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Business transformation

Released at: 18:15, 08/05/2018

Business transformation

Mr. Tindaro Danze (Photo: Viet Tuan)

Mr. Tindaro Danze, DF & PD Country Division Lead & Vice President of Siemens Vietnam, tells VET about the digitalization of the industrial sector and Siemens’ digital offerings.

by Linh San

Digitalization is a huge buzzword floating around these days, especially in the business world. What does it actually mean and how is it different from the Internet of Things (IoT) or Industry 4.0?

There is definitely a lot of buzz out there with all of these terms and they often get confused. In really simple terms, “Digitalization” is moving process data onto a digital platform; like moving the process of reading a newspaper in print form to reading it on your smartphone. 

IoT is the process of how multiple processes are then connected digitally. This is not just viewing shopping products online but actually ordering them and that order then generating a digital request for the order to be paired with payment and shipping. So, multiple steps are digitalized to bring you from your touch screen to an actual product or service at your doorstep.
The Industrial Internet of Things (IIoT) is where this series of processes starts with the concept of what needs to be produced to the eventuation of the final product. The focus of IIoT is an “industrial internet”, harnessing the internet in a way that streamlines, connects and prioritizes industrial needs in the academic, business and government realms.

“With Vietnam’s emerging economy, I have no doubt about the prospect of a digitalized industrial economy in the near future”.

Industry 4.0 is the German initiative to transform businesses into digital enterprises that design, test, manufacture, maintain and deliver goods through a digital feedback loop by harnessing digitalization. The main distinction between the IIoT and Industry 4.0 is that Industry 4.0 places a heavy emphasis on creating a digital twin of the entire value chain of the manufacturing process, starting from product design, production planning, production engineering, and production execution all the way to service and maintenance. Having a digital twin of the entire manufacturing value chain allows you to connect the real physical world with a virtual replica of it and implement a real time feedback loop to improve the performance of the product and production as you go. 

While people can see how useful smartphones, online shopping, and social media are in their personal lives, why do you need digitalization in the industrial sector?

There has been a massive change in our lives due to digitalization. You are right in the example that digitalization has brought about IoT in our personal lives. Things that used to be manual are now digital. Catching up with an old friend meant taking a couple of hours out of your day for a meal or a beer, now you can just check out and “like” their Facebook page. When I was back in college (not too long ago mind you!), I would buy my favorite albums at the record store. These days I don’t need to go to the store, I simply log on to my music provider of choice and download the album or single I am interested in. The same applies to your household appliances. We used to need to manually turn lights, air conditioners or heaters on and off - now we have apps to manage our “smart” homes. 

Why do we need these changes in the industrial sector? The answer to your question is the same: efficiency. Digitalization frees up time, provides flexibility, and improves quality control, which in turn increases efficiency. 

All initiatives worldwide are driven by the essential requirements that manufacturing industries must meet. This starts with reducing time-to-market. Due to faster-changing consumer demands, manufacturers have to launch products faster - despite rising product complexity. Traditionally, the big competitor has beaten the small one - but now the fast one is beating the slow one.

The next requirement is enhancing flexibility. Consumers want individualized products - but at the prices they’d pay for mass-produced goods. As a consequence, production has to be more flexible than ever before. 

After that we need to ensure we are increasing quality. Consumers reward high quality by recommending products on the internet - and they punish poor quality the same way. Online reviews have become one of the most important badges and most damaging factors in modern business success. To ensure high product quality and to fulfill legal requirements, companies have to install closed-loop quality processes, and products have to be traceable. 

Finally, it is vital to increase efficiency. Today, it is not only the end-product that needs to be sustainable and environmentally friendly; energy efficiency in manufacturing and production becomes a competitive advantage, too.  

Another general requirement is security. Digitalization also leads to increasing vulnerability of production plants to cyberattacks, and this increases the need for appropriate security measures

What role does Siemens play in the digitalization of the industrial sector?

Siemens’ digital portfolio, the “Digital Enterprise Suite”, provides digitalization technology for each step of the production value chain in order to create a perfect digital twin of our customer’s operations.

One example of how our Digital Enterprise Suite has created efficiency is through digitalized stress tests of the product and the production line. In the past, companies needed to have a prototype built in order to test the design, durability and effectiveness of the product and the layout of the production lines. Now thanks to our industrial software, companies are able to design and test prototypes virtually. This saves tremendously on time and cost and creates more flexibility in the design, leading to more optimal products in a shorter timeframe. Remember, speed is the competitive edge - the fast one will beat the slow one.

Now to embed the industrial production process into an internet based eco-system, Siemens provides to its customers an open IoT operation platform called MindSphere. This allows the user to connect all his facilities onto one internet-based platform and turn big data into smart data accessible from anywhere at any time.

How does this all actually work? How does it fit together?

Another great question. So, it all starts with data. Let’s take an analogy of something you might use every day yourself - a smart watch. Now this smart watch is equipped with various sensors collecting data such as pulse, steps taken by day, sleeping patterns, etc. This information gets transmitted to your smartphone, which usually operates on iOS or Android. Then you go and download a nice app, which has a nice user interface and gives you a number of reports and recommendations on how to keep yourself in shape. Basically, you could think of MindSphere as being the industrial version of an Android operating system. Sensors in the production line collect a huge amount of production data and send it via a gateway - we call this MindConnect - to the IoT operating system MindSphere, storing big data on a cloud server. And similar to our smart watch example, you then download an app - we call it MindApp - that turns your big data into smart data, providing various reports and recommendations on how to improve your operations. In simple terms, that’s how IIoT works. 

Where do businesses, especially here in Vietnam, begin to move towards Industry 4.0? What are the steps in moving forward?

From my time here in Vietnam I have already seen great movement towards an increased level of automation, which is the first step in moving towards Industry 4.0. But I think the most important thing for businesses here to focus on is small, manageable changes towards the big goal. This is a huge revolution in how we manufacture and produce goods. With Vietnam’s emerging economy, I have no doubt that a digitalized industrial economy is in the near future. But we need to build it sustainably, taking the right steps to ensure long-lasting success.

 What sort of future does this paint? What is the potential for a digitalized near future?

I think the possibilities are endless. I know this is rather cliché, but we are really moving toward a future where we are only limited by our imagination. I believe that digitalization, especially in the industrial sector, will lead to improved processes that will support both economic and environmental goals. This will be our best hope for a cleaner, greener and more prosperous future, globally and here in Vietnam. And don’t forget - the fast one will beat the slow one.

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