Interview with Nihar Patel and Sarah Cooper
Together with Amazon Web Services (AWS) and integration partner Siemens, Volkswagen is opening up the Industrial Cloud to other companies from the engineering and technology sectors. In an interview, Nihar Patel, Executive Vice President New Business Development at Volkswagen AG, and Sarah Cooper, General Manager of IoT Solutions at Amazon Web Services, Inc., explain the advantages of new partnerships and give an outlook on the further expansion of the cloud.
“As the number of partners grows, so does the range of solutions our plants can draw on.“
Volkswagen and AWS have been working on the Industrial Cloud for a good year now. How would you describe the mission from today’s perspective?
Patel: We want to bring together data from all the Volkswagen Group facilities and make it usable on a real time basis. This will create the basis for even more efficient processes and increased productivity. We have already completed the first part of the journey – by the end of this year, 18 locations will be connected via the cloud. But that is only part of the task. In the future, we want to integrate other companies, such as suppliers, into the cloud. We are now taking an important step with eleven international partners who provide their own software applications.
What is the benefit?
The data that we integrate with the Industrial Cloud creates more efficiency through intelligent algorithms and software applications. For example, one of the eleven pioneering partners has developed an algorithm that uses artificial intelligence to optimize the use of driverless transport systems. Another company has an application that can be used to simulate the maintenance intervals of machines. The examples show: As the number of partners grows, so does the range of solutions our plants can draw on. The Industrial Cloud is not a closed club. We are open to cooperation – with our suppliers and any other company that wants to contribute solutions and/or consume them.
Cooper: At AWS, we have extensive experience with building technology solutions that create value for both solution providers and users. Our insight is: Additional partners always bring in additional data, which in turn enables new solutions. This creates a positive dynamic that leads to further improvements.
How might such improvements look?
A good example is software for optimizing plant efficiency. But this is only one option – analyzing data offers almost unlimited opportunities to expand the range of industrial applications at a rapid pace.
Patel: Another example is energy management – a major issue in every factory. Together with partners, we want to work out solutions to reduce energy consumption – not just in one plant, but at many locations. This is good for the environment and good for Volkswagen. The more plants we bring into the cloud, the greater the economies of scale.
“The companies have the opportunity to use their applications in partnership with one of the largest automobile production networks.“
What do the partner companies gain from this?
The companies have the opportunity to use their applications in partnership with one of the largest automobile production networks. They gain access to data with which they could further improve their products and processes and be even more successful in the market. The partner companies can also achieve high economies of scale because their solution is not only used in one plant, but potentially at more than 100 locations of the Volkswagen Group.
Cooper: In our experience, many industrial companies face very similar challenges. For system suppliers, this means: If their solution proves to be a standard in the Industrial Cloud, then the interest of other customers will also grow.
Is it not risky to give other companies deep insights into production data?
Data security and confidentiality are always our top priorities. Nevertheless, it can be useful to share information in order to get more efficient solutions. The key concept is selectivity: with whom does Volkswagen share that data and for what purpose?
Patel: It’s a give-and-take. If we expect companies to develop solutions for us, then we should also share the necessary information. There is great potential for better processes. In a data cloud, 1 plus 1 is not 2, but significantly more.
“Together we solve challenges that none of us could tackle alone.”
Let us return to the cooperation between Volkswagen and AWS. Do you see a benefit beyond cloud development?
At AWS, there is a strong culture of putting the customer at the center of everything. The needs are recorded in a narrative to develop the appropriate solution. This is a method that we increasingly adopt in our collaboration. We orient ourselves to the needs of our plants, and in the future to the needs of the supply chain.
Cooper: We learn from each other every day. It’s not that each company only does its part of the job – the Industrial Cloud is created as a joint development project. Volkswagen contributes in-depth knowledge of industrial processes and excellent production. We at AWS are experts in digital processes. Together we solve challenges that none of us could tackle alone.
What are the next steps?
Patel: We take an evolutionary approach. On the one hand, we will integrate more and more solutions and Volkswagen locations into the cloud. On the other hand, we want to bring additional partner companies on board with incremental / new solutions. Volkswagen locations can then obtain software applications directly from the cloud to optimize their production. The Industrial Cloud will become the App Store for our plants.
Can the project ever be completed or is the Industrial Cloud growing and growing?
Modern software is never finished. I think the Industrial Cloud will lead to many applications and solutions that we are not yet thinking about. It is important that we get the right partners on board now. The more the companies contribute to solving the existing challenges, the more dynamic the collaboration will become. Together we can create a platform for Volkswagen from which many partners can benefit – companies from the automotive industry and perhaps even beyond.
Patel: In the long term, we are striving for an open marketplace for industrial applications. On such a platform, all participants would be able to exchange, purchase and use their applications among themselves – regardless of any ties to Volkswagen. It would be a place that is basically available to all companies – from suppliers and technology partners to other automobile manufacturers.