At the recent ABB Customer World event, we had the opportunity to participate in a technology tour and a several meetings that gave us a good sense of ABB’s overall direction, new organization, and strategic partnerships. Further, we joined in on a detailed briefing on ABB Ability, focusing on the company’s Industrial Internet of Things (IIoT) and corporate partnership strategies.
IIoT Platforms Morphing
We have written a lot about the IIoT generally and about IIoT platforms specifically. We were, in fact, the first to coin and define the terms. Our definitional blog on IIoT Platforms continues to lead Google search engine algorithms on the subject.
We have been through two different definitions of an IIoT, with the third one set to be published soon. The reason we continue to refine the definition of the IIoT platform is the change in the market and the strategy of the leading IIoT vendors. The original characterization of IIoT platforms was heavy on development tools and software development kits (SDKs). Over the last couple of years, we have often seen IIoT vendors deliberately seek different positioning.
- IIoT ARCHITECTURE: Some vendors position their IIoT solution as an “architecture” made up not of a licensed product but rather a series of products that can be brought together to achieve the core goals of IIoT; smart connected assets, operations, and products.
- IIoT APPLICATION AND TOOLKIT: Other companies position their IIoT offering as a set of applications to solve specific operational challenges (asset performance management (APM), quality, connected worker, production monitoring, and others). Moreover, some vendors have expanded the original vision of a platform to now include these applications while also still promoting the capabilities, value, and impact of the development environment to create custom applications and to modify their standard applications.
- APPLICATION-CENTRIC: Finally, some companies have opted out of the race for IIoT platform leadership and focus instead on delivering targeted solutions around pieces of an IIoT platform such as connectivity, transport, or data cleansing.
ABB Ability has Landed: Application-Centric IIoT
In our ABB event coverage, we noted: “Regarding ABB’s Ability brand and theme, everything now seems to be ‘Ability-ized’ whether it has changed and been digitized or not.” Despite the seemingly deliberate marketing effort to confuse around digitalization capabilities, there is a core IIoT product at the heart of this “Ability-ization”: ABB Ability. It just happens that it is not available to customers or partners (yet). ABB Ability is an IIoT platform used exclusively by ABB to enhance and extend their applications.
ABB Ability offers:
- Device and asset connectivity and transport
- Data cleansing and contextualization
- Cloud, Edge and on-premise enablement
- Development tools and advanced industrial analytics libraries
Together these capabilities enable the rapid creation, extension, deployment, and operation of digital industrial applications. It is, in other words, an IIoT platform. Interestingly ABB is leveraging the full Microsoft Azure platform-as-a-service (PaaS) cloud and internet of things (IoT) capabilities, except for IoT edge, rather than building its specialized skills around PaaS.
ABB has already leveraged the platform to roll out or significantly extend several of its existing software products. There are three fundamental advantages of this application-centric strategy:
- ABB rightly argues that customers are interested in applications that deliver business value rather than some development toolkit.
- The company can accelerate “time to market” or “time to value” because it can create a focused roadmap catering to one type of user, ABB in-house development teams, rather than anticipating the needs of the greater market.
- By focusing on the value added IIoT capabilities needed, ABB is not creating a development environment that will likely always be less capable than the generalized development environments already on the market such as Visual Studio and Eclipse. They contend developers would instead code in a real integrated development environment than to operate in a specialized, but less capable, SDK.
We have seen similar tensions in the business process management and manufacturing operations management (MOM) environments where specialized customization tools always meet resistance from developers that want more capability and freedom.
There are also some notable disadvantages to an application-centric strategy. First, it is quite easy to restrict later capabilities based on early design decisions focused on a specific application space. Second, it means that ABB will compete in application areas, APM for example, with applications that may have some technical advantages but may have feature/function challenges versus established vendors in the space (that are already cloud enabling their on-premise applications). Without the robustness of a customer usable development environment, customers must evaluate the application exclusively on its capabilities, not what it could leverage in the custom development or the future. Third, partners will not be able to build incremental applications for the ABB customer base.
ABB has announced a marketplace, but it is for internally created applications only at this time. Third parties cannot build additional applications until they have development access to the platforms. This may limit the overall ABB ecosystem offering over time relative to its competitors. And finally, an application-centric strategy diverges from the original transformational vision of IIoT: to enable devices/things to provide unique services to redefine markets and customer relationships. ABB is not developing a development environment for machine builders to use in redefining their markets (nor is any application-centric IIoT platform provider doing so).
ABB is playing its cards well. As a leading operational technology supplier and a latecomer in the IIoT platform space, an application-centric IIoT platform strategy is the best option. However, ABB and all application-centric IIoT platform suppliers will have to live with the advantages and disadvantages of that strategy over time.
Dassault Partnership Announcement
The week before ABB Customer World, Dassault Systèmes and ABB announced a “wide-spanning global partnership.” Concurrent to the ABB event, Dassault Systèmes hosted a conference call for analysts on the partnership agreement.
ABB is among the largest automation, robotics and motion/drive suppliers in the world. Dassault Systèmes is among the largest suppliers of software to transform the way products are designed, produced, and supported with a long history of success in computer-aided design (CAD) and product lifecycle management (PLM). Therefore, the partnership could be a fundamental game changer in the industrial technology space.
ABB has been known as a company that likes to do things all by itself. The exhibit hall at the event was focused almost exclusively on ABB products, in contrast to similar events by competitors that included significant participation by services, application, and support partners. At the ABB Customer World event, Guido Jouret the ABB Chief Digital Officer put the Dassault Systèmes announcement into context within a broader ABB corporate digital partnership strategy. He noted that ABB has four strategic partners in its effort to become a “digital first” organization:
- Microsoft for PaaS and Cloud
- IBM for specialized artificial intelligence
- HPE for Edge computing
- Dassault Systèmes for Digital Twins
This partnering strategy has the clarity of defining what ABB should do and where it should be leveraging others’ capabilities.
We will watch the development of this partnership closely. The announcement and follow-on presentations were heavy on excitement and potential. However, this agreement follows now 12 years of investment by Siemens in linking CAD, PLM, simulation, manufacturing, and automation together. It also follows Rockwell’s $1 Billion investment in PTC. Dassault and ABB as leaders can potentially do more. However, unlike those ambitious initiatives where customer successes have been paraded before analysts, no joint customer successes were specifically highlighted by ABB or Dassault Systèmes. We agree that there is real potential in the partnership. However, partnerships in software have often led to a lot of market hype with little substance. Time will tell on this potentially important alliance.