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16.05.2022

Transforming product development

Never-ending digitalization projects? Those days are long gone.

Challenges like product smartification and customization, sustainability goals and the advent of new players with disruptive business models: All these are showing manufacturing businesses that they have to optimize their digital value-adding processes and transform – or entirely rethink – the way they do business. Now more than ever, the objectives must be resilience, sustainability and competitiveness. The “digital thread” created by the “digital data backbone” stands for process and data continuity along the entire value chain. But how does one actually address these topics in a concrete, plannable, measurable and efficient way? Software provider CENIT is taking a digitalization approach toward rationalizing PLM. What’s the idea behind this, and how does one go about implementing it? An interview with CENIT’s Horst Heckhorn (Senior Vice President, SAP Solutions) and Martin Grunau (Senior Vice President, Dassault Systèmes Solutions & COO, Keonys).

Mr. Heckhorn, Mr. Grunau, in starting we should mention that as a software and consulting provider, CENIT is engaged in a long-standing partnership with SAP und Dassault Systèmes. You are at home in both software worlds, so to speak, and have decades of experience with integrating the two. In early 2021, you were the first company to merge these two worlds into an innovative system architecture that extends the digital thread across both the SAP business software and the Dassault Systèmes 3DEXPERIENCE platform – whether in the cloud or in hybrid or on-premises form. But we know that success depends on the right blend of technology and process optimization. That’s why your concept for implementing seamless business processes comprises all the components needed for the successful implementation of a digitalization strategy.

Please explain: What’s the goal of your approach, and who is your target group?

Martin Grunau: We are addressing two dimensions that are decisive for manufacturing businesses: the product development/innovation process one the one hand, and the rather more operational business processes on the other. Our goal is to optimize and digitally integrate these processes across the entire product development cycle, all the way through to aftersales service and including feedback – to fuse them, if you will. If a business fails to do this, it will inevitably generate data silos, redundancies and information-related discontinuities in decision-making processes – and down the line, that will slow down the entire product generation process.

Horst Heckhorn: This is certainly not a new approach. But decisively, we want to ensure that – right from the outset – we view and address the actual value-adding or PLM process (which describes the path from the product idea through to service and maintenance) as indivisible from the ERP process, i.e. the sum of project execution activities including control, logistics, etc. The mature, innovative software platforms provided by SAP for operative aspects and Dassault Systèmes for the innovation management side of things give us an excellent basis for achieving this goal – in terms of technology.

For the first time, the new software architecture offers us a chance to achieve very extensive process and data integration without breaking the bank. Getting to this point took some doing, so we are all the more pleased that we can now present ourselves to our customers as Trusted Partners for their digitalization strategy.

Martin Grunau: But regardless of their specific circumstances, this will require full integration of their business and data processes. It’s our conviction – and it has been amply demonstrated in practice – that mere data integration is not enough. Data integration can only add value if it can be controlled by business processes.

Does that mean that since we already have the technology and the process knowledge, successful digitalization is a foregone conclusion?

Horst Heckhorn: As in all digitalization projects, the greatest challenge is the human factor. In our projects with our customers, we frequently find silos: unit boundaries that have become ingrained over time, work and thought patterns that separate rather than integrate. Often, we have to start by convincing people, getting them on board and persuading them to leave their personal comfort zone. Yes, we have the consulting expertise, the experience and the technology, but the project will only be a success if the client business creates structures that can overcome these traditional limitations. The challenge – and the key to success – lies in changing legacy attitudes and thought patterns.

Let’s take the view of a potential client company. The intriguing question is: What level of digital maturity must the business possess to be able to benefit from your approach?

Martin Grunau: Actually, the question should be: “What, in fact, is digital maturity?” We define it as a client’s determination to prioritize the topic of digitalization to such a degree that all the necessary structures, decisions, changes and budgets are committed to bringing digital transformation about. Concretely, this means that digital maturity needs resources that only become available when C-level leadership actively pursues the topic.

Horst Heckhorn: I agree with Martin. The decisive aspect for successful digitalization of a business is not just the maturity level of its digital technology. Certainly, this defines the point of departure and the technology gap that must be closed, but the client’s level of “cultural maturity” is at least equally important. How mature is the company in terms of corporate culture, its approach to management control, in the extent to which stakeholders at all hierarchy levels are prepared to make good things better and embark on entirely new paths? If management is not both driver of and participant in an open, outside-the-box approach, the company may – bluntly put – end up spending lots of money on digitally cementing bad processes.

Is this readiness and/or maturity level sufficient for your approach? Or does the technology base need to be there as well?

Horst Heckhorn: The success of our approach doesn’t hinge on the client’s IT foundation – and in a world of proliferating plug-and-play it shouldn’t: Cloud applications now make the latest technology easily available.

Martin Grunau: Exactly. Our customer companies don’t need a specific IT infrastructure to be able to implement our PLM approach or streamline their PLM setup. In fact, our approach pursues precisely this principle of technology independence, e.g. in that we let the clients decide whether they want an on-premises solution or a cloud or hybrid IT architecture. And in any event, the more important 98 per cent lie in the challenges we mentioned earlier.

You spoke about integrating business and data processes. What use cases should we be thinking about here? And where is the added value?

Horst Heckhorn: Let’s look at the much-hyped digital twin: For a digital twin to exist, you need a real-world sibling. But when do you actually have that sibling? At a fairly late stage of the process – during prototyping, or perhaps only during production. Modern technology lets us shift many processes into the virtual world – frontloading is now no longer a vision, it’s a reality. Simulations, what-if scenarios, logistics planning and so on are now all based on virtual products and have to be transposed loss-free to the real product. That requires consistent data flows and well-organized process sequencing. Once the real product comes into being, you then need to constantly synchronize the analog and digital twins to be able to keep using the simulation applications meaningfully. That’s why during virtual product development we already maintain a strict focus on process-driven communication with the digital business backbone. You can’t achieve synchronicity between the digital and the real twin with a simple one-off data handover at the end of the engineering process: It’s a permanent task for bi-directional communication between the company’s innovation platform and operational platform.

And regarding added value: Speed, process costs, cycle times – all the typical KPIs that play a role for a company.

Martin Grunau: Let’s not forget the aspect of sustainability: Using a digital twin to simulate processes and workflow sequencing is clearly a great deal more sustainable than the analog alternative. The digital twin promotes traditional business goals but also opens up flexibility, creativity, quality and sustainability potentials within the product lifecycle.

Let’s go a bit deeper: What would a concrete implementation scenario look like at company level?

Horst Heckhorn: We have developed a two-pronged consulting methodology to address the strategic and operative challenges. On one hand, this involves a so-called Digital Process Assessment (DPA) as a top-down approach: Together with the client’s top management, we examine the business goals, the business model, existing strategic initiatives, etc., and translate the respective objectives into the digitalization strategy. At the same time, we sit down with the client side’s experts for a bottom-up Customer Method Assessment (CMA) to evaluate their currently used methods and tools for virtual product development and develop optimization proposals.

By dovetailing the results of the DPA and the CMA exercise, we can develop a meaningful, custom-fit phase plan that lets the client exploit digitalization in such a way that the business objectives become operatively embedded in all processes, methods and tools.

Martin Grunau: During the implementation of the phase plan, our “ready to” packages offer best-practice solutions that provide quick, cost-effective support for core common-sense use cases which we have identified based on our experience. The packages are a low-risk basis for productive use of the integrated solutions and create a foundation on which the end users can build up experience. But despite all our knowhow, our best practices can’t cover everything, meaning that in most cases there will also be a company-specific segment which we add flexibly as our clients’ customization partner.

Before a company decides to embark on the road to digitalization, it has to ask what tangible added value it can achieve. At what point does your approach produce the first benefits?

Horst Heckhorn: Early on in the project actually, because we aim to achieve quick victories that make the going easier. Instead of spending months drafting blueprints, our “ready-to” approach makes the relevant applications available quickly. Our strength is that our repository of best practices helps us rapidly generate tangible successes and optimizations within the enterprise – based on the results of the assessments, of course, to make sure that we target the right issues. It’s also crucial that we build up experience with the new work methods together, not only to increase user acceptance, but also to get everyone creative juices flowing. The best digitalization ideas often come from the people who work with the processes and methods on a daily basis.

There may have been a time when people put up with projects that ran endlessly without producing any concrete applications, but those days are long gone.

Now to bring theory and practice even closer: Are there companies that have already implemented your approach and/or organized their PLM on this basis?

Martin Grunau: Certainly. Over the past 30 years, we at CENIT have helped hundreds of businesses to better integrate their engineering and business process worlds. But let me give you a more recent example: In Q4 of 2021, three major aerospace corporations from Europe and the US decided to partner with us to achieve end-to-end transformation, i.e. to integrate their Dassault Systèmes and SAP platforms.

Why the platforms by SAP and Dassault Systèmes?

Horst Heckhorn: Because as a partner to SAP and Dassault Systèmes, we want to give our clients the means to exploit the synergies generated by integrating the two platforms. And because our partnership is based on the conviction that these are the very best solutions for the respective task – innovation / product engineering one the one hand and ERP on the other.

Mr. Heckhorn, Mr. Grunau – Many thanks for speaking with us!

Published in: February Issue of “IT & Production” , 2022