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From lignite to blockchain territory

© MWIDE NRW R. Sondermann

© MWIDE NRW R. Sondermann

On September 2, 2019 the project "Blockchain-Reallabor im Rheinischen Revier" was started in Düsseldorf. The state government of North Rhine-Westphalia is funding the establishment of the Blockchain-Reallabor for the testing of practical applications of Blockchain technology with 1.2 million euros over a period of one year.

Prof. Dr. Andreas Pinkwart, Minister for Economics, Innovation, Digitisation and Energy of the State of North Rhine-Westphalia, presented the official funding decision to the project consortium consisting of the Fraunhofer Institutes for Applied Information Technology FIT (Bonn), Material Flow and Logistics IML (Dortmund), the Institute for Scientific-Technical Trend Analyses INT (Euskirchen), the RWTH Aachen, the Ruhr University Bochum and the University of Applied Sciences Gelsenkirchen.

The sectors of energy, logistics, services of general interest, finance, industry 4.0 as well as the associated business models prevailing in the Rhenish territory will be investigated in the Reallabor with regard to the potential of blockchain applications. The aim is, among other things, to promote and further develop digital innovations in a temporally and geographically limited environment. Here, new technologies and business models are put to the test and validated with relevant actors in the state of NRW.

Industry 4.0 Recht-Testbed launched

© Fraunhofer IML

The Internet of Things is becoming more and more autonomous. Machines generate orders independently, book suitable production capacities, place orders and sign contracts with each other. However, while there is a clear legal framework in the rest of the business world, the legal situation for signing contracts between machines is currently less clear. Which law applies? What do legally secure solutions look like? Who is liable if damage occurs as a result of machine decisions? These and other questions are to be answered by the "Industry 4.0 Recht-Testbed".

In this context, the Federal Ministry of Economics and Energy (BMWi) is supporting the "Industry 4.0 Recht-Testbed", an application-oriented research project that serves as a model. In addition to the Fraunhofer Institute for Material Flow and Logistics IML, the project is supported by the Fraunhofer Institute for Software and Systems Engineering ISST, also from Dortmund, the Saarland University with the Institute for Legal Informatics, and the Ruhr University Bochum with the Horst Görtz Institute for IT Security.

In the testbed, engineers simulate negotiations and the conclusion of contracts for machines with a clear focus on the analysis of legal problems. Lawyers evaluate the processes on the basis of the current legal situation and point out legal uncertainties and give recommendations for the development of new legal standards. However, the project will also result in very concrete approaches and tools, model clauses and contracts. Small and medium-sized enterprises in particular will thus have a basis on which they can assess legal risks resulting from communication between machines in the areas of civil law and civil procedure law as well as IT and data protection law - as is the case today with contracts and negotiations between people.

The project, which is also supported by BMWi, started on 01.06.2019 and runs until 31.05.2023. The total funding amount is 5.5 million euros. In addition to BMWi, the project partners can also count on the support of the Industry 4.0 platform, a joint project of the BITKOM, VDMA and ZVEI trade associations and the International Data Space Association sponsored by the German government.

 

Blockchain Demonstrator 2.0 at Transport Logistic

Our team from Fraunhofer IML will be represented this year at the transport logistic trade fair from 04.-07.06.2019 in Munich. The trade fair for logistics, mobility, IT and supply chain management has been taking place since 1978 and this year again offers concentrated expert knowledge along the entire value chain.

Our team presents the Blockchain Demonstrator 2.0, a playful demonstration of Blockchain and Smart Contracts, under the umbrella of the Fraunhofer Traffic Alliance. In addition to the already known functions, transactions can also be stored transparently and irreversibly for the first time, and internal and external billing can be mapped.

We will be happy to explain to you how this is possible at transport logistic!

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Trackchain Demonstrator presented at the Hannover Convention

© Fraunhofer IML

© Fraunhofer IML

As one of four exhibits of the Fraunhofer Cluster of Excellence Cognitive Internet Technologies (CCIT), the Trackchain Demonstrator was presented to the interested public at the Hanover Fair. For the first time, the Trackchain combines two key technologies by combining a Track & Trace system based on modern sensor technology with the tamper-proof functionalities of Blockchain technology. The trackchain enables real-time product tracking with simultaneous seamless, trustworthy product traceability along the entire supply chain.

Representing the Fraunhofer IML, the team from the Purchasing and Finance department in Supply Chain Management developed the blockchain application for the Trackchain Demonstrator and - together with colleagues from the participating Fraunhofer Institutes (AISEC, FIT, IIS) - supervised the exhibit at this year's Hanover Fair. The visitors reacted very positively to the presented application case, as the demonstrator addresses both current problems in the supply chains of the companies as well as the growing demand for application possibilities of the blockchain technology in logistics.

Commerzbank and Fraunhofer IML establish Enterprise Lab for international trade finance

© Commerzbank

Prof. Dr. Michael Henke (Fraunhofer IML) and Nikolaus Giesbert (Commerzbank)

Commerzbank is the first bank to establish an Enterprise Lab at the Fraunhofer Institute for Material Flow and Logistics IML. The partners are thus striving for close cross-sector cooperation on logistics, supply chain management, supply chain finance and digital innovations.

 

Commerzbank is the first financial institution to establish an Enterprise Lab at the Fraunhofer Institute for Material Flow and Logistics IML in Dortmund, thereby expanding the cooperation that has existed since July 2017. With the "Trade Finance Innovations Lab", Commerzbank as one of the leading European foreign trade banks is now also part of the Enterprise Lab Center at Fraunhofer IML and is the first bank to cover the area of financial services with a focus on trade finance business, i.e. the processing and financing of international trade transactions. In future, application-oriented Fraunhofer IML scientists from the fields of logistics, supply chain management and blockchain technology will work closely with trade finance specialists from Commerzbank and its research and development unit "Main-Incubator".

In the "Trade Finance Innovations Lab", new payment and financing solutions for the trade finance business are to be developed and brought to market on the basis of innovative technologies such as Distributed Ledger Technology (DLT), Smart Contracts and the Internet of Things (IoT). At the same time, standards and framework conditions for the digitization of international supply chain management and the corresponding financing instruments are to be actively shaped.

The "Fraunhofer Enterprise Labs" have established themselves as a successful model since 2013: Commerzbank is a member of the European Pallet Association e.V. (EPAL), Deutsche Telekom, Dachser SE, Rhenus SE & Co. KG, Boehringer-Ingelheim, the BMW Group, DB Schenker AG, Audi AG, the Würth Group and Sick AG are the eleventh companies to have opted for this innovative form of joint research between industry and science.

Hype becomes reality

Pleased visitors after the kick-off event at the beginning of September at the IML. Together with the medium-sized company PIEL, our experts for plant and service management and blockchain applications are developing a blockchain-based solution for cross-company electronic data exchange along the entire supply chain of an SME for the first time.

 

The cooperation project, funded by the Federal Ministry of Education and Research and scheduled to last twelve months, is the continuation of a transfer project successfully completed in May 2018 by the "Digital in NRW" competence center, in which PIEL and Infineon Technologies Bipolar, together with Fraunhofer IML, developed and evaluated new digital business models. Requirements were jointly defined, fields of action identified, technologies selected and a concrete business case put into practice.

 

Based on the blockchain technology, an intelligent supply concept for the automatic replenishment control of spare parts is to be developed in the future, reducing the administrative work of maintenance and fully automating transactions. The follow-up project that has now begun will develop a functional pilot within the next few months, which can be tested in the real company environment next year and then implemented.

 

© Fraunhofer IML

Future Congress Logistics 2018

This year, the 36th Dortmunder Gespräche - the Future Congress Logistics 2018 - will take place from 11 to 12 September. In addition to many other trend-setting research projects and innovations, Fraunhofer IML will also present a specially developed demonstrator for the project "Smart Objects and Smart Finance Approaches (SOFiA)". Visit us and experience the innovations logistics is using to meet the various challenges of the future. We look forward to your participation!

Find out more here: 

http://www.zukunftskongress-logistik.de/

 

 

© Fraunhofer IML

Whitepaper "Blockchain and Smart Contracts" published

© Fraunhofer IML

Blockchain technology and Smart Contracts based on it hold considerable potential for optimizing business processes. The Purchasing & Finance department in Supply Chain Management researches and analyses, among other things, current and future applications of these technologies. As part of the series "Future Challenges in Logistics and Supply Chain Management" of the Fraunhofer IML, the white paper "Blockchain and Smart Contracts: Efficient and Secure Value Networks".

 

In order to make the various optimization possibilities accessible, it first explains the basics that are important for understanding this complex and still quite new technology. Furthermore, different fields of application of blockchain and smart contracts, also outside the financial sector, are considered. The potential of a blockchain application for the optimization of internal and external company processes is demonstrated, especially with regard to the fact that value creation networks are becoming increasingly interlinked. 

Fraunhofer position paper "Blockchain and Smart Contracts" now available in English

Fraunhofer’s strategic position paper Blockchain and Smart Contracts, which was published by several Fraunhofer institutes collaboratively in late 2017, is now also available in English. Herein, scientific and application-oriented aspects of the Blockchain technology are investigated. In particular, it deals with possible applications and technical research questions.

© Fraunhofer IML

Blockchain and Smart Contracts position paper

SOFiA project contribution wins "Best Paper Award"

The contribution "Smart Contracts and Smart Payment in Farming 4.0" was awarded the "Best Paper Award" at a conference of the BMBF-funded project "Digivation" from 03/20 - 03/21 2018 in Aachen. The planned publication contains company-specific applications of various digital innovations. Marco Motta from Fraunhofer IML accepted the award on behalf of the team of authors led by Dominik Sparer and Philipp Sprenger.

© Fraunhofer IML

Demand for Procurement 4.0 Check in Asia

With a trip to China, our Procurement 4.0 theme has gained further momentum: Axel T. Schulte and Natalia Broza-Abut were on the road with the new customer Zber in Beijing, Nanjing and Shanghai at the end of September 2017. The Chinese company is a provider of solutions for global procurement and supply chain management. Chief consultant Yi Zhu first became aware of our preliminary study "Procurement 4.0 - Digitisation in Procurement". In the spring of 2017, Yi Zhu visited the IML together with his team. Zber then placed several orders with the IML.

At the 16th International Sourcing Fair Shanghai, Axel and Natalia presented the topic Industry 4.0 and digitization of procurement, as well as our Fraunhofer Procurement 4.0 Check. The trade fair organisers also appointed Axel to the International Sourcing Expert Panel. Also on the agenda was a visit to the company eventown.com, which carried out the Fraunhofer Procurement 4.0 check for the first time in Asia. Eventown is China's first and largest booking platform for the conference industry. The company was voted as one of the most successful Chinese start-ups by the business magazine Forbes in 2015. The Chinese business partners were also very interested in the potential of blockchain technology in the context of SCM and procurement.

High expectations are being placed in Procurement 4.0 today - and the Fraunhofer IML makes it possible for companies to set standards here. With the "Procurement 4.0 Check" - a development from the Procurement and Finance Department in Supply Chain Management - companies have the opportunity to identify individual needs for action and potential for Industry 4.0 in Procurement.

© Fraunhofer IML

Commerzbank and Fraunhofer IML to conduct joint research on trade finance

Commerzbank press release July 4th 2017

Commerzbank and the Fraunhofer Institute for Material Flow and Logistics IML in Dortmund have agreed on a cooperation. At the heart of this cooperation, scenarios for the supply chains of the future are to be developed. The institute supports the bank in orchestrating these processes and at the same time provides the latest findings on supply chain management and the possible use of blockchain technologies in this area. The blockchain, or distributed ledger technology, is a decentralized data structure and, for example, the basis for intelligent electronic contracts, so-called "Smart Contracts", which focus on the automated processing of business transactions.

Many digitisation approaches of banks, companies and scientific institutions are currently focussing on international trade transactions and the related commodity and financial flows. Increasing global competition, changing customer expectations and shorter product lifecycles make the associated international supply chains increasingly important for operational decision makers. With further digitization along supply chains, many process improvements and opportunities will arise from optimized management and faster availability of data. “Talking” containers, for example, will then become commonplace in global foreign trade.

Greater networking of functions can also create completely new areas of application across companies. This applies in particular to modern applications in the field of Internet of things, i.e. for networked objects that connect themselves independently via the internet and carry out tasks, as well as for Smart Contracts. This can result in new trading systems and trade financing concepts, faster transaction procedures and ultimately new solutions in working capital management. These are the focus of the new cooperation.

“Our core competencies, 'Moving money safely', 'Financing trade' and 'Assuming risks' will also be highly relevant for our customers in the age of digitalisation. The integration of the Fraunhofer Institute for Material Flow and Logistics IML ensures the best possible insight into the currently very diverse digitization approaches along the logistics and material flow processes of our customers", said Dr. Bernd Laber, Member of the Board of Managing Directors responsible for Trade Finance & Cash Management for corporate customers at Commerzbank. “In numerous projects and consortia, we are also working with other international banks on the digitization of products and services, as well as on applications for blockchain technologies. The clear focus on the future supply chains of our customers, which we will develop together with the Fraunhofer IML, is very important to us as a corporate customer bank", continued Dr. Laber.

“Digitalization approaches in supply chain management, such as the development of smart containers that are able to route themselves, commission logistics service providers and pay for them independently, will enable completely new business models for banks in the areas of financing, risk management and transactions", explained Prof. Dr. Michael Henke, head of the Fraunhofer IML institute. “I am convinced that technologies such as block chains and smart contracts are key enablers for linking physical and financial supply chains. With Commerzbank as an innovative cooperation partner, we will develop new, safe and fast solutions for the supply chain of the future.”

© Fraunhofer IML

Blog on Blockchain

Blockchain Infographics
© Fraunhofer IML

The Fraunhofer Institute for Material Flow and Logistics (IML) focuses on the implementation of blockchains in various research and development projects.

This is a shared, trustworthy and validated transaction record that can be viewed by any network member but not influenced by anyone. It is an encrypted, protected, tamper-proof and decentralized database. The blockchain is the perfect location for storing values, identities, agreements, property rights or credentials. Once a value, such as a bit coin, has been entered, it remains there forever. 

We would like to inform you about the latest information on blockchain in supply chain management via our blog. A special highlight is that this blog is based on a blockchain application. So you can follow the content of the blog and at the same time understand how the blockchain works using a concrete example. The figure illustrates the principle implemented here.

We hope to inspire you with this exciting topic and will keep you up to date on progress in blockchain technology. 

 

Fraunhofer Procurement 4.0 Check

You want to determine where your procurement department is situated in terms of Industry 4.0 and which fields of activity are on their way to procurement 4.0?
The Fraunhofer Procurement 4.0 Check serves as a starting point for the implementation of Industry 4.0 within your procurement department and supports you in finding answers to your questions.

Evaluating both qualitative and quantitative success factors of your procurement department, the essential fields of activity regarding Industry 4.0 are identified by means of a gap analysis.
Furthermore, you will receive an evaluation of the most relevant KPIs as well as a determination of your progress level on the way to procurement 4.0.
Therefore, the Fraunhofer Procurement 4.0 Check serves as a foundation for the development of an individual roadmap to the implementation of Industry 4.0 in your procurement department.

Fraunhofer Procurement 4.0 Check

Procurement can assume a leading role

Fraunhofer IML and BME present new pilot study on the digitalisation of procurement

The digital structural change of industry will not be successful without the participation of procurement. However, opinions on its role vary greatly, ranging from “active driver” to “mere supporter”. Therefore, procurement has to intervene more actively in the discussion on Industry 4.0. As an innovation scout as well as an expert on technology and management, its voice will be heard. These are the central findings of the study “Procurement 4.0 – The Digitalisation of Procurement”, conducted by the Fraunhofer Institute for Material Flow and Logistics and the Association Supply Chain Management, Procurement and Logistics (BME). From august 2015 through april 2016, 25 procurement managers and CPOs of renowned industrial companies, as well as representatives of two universities were interviewed.

Key findings of the survey:

A strong internal and external connectivity is crucial, if Industry 4.0 is to be developed successfully. While the connectivity within the own company affects all departments equally, the procurement department is required particularly regarding external connectedness. It is the exchange of know-how with other companies and organisations which only makes it possible to benefit from the advantages of digitalisation. Procurement is the driver of this external connectivity and, as such, bears the full responsibility. It assumes a decisive role in the implementation of Industry 4.0: It has to bring innovations and technologies into the company, so that it can successfully master the fourth industrial revolution.

Procurement has to be able to react in real-time. This is only possible, if all its processes have largely been digitised before.

Procurement has to manage an increasingly digitalised purchasing portfolio. Not only the procurement processes, but also the products that are to be procured are subject to the change of digitalisation.

Operative procurement processes can be digitised almost entirely. They do not need to be handled by an employee, as new technologies and e-solutions will take over this part. The strategic procurement department only controls and oversees these processes from then on. As a consequence, an operative purchasing agent is a discontinued model.

The challenges and expectations of the strategic procurement are increasing and with it the demand for an increased value contribution.

The occupational profile of a buying agent is changing fundamentally. His traditional role is a thing of the past. He becomes a digital interface manager, both inward and outward.

Technologies create many new opportunities for companies, but they do not replace personal relations. Particularly in the procurement department, personal contacts to suppliers and internal customers remain as an important foundation.

Procurement does not bear the overall responsibility for the implementation of Industry 4.0 – but it plays a crucial role in it.

The current study is a starting point for proceeding, more detailed examinations of the topic Procurement 4.0. For this purpose, BME and the Fraunhofer IML have founded a think tank as a provider of experiences and ideas. The assignment of this body of experts is to gather practical experience values and to determine the challenges to procurement which arise from the advancing digitalisation of economy.

Business Case Calculator for innovative business models

Business Case Calculator
© Fraunhofer IML

Business Case Calculator

Initiated by technological developments and research projects in recent years, a tremendous supply of Industry 4.0 applications emerged in Germany alone. Among other aspects, throughput times were reduced, productivity levels were increased and capacities were optimized. But do these innovative applications live up to their promises? Is an investment in them profitable? The implementation has proceeded only hesitantly until now. Especially the SME area exhibits a low degree of implementation of Industry 4.0 at the moment. There are many reasons for this reticence, primarily the question: What are the benefits of Industry 4.0 for my company?

So far, investment decisions have been made predominantly based on the monetary advantageousness of investment projects. The major challenge in terms of Industry 4.0 is the uncertain economic benefit in conjunction with the high investments. There exist little to no experience values regarding the costs or benefits. Statistical forecast procedures based on the past offer only limited valid results. Furthermore, uncertainty prevails regarding future developments and environmental conditions, especially on the quest for reliable figures. In times of disruptive innovations, more qualitatively strategic decision-making parameters (non-financials) should be used to safeguard investments.

Together with you, the Fraunhofer Business Case Calculator allows for a quick and simple business case validation from various perspectives. Taking into account both classic “financials”, and qualitative potential benefits (i.e. “non-financials”) as well as project risks of an innovative business model, you are able to protect yourself when making investment decisions.

Smart objects and smart finance approaches (SOFiA)

Sofia
© Fraunhofer IML

Sofia

Kickoff for the research project “Planning and control of value networks by integration of smart objects and smart finance approaches (SOFiA)”

Dortmund, February 01st 2016.

 

Within a given value network, delays occur during the planning process of a sea freight shipment. The sea freight container will not reach the planned vessel in time. Replanning, rebooking and the corresponding payments have to take place on short notice. This scenario describes the classic and time-consuming daily life in the logistics and supply chain management. Via innovative smart objects and smart finance technologies, the container itself becomes the dispatcher. It recognizes delays, analyses action alternatives and chooses the best transportation route. Subsequently, it assigns a carrier (logistics service provider)   and handles the payment via mobile Business-to-Business (B2B) payment technologies in real-time. The logistical objects are equipped with all the logistical and financial information to allow for a completely autonomous decentralized decision and transaction. In addition to this transport case of application, the SOFiA-project also focuses on the fleet control of harvesting machines for the transport and storage of agricultural commodities.

Therefore, new industry 4.0-based management approaches regarding the self-control and self-organization of logistics, production and the appropriate tasks of payment transactions and supply chain finance are addressed by the SOFiA research project. It is part of the subsidy program “Service innovation by means of digitalisation” by the German federal department for education and research. The project’s objective is the improvement of the process handling within complex manufacturing and logistics networks through integration of smart objects and digital B2B smart finance approaches.

The project was initiated in November of 2015 and has a total duration of three years with the project consortium consisting of the agricultural machinery manufacturer CLAAS E-Systems KgaA mbH & Co KG, the logistics service provider Ekol Logistik GmbH, the financial IT solutions provider Wincor Nixdorf International GmbH and the Fraunhofer Institute for Material Flow and Logistics (IML).

The consortium partners’ subgoals, aligned with the project objective, are:

  • Development of management procedures for industry 4.0 based on decision-making methods for intelligent logistics objects for the autonomous logistical and financial control within complex value networks (Fraunhofer IML)
  • Intelligent machine fleet control by means of autonomous logistics objects from a manufacturer’s point of view (CLAAS)
  • Intelligent logistics control by means of autonomous logistics objects from a transport service provider’s point of view (Ekol)
  • Innovative, decentralized B2B payment methods for autonomously operating logistics units within value networks (Wincor Nixdorf)

On behalf of the consortium leader Fraunhofer IML, the project is headed by Prof. Dr. Michael Henke (Institute director) and the department heads Marco Motta (Supply Chain Engineering) and Dr. Axel T. Schulte (Procurement & Finance in Supply Chain Management). Additional information on the research project will be published at www.sofia-projekt.de.