Since 2005, the amount of world trade has doubled. If this trend continues, says Mike Houghton, managing director of process industries and drives at Siemens UK, it will add untold pressures to UK industry.
“This global trade means you are no longer competing with your neighbours, but with the entire world,” he explains. “That means the drive for productivity and competitiveness is going to be ever-increasing.”
One way to enhance your productivity and competitiveness, continues Houghton, is digitalisation. This is the process of converting information into a digital format – and its benefits are numerous.
“There are a lot of companies that don’t properly understand how their assets are performing,” Houghton explains. “First and foremost, these businesses need a system that allows them to analyse the performance, which they can use to benchmark any improvements in performance going forward. This is the first step on the long road towards full digitalisation.
“Some companies have very little data, while other have a lot,” he continues. “Those that have lots tend to have multiple databases – Excel spreadsheets, ERP systems, timesheets or scheduling programmes and so on. What often happens here is that each database operates in siloed isolation – they become ‘data jails’: inaccessible pools of data.
“Added to this, the risk of cyberattacks has caused companies to look hard at how open their data is, and made these data jails even tighter and harder to access, which, unfortunately, is the exact opposite of what needs to happen.”
As a result of this, companies are turning to digitalisation technologies such as the Internet of Things (IoT) and the cloud. “The awareness of digitalisation and its benefits is growing,” says Houghton. “We’re seeing a lot more companies reaching out to understand not just what digitalisation is, but also how they can maximise its benefits in their business.”
Digitalisation’s role in productivity
Going hand-in-hand with digital technologies is productivity, says Houghton. “I meet a lot of businesses who don’t have a plan in place for improving year-on-year productivity,” he explains. “Understanding how to increase productivity and how can technology can improve it is important. In simple terms, a company may have a maintenance regime that is reactive – when things break, they get fixed. This costs on average about four times more than a preventative strategy would – one that involves sensors monitoring the performance of assets out in the field and allows maintenance to be scheduled sensibly. This is a simple example of how digitalisation can benefit companies.”
This drive for productivity will be even more important in 2018, where Brexit uncertainty is set to rule the roost. However, says Houghton, Brexit has already had a positive effect on productivity. “Whichever way you voted, you have to realise that Brexit has had the effect of getting people looking at the way they do things, especially when it comes to productivity,” he explains. “The importance of maximising productivity will become even more important in terms of remaining competitive, both within Europe and on a wider global scale.”
Squeezing the sponge
As the chair of the recently published Industrial Digital Review, part of the government’s wider Industrial Strategy, Siemens are at the forefront of how digital technologies can benefit manufacturers. “The Review is helping to create a buzz and discussion about how things can be improved, and how the industry can progress to the next level,” says Houghton. “This has led to companies asking us to help them on their journey to become more aware of the benefits of digitalisation.
“The automotive industry is particularly successful at driving productivity. A lot of them use the term ‘you can only squeeze the sponge so much’ to explain the secret to their success. You can wring out every bit of productivity in your existing infrastructure, but at some point you have to invest in innovation and digitalisation technology to drive it further.”
Skills, as well, will need to be improved in preparation for digitalisation. “The skills you have now may not be the ones best suited to take you and the organisation into the future,” warns Houghton. “It’s important to retrain and make people aware of the changes that will be needed with digitalisation. Leadership also plays an important rule: it needs to be aligned with the company’s corporate strategy, and ‘digital leaders’ need to be identified early on to allow them to gain traction within the company through the digitalisation process.”
Siemens’ MindSphere cloud-based IoT system allows companies looking to get onto the digitalisation ladder monitor their assets. It is an open ecosystem product, as Houghton explains: “An open ecosystem is the model used by Apple. Anyone can design applications for their products, which has allowed Apple to take over the market to the detriment of companies like BlackBerry, which designed all their apps in-house and limited their appeal. MindSphere runs off the open ecosystem, so users can develop their own app to make the system work to their needs.”
Wherever your company is on its digitalisation journey, 2018 promises to be the year the concept becomes more widely adopted by the industry. It’s imperative for manufacturers to be prepared for the coming changes, not only by investing in their assets, but also recognising the power of their people, and harnessing their expertise going forward.
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The process industry is one of the core businesses of Siemens. Countless applications, installed throughout a wide variety of industries, demonstrate our expertise. But even more important is the value we add for our customers, enabling them to increase their productivity in every part of the value chain. With our precise knowledge of the different market segments, we can help you respond faster and more specifically to new market requirements and developments, and thus strengthen your competitiveness.
