The manufacturing sector in China is undergoing a transformation, with increasing investments in innovation and digital technologies. http://www.orange-business.com/en/library/white-paper/powering-up-the-assembly-line (EN) http://www.orange-business.com/en/library/white-paper/qi-dong-liu-shui-xian (CN) http://www.orange-business.com/en/iot-and-data-analytics Manufacturing is huge in China, having grown from just 3% of total global manufacturing output in 1990 to 25% today, making up 33% of China’s GDP. But “cheap” is no longer enough, so against a backdrop of rising real estate costs and Yuan exchange rates, greater competition from the likes of Vietnam and technology-powered Germany and US, and customers who now expect innovation and quality, China is making significant investments in innovation and digital to transform their manufacturing sector and help move it forward. Find out what are some of these innovations are, and how digital technologies like the Internet of Things can be used to transform manufacturing, enabling China to continue to be a global manufacturing powerhouse.

1. Manufacturing Innovation – how the
Internet of Things is transforming China
July 2017

2. 2 Manufacturing innovation – how the Internet of Things is transforming China
Manufacturing in China has seen a rapid rise in growth and output in the past few decades.
Current landscape:
Manufacturing in China – where is it today?
1990 – China less than 3% of global
manufacturing output by value
By 2015 it was nearly a quarter
3% 25%
1990 2015

3. 3 Manufacturing innovation – how the Internet of Things is transforming China
Manufacturing in China – where is it today?
70%
China produces about
80% of the world’s
air-conditioners
of its mobile phones 60% of its shoes

4. 4 Manufacturing innovation – how the Internet of Things is transforming China
33%
Manufacturing in China
– where is it today?
15% of national workforce
Recent slowdown as real estate costs rise
and increasing Yuan exchange rate.
Also face greater competition from likes of
Vietnam and technology-powered Germany
and US.
of China’s GDP

5. 5 Manufacturing innovation – how the Internet of Things is transforming China
Customer expectations have changed – they now expect more for less.
A shifting global marketplace
Pressure is on manufacturers to protect bottom line while supporting growth.
‘Cheap’ is no longer enough Customers now expect innovation and quality
+

6. 6 Manufacturing innovation – how the Internet of Things is transforming China
To help power manufacturing forward,
China is investing in digital transformation.
 Five Year Plan for China’s economy includes
“Made in China 2025” (MiC2025) initiative
 Makes billions of yuan available for
manufacturers to upgrade technologies
 Potential includes mobile, robotics,
3-D printing, cloud computing or
big data, IoT
China investing in digital New advanced information technology
Automated machine tools and robotics
Aerospace and aeronautical equipment
Maritime equipment and high-tech shipping
Modern rail transport equipment
New-energy vehicles and equipment
Power equipment
Agricultural equipment
New materials
Biopharma and advanced medical products

7. 7 Manufacturing innovation – how the Internet of Things is transforming China
Robotics are fast being embraced
by China’s manufacturing sector.
Working-age population is shrinking,
leading to rising labor costs.
Chinese government is bolstering
its tech sector to reduce reliance
on foreign companies.
In 2015, manufacturing hub Guangdong
province committed to about $150 billion
on robotics-based manufacturing.
China – the rise of the robots

8. 8 Manufacturing innovation – how the Internet of Things is transforming China
By delivering great
improvements in
productivity,
efficiency and cost-
effectiveness
How can IoT transform
manufacturing?

9. 9 Manufacturing innovation – how the Internet of Things is transforming China
Plant optimization
Process data can be collected from machines and sensors and
sent to the cloud for storage and analysis. This data can be
translated into real-time dashboards, allowing for monitoring
and control of factory processes and equipment, as well as
generating insights for use in plant optimization.
Benchmarking
Using IoT, data from multiple factories can be collected and
consolidated in the cloud. This consolidated data then enables
cross-factory monitoring and benchmarking,and eventuallythe
identification of high-performing or
under-performing facilities
Maintenance
If equipment fails data can be gathered and analyzedin real-time
to automatically recommend repair actions. Decision-making is
enhancedvia alternate courses of action, and average downtime
and repair costs are reduced. IoT-based predictive maintenance
can reduce downtime by 50% and increase production capacity
by 65% via shortened planned maintenanceand production lines
running for longer.
How IoT is impacting manufacturing in China
Quality control
Intelligence embedded in equipment enables automatic quality
inspection in real-time, immediately repairing defective products
and materials.
Production lines with quality control issues can be shut down
quickly, preventing further creation of faulty products – enabling
error-proof processes, external supplier quality management
and can reduce reject rate by 75%.
Energy Saving
Real-time energy consumption can be tracked using IoT
technology, so that the most energy-intensiveassets are
scheduled to run outside of peak-period when energy costs are
at their highest
Health and safety
Production environmentswith embedded intelligence can take
health and safety compliance to zero tolerance level. Such
environmentsimprove accidentprevention as well as real-time
detection, investigation and resolution of near-miss incidents.

10. 10 Manufacturing innovation – how the Internet of Things is transforming China
10-20%
energy savings in factories
The benefits of IoT in
manufacturing
65%
potential production
capacity increases
using data-backed
approaches
$4 trillion
of value via increased
revenues and lower
costs over next decade.
Up to
10-25%
potential improvement in
labour efficiency

11. 11 Manufacturing innovation – how the Internet of Things is transforming China
Sensors plus GPS and RFID provide real-time visibility and traceability in supply chain
IoT technology enables richer data and deeper intelligence in supply network and factories
Manufacturers can use data to track raw materials, coordinate faster deliveries and
shorten cycle time
IoT technologies can improve cycle times by up to 28%
The smart supply chain
IoT technologies also bring benefits to the manufacturing sector by making the supply chain smarter.

12. 12 Manufacturing innovation – how the Internet of Things is transforming China
Manufacturers throughout Asia can thrive and grow
using the right digital technologies. The right digital
transformation partner is essential to making
the right choices from day one.

13. 13 Manufacturing innovation – how the Internet of Things is transforming China
Smart manufacturing technology
in the real world
Use cases are already in the pipeline in
China as manufacturers grow to recognize
the many positive impacts smart IoT
technologies can have on their operations. Foxconn
Technology Group, the world’s largest electronics
contract manufacturer, is one:
Plans to introduce
more automation,
cloud computing
and services to drive
long-term growth.
Workers were moved
to higher value-add
elements in manufacturing
process like R&R, process
control and quality control.
60,000
factory workers recently
replaced with robots
and workers.

14. 14 Manufacturing innovation – how the Internet of Things is transforming China
Smart manufacturing technology
in the real world
In 2016, Huawei, the Chinese technology
and smartphone giant:
Huawei plans to connect
all areas in a production
process via the Internet
to improve productivity
Goals also include lower costs
and reduced emissions
£500m
Improvements are
expected to help
save $500m a year
Signed a deal with
equipment provider to
help improve production

15. 15 Manufacturing innovation – how the Internet of Things is transforming China
Digital technology powering real
manufacturing change worldwide
General Electric
 Rethinking products with more intelligence
 Adding more sensors making it easier to
collect data
 Analytics giving customers ability to build
analytics on products.
Enabling customers
 Providing them with applications
empowering them to become more digital
 ‘Predictive’ industrial operating system
lets them create their applications for
the future.
How?
 GE using new process “fastworks”
to develop products faster
 Re-training employees, targeting
new talent
 Digitizing GE itself, then digitizing
our customers.
Bill Rush, SVP & Chief Digital Officer, General Electric
and CEO, GE Digital talks digital in manufacturing:
Click here to watch the video

16. 16 Manufacturing innovation – how the Internet of Things is transforming China
The IoT and Big Data revolution is profoundly changing the core business of
many companies. To better understand these changes and to support our
customers throughout this transformation, Orange has developed vertical
expertise in a variety of industries.
Orange is the partner for your digital transformation
 A global IoT leader with over 12 million connected objects.
 700 IoT and data analytics experts who can provide end-to-end support for
your digitalization.
 Proven experience in digitizing manufacturing enterprises.
Network expertise
 Connectivity solutions designed for each type of use.
 Global coverage with a broad range of hybrid fixed and mobile networks.
 Over a decade of experience as an M2M operator (2G/3G/4G).
 LPWAN (LoRa®) network development to prepare for the future of the IoT.
An open approach to co-innovation
 Full, regularly enhancedcatalog of corporate solutions and services.
 Continuous innovation cycle to prepare for the challenges of the future.
 A commitment to French Tech.
 Leadership of a full ecosystem of partners, from device manufacturers
to startups and software publishers.
Orange, a trusted operator: security by design
 Guaranteed end-to-end security, from devices and users to data
platforms and business applications.
A set of skills and solutions to
transform your environment

17. 17 Manufacturing innovation – how the Internet of Things is transforming China
Select
Select your objects and data sources
 Orange helps you select your connected
objects from a comprehensive catalog
developed with our partners. These robust,
durable objects are designed for industrial
use and meet your safety requirements.
 We work with you to select the right sensors
for the type of data that you need and
ensure that they are compatible with your
production environment.
Datavenue: our IoT and data offer
Manage
Manage the lifecycle
of your objects
and data
Control
Control your project’s
key success factors
Select
Select your objects
and your data sources
Connect
Connect your objects
securely, based on
your needs

18. 18 Manufacturing innovation – how the Internet of Things is transforming China
Connect
Connect your objects securely, based on your needs
 We help you select a network solution that matches your
performance, quality and cost requirements.
 Our teams guarantee all of the key network parameters:
optimal availability and security, adequate speed, robust technology
and controlled energy consumption.
 As a long-term, multi-technology partner, we can roll out
our own network infrastructure on your sites and recommend which
technologies to use (RFID, Wi-Fi, 2G/3G/4G, LPWAN, etc).
Datavenue: our IoT and data offer
Manage
Manage the lifecycle of your objects and data
 Orange integrates and stores collected data on a platform. You receive
secure messages and incident notifications from your connected
objects. The platform dynamically updates your objects and allows you
to manage your fleet in real time. You can generate performance
indicators that match your needs and implement follow-up actions to
optimize your business.
Control
Control your project’s key success factors
We have 700 Orange experts available to support you throughout
your project and help you control your solution:
 Security
We provide support to secure your IoT and data chain, with
security audits and the creation of IT infrastructure that protects
your employees’ privacy. We also offer certified hosting
infrastructure.
 User interface
We help you roll out the human-machine interface for your
solution and connect it to your employees’ various electronic
devices.
 Data analytics
Depending on how it is interpreted, a single piece of data can be
used in a wide range of analyses and decision-making
processes. Thanks to our APIs, you can use this information on a
very detailed level in your predictive analysis system.
 Change management
We work with you to integrate the new IoT-related roles and
activities, implement new processes and handle change
management within your teams.
 Maintenance
We provide maintenance for your applications and support
upgrades through our service centers.

19. 19 Manufacturing innovation – how the Internet of Things is transforming China
Our mission: being the trusted partner of our customers’
digital transformation
for your
teams
for your
projects
The right support along your digital journeyServices
&
Consulting
Digital inside Digital enablersDigital outside
Connect
anything
anywhere
Protect
your
company
from cyber
threats
Engage your
customersFoster team
collaboration
Differentiate
through new
services
Infrastructure
that adapts
to your needs
Collaborativ
e workspace
Flexible
IT
Business
innovation
Enriched
customer
relationships
Enriched
connectivity
Cyber
defense
for your
customers

20. 20 Manufacturing innovation – how the Internet of Things is transforming China
Residential provider in
29 countries
World's largest
seamless voice/data
network and end-to-
end connectivity
services, with people
located in 220
countries and
territories
Unmatched global coverage with
345,000+ sites
More than
260 million
customers
€40.9 billion
in revenues in 2016
€600 million
yearly investment in
backbone infrastructure
450,000 km
of underwater cables
155,000 employees
worldwide - Top global
employer in 2017
Research & innovation
labs in 12 countries (6930
patents in portfolio)
The Orange group at a glance

21. 21 Manufacturing innovation – how the Internet of Things is transforming China
We are more than a global leader in
corporate telecommunication services:
 Professional services provider
 Solutions integrator
 OTT player
21
21,000collaborators dedicated
to corporate activities
400 application developers and
700IoT and big data experts
170engineers and project managers
in workplace infrastructure and
transformation to cloud migration
1,200
cloud experts
1,000
cyberdefense experts
With local presence in 166 countries
€6.4billion
of revenue in 2016
We cater multinational companies worldwide:
2,200+ in Europe 800+ in America
700+ in Asia Pacific 200+ in Africa
and the Middle East
Orange Business Services:
a worldwide digital
transformation partner
Manufacturing innovation – how the Internet of Things is transforming China

22. ThanksReference: PwC report “Powering up the assembly line, How the Internet of Things can help
Chinese manufacturers compete”, a study commissioned by Orange Business Services
Download PwC report here:
http://www.orange-business.com/en/library/white-paper/powering-up-the-assembly-line (EN)
http://www.orange-business.com/en/library/white-paper/qi-dong-liu-shui-xian (CN)