Unlocking Innovation & Delivering New Services Through Digital Transformation

45 min video  /  31 minute read


Jeff Winter

Industry Executive


Digital Transformation has accelerated as a result of the pandemic as nearly every industry and every company has had to adapt to changing work conditions, market conditions, and environmental conditions. Those companies that are thriving in this new normal have uncovered new value in leveraging technology to accelerate innovation cycles and deliver entirely new products, services, and even business models. Imagine fully recovering from this pandemic better off than before it started with entirely new revenue streams that fill the revenue gaps with even greater profitability through new channels. Learn how this can be done and hear the stories of companies who have succeeded.


David Grussenmeyer: Morning, everyone. My name is David Grussenmeyer. I'm the Industry and Education Engagement Manager here at Inductive Automation. Welcome to today's session, “Unlocking Innovation and Delivering New Services Through Digital Transformation.” To start things off, I'd like to introduce you to our speaker today. Jeff Winter is an Industry Executive with Microsoft, with over 16 years of experience for industrial automation product and solution providers. Jeff has educated a wide range of audiences from the shop floor to the executive boardroom. He currently is part of the International Board of Directors for MESA, the leader of the Smart Manufacturing and IIoT division of ISA. A US registered expert for IEC and is on the Smart Manufacturing Advisory Board for Purdue University. Please help me welcome Jeff.

Jeff Winter: Thank you. Good morning. How's everyone doing today? Well, I'm excited to be here as part of this ICC. This is actually my first one. I think that I chose a pretty good one to start. Wouldn't you say? So my name is Jeff Winter, and I'm an Industry Executive for Manufacturing with Microsoft. And what that means is it's basically my job to help US manufacturers digitally transform at scale. And in order to be successful with that, I have to be intimately involved with what's happening in the industry, and that's why I participate in so many associations, academic groups, standards bodies, and even research teams within Microsoft so that I can stay current with the latest and greatest, and share that with you and how you get to benefit from it.

Jeff Winter: So I want you to start off by thinking about how much the world has changed in the past couple of years. Mainly driven by the pandemic, but the world today is a lot different than it was a few years ago. Industry 4.0 and Digital Transformation have been thrust into the spotlight. And what was once seen as this lofty, futuristic goal has now become a necessity for survival, and some have thrived, and others have faltered. So I'm gonna be talking about Digital Transformation a little bit differently than you may normally hear about it. Most of the time I hear about production optimization or cost reduction, but I'm gonna be talking about how to unlock innovation and deliver new services through Digital Transformation.

Jeff Winter: So what I personally find very exciting about my role and Microsoft, in general, is that although we make products and services that help manufacturers digitally transform, most people don't realize or they forget we are a manufacturer ourselves. We have over 42,000 SKUs at 33 manufacturing facilities and distribution centers that send over 30,000 locations in 107 countries. So yeah, we get to see it at a pretty massive scale from both sides, and there aren't that many companies that can claim that, which gives a very interesting perspective on what I'm gonna talk about here today. So today, I'm talking about innovation. My personal favorite definition of innovation is the practical implementation of ideas that result in the introduction of new products and services or a new way in which products and services are brought to market. And innovation is emerging from all sorts of unexpected places, and it's impacting both the top line and the bottom line of companies, but those that are digitally transforming are finding new and more ways to innovate.

Jeff Winter: So around four years ago, the World Economic Forum engaged McKinsey, and they walked around something like 3,000 factories looking for companies that were doing Industry 4.0. They initially found a whopping 16, and every six months or so, they released the next wave, and I believe they're up to like 103 or something like that as of today. Now, these “lighthouse factories,” as they call them, are implementing advanced manufacturing and AI-driven technology at scale and seeing significant results. They represent the leading edge of technology adoption and exemplify a new production approach that will drive the next wave of global economic growth. Now, if you look across these findings, some of them are pretty interesting, and some of them are counterintuitive. I'm gonna share my favorite four.

Jeff Winter: First, success is not limited to just the big companies. In fact, one of those first 16 was a small Italian manufacturer that only had around 200 employees. So yes, small can be successful. Second, every driver of this change was external. What that means is no one volunteered to do this or did some small incremental gain. They did it because they believed they had to. Third, minimal replacement of equipment. Legacy equipment in existing facilities don't necessarily create a barrier to innovation. In fact, most of these transformations were created through their existing brownfield operations. And fourth, these lighthouse factories did not deploy technology to replace operators. They found incredible efficiency gains through transforming the nature of work by upskilling and reskilling their workforce. It's estimated that 5% of occupations have 100% of tasks that can be automated with today's technologies, and 62% of occupations have at least 30% of tasks that can be automated with today's technologies. So these companies were able to repurpose a portion of their employee skill and time to more meaningful work for them as individuals and for them as companies.

Jeff Winter: So as part of Microsoft's focus on manufacturing, we have identified five areas that successful companies focus on to realize these benefits of Industry 4.0. And we pull from industry research like the World Economic Forum Lighthouse Program. I just talked about our own research, our own market research, and talking to thousands of clients, and we call them Industry Priority Scenarios. We have “transform your workforce,” which is about changing the way that your employees work. We have “engaging customers in new ways,” which is about creating new and relevant customer experiences that span your sales, your marketing, and your service channels. We have “unlocking innovation and delivering new services,” which is about discovering and engineering new value, and that's the part of what I'm here talking about today. We have “building more agile factories,” which is about creating a more flexible, responsive, and agile production process. And we have “creating more resilient supply chains,” which is about improving service resiliency and profitability through intelligent supply chain planning and execution.

Jeff Winter: Now the reason I bring all these up is to show you that unlocking innovation is just one pillar of a much larger Digital Transformation journey. And the common denominator across all five of these is the digital thread. The digital thread ultimately provides universal access to data as it weaves in and out of different business processes and functions to enable continuity and accessibility. Now, it doesn't matter where you start as an organization on any of these five, or if you wanna tackle them all at once, you can. You need to make sure that you properly define your business outcomes because the technology is there, and it works, but deep down, I don't think that manufacturers actually think it works. They go to test it, they're not ready for it to work, which means they're not ready for it to scale, which means you end up having a change management problem, which results in and is because of a cultural problem.

Jeff Winter: I mean, think about this, if your Digital Transformation is successful, and I mean truly successful, it fundamentally changes your entire organization, that means nearly everyone's job in that company changes. How many companies are ready for that level of change? How many individuals are ready for that kind of change? So for successful Digital Transformation, people are the focus, technology is the tool, and more value is the outcome. So whenever we talk about Industry 4.0, I like to make sure we're all talking about the same thing. tThis is my personal way of describing it, the way that I like. Industry 3.0 is about automation or the reduction of human intervention in processes. Industry 4.0 is about cognition or the process of acquiring knowledge and understanding. And what separates these two is your ability to properly capture and harness the power of data, and IoT is one of the core enabling technologies to generate and capture this data.

Jeff Winter: Eric Schmidt, the former CEO of Google, famously said in 2010 that, "Since the dawn of civilization all the way up until 2003, there was estimated to be five exabyte worth of data generated." According to Statista, in 2020, 64 zettabytes worth of data was made. Think about that. That means almost 13,000 times the amount of data was made in that one year, 2020, as all of civilization up until 2003. That's crazy. So my first question for you is, are you taking advantage of that data? Well, according to Splunk, an estimated 55% of companies... Or sorry, companies, 55% of the data that they have is either unknown or unused by anyone in the company. According to University of Texas, Austin, a 10% increase in data usability results in the average Fortune 1000 company's revenue increasing by $2 billion, with a B. Billion. And my personal favorite statistic, according to Forbes, is that data-driven companies are 23 times, not two to three, 23 times more likely to acquire new customers over their peers. So how much of that data are you actually using?

Jeff Winter: Now, used in conjunction with IoT, today's digital twins unlock multiple capabilities. So a digital twin, it takes a real-life object and it creates an exact copy of that object in the virtual space, and this digital twin acts as a representation of a system to generate data to help determine decisions and make predictions about that system. Now, this can be used for a lot of different things. This can be used to help optimize operations, to validate design ideas, or to even provide predictive feedback into real-time processes.

Jeff Winter: Now, modeling and simulation aren't new. What makes this digital twin different and unique is the fact that that digitally recreated object is fed real-time information from the physical object to accurately and precisely imitate its actions and responses. And this allows you to go about making new products differently because you can make them the right way the first time and potentially avoid costly mistakes. Now, digital twins can provide unbelievable clarity to manufacturers by creating this digital feedback loop that fosters an environment of exponential learning and adaptability, and this kind of power is extremely important today when the only constant is change. Demand uncertainty and supply chain disruptions are pushing our existing planning systems to the brink of failure. Now, if we go one step further, the cutting edge, the metaverse, so the metaverse can be thought of as a collective virtual space created by the virtually enhanced physical world and the physically persistent or always on virtual world. It's the combination of your augmented reality, your virtual reality, and even the Internet. In fact, early versions of the metaverse can be thought of as the anticipated future iteration of the Internet that's often hailed as Web 3.0.

Jeff Winter: Now, if what you're thinking of is avatars, you're missing the bigger picture and its applicability to the industrial setting, especially in the near term. So here's how I want you to think about it, think of it as a digital twin on steroids that connects with people, that connects with your employees, and even directly with your customers. So this can create a fully immersive, fully integrated 3D experience. Now, this may be a new buzzword to many and a new term for others, but this is already starting to happen. You just may not be thinking about it that way or referring to it as that. So this is where having the right vision of where your company wants to go, based off of what is possible, dramatically changes what you end up working on today. And as part of my goal is to show you what that vision looks like based off of what is already happening. Anheuser-Busch InBev is a great example of this. As experts in process manufacturing, they're able to leverage most of these technologies and their early versions of the metaverse to completely change the way that they operate, the way that they collaborate, the way that they innovate, the way that they manage, and even the way that they engage with, well, everyone. Let's take a look.

Narrator: With more than 200 breweries and 160,000 employees across the globe, Anheuser-Busch InBev is the largest brewer in the world, with an unparalleled portfolio of brands and a global presence with operations in 50 markets. AB InBev is an expert in their field, and their forward-leaning and innovative spirit is leading to new breakthroughs in brewing. Through their digital factory and supply chain of the future initiatives in collaboration with Microsoft, AB InBev is focused on transforming both breweries and their global operations by empowering their frontline colleagues with digital solutions that enable world-class manufacturing, mobility, data automation, and business insights. It begins with the brewery coming to life with AI, Azure Digital Twins, and the Microsoft Cloud. The brewmaster is responsible for making the best quality beer. She has unprecedented visibility into the brewing process, so she can predict and monitor the complex chemical and biological fermentation parameters required to produce the highest quality product. Frontline operations can remotely monitor critical quality and traceability data from the manufacturing execution systems using the mobile brewery technology built using Azure.

Narrator: With built-in energy and utility management solutions, the digital brewery supports AB InBev's industry-leading sustainable development goals. After the perfect batch is ready to be bottled and shipped, AB InBev extend their digital twin solution to support the packaging line operations to ensure it's done right. These can plans are adopting Azure AI and Microsoft Project Bonsai’s deep reinforcement learning to deliver line balancing optimization that detects and automatically compensates for bottlenecks in the complex can manufacturing operations. At AB InBev, their 100% uptime mindset is enabled through predictive maintenance and global support. A frontline operator can efficiently address problems through remote collaboration with a maintenance technician, ensuring no unplanned downtime of packaging equipment. The perfect beer is packaged and ready. The digital technologies of the AB InBev supply chain of the future minimizes carbon footprint while making sure the right beer gets to the right customer at the right time. This beer's journey is complete. And AB InBev and Microsoft are taking bold steps into the future.

Jeff Winter: So pretty impressive, isn't it? And they're not the only ones doing this. They just happen to have the coolest video, and I'm a fan of their beer. But let's dive into unlocking innovation a little bit deeper, and in doing so, I wanna talk about two concepts. Digital engineering and connected products, and first, I'm gonna talk about digital engineering. So, in theory, digital engineering can be applied anywhere that product engineers want to make their product development process more agile and responsive for customer demands. It can be thought of as the art of creating, capturing, and integrating data using new digital skills and digital tools. And it involves creating the data that forms and informs the digital twins that we just spoke about. Digital engineering principles are foundational to Digital Transformation, and it doesn't even matter what industry you're in. You need to start thinking like a digital engineer. You need to start embracing concepts like DevOps and iterations and agile and continuous testing and experimentation with new and untested elements. And when you do this, this means that transformation is no longer limited to just product definition and design. But it completely changes the way that products are manufactured, assembled, delivered, maintained, serviced, consumed, and even sold.

Jeff Winter: Products are not only being designed differently. They're being designed with intelligence built in and factoring in the customer experience as part of the sale. The cycle of delivery used to end at the point of sale, but now manufacturers, and especially OEMs, are making their products relevant for years to come through small continual iterations that more align to customer behavior and expectations. Manufacturers are thinking about how they sunset products differently and capitalization by extending the life of their products. Over-the-air updates is a great example of this, whether it's your laptop, your phone, your car, an airplane, and yes, industrial automation equipment and machinery. It's already being done. The way that manufacturers are capturing value and profit is also changing. The sale of products and hardware used to be the dominant way of realizing profits, but now manufacturers are finding new ways of generating revenue through digital services and insights and data that allow them to more align directly with their customers.

Jeff Winter: In fact, most manufacturers are able to generate new streams of data just from the insights gained from the operations and maintenance data for how their stuff is used in the field. It doesn't matter if it's B2B or B2C. The question is, are you collecting that data? And are you using it? And lastly, engineers are no longer just integrating with the supply chain. They're integrating with the entire value chain, so the supply chain mainly deals with the production and distribution of goods, but the value chain focuses on innovation and adding value to the product at every stage in the process, from planning, design, development, and delivery. Now earlier, I talked about the concept of the digital thread as kind of the common denominator across those five areas that manufacturers focus on, but the digital thread is what brings them to life. It's what connects the physical and virtual worlds together, and it powers how we model and understand our systems, our assets, our products, our production, our operations, our suppliers, and even our customers.

Jeff Winter: Now what's important to realize here is that just connecting data silos together is only one part of a digital thread. You also have to be able to intelligently connect it across your product and service life cycles. That's part of digital engineering. You need to be able to see your product definition and configuration in its as-designed state, its as-manufactured state, and its as-maintained state in the field. Allowing for better collaboration and visibility, not just with your production teams but directly with your suppliers and even your customers. Now we capture all this data in history already. It's what makes our digital twins so effective. But imagine being able to look into an individual serialized asset or product at any point in time and perform a rewind and replay function to better understand how it performed, or utilize AI in deep reinforcement learning and ask some good questions and predict how it would have performed in different situations. That's game-changing. Now there are many different systems in a manufacturing landscape that leverage the flow of data, and they come from all different places, whether it's CAD, ERP, MES, CRM, QMS, just to name a few. You didn't think I'd successfully be able to name five acronyms in five seconds and have it make sense, did you?

Jeff Winter: Now, unfortunately not many companies have built a digital thread or democratized their data. According to a recent PTC study, 34% of data generated in their department, a company claims, in their department is widely accessible in enterprise systems. 34%. And sadly, that's the best stat. It's only gonna get worse from there, 16% of data generated from other departments, 9% of data generated from products in the field and suppliers are in customers, and 8% from suppliers. That's not good. We can do better than that. Imagine if that were 100%. Let's go over an example. Rolls-Royce has evolved from manufacturing and selling aerospace engines to offering extensive comprehensive maintenance services through connectivity with their engines, and this connectivity and data allowed them to create their total care service offering or what's known in the industry as just power by the hour, to better service their customers and optimize maintenance operations. They used IoT to capture and aggregate the data and machine learning to generate incredible insights, so much so that they completely changed their business model, and it resulted in improving their customers’ operations, flight schedules, and even maintenance plans.

Jeff Winter: The United States Air Force, last October, I believe, awarded Rolls-Royce the contract to build the new B-52 airplane engines. This is expected to be a $2.6 billion deal when all is said and done. And this was the first government E-Series bid with full digital submission, including digital verification and digital validation. And if you're not familiar, digital verification and validation are a top priority for engineers within the manufacturing industry right now because, well, customers are demanding to be able to digitally verify product performance from multiple dimensions like that. In the case of aircraft engines, this could be structural integrity modeling, heat transfer modeling, fuel flow modeling, airflow modeling, power generation simulation, just to name a few. And physical prototyping is costly and time-consuming and still doesn't get you as much. This is where being able to digitally verify and validate drastically shortens your product development time. Engineers no longer need to design and then simulate, but you can design and simulate. Rolls-Royce not only met all the requirements of their bid, but they were also able to demonstrate how they reduced maintenance and sustainment burden while simultaneously increasing fuel efficiency all in a virtual environment.

Jeff Winter: In fact, they've become so good at their use of digital tools and digital processes that they're gonna continue to lease only 40% of their office space in their downtown Indianapolis office. Their lease was up, the pandemic happened, and they were able to get most of this done with people working remotely, so yeah, there's a lot of innovation in this one company. The other area for unlocking innovation I wanna talk about is connected products. And this lays the foundation for a lot of cool things. But there's three different ways I wanna break this up to get you to think about connected products potentially differently. First is just basic connectivity, just connecting to your product, and when you do that, you can do health checks, remote monitoring, over-the-air updates like I talked about earlier, geo-fencing, and security, just to name a few examples. But if you're connected to your product, you can collect data, and when you collect data you can analyze the data. And when you do that, you can gain insights. Example, you can use product usage to help with better product development or new feature development. You can better understand when and how to maintain your products or assets in the field. You can even understand how much life is left with your products in the fields. If you do this, you can lead to new business models. You can take those insights that you just gained and turn them into digital services, like predictive maintenance, as an example.

Jeff Winter: Where you get paid for it, maybe even at a subscription level. And going one step further is product as a service. Whether it's power tool as a service. Printing as a service or packaging as a service. And yes, all those exist. Michelin offers tire as a service. ThyssenKrupp offers material as a service. Chances are more of this is happening than you may realize. I recognize though, that a shift to product as a service can be a challenging transformation for some manufacturers. I mean, the traditional business model offers up-front cash but little to no commitment from the customer's use of the asset or product. Which misses out on an entire opportunity to better understand your customers' evolving business needs. And manufacturers today are seeing the value in staying connected with their customers after the sale of the product all the way through to disposal. Now there are three major steps to get to this product as a service. First, you start with digital service. So digital service, you're basically adding new revenue streams, you're adding new revenue streams to your existing product portfolio. You capture the data. You turn it into insights. You charge a premium for it. Least risky option and allows you to keep that upfront traditional business model. But sometimes large capital expenses, especially upfront, can be difficult for some customers to purchase.

Jeff Winter: Now you have an opportunity to reshape the way that you charge at a subscription, which changes from CapEx to OpEx, and the other part it does is it changes accountability from one-time to continuous. And if you go one step further, you can go to outcome-based contracts. So outcome-based contracts allow manufacturers the ability to demonstrate their commitment to their customers by charging for the outcome delivered instead of the product or asset. And when you do this, it fundamentally changes the way that you engage with your customers because now you're held accountable to the outcome. That's gonna incentivize you to stay connected to your product, to actively monitor your product, to proactively maintain your product. Your incentive is different. Let's look at one more example. Celli Group. So Celli Group is a global manufacturer based out of Italy that manufactures and services dispensing equipment for water, soft drinks, and beer. They've got about 400 employees in six facilities, and they've implemented an IoT strategy that allows them to connect directly to their customer and change their service revenues and their service delivery. They implemented a model-based system with PLM at IoT at the foundation. And it resulted in the creation of this novel smart warranty that's completely unique in their industry.

Jeff Winter: Their warranty actually changes depending on how hard and how frequent you use their product. You run it more frequently, and you run it harder; it's a shorter warranty. You run it less frequently, you run it within specifications; the warranty extends. That's innovative. And because they were generating all this data from their connected products, they turned it into profit and used it to completely differentiate their tap and brewing offering against their competitors. And this resulted in a 14% increase in sell-through rate via enhanced sales and inventory management. A 13% reduction in product failure. A 27% increase in product quality just through measuring sanitation cycles, temperature, and shelf life. And they reduced their service costs by 10% through better predictive maintenance. The key to all this was having their PLM and their IoT come together as part of their digital thread, which, in their case, extends all the way out to their customer. There is so much opportunity here. And in the era of Digital Transformation and Industry 4.0, there's no time to waste. Think about this, if you did just half the stuff I talked about today, how much would this revolutionize your company?

Jeff Winter: Let me ask it a different way. If your competitors did half the stuff I talked about today, how difficult of a spot would you be in? Remember, the technology is there, and it works. The question is: Are you using it to unlock innovation? And with that, I will end with a quote from Satya Nadella, the CEO of Microsoft. "Our industry does not respect tradition. It only respects innovation.” Well, hopefully, I got you excited about the time that we're in, in Industry 4.0. There is a ton of resources out there, educational videos, documents. If you would like any of them, feel free to connect with me, and I would be happy to send them to you. Otherwise, I am here if anyone has any questions. Thank you.

David Grussenmeyer: Thank you for that, Jeff. We're gonna open up the floor to questions now. We have a few mic runners out there, so feel free to raise your hand, and we'll get a mic over to you. Alright. Well, maybe I can start it off here. What do you see as the single largest obstacle that organizations face when they're looking to digitally transform?

Jeff Winter: It's culturally being ready. Hands down, most companies are not ready for the level of change that they have. Most companies have good vision, and they have good objectives that they put forth, but to make those objectives turn into reality requires changing much more than just the technology. It requires changing what people do, and humans are just naturally fearful of change. They naturally resist it. Even if you show how something improves their job or improves their life, they're not always on board with it. So I usually say that cultural transformation is really kind of at the heart of Digital Transformation 'cause the technology is there like I said, and it works. You need to make sure that people are ready for it.

David Grussenmeyer: Okay, great.

Audience Member 1: Sort of related to that question. So you showed some pretty cool examples of businesses who have really improved their bottom line through this sort of Industry 4.0 applications. What challenges do you see in building a business case other than pointing at other people who have done it? 'Cause I feel like that's the wall I tend to run up against as well. How do you know it'll really work here?

Jeff Winter: Use cases are by far our most effective approach at that. We have over 3,400 of them on our website that you can go access and sort, if you want, by anything that shows the challenge, the problem, the outcomes for them. We do a good job of even stating who the actual company is. All 3,400 have company names a part of it. They're not just generic examples. So if you can tie an exact use case directly to what a customer's experienced, that's the most powerful. Because Digital Transformation means different things to everyone. I mean, some companies may focus on improving productivity, while their ROI is different than someone else that's trying to enter into a new market, and that's the purpose of their Digital Transformation. So you have to really understand what they're trying to do and what they're trying to change. And then, you can show them how it can be done through use cases or just put the data together. There are companies out there, Microsoft is one of them that will actually generate the ROI for them. We will collect all that data, and we will come back and say, "Here is your business case."

Audience Member 2: Speaking of business cases... Sorry, right here.

Jeff Winter: Up there?

Audience Member 2: No down. Yeah.

Jeff Winter: Got it.

Audience Member 2: Yeah. Speaking of business cases, we're a Dynamics 365 user. We're also Ignition user. How could we partner with you guys or continue our journey to get to that 4.0 ideal? Are you guys seeing a lot of use cases from using Microsoft in Ignition?

Jeff Winter: If I think I understand your question correctly, Microsoft ultimately makes the underlying foundation of all this. We consider ourselves the one that kind of allows a lot of this to work all together. We have over 64,000 partners that we have built into our ecosystem to be able to say that we can do the entire Digital Transformation for any company in the world, regardless of what industry and regardless of where you're located it's part of that. And yes, Inductive Automation is one of the partners that we work with as part of that journey depending on which part you're talking about. Because we're gonna be mainly dealing with what we call the agile factory approach here, but engaging customers in new ways or transforming your workforce is entirely a different part of Digital Transformation that may or may not play in depending on what you're looking to do. I don't know if I answered that question.

Audience Member 2: Thank you.

David Grussenmeyer: I think we got a question up top.

Audience Member 3: So toward the end, you did ask if you got us excited. And you did totally get me excited about the whole Digital Transformation. For me, initially, when you're talking about software as a service, product as a service, BMW's seat warmers was an example. I don't know if you heard about that, but they were charging subscription for their seat warmers. So as like a business owner, the idea of that is really timely 'cause it's gonna make me more money, but as we're all consumers as well, and I'm not really interested in the idea of having to pay for my seat warmers, right? So how do you balance the idea of getting people on board because you can convince the business manager that it's gonna be more money, but how do you balance that idea of like we're both consumers, and we own our businesses too, and find that fine line of using that data in and that Digital Transformation to make up a really valuable thing for all people?

Jeff Winter: Good question, and I have a unique opinion from this one as a BMW owner who's not happy that that subscription is coming out from my heated seats as part of it. So this is just my thought and my opinion to answer the question. This is not Microsoft’s stance on this. But you need to make sure that your go-to-market strategy is actually matching in alignment with that being of value to the customer. And where it provides value is when your subscription allows you to continually stay connected to whatever it is you're selling and allow you to make the small continuous iterations. That's why some companies don't mind to pay a monthly subscription 'cause they know that next month or the month after, there might be some new improvement to what they're getting. Heated seats is a great example of a product that won't change. So it's just changing how you pay for it. You're not actually changing the way that you're engaging with your customers. If you can change the way that you engage them, you're gonna find out that most actually want to pay that way. Because then they are relieved of responsibility for it, and they know that you're the one that actually has to keep making it relevant, keep updating it, and making it current. It's part of your responsibility now. So you gotta find the right places for it. It's not everything will turn to a product as a service.

Audience Member 3: Alright. Thank you.

Jeff Winter: You're welcome.

David Grussenmeyer: Alright. Another one up top.

Jeff Winter: Okay. There's one down here I think.

Audience Member 4: With Digital Transformation, Industry 4.0, IIoT, I feel like we have a tremendous educational thing we have to do in our industry to get our customers and partners on board with starting that path. When you talk about use cases, I think that's the easiest way to paint a picture for them. cCan you give us a feel of the 3,400 use cases? What levels of the organization are signing up for Digital Transformation and are working with you on projects? Is it C-suite? Is it people in operations? I'm sure it's a variety, but if you can give us a feel of where you're starting those conversations.

Jeff Winter: I'm disappointed, as the guy that likes my trends and statistics, that I don't have an answer ready to give you for that. I can say, from myself, the way that we approach going to market is we try to work with the entire leadership of companies because Digital Transformation is more than just one component, whether it's operations, whether it's HR, whether it's finance, whether it's legal, whether it's supply chain. Those are all different departments, and what we try and do is unite them all so you don't have operations digitally transforming and HR 10 years behind. Then your talent and labor workforce is not gonna be combined with your actual infrastructure in your facility. So trying to link those all together is a big part of what I do all day for customers. And then, to answer your question, yeah, I'm usually working at the C-level or VP level, if that answers your question.

Audience Member 4: Yes it does, thank you.

Jeff Winter: Okay.

David Grussenmeyer: Alright. I think we got time for one more question.

Jeff Winter: No easy one like, “What's my favorite color?”

Audience Member 5: What's your favorite one?

Jeff Winter: Blue.

Audience Member 5: What's your favorite animal?

Jeff Winter: Tiger.

David Grussenmeyer: Alright. I think that concludes our session for today.

Jeff Winter: Thank you.

Posted on October 17, 2022