SCOPE: The Internet of Things is already established in some areas of many large companies. Will manufacturing companies be able to manage without an IoT infrastructure in the medium and long term?

Werner Rieche: On the contrary - companies in the manufacturing industry must aggressively implement their digital transformation in order to remain competitive and successful. New challengers are entering the market with digital technologies and driving a wedge between traditional companies and their customers. To keep up, established companies must implement the digital strengths that make their challengers dangerous competitors. With the Internet of Things, industrial companies have a lever to drive further efficiency gains in production as well as in warehouse and transport logistics. However, it is also an important building block for increasing product quality and reducing waste. If you are in global competition, you have to constantly improve in these areas.

SCOPE: Why is IoT so important for a company's success, especially in manufacturing? And can smaller companies afford an IoT infrastructure?

Rieche: The IoT and the analysis of the data obtained form the basis for a whole new range of applications, services and business areas. In the predictive maintenance use case, for example, companies receive detailed information on systems and can predict when the next maintenance measure is due. This enables them to reduce their costs. However, they can also offer this new know-how to their customers as a service and thus sharpen service level agreements and optimize the management of their spare parts warehouse, service quality and maintenance planning. Companies can also use data analytics to forecast demand for a particular product at a particular time and place. All of this will increasingly drive the industry forward. Thanks to the increasing use of cloud computing, company size is no longer an issue when using the IoT. The structure of our IoT customer base, for example, ranges from large corporations to industrial consortia and SMEs.

SCOPE: What problems arise when setting up an IoT infrastructure and how does Software AG make it easy for companies to get started?

Rieche: The need for action has now reached the minds of decision-makers - only the path is often still unclear. For many, the IoT market with its current 300 or so platforms seems unmanageable. With our Cumulocity IoT platform, we provide companies with an agile path to the Internet of Things. The focus here is on fast and uncomplicated connection of the various devices and protocols to the IoT environment and to company systems such as ERP, MES and CRM. We also supply preconfigured solutions for typical use cases such as track & trace or condition monitoring to give our customers a "quick start". We also have a comprehensive, IoT-specific partner network that comprehensively and reliably covers aspects such as sensor technology, connectivity, data security and edge computing. As part of our prime methodology (Platform Rapid Innovation Methodology), our customers receive recommendations and proactive support for the implementation of their new platform. To successfully implement IoT initiatives, we generally recommend the following approach to companies:

Firstly, get creative and discover new perspectives for your own business when it comes to developing innovative ideas and tapping into hidden potential.

Secondly, start small. In the first step, an IoT solution is only about covering the absolutely necessary functions and use cases. With a manageable live operation, you create a solid basis for testing your solution and gradually improving or expanding it.

Thirdly, the roll-out should take place quickly so that the IoT project team receives early feedback from employees and customers, which it can use to readjust and optimize the solution. "Step by step" is the motto for a successful IoT project.

SCOPE: How difficult is it to establish the necessary link between IT and OT?

Rieche: This challenge has two components - one technical and one organizational. In terms of organization, Operational Technology (OT) and IT belong to different "responsibility silos" in which there is little knowledge about the other. Companies must actively promote the exchange and transfer of knowledge in order to connect the manufacturing world with the commercial IT world. This separation also continues in many companies with regard to the network topology. From a technical point of view, however, connecting OT to IT systems is becoming increasingly simple, as companies are working hard to establish "plug & play" connectivity to "things". New protocols and overarching standards such as OPC/UA, LWM2M or Modbus are also promoting this trend. The easiest way to connect the two worlds is to use IoT platforms as a hub to link operational technology with IT and combine IoT insights with the company's business processes.

SCOPE: In this context, security is an increasingly important issue. How can the security of IoT platforms be guaranteed?

Rieche: Just as companies have established procedures to protect networked workstations (PCs, laptops), this will also happen for "things" that are connected to the internet. It is important to plan security as an integral part of IoT environments from the outset. No company can afford a breakdown in productive operations or even to be associated with data misuse or theft.

SCOPE: How will IoT change the manufacturing industry, what can we expect in the future and what paths is Software AG planning to take?

Rieche: In a few years, the IoT will be a standard tool for all manufacturing companies. Initially, they will use it to optimize their own production: Machine learning platforms will become the basis for automated decision-making processes based on real-time data. There will no longer be any good or bad decisions if they are evidence-based. In addition, companies will increasingly use a digital twin of their plant that is linked to real-world objects and their sensors. It can reproduce, analyze and predict production processes - in real time and very precisely. Outside of their own operations, companies will increasingly invest their newly acquired IoT expertise in intelligent products and develop data-driven services that set them apart from the competition and open up new revenue streams.

From a technical perspective, edge computing, i.e. the pre-processing of data as close as possible to the data source, will play an increasingly important role. However, the prerequisite for this is that new logic can not only be executed on the central IoT environment, but also distributed to the decentralized edge devices. The same applies to the ability to provide smart devices with software updates. The topics of blockchain and IoT will also continue to merge, for example in the context of smart contracts between networked machines.

However, we will see the greatest advances in artificial intelligence (AI). IoT platforms will only survive if they integrate and use advanced analytics, artificial intelligence and machine learning. In addition to device connectivity and data collection, platform providers will also offer analysis functions that they implement with the help of AI and machine learning. Our Cumulocity IoT solution portfolio is tailored to these trends and grows with them easily so that companies can meet even complex requirements.