New customer requirements for manufacturers: Developing the business case with the SIINEOS operating system

Hello Christian, hello Sven. Glad to have you here. Welcome to the IoT Use Case Podcast. Christian, how are you and where are you right now?

Christian

I’m doing great and I am once again working from home like in the last podcast – quasi in our recording studio, branch Erzgebirge. I have prepared extra well and had some spicy noodles again, so that my nose is clear, and now I can speak well.

That’s always important, yes. You’re kind of an old podcast hand around here. I’m glad to have you here again today. But this time with a new topc, I’m really looking forward to it. First of all, hello to you too, Sven. Glad to have you as well. How are you doing and where are you right now?

Sven

Thank you Madeleine for the invitation. I am fine, thank you very much. I’m also working from home today. Today is my last day of work. I get to start my vacation next week. That’s why I already have a very big grin on my face. When the podcast is finished later, I will arrange everything accordingly so that the world is allowed to keep turning without me for now.

A nice finish just before the vacations. Are you staying in Germany or where are you going?

Sven

I will stay here in Germany for another week. I have some more personal matters ahead, and then my family and I will be heading to Croatia next weekend to let the sun shine on us for a while. We also go sailing in Croatia once a year, which is also incredibly beautiful. I can only recommend this to everyone, it is beautiful.

I’m glad you’re here! Christian, I would briefly point out your business model regarding IoT. in.hub is generally in the software/hardware industry. You are known as a specialist for condition monitoring in industrial environments. You are passionate about digitalization and SMEs, and it shows. I have often been at your booth at trade fairs. You have a software named SIINEOS, and this is an operating system with various modules for free programming and already pre-installed on your IoT Gateway. You have your own IoT base gateway, a small mini-PC, so to speak, which ensures that a wide variety of data from the machines and systems is acquired. And you also do the analysis. Have I said and understood that correctly?

Christian

Fundamentally, summarized very well. That’s how we started many years ago, with a piece of hardware, so to speak. Then we realized relatively quickly that you can only inspire a few customers with hardware alone. The operation of the hardware is of course essential and so we started to develop our own operating system, SIINEOS. Now, in addition to the gateway, a few add-ons have been added and new generations of devices. Basically, that’s exactly what we do, record the states of machine systems with our products, and we’ll find out more in today’s podcast.

Yes, I was just going to say, you just made the transition already, you were talking about customers. Who are your classic customers? Can you give us some insights?

Christian

Yes, that is also very diverse, we have a classic end customer. These are nearly exclusively manufacturing companies here in Germany and Europe, which consistently bring up topics from the shopfloor that concern customers in digitalization. These are issues such as productivity, quality, maintenance, but also environmental issues in the area of consumption. These are the typical end customers who will always be affected somewhere, where all the needs arise and the requirements for the products. But this also cascades upwards, because our product range can be complemented very well with sensors and software. This actually leads us to the opportunity to collaborate a lot with partners who want to introduce their own portfolio to the customer. These include suppliers from the industrial and automation sectors, software providers for ERP, MDE systems and the like.

We are actually very, very widely positioned, if you can put it that way. There is something for everyone, and that’s what makes it so exciting. When you actually get to see everything in our job, from a bakery to a bicycle production to really high-tech, electronics production, semiconductor boards, there really is the whole range and that’s what makes it so nice.

Yes, very nice. You have some really cool references and one of your customers or partners is ipf electronic, right?

Christian

Exactly.

I have a follow-up question. What use cases do your customers typically implement? So you’ve just given a couple of examples, also for the manufacturing companies. Can you just summarize that again? What are the use cases that are driving your customers?

Christian

Yes, at the end of the day, manufacturing companies actually always need to cut costs and become more effective and efficient. In recent years, when discussing the broad topic of digitalization, there has been a significant growth in the software sector. ERP systems, ERP landscapes were rolled out, document management systems, a lot in the business organization. Gradually, the topic of the shopfloor is also being added. I want to integrate my production so that I have a highly effective company automation and always know how and where everything functions. With machines, I always know how well they are performing and if they are not performing well, I have to find out why so that I can act quickly. These are the very simple things when it comes to monitoring solutions. Of course, there are also some extensions that come bit by bit, that I set my own alarm chains, that I build small digital automations, that I have a process preview. We received an inquiry this week from a manufacturer who processes a lot of minerals, such as large stone slabs for kitchen studios and the like. For them, it is extremely important to always know how much cutting reserve is left on the saw blade and how well the saw is still performing. Are there any major shocks? Once a mineral is broken, it usually needs to be discarded, and there’s not much I can salvage at that point. Then come such requirements, to know how many meters need to be cut for the next order, how many meters have already been cut? Bringing it all together can sometimes become complex and overwhelm customers. I think it’s important to take the customers along with us and give them a solution that enables them to parameterize and set up such things themselves. This way, they don’t have to always pick up the phone and ask someone or bring in an on-site installer. They are able to monitor their processes themselves. This is quite crucial.

Yes, absolutely. I’ve actually seen a similar case in our network, really exciting. Today you brought Sven from ipf electronic with you, how did you actually meet? Is there a story about how you met?

Sven

Yes, definitely. There’s actually a story behind it. Our management told ipf electronic that we use the special circumstances of the pandemic for customer surveys. What added value can we offer, take the customer with us and strengthen customer loyalty? There was an evaluation catalog. The topic of IoT was really strongly present. Then we said, okay, then we have to continue on this path. Then a small group of experts was formed, consisting of three people, one of them was me. The group then took care of this topic and was allowed to search the market to find a possible partner in the area who already had the expertise, so that we would not have to start from scratch, since we come from automation, from sensor technology. Now the two worlds have to be connected with each other. We then came across various companies. One of the companies we particularly liked is in.hub. The communication, all the processes, it was just seamless, it was uncomplicated, it was also on a reasonable human level, and we really liked that. Now I’ve also been given the opportunity to work in the key account area at ipf electronic and look after VW and Mercedes customers throughout Germany. During the COVID-19 period, it hit us pretty hard that the gates were often closed at the customers I just mentioned. As a result, I had some spare time, and that’s when the management said, “Sven, you can take charge of the IoT topic, go ahead and get started.” Then the whole thing developed.

Very nice. Christian, then you came into the picture, and then you both built the whole thing together, right?

Christian

Actually, that was my colleague, Marco, many greetings go out at this point, the initiator. He then said in an uncomplicated way, Pierre, I’ll show you, you’ll just get a demo kit from us. Why don’t you go to the customers, why don’t you try that out. Tell us, how does that feel, does that help you, can customers do anything with it? So even today, pragmatically, you have to keep finding ways. I think that’s such a recipe for success with the company now.

Yes, very nice. First of all, thank you for sharing such some exactly personal stories here. Maybe we can take a quick look at the ipf portfolio. ipf electronic gmbh, you are the world’s leading manufacturer of industrial sensors and automation solutions. You have been on the market for over 40 years with the corresponding experience and offer innovative products with correspondingly high quality and for very different use cases. Sven, can you briefly tell us what kind of sensors these are exactly?

Sven

I can still remember the stories of our owner. He talked about the first generation that ran the company, saying, “I have one sensor in the left pocket and the other sensor in the right pocket.” That was the solution envisioned over 40 years ago. In the meantime, the product range has grown significantly. This means that in addition to the normal inductive, capacitive or optical sensors, measurement equipment is also used. Camera technology, security technology is then also a big part for us in the field. In this way, we can actually cover all customer segments.

Okay, very nice. Now you brought up that you did customer surveys during the Corona period. The topic of IoT is probably an insanely important, strategic topic, especially for the accounts you manage. What is your vision for digitalization? Which direction are you thinking with your customers as the company’s vision?

Sven

The customer wants added value. After all, the sensor data they have available don’t always have to be our sensors, that’s a common need. I would like to record these, evaluate them analytically, and perhaps present them graphically. This is then the ideal basis for us to evaluate the sensor data accordingly and make it available to the customers. In this way, we strengthen customer loyalty. We’re usually in the maintenance, production management, construction area, and now we’re expanding that customer base to include energy management and data analysts who are hands-on with this IoT issue, and that’s where you just go deeper with the customer. You strengthen the bond and the partnership on both sides. The nice thing is that we now have our own product with the technology from in.hub and offer that to the customer.

Now you just said energy monitoring is such an issue. People often talk about low-hanging fruit. Is this something that you say is actually always an issue for customers, and your sensors can also provide corresponding data and added value? Did you start with that or how did you start?

Sven

Right. We did a customer survey and the customer wanted it, the topic of IoT was new to us. How do we quickly get to grips with this so that we don’t get in over our heads? Let’s pick an application scenario that we think might drive a lot of customers. This was practically the topic of energy and the topic of energy monitoring. As a result, we then created marketing materials and a landing page to pick up customers as much as possible on this topic. This also got off to a good start on the topic of energy data collection. We extend the whole thing with condition monitoring or predictive maintenance. We grow continuously with the requirements of our customers.

[13:15] Challenges, potentials and status quo – This is what the use case looks like in practice

Now you had just said it’s about different sensors. You have camera technology, measuring equipment, pressure sensors, flow sensors, various sensor systems in use. What are specific use cases that are exciting for your customers?

Sven

Perhaps this can be demonstrated with an example. We have a customer in southern Germany that manufactures cutting tools on exactly 14 machining centers. A technician approached us and wanted to write his technical paper. The topic of energy consumption or energy transparency is very important to them, and he simply wanted to see what was happening and whether there was any potential for savings. Of course, he didn’t want to interfere with the processes of the machines and set up a mobile measuring station. I need the ipf gateway with in.hub technology and maybe a few more edge sensors, and then a compressed air sensor to make the major cost driver, compressed air, transparent. We have provided that as well. Then he tied it all together technically, so with our support, with the field representative on site. Then the customer and I talked briefly and said how the software works, how the analytics work and how the evaluation is done. In this context, he explained to us the procedure. Then we picked him up. He practically went from machine to machine over a time stint per machine and recorded the whole thing. These data were then scaled up to one year. In the end, he found that some machines were already well optimized, while others still had significant potential for transparency. A particular focus was on the detection of leaks that had previously gone unnoticed, as well as on production processes. For example, compressed air was still being supplied to one machine despite no production, resulting in losses. By making adjustments to the production processes, it was decided to stop the compressed air supply when the plant was at a standstill. Overall, a projection was made across the entire 14 machines and it showed that a compressed air savings of 55% over one year was possible.

Wow, that’s quite an announcement.

Christian

That’s crazy, yes.

Sven

For the customer, this equates to a saving of around 20,000 or 25,000 euros. Of course, this is already a very cool use case. That’s why I wanted to bring that up.

Cool, greetings go out to the person who supervised this work.

Christian

Certainly hired immediately.

In the SME segment, it is very often the case that you have such operational work somewhere and use it to uncover such potential, because you first have to come up with the idea of analyzing the processes outside of the existing business. There are probably still very different cases, because each machine has different components in use. Sven, there you have a wide variety of data, probably data types, that you can provide to customers beyond that. Do you have some examples of what data might be relevant to such projects? Do you have any other examples?

Sven

Of course. Especially in the field of energy monitoring, there are many factors, for example pressure, so what is the pressure of the whole pipeline, the liquid media? How is the compressed air? What is the temperature? We can count water meters, we can read electricity meters, we can relate everything together. These are all things that flow into this energy cycle. We can provide this whole portfolio, this bundle, to customers on request.

Yes. The cool thing is that as a supplier of this sensor technology, you probably also have insights that an end customer will never have, because you know your components in detail. You probably have a whole research behind it and a whole product development that might be looking at those wear limits in detail. That means you really have an asset, you could say, that you can offer customers as added value. This is really very exciting to learn. Christian, now you are working with very different companies. Do you have any additions here for cases you still see in the field?

Christian

There are certainly many more great examples that can be cited here. but the beauty is that the customer has become curious. He just wanted to try something and it was made easy for him. Now, he has the opportunity, with the experienced knowledge and perhaps enriched topics, to evaluate other media or incorporate additional information. For example, for which product being produced on the machine can I measure certain energy consumptions, allowing for a much more accurate calculation of that product later on. Environmental technology, what you just heard, around the process, is significantly interesting. Of course, now also in these times when energy costs are becoming more and more expensive. That is already very concise.

Then sometimes it really is the very simple things. We recently had a customer with the topic of logistics replenishment control. He has manual processes, he drives trolleys through production so that the work processes can always be carried out one after the other. They have a high number of routes in production. For him, it would have been very, very important to measure at an early stage where paths have been processed, where they are empty and where I have to refill what next. Often, customers get into predicaments and have to acquire large software tools. I would have one to three sensors connected there, a gateway attached, also more sensors to a gateway over extension modules and Co. to provide someone a small visualization, so that one knows in the material store, when something is soon empty or where something is already empty. There are countless examples. What we have to understand as a provider in the background is that we can advise the customer – ipf is a very good example here – with an extremely high level of process knowledge. But then there is this complexity, which is different for every customer because the applications are always different in detail. We have to be able to take the customer along with us so well that he loses his shyness, so that he can really use his own knowledge to carry out and expand these things. To do this, you need solutions that everyone can use, that are simple and that can be used in a variety of ways. No matter what I connect there, the customer says, this is exactly where I can get started and feel comfortable and secure and can really consciously control my projects here for a very long time.

[20:05] Solutions, offerings and services – A look at the technologies used

Sven had mentioned that it is like a kind of bundle. There is a gateway with corresponding sensor technology somewhere. Can you summarize that again briefly? What does the end customer, i.e. the manufacturing company, buy from you? Do I approach you and say, this is my case, this is what I need. You put it together for them then? What exactly does this solution look like now that you have built?

Sven

The customer must first know that we are doing something like this. In most cases, an e-mail is not enough. Our sales force approaches the customer with the promotional materials and with good intention.

Yes, or just listen to the podcast.

Sven

Or they listen to the podcast, right. Then, that might click in their mind, and the customer realizes that they indeed have a potential application. Then the call, we then come by their place or have an online meeting, discuss the whole thing. There they presents their idea and constellation and ask what they need for it. The focus is on our gateway as a data collection point and analytics tool. Then there is the sensor universe, which is needed to create transparency or interfaces to connect existing systems. The customer has a certain shyness, has become a bit finicky about the market, and then often a whole busload of engineers comes along, gets dumped, and then it costs maybe 20,000 euros and it should be smart. That’s what customers like about this system, about this gateway. Maybe you can think of it as smart. I remember when my son used to have our smartphone, it didn’t take much explaining. Then maybe you just need to give a hint. The images and the menus are virtually self-explanatory and these little kids have it down in no time. You can see something like that with the gateway and with the software behind it, that it’s so smart that you’re routed through. You can’t break anything, so to speak. If you only record data, in the worst case you have a data chaos, but nothing is broken.

Okay, this is exciting. This means that I am a manufacturing company, I now have the option of connecting a wide variety of sensors, for example the compressed air sensor. How does it work? I have this mini-PC or the gateway, there I connect this sensor. How does the data acquisition work?

Sven

We can often directly connect the sensors. The gateway itself offers digital and analog interfaces and various protocols. Especially in energy management, for example, the Modbus interface is very interesting and then the gateway can communicate directly with it and we can read out many values at the same time. In the case of our compressed air sensors, for example, we now say that we will not only take the current value, but perhaps the cumulative value, the total consumption that the system has recorded to date, and perhaps also the media temperature. For the correct temperature of the compressed air, you can set limits and then merge all this on the gateway. If it should come to it, we have actually made the experience that we may not be able to serve an interface directly and the customer says, I have the following interface XY. Somehow we lack connectivity to the gateway. What am I doing now? Then we can in good conscience refer you to a third-party supplier who specializes in offering converters. That is, to act as a translator from the desired protocol or communication medium to the other. Then it works the same way.

I would have a lot more questions about that as well, but I would want to highlight one more thing. Christian, you have this slogan and devices boot in three seconds. This means that I have the possibility to see the data relatively quickly and then also have it displayed. How does that work with you guys exactly?

Christian

Basically, the gateway has to be integrated somewhere in the network and then I can access the device from any end device that is browser-enabled. In the delivery state, SIINEOS and the technology are configured, the data is first stored on the device. This is a very charming solution for many users. Today, there are still, shall I say, resort boundaries in companies where IT and OT have certain process hurdles. Sometimes something has to be installed somewhere and I need storage space on the server and a database. Can you please provide those so we can log some data? So actually anyone can use the devices today and connect sensor technology. Also such a Modbus sensor, where there are really innumerable lines in the data sheet, which one must enter actually only with register somewhere. Using the library feature, the customer selects the sensor, this is configured in 10 seconds, immediately has the measured values, stores them on the device, can visualize them directly on the device, display, evaluate. They can have alerts and emails sent to them and actually just have to ask IT for an IP address. They don’t even have to, if DHCP is also possible. In companies, however, this obviously does not always make sense. That’s why you just need an IP address and off you go. Then the customer can still decide whether they want to add more data from another database or whether they prefer to store their data not only on the device but also on our server. Adding is never a problem. The customer can also do some of this themselves. That’s actually the beauty of it, that the hurdle both from the usability and from the initialization to start at all is so low that you can take away this shyness from the customer.

Now, if questions come up as you listen, you’re both willing to take queries. I would link your LinkedIn profiles in the show notes. You can also talk about specific requirements, cases or even possible partnerships. Maybe one more thing that would be important to me, that’s about data analysis. I would like to talk about the evaluation again. Christian, SIINEOS is your software, in the end I want to save these 25,000 euros, for that I first have to collect and process data and then bring in this logic. Sven, how do you do this evaluation on the SIINEOS operating system?

Sven

This is the basis for the operating system, so that the data can be recorded and channeled correctly. It’s all relatively smart then. Customers we serve or visit like to use the option of an application that is already stored locally on the gateway, it’s called Grafana. Grafana is an analytics tool that can be used to achieve such evaluations well. Drag and drop to cobble together a dashboard and get results fast. If you do somehow have a question, you can look it up on YouTube. Grafana is truly a tool that often emerges from home automation. There are a lot of very knowledgeable people who work with this tool. There you can always pick up advice, with which you can simply then also grow. And the customer took advantage of that. He had asked us a quick question first. He said, Grafana, I don’t know, what do I have to do here? Then we cleared it up briefly in a team meeting. That was really 15 minutes. Then he said, all right, I can handle the rest. Then he came up with the result on his own.

Christian

The customers are very creative, they really do the most amazing things, you really have to say.

Yes, I can imagine. Sven, of course you also manage the big accounts, they probably know this, but especially in the medium-sized segment Grafana is also relevant, it is just a nice way to do this evaluation. Drag and drop, as you say, that’s a good place to start. Christian, Node-RED would be another topic I would like to address, many customers are already working with it. Can I do the same with it? How does that work exactly?

Christian

SIINEOS is an operating system, you can think of it as something like Android on smartphones, perhaps. This is independent of device and hardware, works on many other hardwares, not only on in.hub. It offers, in addition to the integrated functionalities, that you can also connect and pre-process sensors very quickly. This is specifically designed for condition monitoring. Just like with smartphones, the success factor is installing apps and applications afterwards. Node-RED is one of these topics. If customers want to use that, they are welcome to install it. After installation, the device can be operated completely offline and nothing major needs to be installed on other IT systems. It’s like back then with the smartphone, when no one said you have the most exact coordinates here and can now find your way with the GPS locations and navigate from Hanover to Berlin, but at some point Google Maps came up with a route plan. Of course, we use the coordinates, but it is only with the application that the expert knowledge is brought to the customer, and we do that with our own apps or apps from third-party providers, who then also have the opportunity to provide great applications for SIINEOS. A cool app from us is MADOW, Machine Downtime Wizard, specifically for the topic of machine downtime monitoring and also analysis of the reasons. This is a super tool besides the ones SIINEOS already provides, to provide special solutions tailored for the customer in a simple way, where they have so much input and evaluations that they don’t have to acquire the knowledge themselves as well. But I think we’ll get to MADOW again this year in a dedicated podcast, and I’m really looking forward to that.

Really exciting. So at this point I would like to say thank you very much for all your insights. I think there was a very good understanding of the business case, why it’s important what you guys are doing, why this partnership is important, and most importantly, exactly how it works. I know many have some technical questions, and you really explained that very nicely. What’s in store for the future? How is the topic developing? Do you have some insights you can share?

Christian

I don’t think customers will have a problem at all if the solutions are monetized for all the vendors that are there delivering a good product. It’s a milkmaid’s calculation if I pay some money on one side for a solution that saves me money on the other side or saves time, which is also money somewhere. These are different issues. There are always big things being touted, like, I’ll sell machines later on, or I won’t buy compressors, I’ll just buy generated compressed air. Unfortunately, it has to be said that there are always a few who have to do this. Especially among automation and plant manufacturers, people are still a bit shy. We’re not quite as far along there, as innovative, as we might be in B2C, where products are simply thrown on the market and we see if the customer buys them. The industry is still a bit more reserved in this respect. This will develop. Many of the things we have come to know and love now will be adopted by the industry, and now virtual and augmented reality is coming to us with the new Apple glasses, and that will eventually catch on peu à peu. We are all human beings, and I believe that once you have the comfort in your private life and know that this should actually also exist in industry, if certain conditions are met in terms of security and data sovereignty, then it will also be possible. As long as, and this is crucial, people can operate it and understand what they’re doing. This is quite important in the industry. Nobody wants to use technologies where they don’t know what works how and what might be done with the data and so on.

Absolutely, yes. Sven, do you have any additions from your point of view, from practice?

Sven

In our customer sector in particular, customers are also clamoring for smart solutions, much like in the consumer sector. The industry is a good ten to 15 years behind, especially in such areas. With this product we manage to build a bridge quickly. To say that I have a lot of requirements here, that I can bundle them into one system and start right away. I can use it intuitively, I have support and can get results quickly on my own, and it’s not expensive. This is always very important. I always have the feeling that someone somewhere is sitting there with five fingers on his hand and saying, in so many years I have to amortize this. With this cost factor, it’s done much faster. It’s incredible how quickly that comes to fruition.

You have just calculated a clear business case for one example. There are many more cases. This also brings me to an invitation that I would like to extend to both of you and also to anyone who is listening now. On September 14, we hold our IoT Use Case User Festival. We meet with various manufacturers and with manufacturing companies. We are online in a tool called gather.town. That’s pretty cool. This is a great opportunity.

Christian

Insanely cool.

Not everyone knows it yet, but it’s a precursor to the Metaverse, you might say. The focus there is on which use cases are already being monetized on the market today. There are a lot of business developers there, especially from manufacturers in the automation world. A warm invitation goes out to you. I would be super happy if you were also there. Of course, I would like to present the case with the compressed air topic there as well. Maybe we’ll talk about that again.

Thank you so much for this podcast and for this great episode. I look forward to hearing from you again. I can perhaps make another recommendation: VW is also in our network. In episode 80, Dirk, Head of Innovation, also presented a few of his use cases. Gladly listen to it again. Otherwise, I would now hand over the last word to you. Thank you so much for being there and thank you for your time.

Sven

From my side also many thanks. It was very, very exciting. It was very nice. The time has flown by. But it was a lot of fun. I look forward to the next possible podcast.

Very nice. Christian, do you want to say something too?

Christian

So many beautiful things were said. The most important thing is to stay committed, and as our slogan says, “make it. simple. plug & play”. Don’t be shy, just go for it and try it. I think that’s what all the topics here have shown and also the example today.

Very nice, then thank you very much and Sven you first of all a nice vacation. We’ll be hearing from you very soon. Many greetings.