The process of digitizing the manufacturing industry, and indeed every industry, should always start with the use case. For value to be added, it only makes sense to digitize where the data derived can be used to improve an outcome. At Hannover Messe this week, much of the discussion around data was about changing inanimate objects to smart objects that deliver value and, in turn, can be sold as a service.
Take for example a simple valve. It is purchased to perform a function, opening and closing under certain conditions, maintaining a seal, sustaining pressure, and providing some level of control. It is then repaired or replaced when it is worn or damaged.
What if that valve was a smart valve that could monitor its own performance, predict when it needed maintenance or replacing? This must be better than waiting for it to fail and dealing with the costs incurred, not just to the valve, but to everything that depends on that valve.
Perhaps then the valve manufacturer would be able to market that valve as a service (VaaS), providing something that is continuously monitored and maintained and replaced when needed. The customer now has a known cost for that service, with little or no variation, and the manufacturer has brand loyalty and a way to measure their product’s performance and predict how changes might impact that performance and in turn their revenue.
The next level of progression is the data-driven ecosystem in which the valve exists. This might be an existing ecosystem or perhaps one which the valve manufacturing develops, connecting to other monitoring products and moving their business model into a whole new arena. Yet further beyond ecosystem comes the ability to utilize and monetize the data derived, not from a single valve, but from all the valves and all the ecosystems they operate. Now they’re at a whole different level of value that results in much better valve design and much better utilization of assets.
The idea of Everything as a Service is not new, but at this week’s Hannover Messe, those that claim to be the leading IoT, and more specifically IIoT, platform providers are talking about the benefits of data and the way that data can disrupt current industries, creating new business opportunities. IBM, AWS (Amazon Web Services), Microsoft, Siemens, Google and numerous others have taken the largest booth spaces in the “Digital Factory” halls, promoting themselves as the glue or mortar between the digital building blocks being provided by others.
Key to positioning themselves as the preferred platform is the partnerships they are promoting. Each has an impressive list of industrial partners, with AR, AI, Robotics and Automation solutions being built utilizing their platform, their cloud services, and their cybersecurity solutions.
The trend is clear. Digitize everything, collect data everywhere, create game-changing solutions and new business models, and deliver accretive value and move from a simple analog product to an essential digital service provider. Not everything can be provided as a service, but there’s plenty that can and a whole lot of value that can be delivered as a result.
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