Digital Factory – C&SI Vendor Landscape in Germany 2020: key enablers, maturity, and adoption

When it comes to digital transformation on the shop floor, we typically do not see large-scale digital transformations of entire factories and shop-floor operations. What we see instead are “brownfield” investments where single use cases related to digital factory initiatives are tested and implemented in factories.

When it comes to implementing such digital factory use cases, very often we see manufacturers facing the challenge of lacking own in-house capabilities and know-how – in particular related to the usage of new digital technologies - to drive development and implementation on their own.

That was the trigger for us to start building a vendor landscape for C&SI providers that are relevant players when it comes to implementing specific digital factory use cases. For an analysis of relevant players, we started with an evaluation of the vendor landscape especially for the German market, which is what we have been asked for by many of our end-user clients.

New digital technologies are the key enablers of the digital factory

teknowlogy uses the term “digital factory” to describe the digitization of manufacturing processes in the factory in order to further increase the efficiency of shop-floor operations as well as the flexibility and agility of operations in order to better align with the ever more complex and faster changing customer demand and requirements.

In a digital factory, new digital technologies in particular are used, such as the internet of things (IoT), artificial intelligence (AI), analytics, robotics, augmented reality (AR), virtual reality (VR), cloud computing, wearables, and also new production concepts such as 3D printing technologies. These new digital technologies are used to transform shop-floor operations into smart operations where intelligent production assets and machines as well as smart services enable the ‘digital factory’ to become a highly efficient and integrated cyber-physical production system.

Especially for the usage of those new digital technologies, there often is a lack of in-house capabilities and know-how, which is where the support of external C&SI providers comes into play.

For the purpose of our recent study, “Digital Factory: C&SI Providers in Germany 2020”, we evaluated 47 C&SI providers with regard to their capabilities in implementing use cases in the digital factory. For each of the selected C&SI providers, we assessed their capabilities to address 36 use cases* for the digital factory in Germany.

The maturity and adoption speed of digital factory use cases matches the number of C&SI providers addressing them

Basically, most digital factory use cases defined by teknowlogy are at a less mature stage, meaning that projects are often at PoC stage or even still being evaluated by manufacturers. The number of C&SI providers addressing those use cases often corresponds to the maturity of those use cases and the expected investment trends.

According to our general evaluation of use cases, teknowlogy expects an increasing investment trend in use cases related to asset and plant performance monitoring, predictive analytics and predictive maintenance, as well as connected worker solutions. Maturity levels currently remain quite low for these use cases, but adoption speed is expected to pick up over the next 2 years, which makes them interesting topics with attractive market potential for C&SI providers to address. In fact, our observations from the analysis of the digital factory vendor landscape confirm that a large number of C&SI providers are specifically addressing those use cases.

Most often, less mature use cases that are more complex to realize, and for which we do not expect a significantly rising adoption speed over the next two years have fewer C&SI providers addressing them. Examples include use cases such as advanced supplier insights, which is about enabling real-time insights into supplier capacities by leveraging IoT, cloud-based solutions, and analytics tools in order to reduce risks in the supply chain, and material optimization, which is about optimizing material usage, i.e. reducing costs of raw materials in the context of intelligent production tools such as 3D printers, leveraging IoT and AI.

Basically, the range of C&SI service providers in our digital factory vendor landscape is varied, from providers that are experts in certain topics and therefore only address very few use cases to domain specialists and niche players that focus on a specific industry such as automotive. There are generalists that cover all the use cases in the digital factory thanks to their size and breadth of capabilities, and there are generalist providers that strongly focus on the manufacturing industry and thus also address digital factory use cases.

Digital Factory - C&SI vendor landscape in Germany
 

Digital Factory - C&SI Vendor Landscape in Germany 2020
C&SI providers that address only very few use cases are shown at the very bottom of the graph. Those that address all use cases are shown at the very top of the graph. The number of use cases addressed by a C&SI provider increases from the bottom to the top.

For more details please refer to our SITSI® InSight Analysis “Digital Factory: C&SI Providers in Germany” (subscription required)

A second blog post on this topic will be published shortly.

 

*For a detailed overview, segmentation, and definition of the 36 digital factory use cases please refer to our SITSI® InBrief Analysis report “Digital Factory: Use Cases and Maturity” (subscription required)