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Digital Transformation for Manufacturing Industries


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What are some of the trends that driving the manufacturing industries in this digital economy era? What do these mean for the manufacturing businesses and how can they run and sell smarter? Download this presentation deck and learn more.
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Published in: Business

Digital Transformation for Manufacturing Industries

  1. 1. Matt Chan Director, Industry Value Engineering SAP Asia Pacific Japan 25 February 2016 Digital Transformation for Manufacturing Industries
  2. 2. By 2017, manufacturers will actively channel 25% of their IT budgets through industry clouds that enable seamless and flexible collaboration models. By 2018, 75% of manufacturers will be coordinating enterprise-wide planning activities under the umbrella of rapid integrated business planning. By 2016, 70% of global discrete manufacturers will offer connected products, driving increased software content and the need for systems engineering and a product innovation platform. 25% 75% 70% Trends that Drive Discrete Manufacturing (by IDC) By 2018, 40% of the top 100 discrete manufacturers and 20% of the top 100 process manufacturers will provide Product-as-a- Service platforms. 40% vestments that enable digitally executed manufacturing will increase 50% by the end of 2017, as manufacturers seek to be more agile in the marketplace. 50%
  3. 3. The Digital Economy Disruption and Business Opportunities are Everywhere Uber is not just another taxi company – It is transforming into an “urban logistics” company with 200,000 drivers, roughly double the size of the UPS delivery workforce • Who will stay in the business In the next 10 years 40% of the S&P 500 will no longer exist, if they do not keep up with technology trends • Leaders are emerging from nowhere 90% of CEOs believe the digital economy will impact their industry, but less than 15% are executing on a digital strategy* • Industry boundaries are blurring Every company is expanding beyond traditional industry boundaries and also becoming a technology company Siemens is not just an industrial powerhouse – It is a software company connecting its industrial assets in the cloud and enabling customers to generate new revenue streams by selling services, not products
  4. 4. THREE GEARS OF CUSTOMER ENGAGEMENT Closing-the-Loop with Customer Engagement & Commerce Gears 1. BUYING: From products to solutions 2. OWNING: Predictive Maintenance, Usage-Billing 3. ENGAGEMENT: Moving beyond sales force automation BUYING EXPERIENCE OWNING EXPERIENCE ENGAGEMENT EXPERIENCE
  5. 5. BUYING SOLUTIONS From Selling products to Solutions Sell Products  Product lifecycle management / Engineering collaboration  Make to stock / Make to order manufacturing networks  Direct & indirect sales Augment with Parts & Services  Service operations  Service parts management  Product usage, maintenance and safety training  Risk resilient financing  Operations monitoring  Performance based billing Provide Performance Manage Contracts & TCO  Value based solution selling  Predictive maintenance  Service level agreements
  6. 6. DIGITALLY-ENABLED CONSTRUCTION & MINING EQUIPMENT For the Mining Industry Mining Company: • Investment Cost (Capex →Opex) • COGS (Training, Maintenance…) • Productivity • Land Rental • Margin Re-Imaging Business Model for Construction and Mining Equipment Manufacturer From Selling Product to Solutions: Selling Equipment Up-time, Equipment Operating Services, and Sharing the profit Mining Company/ Contractor Dealer / Contractor Manufacturer/ Dealer/3rd Party Operators Parts Services Owned By Mining Company AS-IS Managed By Manufacturer Managed By Manufacturer Managed By Manufacturer Operators Parts Services Owned By Manufacturer TO-BE Key Benefits
  7. 7. ENRICH OWNING EXPERIENCE Connected Devices (IoT) are changing the paradigm of delivering after-sales service • PUSH Service Notifications • How is your asset health? • How is your asset usage? • Predictive/ Preventive Maintenance • Break-Down Assistance • Usage-based Billing • Service Order Routing • Spares Fulfilment IT / OT Connectivity Condition Monitoring Remote Service Fault Pattern Recognition Machine Health Prediction Create Service Order Schedule Order Execute Order on mobile device Visual Support Kaeser Compressors is one of the largest providers of compressed air systems and compressed air consulting services. Situation: changed the business model from selling compressors to selling compressed air through the Sigma Air Utility service. Company
  8. 8. NEW ENGAGEMENT PARADIGM • Sell Anywhere, anytime • Get Insight into your business • Accelerate productivity • Know your customers • Track and score interactions • Progress leads from anonymous contacts to buying customers • Discover right audience by segmenting data • Nurture Communities • Crowd-source
  9. 9. THANK YOU