The magazine of Friedhelm Loh Group

The magazine of Friedhelm Loh Group

Text Ingrid Kirsch ––– Photography

Networks replace islands

Digitization. Right now, ­networks are be-all and end-all in industry. Digitization has created a new form of coexistence between companies. 

The divisions between sectors are becoming blurred, while industry and IT edge closer and closer together. Anyone wishing to remain innovative, should focus more intently than ever on strong and reliable partners. And on future-proof solutions.

Processing data in real time, operating high-performance IT systems right alongside their machines and facilities, and with short latency times in rough industrial environments – the services promised by the Secure Edge Data Center (SEDC) are as rigorous as our customers’ expectations. It’s an attractive business model – but hardly achievable working alone. The solution lies in a strategic partnership – between ABB, Hewlett Packard Enterprise (HPE) and Rittal, which is based on clearly allocated roles. HPE is responsible for global sales of this solution. “HPE hit upon the idea of launching an edge solution on the market and was looking for the right infrastructure. We then developed an edge solution based on our standardised IT infrastructure,” says Andreas Keiger, Executive Vice President Global Business Unit IT at Rittal. “While HPE sees to the global sales of the SEDC, for example, we plough our expertise into providing the necessary physical armour – protecting the IT solution against theft, moisture, dust and dirt; all the adverse conditions that arise in rough industrial environments. Integrated cooling and fire protection are also included.” And the power supply? “That’s provided by ABB.” Thus the synergies harnessed between the three partners have produced a solution like no other on the market.

Benefiting from shared knowledge

This example goes to show that sharing knowledge with others – in the way Rittal, HPE and ABB have done – can generate new and better digital solutions, expand a company’s market coverage, attract more attention and reach entirely new target groups. “Nowadays, customers expect end-to-end and certified solutions, they want to be able to use hardware and software straight away and expect first-class service once things are up and running,” Keiger says. “Such wish lists can only seldom be covered with one company’s portfolio alone.” 

Anyone stuck in their ways will get left behind. Those who seek to solve every task single-handedly – because they trust only themselves or think along traditionally narrow, sector-specific lines – will lose their place amongst the innovative pioneers. After all, disruptive ideas long since broke through the boundaries between sectors, and successful start-ups don’t even consider the concept of sectors in the first place. When it comes to traditional companies, they will only be able to secure their future by joining forces with others to creatively combine their complementary skills to form revolutionary new constellations. It’s not without reason that Keiger considers “the ability to collaborate” the key characteristic for managers. He says that anyone seeking to remain creative must know whom to collaborate with for which purpose – and be able to convince their desired partners of the benefits to be gained from joint ventures.

Intelligent coordination. When an ant finds food, it marks its return journey from the source to the nest with aromas. This makes the others more quickly aware of where to find sustenance.

Such alliances go way beyond the kind of collaboration we could ever have conceived in the past. It’s no longer about striking up partnerships with suppliers or customers simply to facilitate marketing and boost sales. Nowadays, we’re talking about entirely new digital business models – which frequently carve right through conventional sectors. Thinking in boxes is a thing of the past, replaced by working in a shared world where the most diverse branches of industry move closer constructively. For example, in the way that the clothing industry has started teaming up with companies in the IT sector to co-develop “wearables”, turning T-shirts into prêt-à-porter computers, or how personalised medicine combines pharmacy, diagnostics, medical technology and IT. 

New digital business models

“Future-focused companies have now started to move on from traditional, linear value chains to increasingly work in decentralised value networks,” says Marion Weissenberger-­Eibl, the Director of the Fraunhofer Institute for Systems and Innovation Research (ISI) and Professor of Innovation and Technology Management at the Karlsruhe Institute of Technology (KIT). “This is the only way for companies to manage the increasingly complex tasks that they face, harness synergies and remain competitive.” (See the interview on page 22.)

Nowadays, collaboration goes as far as companies sharing what used to be their most closely guarded data. According to a PwC survey from April 2018, this has led three quarters of all medium-sized and large businesses in Germany to share their data with others – not only with customers and suppliers, but also with companies in other sectors (21 per cent) or even rivals (15 per cent). The aim is to digitize their own business models and tap into new sources of revenue. 

If all goes well, those willing to share their sector expertise stand to gain a new business model – which increasingly crosses the boundaries between sectors. For example, Rimowa, Airbus and T-Systems jointly developed an intelligent case. Audi is working together with the Korean car manufacturer Hyundai to develop innovative battery technologies for electric vehicles, and Continental and Nvidia are collaborating to develop intelligent technology for autonomous vehicles. Joining forces makes companies stronger.

A study of “Collaboration as a driving force behind innovation” conducted by the German Aerospace Centre revealed how SMEs boost their innovative success with collaborative ventures. Innovation management and collaborative management now go hand in hand in the same way as data centres and server enclosures. The one is inconceivable without the other. This is particularly true for collaborations between large corporations and medium-sized companies in traditional sectors, aimed at tapping into future markets and offering their customers networked services, for example. In such cases, they have no choice but to work closely together with information and communications companies or digital start-ups. 

After all, networked products are complex undertakings that usually require a broader spectrum of expertise than can be found in a single company. This increasingly leads companies to cooperate intensively with others – in search of technical solutions from other sectors that they can adopt via collaboration. Or to co-develop new services and products with partners in ­other fields of industry.

Boosting productivity, setting standards

However, it also makes sense to network with others in the same sector. Rittal, for instance, teamed up with its sister company Eplan and the connection and automation technology manufacturer Phoenix Contact to create the “Smart Engineering and Production 4.0” technology network. The three businesses aim to use Industry 4.0 applications to pave the way for boosting SMEs’ productivity and setting universal standards for data and data communication – to investigate how end-to-end data models can be used to automate the entire enclosure production, for example.

Users stand to gain 40 per cent in ­efficiency thanks to seamless digital connections between engineering, materials ­management, production planning and production – making manual actions ­superfluous and eradicating cumbersome switches between media. Each of the companies involved in this project was willing to share its own knowledge to achieve this digital added value. Eplan contributed its engineering prowess, Rittal its expertise in enclosures, and Phoenix Contact the electronic components. “Digitization means networks, not islands,” says Dr Karl-Ulrich Köhler, the CEO of Rittal. He therefore calls for a collaborative effort to create new standards and trusting partnerships, pointing out that companies’ future survival depends upon linking up with others to strategically plan digital transformation. “This broader perspective is essential to seizing the best opportunities for continuing competitiveness.” As long as the knowledge flows in both directions, that is. After all, it’s clear that opening up in this way not only increases the opportunities for growth and profitability, but also makes companies vulnerable. In other words, anyone seeking cross-sector cooperation needs to think beyond safeguarding their own position: “Every company should take precautions to ensure it doesn’t lose out in either the long or short term,” according to networking expert Weissenberger-Eibl.

  • New forms of collaboration

    New forms of collaboration

    The Friedhelm Loh Group is collabo­rating with numerous partners in MindSphere World to develop the IT system for the future.

    Rittal was one of the founding members of this platform together with Siemens, Festo and Kuka, among other companies. The aim of the association is to keep on developing the MindSphere open operating system around the world and thus advance the Internet of Things. MindSphere’s structure helps producers to integrate machines and systems and to develop apps independently from specific manufacturers. The companies are also working on standards for creating a global ecosystem for the Internet of Things. Blue e+ cooling units or chillers, for example, can be networked via IoT platforms such as MindSphere.

    IoT-capable cooling systems can be used to gainfully evaluate and re­present data. This will make it possible to anticipate, plan and design all kinds of after-­sales services more effectively under the banner of predictive maintenance.


Understanding data and improving processes: Rittal breaks new ground in the Internet of Things

The title “MindSphere” on its own sounds like something that is still far in the future. Billions of devices are producing huge amounts of data, of which only a fraction has so far been intelligently used and analysed by industry. This is where Siemens’ cloud-based operating system for the Internet of Things (IoT) comes in. Rittal is one of the handpicked group of companies that are already working on the development of IoT solutions based on MindSphere.

back Part 3: Cooperation and Trust  

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