Raise service levels and cut costs

Raise service levels and cut costs White paper: M2M for industrial remote asset monitoring m2m.vodafone.com Vodafone Power to you What this paper is about Machine to machine (M2M) communications is one of the most disruptive technologies available to businesses today, and its potential is only just starting to be exploited. This paper explores how M2M can change how companies manage and maintain widely distributed industrial equipment, resulting in better equipment uptime, dramatically lower servicing costs, and even the ability to offer entirely new commercial and pricing models. This paper is intended for industrial equipment manufacturers that service the equipment they sell, but it’s also relevant for any organisation that has an extensive estate of equipment to maintain. Contents How do you manage distributed equipment today? .........................3 M2M: empowering just-in-time servicing.............................................4 Cost savings, quality improvements and more ..................................5 Case studies ...................................................................................................6 Making it happen...........................................................................................7 About Vodafone .............................................................................................7 M2M for industrial remote asset monitoring How do you manage distributed equipment today? Striking the balance You might manufacture elevators or escalators, air conditioners, generators, engines, water pumps, MRI scanners or agricultural machinery. Whatever it is, the equipment you manufacture is high value, rarely user-serviceable, and for your customers it’s mission-critical. Those customers expect you to retain responsibility for servicing the equipment throughout its lifespan to an agreed level of performance and availability. For many manufacturers this is a significant source of ongoing revenue and profit — but only if they can strike the balance between the quality and cost of the service they deliver. Controlling costs On the one hand, the demands of profitability dictate that you spend as little as possible on servicing your customers’ maintenance contract — you don’t want highly skilled engineers trekking out to a remote wind turbine or a hospital’s electricity generator every week just to check that everything’s working fine, or to waste money replacing expensive parts when they’re within tolerances, just because the maintenance schedule says to. Keeping service levels up On the other hand, every hour of downtime costs your customer money — and that affects you either through compensation for SLA breaches, or perhaps more importantly through damage to your reputation for quality. You can’t afford to delay booking an engineer’s visit until the customer calls to let you know that a distant generator or gas engine has failed at 2am on a Sunday. You’ve got to tread a fine line between delivering excellent service and avoiding wasted engineering time. 3 M2M: empowering just-in-time servicing What if you had the ability to automatically monitor the health of all the assets you’re responsible for, in real time, without having to send an engineer to the site? It’s possible today, using M2M communications. All the information, all the time In a typical M2M remote monitoring system, a communications module installed in each piece of equipment gathers and logs data from sensors — about temperature, vibration, activity, or other variables. Using the mobile data network, these modules, deployed around the world, communicate with your central management systems to share the information they’re gathering, in real time or near real time. The management system looks for anomalies — such as unwanted vibration or rapid increases in temperature — and takes action, for example by automatically booking an engineer to visit with the right spare part, remotely initiating a failover to a backup system, or polling all the other pieces of equipment to double check for a similar emerging fault. The technology is ready M2M is not new — but it is becoming much more widespread as the technologies behind it mature. Inexpensive, fast wireless connectivity is now available nearly anywhere your assets are located, with one SIM and a choice of compatible wireless standards for international coverage. And even if the mobile network doesn’t extend to your most remote sites, perhaps underground or in coverage blackspots, M2M can also use satellite links or many kinds of wired connectivity to communicate back to base. Both application-specific and general-usage M2M terminals are available to easily connect your application via standard interfaces such as USB or Ethernet, meaning they’re easier to integrate into your equipment. The back-end infrastructure is also more ready than ever to use M2M. Your operational processes like stock control and field job allocation are now often digitised, which means you can connect them to the insights that your M2M management platform produces. For instance, an alert raised by an M2M system could be routed direct to the nearest service engineer, who is notified by a message on their mobile device. Overheating Alert Dashboard Bin Full Alert Empty Alert M2M Platform Controller Engineer Field Force Alert M2M for industrial remote asset monitoring Cost savings and quality improvements are just the start So what can M2M remote monitoring do for you? Raise service quality Sensors operate round the clock and can alert you at the very first sign of a problem: it’s “just in time” servicing, in effect — you can adopt a proactive maintenance approach, instead of “break and fix”. By preventing failures before they occur, you can eliminate downtime, raise the level of service you offer your customers and get longer useful life from the equipment that you manufacture. Increase efficiency Just in time servicing is as beneficial for you as it is for your customers. Using M2M, you could schedule an engineer’s visit at the first signs of falling performance, perhaps as a motor starts to overheat — avoiding unnecessary routine inspection trips in the weeks and months before. You can confidently raise the utilization of your costly field engineering resources, including vans, people, and spares stock. Gather insight for business processes M2M can help you turn information into value. By aggregating and analysing the detailed, continual flow of information from all the assets you manage, you could uncover new insights and opportunities that would have been impossible using manual maintenance processes. For example, you could use the latest analytics software to correlate a spate of equipment failures to identify and correct an intrinsic product flaw before it has a chance to cause more damage — perhaps even correcting the problem immediately by sending a revised firmware version or operating parameters to affected equipment over the air. Or you could feed large-scale usage data into new product development, perhaps tailoring the weight of oil you use in an engine to the most common operating temperature you’ve measured in real customer situations. Transform your business model Ultimately, the information you get from M2M monitoring has the potential to support the evolution of your business model. Because you can precisely track and prove the work each asset does, its lifespan and operational performance, you have a much more solid foundation for shifting to a charging clients not for an upfront equipment purchase, but on a utility basis for the output they receive — whether that’s per passenger transported by an escalator, per watt-hour generated by a solar panel, or per scan for an MRI machine. This kind of charging model is potentially much more attractive for your customers because it ties directly into their cashflow and the way they measure their own business performance, and better for you because you get an ongoing revenue stream, greater profit margins, and the ability to differentiate from your rivals. 5 Case studies Keenan evolves from selling feeders to offering a complete nutrition service with M2M Over the years Keenan has moved from being a manufacturer of agricultural feeding machines, to the provider of a full feeding service. It built up a team of animal nutritionists, vets and researchers who have devised a system, called PACE, that enables a Keenan feeder to mix a feed specifically tailored to the nutritional needs of a farmer’s animals, producing consistent and optimal nutrition with less feed and without the farmer having to mix feed proportions manually. But until recently, to use PACE the farmer had to connect to Keenan over the internet to download settings for the machine and upload them to the feeding machine. With the introduction of the iKeenan connectivity product, the PACE system is now connected wirelessly using Vodafone’s global M2M service. Keenan has complete remote control of each feeder, improving efficiency and helping to ensure that the service delivers consistent results, regardless of the farmer’s existing IT infrastructure or computer literacy. Keenan can manage its SIMs in real time using the dedicated web portal which provides a suite of reporting tools, allowing it to provide a full end-to-end service to its customers by manufacturing the machinery, providing the nutritional service and controlling the transmission path between the two. Prosa’s connected beverage machines cut maintenance, boost sales for leading beverage companies Telemetry solution provider Prosa’s Vebox solution uses Vodafone to provide M2M connectivity for 4,000 drinks fountains and 5,000 beer taps across Italy. The Vebox device sends 24 messages per day, alerting if there is a mechanical fault, logging a work order and reducing unnecessary maintenance call-outs. It also enables the beverage companies to accurately plot hourly sales against marketing spend and gauge the profitability of individual sites. Prosa followed Vebox with an M2M-connected vending machine solution and a device to monitor cooler cabinets, both now used by beverage companies to monitor consumption (and plan restocking) and cash flow. They can send a cashier to empty or resupply machines, lowering the risk of theft. But Prosa hasn’t stopped there. Its new cooler cabinet, Emoticooler, features an interactive touchscreen, allowing consumers to take photos, check the weather, or look up ingredients. A camera captures images of those close to the cabinet. It enables beverage companies to gather consumer data at the point of purchase, and tailor marketing messages. Early trials show the Emoticooler generates 3.5% more sales than a standard cooler. Mic-O-Data’s remote bin monitoring helps councils cut CO 2 by 18% Mic-O-Data’s TarDif product helps Dutch local authorities control access to 6,000 communal refuse collection points around the country, limiting access to keyholding residents only. It’s a powerful electronic system, which collects data that councils could use to track individual residents’ behaviour and improve overall waste management. But collectors still wasted time manually visiting each bin on a strict schedule, even though they may be nearly empty. Now a Vodafone M2M SIM embedded in the TarDif module transmits a daily status signal, alerting Mic-O-Data if the bin is getting full, or if it hasn’t been closed properly. Local authorities can now arrange for only full bins to be emptied: refuse collectors make fewer unnecessary journeys, use less fuel and require fewer refuse trucks. In fact, an independent study of just one city council’s bins found that TarDif saved 18% of CO 2 emissions per year, plus an estimated €92,035 in capital (purchase of trucks) and operational costs (running, fuel and maintenance for the trucks). Local authorities also get detailed data about who is using all 6,000 facilities on a daily basis. Within privacy limits, the data can be scanned for trends and incentives can be customised to support each authority’s mission to encourage recycling. The success of the technology has had a dramatic effect on Mic- O-Data’s business. The waste management business has doubled in the last two years as the commercial and environmental arguments prove compelling for local authorities, and Mic-O-Data sees opportunities internationally, too. Beverage machinesNutrition service Bin monitoring Beverage machinesNutrition service Bin monitoring Beverag machinesNutrition service Bin monitoring It’s not just a kiosk, it’s an advertising platform. The beverage company can change pricing and adjust the messaging – all controlled remotely. It is total asset management by telemetry. Alberto Pravato, CEO, Prosa M2M for industrial remote asset monitoring Making it happen Business process change is the key to value If you’re to realise the full potential of M2M remote monitoring, you need more than just a technological change — you need to undertake a business process re-engineering exercise. Using M2M effectively means changing how you decide which parts to keep in your inventory; how you allocate jobs to field engineers; even how you price your solutions to your customers. The data that sensors collect, and that M2M modules transmit, must make its way to the right enterprise systems, where the right staff and automated systems can use it to act — data needs to be analysed and turned into intelligence. Obviously, there’s an upfront investment in time and money to M2M-enable your business. As well as process change, there’s product change, too: specifying and integrating the sensors and communications module into your equipment. And there’s the cost of monthly connectivity for sharing operational data between equipment and central systems. But these expenses are a trivial percentage of the overall product cost, and are easily outweighed by the efficiencies that M2M can achieve in business operations. Where to start? The first step is to evaluate how you’re managing and monitoring your assets today, and start to build a business case for how you want to make improvements. Perhaps you have a vision for a new service or business model that you want to make real. The best M2M providers will work with you to demonstrate the potential of M2M at a well-equipped M2M testing centre, and then will help you identify which information you need to gather from your equipment, specify and build an appropriate data connectivity concept, and design a comprehensive solution including: • A global M2M platform, essential for managing connectivity • Global SIMs, so you can deploy equipment wherever you do business • Preconfigured M2M terminals for easy integration • Global footprint, for network connectivity, service and 24x7 support • Help with application development to accelerate time to market Be wary of those that claim that one piece of the puzzle alone is enough to produce results for your business. About Vodafone Vodafone is one of the world’s leaders in M2M service delivery. We’ve been working in M2M for over 20 years, and today we provide an end-to-end solution for industrial remote monitoring: from building a business case through technical deployment to training your staff and managing the service. Our capabilities include: global M2M platform; global M2M-specific SIM cards; a broad portfolio of M2M terminals, application and service enablement development, testing and deployment; network connectivity; and system integration — all from a single supplier, with a single contract. To find out more about how we can help with your remote monitoring, please contact your Vodafone account manager, email [email protected], or visit m2m.vodafone.com Want proof of our experience? Don’t just take our word for it. We’ve been highly rated by leading industry analysts such as Current Analysis and Machina Research, and have worked on M2M projects with clients such as BMW, Amazon and TomTom. Visit m2m.vodafone.com/ why_vodafone/ to find out more. 7 m2m.vodafone.com Vodafone Group 2014. This document is issued by Vodafone in confidence and is not to be reproduced in whole or in part without the prior written permission of Vodafone. Vodafone and the Vodafone logos are trademarks of the Vodafone Group. Other product and company names mentioned herein may be the trademarks of their respective owners. The information contained in this publication is correct at time of going to print. Such information may be subject to change, and services may be modified supplemented or withdrawn by Vodafone without prior notice. All services are subject to terms and conditions, copies of which may be obtained on request.