Building the Digital Manufacturing Enterprise of the Future at Siemens

Description

This case describes the motivation for and the development of Siemens' digital manufacturing enterprise vision, which became the foundation for its implementation of Industrie 4.0. While the effort started with a purely defensive move by Anton Huber, head of the Digital Factory Division, to protect his core programmable logic controller business from the migration of value to software from hardware, the scope expanded radically as the company completed the acquisition of UGS. It was then able to articulate a complete roadmap from computer-aided product inception and design through simulation and automation system design all the way to the factory floor. The initial implementation at the Electronics Works Amberg became widely cited as the prototype for Industrie 4.0. The central question of the case is the importance of vertical integration to the delivery of the vision, in the face of pressure for open standards that will expose large parts of the system to competition and price pressure. How will Siemens earn a reasonable rate of return? This case is accompanied by a Video Short that can be shown in class or included in a digital coursepack. Instructors should consider the timing of making the video available to students, as it may reveal key case details.

Keywords

Asset management Big data Computer software Information systems Information technology Innovation Internet IT management Machinery Manufacturing Platforms Production Production management Production planning Software development Supply chain management Technology Technology life cycles