Guido Jouret ABB’s Chief Digital Officer, Guido Jouret, discusses the digital future in an interview with ABB Review and explains how the digital revolution will transform the businesses of ABB and its customers.
AR ABB Review (AR): What do we mean when we speak of a digital revolution? Hasn’t digitalization been around for a long time?
GJ Guido Jouret (GJ): There is nothing genuinely new about being able to communicate remotely with a sensor in a factory, for example. But the cost of connecting that device – including not just the connectivity component of the device itself but also the network, servers, software, etc. – has become much more affordable thanks to developments in areas such as mobile communications.
There are already numerous digital devices in factories. They are all producing data, but much of this data is marooned. If it could be collected, stored and analyzed, factory owners could optimize their operations. It could also be used by ABB to provide service and improve the reliability and operation of equipment. Rather than perform this storage and analysis on a local server, it is advantageous to run it in the cloud.
AR Doesn’t placing data on the cloud mean the customer is losing control over it?
GJ No online storage can be absolutely secure. But data on the cloud is typically more secure than that on a proprietary server. Companies providing cloud services are aware that their reputation is at stake if any customer data is compromised.
Furthermore, most companies have already accepted cloud storage in other areas. For example, they are probably using Microsoft Office 365. If sensitive business documents can be entrusted to the cloud, why not process data?
AR What sort of data analysis are we talking about?
GJ With the help of libraries provided by companies such as Microsoft and Google we can, for example, perform image recognition or analyze data streams based on past experience.
AR Isn’t relying on the algorithms of external suppliers eroding ABB’s leading edge? After all, competitors can use the same libraries.
GJ Indeed they can and they will. But look at it this way: Companies such as Microsoft and Intel provide our operating systems and processors. We would not dream of developing such components ourselves. Machine learning and cloud storage are, similarly, just tools. Our competitive edge lies in what we do with them.
Using isolated customized solutions to encapsulate ourselves is not a wise strategy in the long term. The market is moving towards more choice. Standards such as IEC 61850 for substation automation mean that customers can freely mix and match devices from different suppliers. Choice is good for the customer and is good for ABB. Rather than seeking to grow our share of a cake, it means we are getting a share of a bigger cake.
AR What about the digitalization of the devices themselves?
GJ Devices are becoming more and more digital.
For example, the cockpit of a Tesla car has only two buttons that do not act via software. They
are the button for the emergency warning lights and the button on the glove compartment.
By installing new software, a manufacturer can add functionality or improve performance even after the product has been delivered. To come back to Tesla, an incident recently occurred while a car was on autopilot. The algorithm was modified to prevent a recurrence and the new software was remotely installed on all Tesla cars. All customers thus benefitted. This is a radical deviation from the present situation in which a product remains unchanged throughout its working life.
AR Can you give us some insight into technologies that will open new opportunities?
GJ Just as an example, let us consider blockchain technology, which gave birth to the Bitcoin. Essentially, a blockchain creates, in the public domain, a decentralized record of past transactions. The blockchain can be added to but not easily erased.
Transparency and compliance are important for conducting business. If a quote or goods have been delivered, it is important that this is acknowledged, thus providing certainty for both parties.
Automation and digitalization are moving up the value chain. For example, electrical grids are already digital at the operating level: Opening a breaker is a digital action but on a higher level, scheduling may still involve somebody picking up a telephone. The digital revolution will move entire businesses into the digital world.
AR Thank you for this interview.