Is smarter business better business?

In today’s market, you will not find many CEOs asking themselves whether or not they should tackle digitalisation.

According to Kingsley Edgar from Siemens PLM Software, who will be speaking at Digitalize 2017 later this month, “Most business leaders have already made the decision to embrace the technology, admittedly some more than others.”

Surprisingly, some business leaders still don’t understand what kind of potential digitalisation really offers their organisations. For the CEOs who have decided to embrace it, the big question is “was it worth it?”

According to the McKinsey Global Institute (MGI), the added value of modern Internet of Things (IoT) applications will amount to nearly $14 trillion by the year 2025. IoT has the potential for the greatest impact in factories since the assembly line. For example, Siemens digital enterprise suites save money and time by maximising automation. As more companies adopt this technology, Edgar believes that IoT technology workers will see fewer assembly lines and more automation and virtual reality. With Industry 4.0 well and truly upon us, business owners as well as factory workers must realise they are both coming out on top here.

Consumers have long learned to appreciate the benefits of digitalisation: custom products available in a very short time at a reasonable price and of the best quality. Siemens PLM software has enabled this by helping companies shift their focus from homogeneous market requirements to the needs of each individual customer. The key to a varied and customised range of products lies in digitalisation.

According to the latest study by MGI, companies must set their goals very deliberately, keeping an eye on the current and future development of digitalisation, to improve the return on investment for digital assets. Edgar agrees with the report’s observation that “only those who are familiar with the progress of digitalisation in their industry, and [who] can assess the impact of this development on their economic performance, can implement their own strategy in a goal-oriented manner and be successful”.

The starting point for different industries in terms of the degree of digitalisation required varies. Even the question of where will digitalisation have the greatest impact depends on many industry-specific conditions in each individual case.

The value of data

The KPMG study ‘Creating values with data’, conducted in collaboration with Bitkom, also shows that in addition to the digitalisation of processes, the resulting opportunities for comprehensive data analysis have the greatest impact on value creation. Data is the key to making full use of the potentials of digitalisation. It is only when data 
from machines and plants are collected, processed and used in a secure environment that production processes and equipment can be streamlined on an ongoing basis.

The Digital Enterprise is Siemens’ digitalisation solution for industry and comprises software and automation components for every sector and for companies of every size. It integrates software and hardware solutions that enable a seamless integration and digitalisation of the entire value chain, including suppliers.

The result is a digital twin that maps the entire value-added chain — from product design to service — based on a single data model as a perfect digital copy. Companies can use this to simulate, test and optimise in a completely virtual environment. The process industry benefits from a consistent data model of the entire plant life cycle. The data also form the basis for analyses, which are conducted with Siemens’ MindSphere — the cloud-based, open IoT operating system.

According to Siemens, having the technology to increase productivity at a factory is only advantageous if you have the data to understand what must be done. The world of smart factories and businesses is very exciting, but make no mistake: for digitalisation to be maximised, data must be used in conjunction with the technology.

Learn more at Siemens’ annual digitalisation conference, Digitalize 2017, which will be held in Sydney on Wednesday, 30 August 2017. For registration and more details, see https://www.siemensdigitalize2017.com.