Digitalization is a core part of the corporate strategy at Trumpf and IT plays a big role in the plans. Thilo Press, CIO of the German maker of machine tools since 2015, recently talked to automotiveIT about the digitalization of products and processes, the potential of artificial intelligence and the need for IT to be a fully integrated part of the company’s business. Following are edited excerpts from the interview:

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Trumpf CIO Thilo Press says he wants to raise the ambitions of his IT department

Digitalization is a core part of the corporate strategy at Trumpf and IT plays a big role in the plans. Thilo Press, CIO of the German maker of machine tools since 2015, recently talked to automotiveIT about the digitalization of products and processes, the potential of artificial intelligence and the need for IT to be a fully integrated part of the company’s business. Following are edited excerpts from the interview:

Mr Press, how does IT fit into Trumpf’s digitalization and transformation strategy?

As part of our digitalization strategy we have so far refocused more than two-thirds of our IT activities and that part is growing. Our goal is to make more than 80% of all new IT initiatives subordinate to the success criteria applied to the company’s digital strategy.

How does that impact the IT budget?

We’ve seen our projects grow by between 25% and 60% annually in the last three years and we’ve made IT budget commitments in accordance with that growth. Such an increase in the IT investment volume is unusual but also necessary to manage legacy systems, create new, scalable solution components and realize our digital ambitions.

Trumpf sees its future in data-supported services, smart factories and offerings such as manufacturing-as-a-service. What does that mean for IT?

We support the digital transformation of our company in four areas. First, we assist in the digitalization of our own production and business processes. Second, we’re looking at digital solutions and services for our products. That’s a very important market for us and we are ahead of the competition here. Third, we are focused on developing digital services in new business areas, for example manufacturing platforms. And fourth, we are looking at disruptive business models such as capacity marketplaces.

 

”Digitalization is not about the further automation of existing processes, but about the use of data pools for digital processes and new customer solutions”

 

More than 500 people are working on digital transformation projects at Trumpf. With a work force of 13,000, is that a good ratio?

Yes. Many of the people responsible for processes and their further development concentrate strongly on digitalization issues. They have good process knowledge, a high desire to innovate and much flexibility in their approach to tackling new issues. The decisive question is: How can we further develop the expertise we have within the company. At the moment, we are very interested in data management, which is why we are training so-called ‘data owners” and hope to firmly establish these in the corporate organization.

How should we envision that in practical terms?

Digitalization is not about the further automation of existing processes, but about the use of data pools for digital processes and new customer solutions. For example, we bring together all relevant available data related to a particular machine in a digital machine file, a so-called digital twin. How was the machine delivered, how is it changing as the customer starts using it, how is it deployed and which operating states occurred while it was being used. Only when we have total insight into the digital lifecycle data of all machines can we quickly detect anomalies and improve the quality of our forecasts of likely failures. We see a big advantage in being able in future to move faster, even when there are a lot of relevant factors.

In IT, you are now making more use of a partner network and cloud-first strategies. What role do agile methods play?

In our IT management team we decided that we would deploy the classic waterfall model as well as agile processes. It’s key to adapt the method to the degree of maturity of the application. If that is high, like it can be with an SAP application that supports core business processes, then waterfall works perfectly. But it wouldn’t work to use such a model in new developments with a high degree of innovation where we start with minimum viable products and proofs of concept. In our development we are now working across divisions and, more recently, also with DevOps models. As a matter of course, we now also have our so-called campus organization, where we bring cross-functional teams together and, with the help of coaches, deploy agile methods for projects.

IoT, blockchain, cloud and artificial intelligence (AI) are IT buzzwords in 2019. How important is AI for Trumpf and what can your IT operation do to use the technology to open up new business areas for the company?

It’s an issue we’re discussing internally, but also on the product side. Predictive analytics is playing a central role in our new data integration platform. When a machine needs to be serviced, our technician gets the information he needs for the repair relatively quickly. We’ve been working on that for more than two years. On the product side in the automotive space, we are, for example, testing weld analysis with the help of machine learning. The success rates are clearly higher than when this is done through visual inspection, regardless of how experienced the eyes of the welder may be. 

Final question: Please give us your vision for Trumpf IT five years out.

In the data area as well as in our product IT, we are making big changes to our digital architecture. I hope our strategy will yield results in the next five years. That means that we will have clearly become faster in different business aresas with new solutions and that we will have achieved a new level of scalability. We want IT to increase its contribution and, in our role of ‘digital accelerator,” we want to raise our Internal IT ambitions. That also means reinterpreting the classic role of business IT and understanding that it is a part of the business.