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Author's profile photo Stefan Krauss

Manufacturing companies must transform into digital enterprises now


A lot is happening around digitalization in the market. When you are listening carefully you will hear statements from companies like Samsung saying that by 2017 all of the devices they manufacture will be connected. The research firm IDC stated that by 2020 thirty billion devices will be connected and that companies will spend thirty billion USD on Internet of Things (IoT). You can already see the development towards this trend with the evolution of new technologies, e.g. social media, mobile communication and business analytics are constantly growing and capturing the economy at a faster pace.

Companies have to think about what digitalization will mean for their future business models, their products and services, their business networks (customer and suppliers) and their employees. Leading companies have already started this journey also by appointing a Chief Digital Officer who reports directly to the CEO. They have clearly made digitalization a top priority as they have recognized that only the company who will lead the digital transformation in their industry can reach or expand market leadership to win against competition!

The Digital Discrete Industries Enterprise of the Future

The question is – how will the perfect digital enterprise look like in industries like, Automotive, High Tech, Industrial Machinery & Components and Aerospace & Defense by 2020? We see following trends:

In the Aerospace and Defense industry Maintenance, Repair and Overhaul processes based on Big Data will evolve. I also like the fact of smart data coming from sensors so that processes will advance around predictive maintenance. This will avoid long downtimes of planes and other equipment.

Automotive OEMs redefine their missions to improve people’s lives. Thus they question the importance of the car (the mechanical object) in comparison to the demand on mobility. Their customers focus on “how can I come from A to B” rather than “I want to own a car”. Moreover, autonomous driving can mean that cars will become the 4th monitor after desktops, tablets and smartphones.

High Tech companies will have all their products connected (Internet of Things) and may also sell functionality instead of products (e.g. Lexmark webpage: “Transform your print infrastructure into a platform for delivering precise information”).

The same will be valid for Industrial Machinery & Component enterprises where trends like lot-size one and predictive maintenance will shift how companies will engineer, manufacture, sell and service. It is all about customer centricity leading to a demand driven and not supply driven market.

SAP – being in a digital transformation itself – is very committed to support companies on their evolution to become digital enterprises. This is reflected in our offerings to our discrete industries customers. We have industry solutions with focus on IoT including a leading edge SAP HANA Cloud Platform with many IoT services, like geospital, analytics, etc. We are happy to guide you as customers on your journey to become a digital enterprise!

Join us for the Best Practices for Automotive Conference, the Premier Industry Conference for Organizations using SAP, happening October 12-15, 2015 at the MGM Grand Detroit, MI.

Additional resources:


SAPPHIRE NOW customer panel discussion: “Reinvent Your Business with the Real-Time Power of the Internet of Things” moderated by Stefan Krauss

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      Author's profile photo Former Member
      Former Member

      I believe that when the manufacturing companies convert them self in to digital structure that allows them to gain more success in the market.