SCM Insights, Technology
May 7, 2015

Industry 4.0, M2M and the Internet of Things and Services in the automotive industry: The next generation of e-business?

Matching themes: Industry 4.0, M2M

Many articles today deal with Industry 4.0 and communication between machines and production facilities across company boundaries.

In the related area of the Internet of Things and Services, key players in the automotive industry are hard at work describing application models intended to provide added value, in particular for road users. In terms of information technology, the trends are all about triggering activities through the transfer of data — activities intended to make daily company life as well as daily mobility easier, safer and more pleasant. But just what do these buzz words really mean?

It all sounds a bit familiar …

Shining a spotlight on Industry 4.0 and the Internet of Things and Services reveals that these seemingly cutting-edge phenomena comprise nothing more than the combining of data storage and data exchange with intelligent interpretation of the data and, if applicable, a beneficial action as well as feedback.

There’s nothing revolutionary about this. It actually constitutes the basis of information technology and can be reduced to input–processing–output. What is new, however, is the granularity of the information and the options created by the inexhaustible memory capacity and breathtaking processing speeds now available. All operations are executed in the main memory and do not require database access.

And therein lies the crux of the matter from an information technology point of view: The challenge is getting the communicating entities in such systems to speak to each other using the same language. It is essential that all parties involved agree on the standardized communication channels they will use.

Possible applications

We still don’t really know what aspects of life these developments will impact, but two trends stand out in the automotive industry:

  1. Intercompany communication (warehouse and logistics concepts) heads the list as the most advanced scenario in the industry to date.  Bosch is currently making excellent headway with implementing the company’s RFIDproject. A RAN project (RFID Automotive Network), backed by BMWi, includes the crucial related aspect of integrating suppliers and business partners into processes. This project provides input for a working group established by the German Association of the Automotive Industry (VDA).
  2. Accident prevention and autonomous driving are the primary areas of application that have captured the public’s attention:
    a) Companies like Google and Baidu are have made strides in developing their own vehicles that can drive autonomously and therefore need to process a flood of data.
    b) OEMs like Daimler, BMW and Audi continue to work hard on their assistance systems for autonomous driving and already offer corresponding trim levels in the luxury class, a development that mirrors what happened with ABS at the end of the 1970s.
    c) Supply industry giants Bosch and Continental—companies that traditionally represent a very high share of value added in the automotive sector—are also working extensively on related features. Ultimately, these companies drive innovation by promoting technologies and getting them out on the road in cooperation with OEMs (or the new IT players mentioned above). One only needs to consider the example of ABS technology. Developed by Bosch, ABS made its debut in a Mercedes S-Class in 1978 (see above).

The next time I will discuss the challenges Industry 4.0 faces as well as what we learned from e-business projects at the turn of the millennium.

thomas huebsch

Thomas Hübsch

Sales Manager

What are the main characteristics of the automotive industry? In addition to the capacity for innovation and the high market value of the products involved, the processes employed are often used as the benchmark for the manufacturing industry and as a shining example for other industries. I find that fascinating and I see it as my job to promote this kind of process excellence. In my posts, I try to cover the potential behind cross-company collaboration beyond phone calls, faxes, and e-mails. With well over 20 years’ experience in the automotive and IT industries, I’ve got plenty to share with you.

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