HANNOVER, GERMANY — PLM’s potential has been hindered by the lack of affordable processing power that can handle the terabytes of data manufacturers amass in their 3D design initiatives, the CEO of Siemens Industry sector, Heinrich Hiesinger, told Manufacturing Executive.
In a wide-ranging interview at the Hannover Fair, Hiesinger also faulted banks for overheated investing and hinted that ERP vendors and manufacturing software providers could eventually clash in their pursuit of the valued factory floor applications middle ground — a battle that many industry analysts already see forming but which vendors tend to downplay.
As for the challenges of tying product design and manufacturing simulation into the enterprise and shop floor, Hiesinger said that most of today’s computer systems are still not up to the task, at least not at a reasonable price. That holds especially true as manufacturers try to bring suppliers and other outsiders into the design process.
“You get into a new world of data mining; you go into terabytes [of information]. That means we need the computers that are able to handle it,” Hiesinger said. “Today, you still face limitations. You need computers and connections that are able to move from gigabytes to terabytes. We need it as our standard, at affordable prices.”
Hiesinger’s remarks echoed a recent call by Masaki Nakaoka, CEO of Canon Inc.’s copier division, for more powerful supercomputers to help Canon’s PLM programs.
Meanwhile, Hiesinger also repeated a Siemens assertion that the utopian vision of the “digital factory” — in which a manufacturer continually refines operations by integrating enterprise IT, such as ERP, with shop floor IT, such as MES, and product development IT, such as PLM — remains a thing of the future.
“From a greenfield approach, we could build such a system,” Hiesinger said, meaning that if Siemens were to build a factory from scratch with all Siemens automation gear and PLM and MES software like Teamcenter and Simatic IT, it could come closer to tight integration. But, he said, “We know the world is never ideal. We have real customers with real expectations. In an economic situation like now, they will never jump on ordering from us a ‘digital factory.’ They will always start optimizing step by step and begin at the weakest spot of their existing systems.”
Manufacturers also face considerable cultural and process challenges as they try to integrate across divisions and geographies, he said.
Asked whether the organizational challenge of absorbing acquired software companies such as UGS, Innotech, and Elan was diverting Siemens’ attention from customer integration projects, Hiesinger said the work is on track.
As the company builds its stable of PLM and MES software and ties it increasingly into the enterprise, Hiesinger did not deny that Siemens might at some point start competing against ERP vendors such as Oracle and SAP, which are also going after the valued shop floor. As those ERP vendors vie to integrate ERP, MES, and PLM, analysts anticipate a slugfest against traditional automation vendors such as Siemens, Rockwell, Mitsubishi, and GE Fanuc Intelligent Solutions.
“There is a kind of meeting, and how the world will change is not decided so far,” Hiesinger said.
On the broader economic scene, Hiesinger said, “It will probably take quite a while until we [again] see the demand of 2008.” He described last year’s demand as largely “overheated” and “artificial,” based on capital that banks made available purely for investment reasons.
“The financial system has lost billions. The market will recover, but it will recover on substance, not on overheating,” Hiesinger told ME. “In many segments, the market size we’ll see will be below the previous peaks for a while,” he said. He declined to predict when demand might return to peak levels.
Siemens is scheduled to report second-quarter financial results on Wednesday, April 29.