Edge computing & real-time analytics - Stage picture

Increase Efficiency with Edge Computing

Real-time data: The path to the smart factory

Edge Computing & Real-Time Analytics: Turbo for Manufacturing
07.05.2026
Digital Transformation
Manufacturing
Digital Sovereignty
Logistics

Real-time data is driving modern production. With edge computing and AI, you can process information directly at the machine, make quick decisions and increase efficiency and resilience - even in mature production environments.

Edge Computing: Why the Cloud Is Sometimes Too Slow

Cloud computing is powerful, but milliseconds count on the factory floor. If a robot arm needs to be stopped, the signal must not first take a detour via the data center. By the time the response arrives, the damage has already been done.

 

That's why we are moving intelligence directly to the data source: to the machine, to the conveyor belt, to the factory. Edge computing means that data is processed where it is generated, locally, in real time, without detours. This sounds like a technical detail, but it has far-reaching consequences for production:

  1. Reaction speed: Reactions at sub-second speed for critical controls.
  2. Less data volume, lower costs: High-frequency raw data such as vibrations or temperature fluctuations are filtered locally. Only what is really relevant is sent to the cloud.
  3. Resilience: If the Internet connection fails, operation simply continues in "Island Mode" - independent, stable, uninterrupted.

 

But how do you implement this in a factory that has grown historically?

Brownfield: Intelligence for Grown Systems

The reality on many German factory floors looks like this: Machines from three decades ago stand side by side, systems do not communicate with each other, and modernization only seems possible through costly new investments. We call this the brownfield problem – and it's the norm, not the exception.

 

The good news: edge computing does not require a reboot. Existing machines can be retrofitted with IoT gateways and sensors without replacing the system. Instead of "rip-and-replace", intelligence comes to the machine – not the other way around.

Retrofitting: Every Machine Gets a Digital Identity

To ensure that a retrofitted machine not only sends data, but also becomes understandable in the overall system, two things are needed: a standardized description of the system and a standardized way for machines to communicate with each other.

 

For the asset description we rely on the Asset Administration Shell (AAS) - a vendor-neutral data metamodel that standardizes what a machine is, what it can do and what data it delivers. Whether ERP, MES, or cloud platform: every system knows what it has to do with.

 

For communication between machines and systems, the OPC Unified Namespace (OPC UA) is also widely used – the data standard defines how data is structured and securely transported and has established itself as the de facto standard on the store floor. Both standards together ensure that a retrofitted system does not remain isolated, but is seamlessly integrated into the overall system.

 

This also pays off beyond your own factory: Those who describe and network their machines in this way create the basis for sharing data with suppliers or partners in a targeted and confident manner in so-called dataspace to share – just like Manufacturing-X and Factory-X. Retrofit becomes the ticket to the networked supply chain of tomorrow.

ITX
Save the Date: Industrial Transformation Xperience

On September 3, we invite you to Cologne. You can look forward to inspiring impulses and best practices on digitalization, presented by industry experts and leading organizations.

The Digital Backbone: From Data Point to Business Decision

A machine that responds in real time but doesn’t connect to your ERP system is smart on a small scale but blind on a large one. The Digital Backbone bridges this gap: it connects OT and IT across all layersfrom machine control through the edge all the way to SAP S/4HANA. Relevant anomalies don’t just eventually end up in the system; instead, they immediately trigger the appropriate follow-up processes: a maintenance order in SAP PM, an adjustment to the production plan, or a notification to the supply chain.

 

How to turn a quick machine decision into an intelligent business response.

AI and Computer Vision: Quality Assurance on a New Level

As soon as the data starts flowing, artificial intelligence delivers measurable results. A prime example is automated visual inspection. Human visual inspection is prone to errors, tedious, and not scalable. Computer vision solutions specializing in AI-powered image processing analyze video streams from the production line in real time. An AI model on the edge device detects scratches or dents in milliseconds and sorts out defective parts.

 

What makes this special is that the system continuously learns. New images of defects are used in the cloud to improve the model – the update is automatically pushed to the edge devices. This significantly reduces not only scrap but also “pseudo-scrap” (good parts incorrectly sorted out).

Data Sovereignty: Your Data Belongs to You

In Europe, data security is non-negotiable - especially when it comes to machine data, production secrets, or supply chain data.

 

Our approach: You retain full control over your data at all times.

 

We are actively involved in Factory-X as part of Manufacturing-X and rely on federated data rooms instead of central data lakes. This means that you decide which data you share with whom - whether auditor, supplier, or customer - and under what conditions.

 

For secure operation, we offer our own German data centers based on the Arvato Systems Virtual Private Cloud and / or combine them with sovereign cloud offerings leading hyperscalers. Depending on requirements, we integrate sovereign services from Microsoft Azure, AWS, or Google Cloud, always with clear data residency, controlled access, and transparent governance

Conclusion: Start Your Transformation Now

The technologies are ready. The entry points are clear – a sensor on a pilot machine, an automated visual inspection at a quality control stage, an initial data feed into the ERP system. Not a “big bang,” but a targeted first step.

What sets us apart: We connect OT and IT, edge and cloud, manufacturing and logistics – all from a single source. From retrofitting existing systems to AI-powered image processing tools, all the way to data-sovereign integration with SAP S/4HANA, we guide you through the entire digital transformation – not as a system supplier, but as an implementation partner.

Frequently Asked Questions About Edge Computing & Smart Factory

  • We use edge computing to process data directly on the machine, enabling response times in the millisecond range that a cloud alone cannot achieve. This secures your production even in the event of internet outages and massively reduces transmission costs through local data filtering.

  • No, we rely on retrofitting instead of buying new. Using IoT gateways and the administration shell (AAS), we also integrate older existing machines ("brownfield") cost-effectively into modern IT systems.

  • Our digital backbone forwards machine data, such as fault messages, directly to your SAP S/4HANA in real time. This allows us to dynamically adjust production plans and trigger maintenance orders before things come to a standstill.

  • We enable data sovereignty through federated data rooms (Factory-X) and sovereign cloud partnerships. We process sensitive data locally or in protected environments, while non-critical data takes advantage of the public cloud.

     

  • Since material shortages stop production, we synchronize both worlds in real time with Platbricks®. Sensors automatically request replenishment, which eliminates waiting times and increases equipment effectiveness (OEE).

  • Our computer vision solutions use AI to detect defects directly on the line and sort out faulty parts immediately. By continuously retraining the models in the cloud, we sustainably reduce rejects and complaints.

Related Information on Data Rooms and Smart Data

Manufacturing Industry

Digital Transformation for Manufacturing Companies - Mastering Challenges & Getting One Step ahead of the Competition. Learn more about our complete portfolio for the manufacturing industry.

Data Sovereignty in the Manufacturing Industry

How to share data securely and profitably with third parties: challenges ✔ target vision ✔ solution ✔

Latest Blog Articles

Get first-hand insights into the Digital Transformation of the manufacturing industry from our experts.

Digital Sovereignty

At Arvato Systems, we have been focusing on cutting-edge technologies and handling critical infrastructures for years. We are your partner for digital sovereignty.

Written by

Fuhrmann, Johannes
Johannes Fuhrmann
Head of Strategic Business Development

As Head of Strategic Business Development, Johannes Fuhrmann manages the portfolio and product development for the manufacturing industry, focusing on digital twins and data ecosystems. He previously worked at Deloitte and VELUX. He holds an MSc in Information Systems Management (University of Warwick) and a B.A. from HAW Hamburg.

Learn more about this author