What do new business models look like in mechanical engineering?

One of the key challenges in digitalisation is developing new business models.

There are two aspects to digital transformation. It covers both the digitalisation of existing internal company processes and the adaptation or modification of business models. Many mechanical engineering companies are still hesitant when it comes to the latter. But they’re not alone in this. As Germany’s digital association Bitkom found out in its study “Digitalisierung der Wirtschaft” (“Digitalisation of the economy”, German only), just one in four of the companies surveyed is investing in new business models. Finance is certainly a contributory factor, and it is true that the optimisation of internal processes is already firmly anchored in mechanical engineering, particularly due to the widespread use of lean production methods. All the same, keeping things exactly as they are because you’re doing well at the moment is not an option. However, which new business models should mechanical engineering companies consider? And how exactly do you go about developing such a digital business model?

Digital services and platforms for mechanical engineering

It goes without saying that there are no one-size-fits-all answers. Nevertheless, successful ideas from other sectors are already being adopted in the mechanical engineering sector. Predictive maintenance as part of the Industrial Internet of Things is a prime example. This involves continuously transmitting data from a machine so that its performance statistics can be permanently monitored. The key benefit is that even the slightest deviations in the data can help root out potential defects. Two things are typical of business models relating to predictive maintenance – firstly, there’s the networking aspect and, secondly, the service side. Companies don’t just deliver a piece of machinery, they also provide location-independent maintenance.

Looking at this scenario from a broader perspective, there is another important factor to bear in mind, which is that solutions based on the Industrial Internet of Things can be offered on platforms. Even if the term “platform economy” might not mean much to you right away, you probably come across it every day. Apple, Airbnb and Amazon are all digital platforms. They act as intermediaries – that is to say, they connect two or more market players with each other. When several companies come together in this context they form a “business ecosystem”. A number of different approaches are important when it comes to new business models in mechanical engineering. These relate primarily to marketplaces for services and goods. As a general trend, it is to be expected that services will generate increasing volumes of sales in the mechanical engineering sector.

The path to new business models in mechanical engineering

The question now is how mechanical engineering companies can start developing new, digital business models. Again, this is a skill that can be learned – Business Model Innovation.  The Business Model Navigator developed by the University of St Gallen is one of the best known models for this discipline. While designing it, the researchers discovered that 90 percent of the business models examined weren’t new at all – in fact they were simply adaptations of existing models or new combinations of established elements. The Business Model Navigator can be used to both evaluate current business models and create new prototypes. The following questions offer guidance:

• Who are the target customers?

• What is promised to the customers?

• How is the product or service created?

• How exactly is the value created?

On top of this, 55 typical patterns for successful business models have been identified. The Business Model Canvas has become extremely popular with start-ups in particular, as it is especially well-suited to laying out an overview of business models on a single page. The range of categories stretches from aspects such as key partners, activities and customer relations to channels and sources of income. However helpful these methods may be, the growing importance of the platform economy means they are not sufficient for the more complex new business models in mechanical engineering. Technical committee 7.23 of the VDI/VDE Society for Measurement and Automatic Control (VDI/VDE-GMA) has therefore developed its own VDI Industry 4.0 canvas. This gives particular consideration to the suitability of potential platform partners, which can be assessed in fine detail based on the criteria of value contribution, value drivers, reliability and integration. In its most developed form, it gives rise to a total of three interconnected canvases.

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2019-04-01T06:54:19+00:00March 22nd, 2019|Know-how|
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19. Dec 2018 item Redaktion Once more the year is almost over and the holidays are fast approaching. All the more reason to look back at the blog highlights of 2018. At the same time, we’re signing off for a short Christmas break. After the over-indulgent festivities of the holiday season, the item blog kicked off the new year with an introduction to lean production methods. This is a great place to get an overview of lean terminology. Two more posts at the beginning of the year continued the lean theme. The first was about RWTH Aachen University, which had launched a practical course that teaches students lean assembly on a U-shaped cell. The second was on the CETPM and its new building, where a “Lean 4.0 lab” with integrated Karakuri solution enables an even better form of lean training. Becoming more efficient with digital engineering In the spring, our post “Digital engineering – designing online made simple” was the springboard for an issue that would come to shape 2018 for item. The item Engineeringtool, which is continuously growing, allows users to design 3D constructions using item components from the comfort of their web browser – without having to install any additional software. This means standard tasks can be completed more quickly, and even users with no previous experience find the whole design and configuration process easy. Florian Palatini, head of sales, was the subject of our interview with an expert, and this further expanded on the topic of digital engineering. Networking between design engineers and projects is at the heart of this, which means that engineers are increasingly taking on the role of a project manager. Other posts were devoted to data security in the face of digitalisation in the mechanical engineering sector and a basic explanation of what digitalisation actually is. The entire world of item Alongside these insights into the mechanical engineering of the future, we still stayed true to our roots. For example, we went back to Solingen in the 1970s and the origins of the MB Building Kit System. Shortly after, we dedicated a whole post to expounding the benefits of aluminium profiles. These benefits are particularly obvious in comparison with steel, as only three process steps are required instead of eight. Plus, aluminium is far lighter than steel, while also being very strong and exceptionally corrosion-resistant. The quality of fasteners for aluminium profiles is also of vital importance in this context. Thanks to our quality policy, we are able to provide targeted assistance to our customers in successfully meeting the challenges of specialist mechanical engineering. Stylish and functional We are always fascinated by the unusual ways our solutions are used. For example, we were particularly impressed by the world’s largest 360-degree display in the Autostadt Wolfsburg. The basic construction uses curved profiles from the MB Building Kit System. In the Sivasdescalzo sneaker store in Barcelona, our profile technology is not just to be found in the frame structure of the shelving. Used in the place of steps and to form display platforms, it also adds to the store’s stunning look. Munich-based start-up Spyra has also taken a liking to our profiles, which offer a flexibility and stability that turned out to be perfect for the prototype and a test channel for the innovative Spyra One water pistol. We hope this year’s blog posts about solutions, applications and people from the world of item have been a useful source of inspiration. We’d like to wish all our readers, customers and partners a very happy festive season and a great start to the new year! We’re taking a little break, but will be back after the holidays, with the first article for 2019 on 9 January. Previous article Digitalisation in layman’s terms Categories Latest Posts Archive Research Know-how News Industries People via E-Mail Don´t miss a new blog article!
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