Business Models and Platform
economyThe Robot Revolution and Industrial IoT International Symposium 2020
Japan-Germany Expert Forum
Naoaki Fujino (Nomura Research Institute)Prof. Dr. Ulrich Löwen (Plattform Industrie 4.0 AG6 / Siemens AG)

Introduction
In the computer industry, in 1966, IBM developed the System 360, and forthe first time a clear interface was defined between software and hardware,and it was successfully modularized, so that another organization can use its
unique capabilities to create different products.
The apparel industry and the logistics industry have formed a global
corporate network for many years. In recent years, advances in IT technology
have led to the early establishment of international standard interfaces
between open companies such as 3D / PLM, EDI, and XML by GS1 (globalstandard one) and as a result, platformers that operate an ecosystem of tensof thousands of companies have appeared. In the B2C field, GAFA expanded
its service business to about 200 countries at the same time as the global
expansion of smartphones, create new business models and industrial
structure based on software with zero marginal cost and IT with exponentially
improved performance.
In the manufacturing industry, there is a product production ecosystem formed by vertically integratedcompanies. However, an open platform that can scale out to promote product value as a service is still in thestage of budding cases.
It is considered to be of great significance for both countries that Japan and Germany share such abackground, exchange opinions on digitization in the manufacturing industry, and have a common
understanding of the overall view of future growth of the manufacturing industry.
Page 2October 2020

Business Models and Platform EconomyFJPN-GER Discussion on Digital Business ModelsPurpose
Context• There are many theses and ideas from a technical perspective (e.g. security, communication, artificial
intelligence, etc.)• There are many claims from an economic perspective (e.g. platform economy, new intermediaries, etc.)• Often facts in B2C are directly transferred to B2B, but the discussions typically stay on an abstract level andgenerally do not reach the business level in the manufacturing industry
Overall objective• Illustration of the economic importance of digitization for the manufacturing industry, driven by the analysisof selected examples, scenarios and use cases that can be observed in the market
Addressed stakeholder• Primarily the manufacturing industry, in order to provide guidance in the complex discussions, but also
politics and researchConsequences• JPN and GER both benefit from a joint discussion because they have a similar understanding of theimportance of digitization for the future of the manufacturing industry
FPage 3October 2020

Business Models and Platform Economy

Overall Evolutionary Approach
Evolutionary procedure
Structure of template

Selection of examples
clear understanding ofcustomer needs andmarket trends• Overall description → purpose• Value network → orchestration, platform,
ecosystem• Revenue stream → monetarization• Business model contract → value• Business model innovation → disruption
analysis of underlying
mechanism andprinciples

Conclusions (still in discussion)• Different purposes of business models,
ecosystems and digital platforms
feedback to
manufacturing industries
and input to look forfurther candidates
Page 4

October 2020

Business Models and Platform Economy• Different architectures of business models,
ecosystems and digital platforms• Communication of lessons learnt and bestpracticesFLandlog: Platform for monitoring and managing daily construction activities
Value Streams
ownertruck & constr.
mgmnt. services
providerERP
services
providertruck & constr.
mach. mgmnt.
services

ERP
services

Landlog(platformoperator)

platform
services

construction
ERP services
progress report services

construction
company

truck & constr. mach.
mgmnt. services

3D view 3D view
servicesdata

truck services

construction
machinery services

usage information

3D view drone
services operator
providerphysical value stream

reporttruck
services
supplier

truck constr. construction
operator mach. machinery
operator services
supplierservices value stream

F
Page 5October 2020

Business Models and Platform Economy

Landlog: Platform for monitoring and managing daily construction activities
Value Streams
ownerconstruction

reportconstruction
company

truck services

truck
services
supplier
physical value stream

Page 6

October 2020

construction
machinery services

construction
machinery
services
supplier

services value stream

Business Models and Platform Economy

FLandlog: Platform for monitoring and managing daily construction activities
Value Streams
ownerconstruction

reportconstruction
company

truck services

truck
services
supplier
physical value stream

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October 2020

construction
machinery services

truck constr. construction
operator mach. machinery
operator services
supplier

services value stream

Business Models and Platform Economy

FLandlog: Platform for monitoring and managing daily construction activities
Value Streams
ownertruck & constr.
mgmnt. services
providertruck & constr.
mach. mgmnt.
services

Landlog(platformoperator)

construction

reportconstruction
company
truck & constr. mach.
mgmnt. services
truck services

truck
services
supplier
physical value stream

Page 8October 2020

construction
machinery services

truck constr. construction
operator mach. machinery
operator services
supplier

services value stream

Business Models and Platform Economy

FLandlog: Platform for monitoring and managing daily construction activities
Value Streams
ownertruck & constr.
mgmnt. services
providerERP
services
providertruck & constr.
mach. mgmnt.
services

ERP
services
platform
services

Landlog(platformoperator)

construction

reportERP services

construction
company
truck & constr. mach.
mgmnt. services
truck services

construction
machinery services

usage information

truck
services
supplier
physical value stream

Page 9October 2020

truck constr. construction
operator mach. machinery
operator services
supplier

services value stream

Business Models and Platform Economy

FLandlog: Platform for monitoring and managing daily construction activities
Value Streams
ownertruck & constr.
mgmnt. services
providerERP
services
providertruck & constr.
mach. mgmnt.
services

ERP
services

Landlog(platformoperator)

platform
services

construction
ERP services
progress report services

construction
company

truck & constr. mach.
mgmnt. services

3D view 3D view
servicesdata

truck services

construction
machinery services

usage information

3D view drone
services operator
providerphysical value stream

reporttruckservices
suppliertruck constr. construction
operator mach. machinery
operator services
supplier

services value streamF
Page 10October 2020

Business Models and Platform Economy

Landlog: Platform for monitoring and managing daily construction activities
Value Streams
ownertruck & constr.
mgmnt. services
providerERP
services
providertruck & constr.
mach. mgmnt.
services

ERP
services

Landlog(platformoperator)

platform
services

construction
ERP services
progress report services

construction
company

truck & constr. mach.
mgmnt. services

3D view 3D view
servicesdata

truck services

construction
machinery services

usage information

3D view drone
services operator
providerphysical value stream

reporttruck
services
supplier

truck constr. construction
operator mach. machinery
operator services
supplier

services value stream

F
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Business Models and Platform Economy

Railigent: Application suite for intelligent asset management
Classical value network (example rolling stock)
Value Streams
component
supplier

asset
services
asset
user
operator provides

asset
providerdelivers
componentdelivers
asset

asset
services

providesmaintenanceservices

asset
maintainer

physical value stream
Page 12October 2020

data/services value stream
Business Models and Platform Economy

URailigent: Application suite for intelligent asset management
Extension of value network by an IIoT platform operator
Value Streams
component
supplier

asset
services
asset
user
operator provides

asset
providerdelivers
asset

delivers
component

asset
services

providesmaintenanceservices
providesusage
informationof asset

data-driven
services

asset
maintainer< / > provides
platform
services

Railigent®
Application
Suite
physical value stream
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October 2020

internal IT
platform

provides IT
infrastructure provider IT

data/services value stream
Business Models and Platform Economyinfrastructure

U

Railigent: Application suite for intelligent asset management
Deliver outcome-based asset services
Value Streams
component
supplier

asset
services
asset
user
operator provides

asset
providerdelivers
component

provides data &applications; feeds
back insights

delivers
asset

asset
services

providesoutcomebased
asset
services

providesmaintenanceservices

Business Model
Major business model changes:• Who: same customers• What: additional outcome-based services• Value: additional revenue stream• How: IIoT-platform extends value network
What

providesusage
informationof asset

provides data &applications & insights

value
proposition

asset
maintainer

revenuemechanism

Value< / > provides
platform
services

Railigent®
Application
Suite
physical value stream
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October 2020

internal IT
platform

provides IT
infrastructure provider IT

data/services value stream
Business Models and Platform Economy

infrastructure

Whovaluechain

Siemens Mobility

no significant changeHowsignificant change

Consequences:• Right to use usage information of assets based on
individual contracts with asset operators

U

Railigent: Application suite for intelligent asset management
Extension to ecosystem
Value Streams
component
supplier

asset
providerdelivers
asset

delivers
component

provides data &applications; feeds
back insights

provides data & applications;feeds back insights

provides applications andinsights for Railigent

asset
services
asset
user
operator provides
asset
services

providesasset
services

provides data &applications & insights;
feeds back insights

Major business model changes:• Who & how: other asset provider – typically competitors – and component supplier as new customers

providesmaintenanceservices
providesusage
informationof asset

provides applications,insights & services

Business Model• What & value: acting as value integrator withdifferent value propositions & revenue mechanisms• Managed services• Software as a service• Insights as a service• Outcome as a service

asset
maintainer

Whatvalue
proposition< / > provides
platform
services

Railigent®
Application
Suite
physical value stream

internal IT
platform

provides IT
infrastructure provider IT

revenuemechanism

infrastructure
Valuedata/services value stream

Who

Siemens Mobility

no significant change
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October 2020

Business Models and Platform Economy

valuechainHow

significant changeUAnalysis
First conclusions from elaborated examples
Description
Manufacturing platform
for metal sheet bending
Organizer of supply
SITATERU
chain for apparelcompanies
Platform for monitoring
Landlogand managing daily
construction activities
V-INDUSTRY Digital procurement ofcomponents
CADDI

Railigent

GrabCAD

Page 16

Application suite forintelligent asset
management
3D printing & CAD
collaboration software

October 2020

Purpose of platform

Platform pattern

Matching demand andsupplyMatching demand andsupplyBrokerage platform

Improvement of valuechains of a customer

Cloud-based IIoTplatform

Matching demand andsupplyBrokerage platform

Improvement of valuechains of a customer

Cloud-based IIoTplatform

Brokerage platform

openProvision of technicalinfrastructure to lock acommunity to a productBusiness Models and Platform Economy

Business model ofplatform operator
Provision of metal sheet
bending services
Provision of
manufacturing services
for apparel products
Data-driven services

Revenue stream ofplatform operator
For delivered bended
metal sheet
For manufactured
apparel productFor platform services(consumption based)

For successfultransaction
For data-driven services(time based)
For services and dataPerformance(outcome orimprovement
consumption based)
Operation of platform
No revenues from
Support of current
business model (improve platform operation
market penetration ofcurrent products)
Operation of platform
Data-driven services

UAnalysis: Identification of Generic Platform Patterns
Example Cloud-based IIoT Platform
Value Streams

Revenue Streams

ServiceProvider

Service
ProviderMachineUser
provides services

for services

provides app including
execution services
provides app

provides usage
information

for integration services
for platform services incl. app usage

provides connectedmachine</>100111App
DeveloperMachine
Userfor app usage

provides services
provides services toto develop apps IIoT Platform connect machines

Operator

1001
11

service value stream
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October 2020

ComputingInfrastructure
ProviderBusiness Models and Platform Economy

01 01
10 10for platform services

SystemIntegrator

AppDeveloper

for platform services

IIoT Platform
Operator
for computing
infrastructure services

provides computing
infrastructure services

physical value stream

</>

01 01
10 10

revenue stream

ComputingInfrastructure
ProviderSystemIntegrator

U

Summary and Outlook
Publication of analysis results and lessons learnt

Further elaboration on digital business models

Planned structure of report:• Introduction

Analysis of the dynamics of platform business model
mechanisms and network effects• JPN and GER examples

Investigation of platform pattern• Overall description (purpose)• Value network and revenue streams• Business model contract• Business model innovation• Miscellaneous• Analysis of the examples• Outlook
Publication date: April 2021 (planned)

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October 2020

Business Models and Platform Economy

Exchange with Germany-Japan Standardization Experts,
especially in the context of edge platforms
Elaboration of further examples if necessary
Dissemination of lessons learntDiscussions on business models and platform economy still need to be
deepened, but we would like to evolve by combining the views of both sides as areference and stimulus in our cooperation between Japan and Germany.
Thank you!

ご清聴ありがとうございました。

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October 2020

Business Models and Platform Economy