Data sharing in industrial ecosystems

Data sharing in industrial ecosystems

by Prof. Dr. Boris Otto, Prof. Dr. Niko­laus Mohr, Mat­thi­as Rog­gen­dorf, PhD and Tobi­as Gug­gen­ber­ger

Indus­tri­al eco­sys­tems for data sharing have the poten­ti­al to power tre­men­dous growth, hel­ping com­pa­nies opti­mi­ze exis­ting pro­ces­ses and making new pro­ducts and busi­nes­ses pos­si­ble. At the same time, poten­ti­al eco­sys­tem mem­bers face a num­ber of obsta­cles, from con­cerns about pro­tec­ting con­fi­den­ti­al infor­ma­ti­on to tech­ni­cal chal­len­ges. While indus­tri­al eco­sys­tems are still in their infan­cy, enough suc­cess cases exist to iden­ti­fy both the main stumb­ling blocks and the fac­tors that make the­se approa­ches suc­cess­ful. Com­pa­nies that take proac­ti­ve steps now to tap into the power of eco­sys­tems can secu­re a signi­fi­cant com­pe­ti­ti­ve advan­ta­ge.

Access to data and its sys­te­ma­tic collec­tion and pro­ces­sing have beco­me key dif­fe­ren­tia­tors for indus­tri­al com­pa­nies. Thanks to advan­ces in con­nec­ti­vi­ty and edge com­pu­ting, they can use pre­vious­ly silo­ed data to opti­mi­ze machi­ne per­for­mance and even inte­gra­te data fur­ther to dri­ve value across ent­i­re pro­duc­tion lines. Howe­ver, few play­ers have the in-house skills and resour­ces to sys­te­ma­ti­cal­ly unco­ver such sources of value. As a result, both solu­ti­ons equip­ment manu­fac­tu­rers and sys­tem inte­gra­tors have star­ted deve­lo­ping solu­ti­ons as addi­tio­nal ser­vices, an attrac­ti­ve new source of inco­me that hel­ps balan­ce their decli­ning mar­gins in many sec­tors. In extre­me cases, ent­i­re­ly new busi­ness models have emer­ged that reti­red exis­ting approa­ches. Rolls Royce’s “power by the hour” model of sel­ling uptime ins­tead of tur­bi­nes is a good examp­le. Ana­ly­zing usa­ge and ser­vice data bey­ond pri­ma­ry pur­po­se of data for direct con­trol enab­les GE to turn around their ent­i­re busi­ness model. Ano­t­her examp­le is Caterpillar’s Cat Con­nect ser­vice, which incre­a­ses fuel and mate­ri­als effi­ci­en­cy, pro­duc­ti­vi­ty, and safe­ty.

But the need to share data bey­ond orga­niz­a­tio­nal bounda­ries has tur­ned out to be one of the main bar­ri­ers to full-sca­le adop­ti­on. In a con­nec­ted world, sharing data can be a power­ful enab­ler for all sides: the par­ties who sup­ply data and the pro­vi­ders deve­lo­ping new ser­vices or even dis­rup­t­ing mar­kets with more attrac­ti­ve offe­rings. Such inno­va­ti­on often requi­res data from dif­fe­rent sources and, poten­ti­al­ly, dif­fe­rent orga­niz­a­ti­ons. The­se could inclu­de com­po­nent sup­pliers, machi­ne inte­gra­tors, and machi­ne users. In addi­ti­on, con­text data (such as infor­ma­ti­on on envi­ron­men­tal con­di­ti­ons) might be added from other pre­vious­ly uncon­si­de­red sec­tors. The expec­ted result: eco­sys­tems that crea­te win­ning situa­tions for all par­ti­ci­pants. Even com­pe­ting orga­niz­a­ti­ons may be able and wil­ling to con­tri­bu­te to such eco­sys­tems if con­fi­den­tia­li­ty is gua­ran­te­ed and the value they stand to gain exceeds the requi­red invest­ment.

At the same time, win-win data eco­sys­tems are not fea­si­ble in every case. For examp­le, if cer­tain play­ers are extre­me­ly domi­nant, they can dic­ta­te not only which data for­mats smal­ler play­ers must use but also how they par­ti­ci­pa­te in the eco­no­mic bene­fits. One examp­le of such a domi­nant play­er is Walm­art, which mana­ges the sharing of sup­plier data through Retail Link, its pro­prie­ta­ry data plat­form.

To the next part.