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Customer-driven design of product-services and production networks to adapt to regional market requirements

Periodic Reporting for period 1 - ProRegio (Customer-driven design of product-services and production networks to adapt to regional market requirements)

Reporting period: 2015-01-01 to 2016-06-30

The project “Customer-Driven design of product-services and production networks to adapt to regional market requirements” (ProRegio) aims at developing manufacturing intelligence based product-services that will rigorously change the current way how customer requirements are addressed by manufacturing companies.

The challenges addressed by the ProRegio project are aligned with latest observations drawn by the WTO, saying that global supply chains of today are not really global, but regional in terms of having three major regions, namely Asia, North America, and Europe. The project’s aim is to address regional customer requirements by increasing the ability to export from EU countries to other continents and strengthening inner-regional production within the EU.

While customers in more established markets are demanding more variety and faster product cycles, customers from developing markets require different “frugal” products and product-services to meet their needs with different features as well as different quality and price points. These differing customer requirements have to be continuously monitored, gathered and translated into products and product-services. Existing and new production facilities need to be enabled to deliver such products and product-services efficiently, therefore regional production capabilities and related specialization potential need to be considered when planning and controlling production systems and production networks.

The development of this new business approach is based on four main objectives:
1. Costumer integration in the product development process
2. Development of integrated product and production adaptions regarding site-specific conditions and technology options
3. Innovative product-service design by incorporating customers in the order-fulfilment processes
4. Optimal design of production systems and allocation of production processes to production sites

The four objectives are enabled by innovative cloud-based product lifecycle management (PLM) solutions integrating production (shopfloor and supplier) as well as customer feedbacks using IT-platforms, knowledge repositories and advanced optimization methods in comprehensive decision support tools.
In the workpackages, the following results were achieved:

WP1: Specification of Use Cases and industrial applications
The developed and to be developed tools and solutions are applied and tested in three industrial Use Cases in the aeronautics industry, in the machinery industry, and in the domestic appliances industry. Therefore, the Use Case-specific characteristics where defined in the first 6 month of the project. In parallel, seven frugal innovation-oriented product-services and related business and financial models were defined and characterized which are pursued with during the further course of the project. Regional market requirements were analyzed to validate the need for products and product-services regarding frugal innovation. The potential of the proposed tools and solutions were then summarized in terms of future industrial scenarios. To enable the integration of developed ICT-solutions, the related software and hardware implementation requirements were gathered.

WP2: Customer-driven product-service design for regional market adaptation
Based on the exploration stage of industrial Use Case requirements and frugal innovation theory, fulfilled in WP1, the following results were archived in workpackage 2 during the first reporting period. Conceptual methods and models to support customer-driven product-service design process for regional market adaptation were developed. On that basis, innovative tools based on virtual and augmented reality technologies were designed to support interactions with all involved stakeholders in the customer-driven product-service design process. The first steps were taken in the adaptation of Product Lifecycle Management (PLM) approach to support new data management needs required by the customer-driven product-service design for regional market adaptation.

WP3: Distributed production network design and management
In this workpackage, the following results have been archived so far: For Use Case 1 at Airbus and Use Case 2 at Arcelik, all means necessary to organize and manage the most efficient production network were collected. In parallel, KPIs for a multi-objective assessment and evaluation of production networks and a generic modelling approach for production networks were defined. Based on the KPIs and on the modelling approach, methods for supplier selection and network design as well as for production network design and redesign were developed. First steps were taken in the implementation of the developed methods and in the development of further methods focusing on order assignment and scheduling.

WP4: Process and plant design for product-service innovation
Based on a methodology and a related software tool called “Capability Assessment Tool” developed in the first year of the project, methods and software tools which enable the users to make use of the knowledge on the process and system capabilities of distributed plants to properly allocate frugal product features and to exploit the sensor-enabled innovative services in view of frugal innovation were developed. Furthermore, a set of engineering rules useful to gather knowledge about implicit region-dependent system design requirements and to translate these requirements into feasible process sequence alternatives were developed and implemented. A set of mathematical models, methods and tools have been developed and implemented to support the designer during the critical phases of line balancing and system design optimization.

WP5: Design and Implementation of integrated ProRegio software platform
The general objective of workpackage 5 is to specify, implement, and test the cloud-based software platform that will serve as a software framework of the ProRegio project. The initial data-model and architecture of the cockpit is currently specified and will be reported in the end of the second project year. First steps in the design and implementation of the ProRegio software platform were already undertaken based on the
The ProRegio project aims at providing a set of new technological and methodological solutions to adding value for the customer and stakeholders by innovative services over the product lifecycle.
Through product-services and related tools, which go beyond the state of the art, customers and other stakeholders can be directly involved in the phase of product design (Augmented Reality product configurator), proposal and contracting (Just-in-time specification, faster and more accurate technical solutions of production systems), production/ order fulfilment (visibility of production status) and customer usage (remote maintenance).
Furthermore, ProRegio aims at providing novel cloud-based decision support tools to plan and control production systems and production networks which have to deal with a large variety of differing, mainly customized products with shorter product lifecycles. These decision support tools can be used to identify the need and propose solutions for (re-)design of application case specific production systems and production networks. Already designed tools include the supplier selection and network design tool, the production network design and re-design tool, the plant capability assessment tool, and knowledge-based production system engineering tools. Several decision support tools on production network level and production system level will be developed throughout the second half of the project. All tools go beyond the state of the art when dealing with the complexity of a large variety of customized products and shorter reactions times.
The main innovations of the ProRegio project are:
- increasing customer satisfaction by providing more “power” to the customer comparable to effects of social media
- increasing supplier loyalty by even stronger integration into the value adding process
- offering new added value services to make products more attractive to different customer segments especially for emerging regions
- increasing the ability to export into emerging countries all around the world and in doing so the project will help to stabilize EU’s exports

The application of the ProRegio approach will increase the competitiveness of companies by
- shorten time-to-market of customized products/services
- shortening of throughput times in globally distributed production tasks
- improvement of delivery reliability to the customer through more transparent production processes
- Reduction of production costs

Quantitative impact estimates will be identified throughout the second half of the project on the basis of implemented and tested tools and methods in the industrial Use Cases.
Main challenges addressed in ProRegio
ProRegio approach