Siemens launches its Xcelerator platform in India

• Siemens AG, the German industrial technology giant, has launched its new Xcelerator “digital business platform” in India on September 13th, 2022. The announcement was made at their Siemens India Innovate 2022 industry event, held in Mumbai.

• Xcelerator is an “open digital business platform” that is focused on enabling and driving digital transformation (DX) across a large range of industry verticals. The platform is made of up of three key offerings:

  • A “curated portfolio of IoT hardware, software and digital services from across Siemens and certified third parties

  • An ecosystem of partners

  • A marketplace for customers, partners and developers

• Xcelerator is applicable across industry verticals, both brownfield and greenfield.

• For context, we believe that the choice of India as the location for the launch of the Xcelerator is at first curious but also very deliberate. India has come through the pandemic with amongst the highest reported growth rates in GDP. But more importantly, it is also the beneficiary of several key macroeconomic, demographic and geopolitical trends that are seeing a convergence of interests that will drive the transformation of the economy.

  • At a macroeconomic level, India is seeing an attempt at structural transformation of the economy away from a consumption-led economy to one with a heavier mix of investment. One of the headline shifts is a concerted push to increase manufacturing’s share of the economy. Enough has been said and written about ‘Make in India’ but there is clear momentum, and a tipping point may be within reach. New digital sectors like e-commerce have boomed during the Covid19 pandemic related lockdowns and have induced a potentially permanent shift in consumer behaviour leading to the need for new supply chains and customer experiences.

  • At a demographic level, much has been written about India’s demographic dividend, its highly educated workforce that is also tech-savvy and more. While the ground reality, especially with continuing post-Covid unemployment, is not as euphoric, there is no dearth of an available workforce. Many workers in the younger demographics are also much more attuned to the new Future of Work trends in terms of remote and hybrid work.

  • At a geopolitical level, India is shaping to be a beneficiary of ongoing US-China tensions and broad, post-Covid shift to diversify supply chains for greater resiliency and to minimize disruptions. The Vedanta-Foxconn news announcement of a $20 billion display and semiconductor fab plant in Gujarat yesterday is evidence of some of the shifts currently underway.

• During the event, speakers from Siemens spoke to a number of key themes that are driving the need for digital transformation of industry, and this applies to a rapidly growing number of verticals. Needless to say, Siemens has built a diverse and dedicated set of solutions for each industry vertical.

• Digital transformation was positioned as being inclusive of two key themes – digitalization of industry and sustainability. This is an interesting and effective way of presenting digital transformation, as digitalization and sustainability are essentially two sides of the same coin and will mutually reinforce the transformation dynamic.

  • Digitalization entails adoption of a raft of new, emerging digital technologies. These include digital twins, additive manufacturing, IoT, AI/ML and others. Most of these are crucial for manufacturing in particular but also across verticals.

  • Sustainability is clearly an imperative, especially for the physical, more resource-intensive industries in India. But resource efficiency is becoming critical across industries as well, especially in a climate of high energy costs and inflationary pressures. Decarbonisation, a topic that was discussed at some length, goes beyond the environment and can generate real savings and efficiencies.

• There were several interesting examples at the event of Siemens products and solutions driving digital transformation:

  • Digital twin developed for GSK Pharma in partnership with ATOS, used in GSK’s R&D facilities.

  • NxtGen, a leading colocation data center provider in India, using Siemens’ Desigo CC, a building management platform, to monitor all disciplines from fire safety to HVAC and others.

  • Remote operations products like remote control stations at JNPT port at Nhava Sheva near Mumbai

  • Tata Power Delhi Distribution utilizing smart meters with Siemens’ Energy IP Meter Data Management System

• Viewed from a distance, there is a bewildering assortment of products and services on offer by Siemens for the various verticals. There was little to indicate the total cost of ownership (TCO) for many of these products but it seems to be at the high end of the range.

• However, this brings up to the hard tradeoff faced by companies, Indian and Global, between managing complexity and managing cost as they try to effect changes. In many cases, especially in brownfield deployments, a decision to manage costs often times results in poor execution of projects which then don’t scale and end up inflating the cost anyhow. There is a strong argument to be made for managing costs while working with partners who can abstract away the complexity and provide sustainable roadmaps.

• In conclusion, Xcelerator is a timely launch for the Indian market and positions Siemens as a key player in the value chain, one with vast global learnings and domain expertise across industry verticals. It remains to see how quickly Siemens can ramp up their Indian ecosystem with local partnerships but the building blocks are in place.