Beyond Digital Transformation: From Sand Castles to a Sustainable Business Future

In this article, Jan Burian , Associate Vice President at 国际数据公司 , delves into the true meaning of #DigitalTransformation and how it can benefit businesses.

Moving Forward?

This year marks 12 years since the declaration of Industry 4.0. As it continues to gain pace, the Fourth Industrial Revolution is increasingly — and intensively — shaping how manufacturers create, sell, and service their products.??Globally, tens of thousands of corporations and companies of all sizes are digitally transforming their operations, R&D, and services.

More than 40% of respondents to IDC’s 2022 Future of Operations Survey said digital technology has played a central role in improving their organization’s operations over the past two years.??

Constant disruptions and stimuli, including government-backed initiatives to make regions and even entire continents more competitive, are accelerating change. Organizations must also respond to an emerging game changer: environmental, social, and governance (ESG) policies and regulations aimed at making operations more sustainable.?

Organizations must try harder if they hope to thrive in volatile conditions. Some have already shifted to a digital-first state of mind — but many need to aggressively boost their digital transformation efforts or risk falling behind.?

Industry urgently requires tools and services to scale digitalization and automation and to enable the innovative use cases that will provide organizations with real and significant competitive advantage.?

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A Real-World Check?

Real-world manufacturers live in a world that is not only changing constantly, but that also already offers many progressive and powerful technological tools. The question for most organizations is how to use these potent instruments to yield the best possible results — and to prepare for upcoming waves of change.?

In my 20 years of serving manufacturing companies, a few things have remained constant:?

• Many SMEs end up building their digital castles out of sand. They often skimp, at least initially, on the basics: scalable and safe infrastructure, connectivity, and data storage.?
• Technology must be used to solve the real issues of today. However, it should also have built-in capability to support future business and use cases (e.g., a “connect-all policy” paves the way for new use cases).?
• It is often a challenge for organizations to find a robust model that enables different technologies (and the data they generate) to be integrated securely without creating silos.?
• No organization is an island. Companies that actively create collaboration ecosystems with technology partners and service providers can fill gaps in their technology adoption approaches significantly faster. This boosts their ability to win market share with services and products that improve customer experience.??
• Organizations that follow the “hands-on now, eyes on the future” approach get the most out of available technology. They can create environments in which the ideas and technologies of the future are tested and piloted, giving them a head start in business and an advantage in attracting talented people.?

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Changing Perspectives??

The task is relatively straightforward: to turn real-world challenges into opportunities by bringing together digital technology, a digitally capable workforce, committed management, and business ecosystem stakeholders.?

As we have studied the development/deployment of Industry 4.0 across organizations, we have witnessed much IoT platform hype. Companies have realized that the value is less in the underlying technology stack but in the applications it enables. Scaling and reusing these applications has led to the creation of open digital business platforms.?

An open digital business platform is a significant enabler of competition-driven digital innovation. Open and modular technology enables innovation at the speed of software. This is a real shift in the way digital technology is adopted.?

To gain even more value from digital technology adoption across process areas, organizations have started to develop comprehensive digital twins, defined as a “virtual representation of a physical product, component, asset, process, and even of entire environments.”?

Digital twins visualize data flow. They enable simulations and collaboration across engineering, operations, supply chains, and servicing. They leverage artificial intelligence (#AI), cloud, and IoT to provide users with photorealistic visualizations. They represent a kind of virtual time travel, enabling the examination of entire life cycles.?

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Companies of all sizes can empower digital twins with real-time performance data to create innovative industrial #IoT solutions. Digital twins enable the development of actionable insights from analytics deployed at the edge or in the cloud. They help organizations tackle tomorrow’s engineering challenges through the provision of visually rich, immersive simulations. They are the ideal basis for the next big thing: the Industrial Metaverse, which goes far beyond digital twins.?

Expectations related to the Industrial #Metaverse are ambitious — but realistic.

IDC predicts that in 2025, 20% of G2000 manufacturers will include the Industrial Metaverse in their digital transformation road maps as they pursue advanced simulations, cross-domain collaborations, and enhanced safety.?

The Time to Start is Now?

Even for SMEs, going digital is necessary to stay resilient and relevant today. Succeeding against the competition requires greater levels of speed, scale, and creativity. Solid databases and infrastructure are an absolute must.?

Real change occurs when modular software and hardware are used to create building blocks that accelerate performance improvement and value creation. The modular/platform approach enables the creation of comprehensive digital twins that simulate products, processes, operations, and the supply chain at scale and at speed.?In a constantly changing environment, speed and scalability are key advantages and business differentiators. Organizations can’t meet regulatory compliance obligations or establish a solid resiliency concept without speed and scalability. And challenges are upon us.

It is forecast, for example, that in 2026, regulations and sustainability-linked lending will compel more than 60% of global manufacturers to operationalize sustainability by adopting product carbon footprint as a leading metric.?

Excelling as a business amidst such complex challenges requires a set of adaptable solutions from a single source. To ensure scalability, flexibility, and personalization, the portfolio of tools and solutions must be modular, cybersecure, cloud-connected, and built on standard APIs. Access to an ecosystem of experts is also a prerequisite.?

One example is the Siemens Xcelerator, an open digital business platform that offers all the characteristics described above. Xcelerator’s portfolio of tools and solutions (which will ultimately be available as a service) is provided alongside user access to a community of experts, partners, peers, and developers. This ecosystem benefits users by encouraging the cross-pollination of ideas and the reutilization of solutions. Ready-to-implement applications and solutions — as well as support and inspiration for your next key innovation — are all available in this marketplace.?

In conclusion: Start by filling the gaps, connecting the dots, and bridging the silos. Build the basics — then build the digital twins. Eventually, you’ll be gearing up to enter the Industrial Metaverse.?

All that’s missing is for you to start — now!?