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Institute
Pricing for Smart-Product-Service-Systems in Subscription Business Models for Production Industries
(2021)
In the production industry, subscription business models have the potential to create long-term relationships where a supplier provides a continuous value-oriented service to a customer based on digitalisation. Monetising this increase in value through pricing represents a central challenge for suppliers in subscription business. Unlike the current dominant transactional business, the focus of pricing is on the value-in-use of the customer (e.g. on the increase in output for the customer). In this regard, there is so far no pricing approach for practice that allows the linking of the performance data of the customer with the periodically charged price. However, in subscription businesses, such an approach is required to create win-win situations for the customer and supplier through continuous performance improvement. Therefore, this paper develops a novel process model for pricing of smart-product-service-systems in subscription business for production industries. This process can serve as basis for suppliers of subscriptions in the production industry to align pricing with the created value-in-use. In the long term, this allows companies to systematically develop their pricing to monetise the potential of digitalisation.
The Impact Of Manufacturing Execution Systems On The Digital Transformation Of Production Systems
(2021)
With the focus of manufacturing companies on the digital transformation, Manufacturing Execution Systems are market-ready, modular software solutions for manufacturing companies to integrate the value-adding and supporting processes horizontal and vertical in the company. Companies, especially small and mediumsized companies, face high internal and external costs for the implementation of the MES modules. An advantage of MES is the possibility to implement the systems in a continually, module-by-module approach, with the benefit of timely distributed investments. By realizing fast improvements, companies can use the benefits for further module implementations. This paper proposes a maturity model to measure the impact of an MES on the digital transformation of the company’s production systems. The model fulfils two purposes. The first, companies can measure the impact based on the difference between its current maturity index and the potential index of an implemented MES. The second is, the user can identify what impact an MES has in general on the digital transformation since the developed maturity model is derived from an established industry 4.0 maturity model. The development of the maturity model is based on the methodologies of AKKASOGLU and focuses on the further development of an established model. As an outlook, the application of the model will be described briefly. The proposed maturity model can directly be used by practitioners and offers implications for further development of MES functionalities.
Industrial practice shows a strong trend towards digitalization. It is not only economic crises, such as those triggered by Covid-19, that are reinforcing this trend. It is also the entrepreneurial urge to fulfill customer wishes in the best possible way and to adapt to new requirements as quickly as possible. Due to the advancing digitalization, the role of business application systems in manufacturing companies is therefore becoming increasingly important. The data processed in IT-Systems represent a great potential, especially for the evaluation of change requests in production. Through efficient change management, companies can record and process changes quickly. However, the necessary data basis to decide on existing change requests is still hardly used. Existing IT-Systems for change management coordinate the processing of change requests, but do not relate to data of operational application systems such as Enterprise-Resource-Planning. Therefore, a conceptual approach is required for the evaluation of change requests. This approach is based on an objective recording system that enables the transformation from the change description to an evaluation space. The paper presents an approach for the systematic transfer of requirement characteristics into the world of operational IT-Systems.
Due to shorter product life cycles and the increasing internationalization of competition, companies are confronted with increasing complexity in supply chain management. Event-based systems are used to reduce this complexity and to support employees' decisions. Such event-based systems include tracking & tracing systems on the one hand and supply chain event management on the other. Tracking & tracing systems only have the functions of monitoring and reporting deviations, whereas supply chain event management systems also function as simulation, control, and measurement. The central element connecting these systems is the event. It forms the information basis for mapping and matching the process sequences in the event-based systems. The events received from the supply chain partner form the basis for all downstream steps and must, therefore, contain the correct data. Since the data quality is insufficient in numerous use cases and incorrect data in supply chain event management is not considered in the literature, this paper deals with the description and typification of incorrect event data. Based on a systematic literature review, typical sources of errors in the acquisition and transmission of event data are discussed. The results are then applied to event data so that a typification of incorrect event types is possible. The results help to significantly improve event-based systems for use in practice by preventing incorrect reactions through the detection of incorrect event data.
Companies operate in an increasingly volatile environment where different developments like shorter product lifecycles, the demand for customized products and globalization increase the complexity and interconnectivity in supply chains. Current events like Brexit, the COVID-19 pandemic or the blockade of the Suez canal have caused major disruptions in supply chains. This demonstrates that many companies are insufficiently prepared for disruptions. As disruptions in supply chains are expected to occur even more frequently in the future, the need for sufficient preparation increases. Increasing resilience provides one way of dealing with disruptions. Resilience can be understood as the ability of a system to cope with disruptions and to ensure the competitiveness of a company. In particular, it enables the preparation for unexpected disruptions. The level of resilience is thereby significantly influenced by actions initiated prior to a disruption. Although companies recognize the need to increase their resilience, it is not systematically implemented. One major challenge is the multidimensionality and complexity of the resilience construct. To systematically design resilience an understanding of the components of resilience is required. However, a common understanding of constituent parts of resilience is currently lacking. This paper, therefore, proposes a general framework for structuring resilience by decomposing the multidimensional concept into its individual components. The framework contributes to an understanding of the interrelationships between the individual components and identifies resilience principles as target directions for the design of resilience. It thus sets the basis for a qualitative assessment of resilience and enables the analysis of resilience-building measures in terms of their impact on resilience. Moreover, an approach for applying the framework to different contexts is presented and then used to detail the framework for the context of procurement.
Industry 4.0 and Smart Maintenance represent a great opportunity to make manufacturing and maintenance more effective, safer, and reliable. However, they also represent massive change and corresponding challenges for industrial companies, as many different options and starting points have to be weighed and the individual right paths for achieving Smart Maintenance need to be identified. In our paper, we describe our approach to evaluating maintenance organizations in a case study for the oil and gas industry, developing a shared vision for the future, and deriving economical and effective measures. We will demonstrate our approach, by showcasing a specific example from the oil and gas industry, where a need for action on HSE-relevant critical flanges in the company's piping systems was identified. We describe the steps, that were taken to identify the need for action, the specifications of the project and the criticality analysis of the piping system. This resulted in the derivation of a digitalization measure for critical flanges, which was first commercially analyzed and then the flanges were equipped with a continuous monitoring solution. Finally, a conclusion is drawn on the performed procedure and the achieved improvements.
Generation of a Data Model For Quotation Costing Of Make To Order Manufacturers From Case Studies
(2022)
For contract or make to order manufacturers, quotation costing is a complex process that is mainly performed based on experience. Due to the high diversity of the product range of these mostly small or medium-sized companies (SMEs) and the poor data situation at the time of quotation preparation, the quality of the calculation is subject to strong variations and uncertainties. The gap between the initial quotation costing and the actual costs to be spent (pre- and post-calculation) is crucial to the existence of SMEs. Digitalization in general can help companies to get a better understanding of processes and to generate data. For improving these processes, an understanding of the important data for that specific process is crucial. Accurate quotation costing for customized products is time-consuming and resource-intensive, as there is a lack of an overview of data to be used within the process. This paper therefore derives a data model for supporting quotation costing in the company, based on literature-based costing procedures and recorded case studies for quotation and calculation. Based on the results, SMEs will have a first overview of the needed data for quotation costing to optimize their calculation process.
Künstliche Intelligenz (KI) hat als Technologie in den vergangenen Jahren Marktreife erlangt. Es existiert eine Vielzahl benutzerfreundlicher Produkte und Services, welche die Anwendung von KI im Alltag und im Unternehmen vereinfachen. Die Herausforderung, vor denen Anwendende, gerade im betriebswirtschaftlichen Kontext, stehen, ist nicht die technische Machbarkeit einer KI-Applikation, sondern deren organisatorisch und rechtlich zulässige Gestaltung. Zu einer zunehmenden Dynamik in der Gesetzgebung kommt ein gesellschaftliches Interesse an der Kontrolle und Transparenz über die für KI-Modelle erhobenen Daten. Die Diskussion über Datensouveränität im geschäftlichen und privaten Alltag rückt mehr und mehr in das Zentrum der öffentlichen Aufmerksamkeit.
Datenbasierte KI-Anwendungen stehen damit in einem Spannungsfeld zwischen den Potenzialen, die das Erheben und Teilen von Daten über Unternehmensgrenzen hinweg bietet, und der Herausforderung, die Datensouveränität der involvierten Personen zu wahren. Die vorliegende Studie soll erstens über die Auswirkungen der Datensouveränität und die damit verbundenen aktuellen und kommenden Regularien auf KI-Anwendungsfälle aufklären. Dafür wurden Expertinnen und Experten aus den Bereichen Recht, KI- und Organisationsforschung befragt. Zweitens zeigt die Studie Potenziale und Best Practices von KI-Anwendungsfällen mit überbetrieblichem Datenaustausch auf. Dafür wurden Fallstudien in Unternehmen durchgeführt, die bereits erfolgreich Datenaustausch in ihre Geschäftsmodelle integriert haben, um ihre KI-Applikationen zu betreiben und zu verbessern.
Manufacturing companies (MFRs) are increasingly extending their
portfolios with services and data-driven services (DDS) to differentiate themselves from competitors, tap new revenue potential, and gain competitive advantages through digitization and the subsequently generated data. Nonetheless, DDS fail more often than traditional industrial services and products within the first year on the market. Particularly, companies are failing to sell DDS successfully and efficiently with their existing (multi-level) distribution structures. Surprisingly, there is a lack of scientific research addressing this issue. Since there are currently no holistic models for an end-to-end description of distribution-tasks for DDS in the manufacturing industry, this paper contributes to a task-oriented reference model for mapping interactions in the multi-level distribution management. Therefore, a case study research approach is used, to identify and describe the interactions in the multi-level distribution management of DDS, as well as to develop a regulatory framework for MFRs and their multi-level distribution management. This research uses the established theoretical framework of Service-Dominant-Logic to address the co-creation in multi-level distribution management of DDS. As a result, this paper identifies different interaction variants as well as the need for a new management function with 4 main and 14 basic tasks.
Ongoing digitalization and Industry 4.0 enable the development of new business models due to the increase in available data and digital connected products. A promising business model type for the machinery and plant engineering industry are subscription models, consisting of products and services offered in return for continuous payments. However, subscription-based business models are associated with extensive changes in the traditional machinery and plant engineering industry, in particular, for small and medium-sized companies (SMEs). Established concepts for the development of value propositions and business models neglect important aspects, such as the integrated development and optimization of products and services across the entire life cycle or the data infrastructure. This paper presents a concept for a methodology to support SMEs developing value propositions within subscription models. Therefore, the systematic identification of customer benefits, the determination and prioritization of subscription relevant functionalities as well as the design of product and service elements addressing those functionalities are the main aspects on which the focus is placed on. The result is a subscription value proposition canvas for SMEs to address the impact of subscription models on products and services.