Siemens drives digital transformation

Every day, billions of connected devices and machines bridge the real and virtual worlds, changing the way people live, travel, build and work. Siemens’ U.S. Research and Development (R&D) hub showcases innovative technologies that are helping industries from manufacturing to energy management to transportation embrace the power of data in a digital and connected world. Emerging trends and technologies, such as blockchain-based microgrids, additive manufacturing, artificial intelligence, autonomous robots, digital infrastructure, and MindSphere – the cloud-based, open IoT operating system from Siemens – are changing lives for the better.

“Siemens is driving the digital transformation globally and in the U.S.,” explains Roland Busch, chief technology officer and member of the managing board of Siemens AG. “That’s why we invest about $1 billion annually in research and development in the U.S. We offer an unmatched digital portfolio consisting of software, digital services, security and MindSphere. This enables our customers to increase their efficiency, flexibility, quality, and reduce time to market.”

With around $10 billion in investments in U.S. software companies since 2007, Siemens has made a significant push into the software space with acquisitions including: UGS, eMeter, Camstar, Polarion, and CD-adapco. The company’s most recent investment is the acquisition of Oregon-based Mentor Graphics for around $4.5 billion. Once the acquisition is completed, Siemens will be the first and only player to combine mechanical, thermal, electronic, and software design and simulation capabilities on a single integrated platform.

These software acquisitions and technology integrations further demonstrate how the company’s digital strategy is taking hold. Taken together, they are expected to lead to double-digit revenue growth through 2020 in Siemens’ digital business. In fiscal 2016, Siemens’ businesses with software and digital services generated around $4.6 billion, some 12% more than in the prior year.

MindSphere, the Siemens cloud-based open operating system for the Internet of Things, will be a key component to achieving these growth targets, as it will enable customers across all industries to digitize their enterprises. A strong ecosystem of global partners is already established including IBM, Atos, Microsoft, SAP, Accenture, and many others. MindSphere, combined with the “Flex LTP” platform, makes it possible to improve the efficiency of plants by recording and analyzing large volumes of production data to, for example, implement predictive maintenance schemes and optimize asset performance. Siemens has deployed this in its Charlotte, North Carolina Energy hub. And there are many more domain specific platforms and applications running on MindSphere, such as: Navigator for intelligent buildings, teamplay for healthcare, Railigent for rolling stock, and EnergyIP for smart grids.

“Half of all data that exists in the world was created only last year. Yet less than half of one percent of this data was used or analyzed,” states Judy Marks, CEO of Siemens USA. “In today’s innovation economy, Germany is a leader in machine tools and robots and the U.S. stands out as a leader in software innovation. This gives us a leg up on the competition and enables us to deliver tremendous value to our customers in all industries embracing digitalization.”

Siemens has announced an increase in global investments in research and development in fiscal 2017 of more than $300 million to around $5.4 billion. Over the last two years – from fiscal 2014 to fiscal 2016 – R&D spending in the U.S. has increased by more than 30% and a significant portion of these funds are earmarked for automation, digitalization, and decentralized energy systems.