
Reliable cobalt production
Freeport Cobalt Oy uses the ABB 800xA auto-
mation system to control and monitor every
production line at their plant. The virtualized
automation IT infrastructure provided by ABB
will keep all of the plant's critical production
systems available even if over half of the net-
work, server and disc systems were to
malfunction. The 800xA History data collection
system supports production planning, invoicing,
and external system integration.
For decades, measurement data has been utilized at the factory
level to improve productivity and competitiveness and to save
energy. Current data is compared to historical data to discern
how

a process should be run. Analytics provides recommendations,
enhancements and warnings to support decision-making. This
results in effective, productive, environmentally friendly and
cost-
effective production.
Automation integrates measurement data
ABB's intelligent products and devices – from measuring
equipment to frequency converters and motors – are a vital part
of
industrial processes and electrical systems. The data generated
by
smart equipment can be collected either directly or by
automation
systems. The same system can be used to control multiple
production facilities. Integrated systems are irreplaceable when
information must be delivered to experts who are far away from
the facility itself, for example in applications for the oil and gas
industry or for offshore wind power plants. Automated systems
can pre-emptively detect and analyze faults, check resources
and spare parts, and send reports to operation and production
planning systems.
ABB information systems are based on the information
processing platform developed by ABB in Finland that collects
all
measurement data in real time. The platform gives simultaneous
access to production, monitoring and business processes from a
combined real-time view. Examples of systems using the
platform
include resource planning in the process industry, fleet-wide
energy management optimization in the marine industry, and
productivity enhancement in mining.
The Internet is the next step
Advances in mobile technology and cloud services are creating

new opportunities for industrial Internet solutions that combine
people, services and things. The next big step in industrial
evolution will be the availability of measurement data outside
a facility, either through cloud services or standardized secure
interfaces and remote access. In this concept, everything is
connected and information from all over the globe can be
combined in new ways. For example, by combining factory-
level measurement data with the availability and price data of
raw materials and energy, decisions can be made based on
remarkably enhanced information. This information can also be
used for entirely new purposes, such as creating new, pre-
emptive
maintenance services.
Centralized
fleet control
All ten ships in the AIDA Cruises fleet use ABB’s
EMMA energy management system to control
their propulsion power and efficiency, vessel
trim, energy production, air conditioning, the
specific fuel oil consumption of the main diesel
generators, and total fuel consumption. This
information is transmitted to a cloud application
for ship-to-ship comparison and can be
remotely monitored.
Nonstop energy
Kotka Energia’s two power plants use ABB’s

condition monitoring system to monitor critical
actuators and ensure uninterrupted energy pro-
duction. The monitoring system collects data
and delivers it to the plant's staff using an
online mobile data solution. The system will
pick up any indication of coming faults and
helps to optimize lubrication and measure the
effectiveness of maintenance and process
changes, among other things.
People
Things Services
production 7
Services
A new dimension for services
Traditional repairs of sudden production equipment failures take
a heavy toll on valuable production hours.
The Internet of Things, Services and People makes pre-emptive
diagnostics and maintenance possible.

Improved
performance
ServicePort™ is a secure remote service deliv-
ery platform for providing local and remote
services. It also enables the use of advanced
diagnostics in ABB's latest equipment and pro-
cesses. By automatically collecting the
customer's KPI data, ServicePort helps its users
make informed decisions. This increases the
availability, quality and productivity of systems,
while reducing production costs.
Predictability increases operational reliability, uniformity, cost-
effectiveness and safety, all while making it easier to control
remote locations.
Frequency converters in the cloud
ABB offers a remote support service for collecting frequency
converter data in the cloud. Having this data means that
maintenance work can be adjusted according to the actual
condition and environmental information of the equipment.
Frequency converters no longer need to be serviced according
to an annual schedule, but can be serviced based on actual
need. This translates into improved reliability and availability
in harsh conditions, and reduced maintenance costs for less
demanding environments. Internet-based, pre-emptive services
require industrial processes to be flexible; compatible and
intelligent machines and devices with measurements and

analysis.
The development of new operating models will require close
cooperation with customers.
Industry as a demand-buffering resource in the energy market
The changes in the energy market combined with solutions from
the industrial Internet are creating opportunities for industry to
become a resource for demand management. Great cost savings
can be achieved by utilizing fluctuations in energy prices; home
and building automation can already achieve these by using
energy at times of day when it is more affordable.
People
Humans in charge
Automation has already changed the role of people in industry.
Work is less physically demanding, as automation and robots
have come to replace human effort in strenuous and dangerous
tasks, and human responsibility now lies more in expert
knowledge work and process control.
People will still play a key role in the new age of industrial
production. The Internet can be used to integrate information
from machines, services and users and process it into a format
that can be easily and automatically utilized. People can then
use this information to program and control operations and
make decisions to optimize the quality, safety, efficiency and
environmental aspects of production.
In the future, the Internet of Things, Services and People will
enable innovations in other sectors, such as game design, to be
incorporated into the industrial environment. An excellent
example
of cross-sector incorporation would be the use of "smart
glasses"
to enhance the efficiency and safety of maintenance work.

Safe human-robot cooperation
Major advances in robotics will mean that robots will become
colleagues for humans. ABB's YuMi is the first robot in the
world
capable of safely working alongside humans. YuMi was
developed
to provide the flexibility and dexterity required in the industrial
production of electronics.
Remotely controlled
robots
The robots at Metsä Board’s Simpele paper-
board mill are monitored using the ABB
Robotics Remote Service. Each robot in the
facility has its own 3G modem. Scheduled
backups are created of programs and parame-
ters currently used by every robot. This allows
abnormalities to be detected remotely and any
necessary maintenance and repair work to
begin before any interruptions occur.
People will still have a key role in the future of industry:
it takes a person to control, monitor and make decisions.
ABB YuMi® ("You and Me") is the first robot in the world
capable of safe cooperation with humans.
Smart monitoring of

frequency converters
Drivetune, ABB’s smartphone application, can
now be used to remotely adjust frequency con-
verters. Technicians can use their smartphones
as control panels to set and adjust control val-
ues. Equipment maintenance will be faster,
easier and safer, as there is no need to go to
dangerous and difficult areas.
YuMi can take on assembly tasks with two hands. It can both
touch and see. The robot has special flexible hands and an
innovative sense of touch that
make it a safe colleague for humans.
production 9
Factories of the future
Automated from order to delivery
In the smart factories of the future, processes take place in real
time, production is flexible, and the entire value chain is
automated
from order to delivery. Production can be monitored remotely
and
customer orders and manufacturing handled automatically, even
at night. This future has already arrived at ABB’s switch

production
plant. The plant benefits from improved competitiveness, more
reliable deliveries, better quality and happier staff.
There are 22 robots working safely alongside humans at ABB’s
Breakers and Switches plant in Vaasa Finland. Two more robots
will be added in 2015. The plant is largely automated, and auto-
mation is used throughout the order-delivery process chain. The
plant has applied automation to functions from material
procure-
ment to switch assembly and logistics. Automation has
increased
the reliability of deliveries, competitiveness and profitability,
as well
as reducing the amount of sick leave.
The vision for 2020 is to have the entire value chain highly
auto-
mated, from order to delivery. People will not become obsolete:
humans will be needed to control and monitor the automation
systems and to make decisions. Complex products will also still
require manual assembly.
RFID eliminates bottlenecks
The switch production plant uses RFID gates to register every
shipments both in inbounding and outbounding logistics. As
com-
ponents arrive, they are unloaded by automatic conveyors and
sorted for reception, where they will be picked up by automated
guided vehicles (AGVs) and put in storage or a production cell.
The use of RFID prevents bottlenecks and human logging errors
and enhances the accuracy of the inventory.
Assembly workers can use touchscreens to request more parts,
and order is immediately placed in the work queue. AGVs will
bring the necessary components to the assembly line and trans-

port assembled products away for delivery.
Robot night shift
An automated ordering system is used to guide customer orders
to production in real time. Even if the order arrives at night, an
automatic assembly line will assemble and test switches. In the
morning switches are ready to be packed and shipped . These
automatic workers further reduce the lead time for products.
Traceability is integrated into the automatic production lines,
and
each switch is uniquely marked.
Automatic logistics
Automated storage controls the assembly line. New orders are
generated as stock runs low or big order is received. Storage
automation reduces the need to stock finished products. In
smart factories, automated production lines pack the products
and AGVs transport them from production cells to delivery
area. Internal logistics is highly automated. Pallets are weighed,
wrapped and strapped automatically. Products pass through
RFID
gates to make sure that the right items go in the correct truck.
This reduces the risk of delivery errors to a minimum.
Rapid response through remote monitoring
The status of the switch production plant can be monitored
remotely. The production monitoring system works in real time
and
indicates equipment malfunctions, reports test results with root
causes for rejected switches, shows inventory levels and gener-
ates statistics from production data. Remote monitoring allows
faster response.
Case: ABB production plant, Breakers and Switches

Robots can detect faults without error. They work exactly as
programmed.
Plant benefits
from automation
• The reliability of deliveries is now 98.3 percent,
up from 94.4 percent.
• The average lead time has improved from ten
days to five.
• Profitability has nearly doubled in four years.
• Production can be adjusted according to
demand.
• The quality of work has improved, and the
number of customer reclamations has halved.
• Sick leaves are down 30 percent.
Increasing automation improves the quality of the entire value
chain.
Automation has changed the nature of the work. As less manual
assembly is required, the work has become less physically
taxing.

production 11
The Internet of Things, Services and People
In the smart factories of the future,
people will control the operations
and make decisions based on
measurement data from the factory's
equipment, as well as information
regarding the availability of raw
materials and the price of energy.
This will improve productivity, be
more environmentally friendly and
reduce costs.
Services People
Things
Contact information
©
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. A
ll rig
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ts reserved
.
ABB Oy
PL 187
FI-00381 Helsinki
Tel. +358 10 2211
www.abb.fi
441 822
P a g e | 0

March 2015
IoT basics: Getting
started with the
Internet of Things
Author – Knud Lasse Lueth

Executive summary
The whitepaper is aimed at people who are new to
the Internet of Things and seek to get a basic
understanding of the concept, its applications and
its technology.
Contents
1. Definition of IoT
2. History of IoT
3. IoT vs. similar concepts
4. Application/Segment overview
5. Technology overview
IoT Analytics
P a g e | 1
March 2015
IoT basics: Getting started
with the Internet of Things

The internet is seen by many as the biggest technological
disruption of
all time.
It has enabled entirely new forms of social interaction,
activities, and
organization. There are only a handful of similarly important
disruptions
in the 10,000+ years history of mankind (like the invention of
the wheel
around 4500 BC or the printing press in 1450).
It looks as though the next major technological revolution is
around the
corner: The Internet of Things.
1. What is the Internet of Things?
According to the McKinsey report “Disruptive technologies:
Advances
that will transform life, business, and the global economy“, the
Internet
of things (IoT) is one of the top three technological
advancements of the
next decade (together with the mobile internet and the

automation of
knowledge work). The report goes on to say that “The Internet
of Things
is such a sweeping concept that it is a challenge to even imagine
all the
possible ways in which it will affect business, economies, and
society.”
Definitions for the Internet of Things vary. According to
McKinsey:
“Sensors and actuators embedded in physical objects are linked
through
wired and wireless networks, often using the same Internet
Protocol (IP)
that connects the Internet.“
The idea is that not only your computer and your smartphone
can talk
to each other, but also all the things around you. From
connected
homes and cities to connected cars and machines to devices that
track
an individual’s behavior and use the data collected for new kind
of
services.

“The Internet of things will involve a massive build-out of
connected
devices and sensors woven into the fabric of our lives and
businesses.
Devices deeply embedded in public and private places will
recognize us
and adapt to our requirements for comfort, safety, streamlined
commerce, entertainment, education, resource conservation,
operational efficiency and personal well-being.”, according to
Intel’s
report “Rise of the Embedded Internet”.

Figure 1: Disruptive technologies of the
next decade Potential economic impact
in 2025 (in $trillion annual)
(Source: McKinsey)
Figure 2: A definition for the Internet of
Things
(Source: McKinsey)
“Sensors and actuators embedded in
physical objects are linked through wired
and wireless networks, often using the
same Internet Protocol (IP) that connects

the Internet“
P a g e | 2
2. History of IoT
The term Internet of Things is 16 years old. But the actual idea
of
connected devices had been around longer, at least since the
70s. Back
then, the idea was often called “embedded internet” or
“pervasive
computing”. But the actual term “Internet of Things” was
coined by Kevin
Ashton in 1999 during his work at Procter&Gamble. Ashton
who was
working in supply chain optimization, wanted to attract senior
management’s attention to a new exciting technology called
RFID.
Because the internet was the hottest new trend in 1999 and
because it
somehow made sense, he called his presentation “Internet of
Things”.

Even though Kevin grabbed the interest of some P&G
executives, the
term Internet of Things did not get widespread attention for the
next 10
years.
The concept of IoT started to gain some popularity in the
summer of
2010. Information leaked that Google’s StreetView service had
not only
made 360 degree pictures but had also stored tons of data of
people’s
Wifi networks. People were debating whether this was the start
of a new
Google strategy to not only index the internet but also index the
physical
world.
The same year, the Chinese government announced it would
make the
Internet of Things a strategic priority in their Five-Year-Plan.
In 2011, Gartner, the market research company that invented the
famous “hype-cycle for emerging technologies” included a new
emerging phenomenon on their list: “The Internet of Things”.

Figure 4: Gartner’s 2014 technology hype cycle (Source:
Gartner)
The next year the theme of Europe’s biggest Internet conference
LeWeb
was the “Internet of Things”. At the same time popular tech-
focused
magazines like Forbes, Fast Company, and Wired starting using
IoT as
their vocabulary to describe the phenomenon.
Figure 3: Keven Ashton Inventor of the
term “Internet of Things”
(Source: Twitter)

P a g e | 3
In October of 2013, IDC published a report stating that the
Internet of
Things would be a $8.9 trillion market in 2020.
The term Internet of Things reached mass market awareness
when in
January 2014 Google announced to buy Nest for $3.2bn. At the
same
time the Consumer Electronics Show (CES) in Las Vegas was
held under
the theme of IoT.
Figure 5: Google Search Trends 2011-2015 IoT vs IoE vs M2M
vs Industrial Internet vs
Industry 4.0 (Source: Google)

3. IoT compared to similar concepts
While the Internet of Things is by far the most popular term to
describe
the phenomenon of a connected world, there are similar
concepts that
deserve some attention. Most of these concepts are similar in
meaning
but they all have slightly different definitions.
Figure 6: Concept disambiguation: IoT vs IoE vs M2M vs others
The term Machine to Machine (M2M) has been in use for more
than a decade, and is well-known in the Telecoms sector. M2M
communication had initially been a one-to-one connection,
P a g e | 4
linking one machine to another. But today’s explosion of mobile
connectivity means that data can now be more easily
transmitted, via a system of IP networks, to a much wider range

of devices.
The term industrial internet is strongly pushed by GE. It goes
beyond M2M since it not only focuses on connections between
machines but also includes human interfaces.
IoT has yet a wider reach as it also includes connections beyond
the industrial context such as wearable devices on people.
In the above graph, the internet is a fairly small box. In its core
it
connects only people.
The Web of Things is much narrower in scope as the other
concepts as it solely focuses on software architecture.

Still a rather vague concept, IoE aims to include all sorts of
connections that one can envision. The concept has thus the
highest reach.
The term Industry 4.0 that is strongly pushed by the German
government is as limited as the industrial internet in reach as it
only focusses on industrial environments. However, it has the
largest scope of all the concepts. Industry 4.0 describes a set of
concepts to drive the next industrial revolution. It includes all
kinds of connectivity concepts but also goes further to include
real changes to the physical world around us such as 3D-
printing
technologies, new augmented reality hardware, robotics, and
advanced materials.
P a g e | 5

4. IoT application/segment overview
To the public, IoT currently appears to be a mixture of smart
home
applications, wearables and an industrial IoT component. But
actually it
has the potential to have a much wider reach. When the
connected
world becomes reality, the Internet of Things will transform
nearly all
major segments – from homes to hospitals and from cars to
cities.
Figure 7: IoT market segments (IoT Analytics)
Most of these segments carry the name “smart” like Smart
Home or
“connected” like Connected Health. Today’s major applications
include:
Smart Home or “Home automation” describes the connectivity
inside our homes. It includes thermostats, smoke detectors,
lightbulbs, appliances, entertainment systems, windows, door
locks, and much more. Popular companies include Nest, Apple,
Philips, and Belkin.

Whether it be the Jawbone Up, the Fitbit Flex, or the Apple
Smartwatch – wearables make up a large part of the consumer
facing Internet of Things applications.
Smart city spans a wide variety of use cases, from traffic
management to water distribution, to waste management,
urban security and environmental monitoring. Smart City
solutions promise to alleviate real pains of people living in
cities
these days. Like solving traffic congestion problems, reducing
noise and pollution and helping to make cities safer.
A future smart grid promises to use information about the
behaviors of electricity suppliers and consumers in an
automated fashion to improve the efficiency, reliability, and
economics of electricity.

P a g e | 6
Many market researches such as Gartner or Cisco see the
industrial internet as the IoT concept with the highest overall
potential. Applications among others include smart factories or
connected industrial equipment. In 2014 GE reported roughly
$1bn revenue with Industrial Internet products.
The battle is on for the car of the future. Whether it is self-
driving or just driver-assisted: Connectivity with other cars,
mapping services, or traffic control will play a part. Next
generation in-car entertainment systems and remote monitoring
are also interesting concepts to watch. And it is not only large
auto-makers that play a role: Google, Microsoft, and Apple have
all announced connected car platforms.

The concept of a connected health care system and smart
medical devices bears enormous potential, not just for
companies also for the well-being of people in general: New
kinds of real-time health monitoring and improved medical
decision-making based on large sets of patient data are some of
the envisioned benefits.
Proximity-based advertising, In-store shopping behavior
measurement and intelligent payment solutions are some of the
IoT concepts of Smart Retail.
Supply chains are getting smarter.
Solution
s for tracking goods

while they are on the road, or getting suppliers to exchange
inventory information are some of the Supply chain applications
as part of the Internet of Things.
The remoteness of farming operations and the large number of
livestock that could be monitored makes farming an interesting
case for the Internet of Things.
The Internet of Things is also expected to change business
models in
baking, insurance, and government for example. These use
cases,
however, are not yet as advanced as the business cases listed
above.

P a g e | 7
5. IoT technology overview
The Internet of Things builds on three major technology layers:
Hardware (including chips and sensors), Communication
(including
mostly some form of wireless network), and Software (including
data
storage, analytics, and front end applications).
Figure 8: IoT technology architecture (IoT Analytics)
The reason for the Internet of Things coming up so quickly right
now is

that there have been major technological advancements in all
three of
these technology layers:
Costs of sensors has declined by 54% over the last 10 years.
Moreover, form factors are shrinking quickly. Complete sensor
packages that are smaller than fingertips have become the
standard.
Mobile devices have become a commoditiy for the wider public.
At the same time the cost of bandwidth has declined by 97%
over the last 10 years.

The cost of processing has even declined 98% in the same
timeframe. Moreover, a number of big data tools and big data
infrastructure such as efficient databases have emerged over
the last 5 years.
There are plenty of different technologies and competing
products
in each of the boxes in the above graph. From MEMS
accelerometers
to Raspberry Pi development boards, from Zigbee
communication to
next generation LTE-M, and from column-based databases to

P a g e | 8
streaming analytics engines. Each of these concepts,
technologies,
and products could fill a whitepaper on their own.
If you are interested to further deep-dive into IoT, make sure to
stop
by www.iot-analytics.com and check out our other whitepapers
and

perspectives.
References
1.
http://www.mckinsey.com/insights/business_technology/disrupti
ve_te
chnologies
2.
http://download.intel.com/newsroom/kits/embedded/pdfs/ECG_
Whit
ePaper.pdf
3. http://www.gartner.com/newsroom/id/2819918

About the author
Knud Lasse Lueth is the founder and CEO of IoT Analytics. He
builds
on 5 years of strategy consulting in industrial companies at
BCG and
a manufacturing background. His focus areas are the Industrial
internet and Industry 4.0

http://www.iot-analytics.com/
ve_technologies
ve_technologies
WhitePaper.pdf
WhitePaper.pdf
http://www.gartner.com/newsroom/id/2819918
P a g e | 9

IoT Analytics
Copyright © 2015 IoT Analytics. All rights reserved.
IoT Analytics is a leading provider of competitive
intelligence for the Internet of Things (IoT).
This document is intended for general informational
purposes only, does not take into account the reader’s
specific circumstances, and may not reflect the most
current developments. IoT Analytics disclaims, to the fullest
extent permitted by applicable law, any and all liability for
the accuracy and completeness of the information in this
document and for any acts or omissions made based on

such information. IoT Analytics does not provide legal,
regulatory, audit, or tax advice. Readers are responsible for
obtaining such advice from their own legal counsel or
other licensed professionals.
For more information visit http://www.iot-analytics.com
http://www.iot-analytics.com/

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