Siemens Delivers So Much Technology – Even More Opportunities

Siemens USA Process Industry and Drives, and Digital Factory business divisions held their 20^th annual user conference in Las Vegas at the end of June. Security was a strong message.

The focus was Control Technology for engineers from their U.S. customers. Nearly 70 presentations from Siemens staff and users covered a range of topics from network security to deep PLC programming techniques. There were also a variety of hands-on training sessions covering Siemens’ latest release of a wide variety of products.Before the event opened, we had a breakfast meeting with the head of Customer Services and the leader of Cyber Security. They presented the service organization and some fascinating insights as to how they are using Big Data from factories to analyze system performance, allowing a more sophisticated service offering, including planned maintenance based on usage. Siemens has partnered with SAP using SAP HANA as a cloud-based analytics solution to improve support, especially predictive maintenance. Although we hoped to hear more about Big Data during the conference, the conversation moved towards security and automation.

Siemens Continues Control and Networking Strength

Siemens is made up of eight divisions, only two of which were represented at the conference. Between them they make up all the control hardware, software, and services from large drives to PLCs and PLM and MOM software. Two main product families cover process and discrete control: the PCS7 distributed control system for process industries and the S7 PLC system for discrete automation. There were many announcements of new and upgraded functionality across the product ranges, which held the most interest to the target audience. There was a lot of support for improvements to Siemens’ HMI offerings, particularly with configuration capabilities that were much easier to use. Totally Integrated Automation (TIA) solutions also saw updates. We felt that the inclusion of a global picture of where Siemens is going with its Vision 2020 strategy would have helped position the more detailed announcements in the context of corporate strategy.

One important strategic direction was clearly discernable from the agenda: networking. Siemens has built a solid IP networking capability. Connecting smart devices, supervisory control and information management, or Manufacturing Operations Management (MOM), are already well supported by a comprehensive product range that delivers reliable networking capability. This, along with a dedicated security practice, bodes well for the Industrial Internet of Things (IIoT) when connectivity, both physical and wireless, will become a key competitive benefit.

A Strong Security Offering

One pervading theme throughout the conference was security. Generic security presentations were augmented by practical examples of security in complex multi-level control solutions. The most impressive user example came from Pfizer. As a pharmaceutical company, they had two important considerations:

• The FDA set high security standards that need to be met across all plants
• Many processes in their plants have been running for years on operating systems (e.g. Windows XP) that are no longer supported

Pfizer has built an architecture that can be realized in any of its plants. It enables them to secure different zones as required, while allowing access for activities as remote maintenance. An interest to many manufacturers will be Pfizers approach to older systems.

Other than green field plants, almost all manufacturing facilities have processes that are old and reliable. They raise a major security risk, as many are controlled by obsolete software that is no longer updated or patched for known security issues. In the past, manufacturing IT was protected from the vast majority of potential attacks. Our hardware and software were esoteric and only used in an industrial environment (Do you remember CxOs on 68000s? – I do). The advent of Microsoft Windows in control systems, led by Siemens, brought many advantages in technology and ease of implementation, but did introduce the industrial control world to malicious hacking.

A security strategy has to address these vulnerable systems. Pfizer uses a simple and effective deterrent against most generic Windows attacks – A yellow canary -- after the canaries used in mines to detect dangerous gases. They isolate, via firewalls, all their obsolete systems into one secure area. In that area they put in a new, fully protected and daily updated Windows system that sends an alarm if it detects a virus. With that alarm, the security system is alerted and they can manually check the Windows XP and older systems for the invasive software. The system was proven to work when a USB flash drive introduced a virus. The canary tweeted and the older systems were found to be infected, taken offline, cleaned and reconnected to the network.

We Want to See More

Throughout the conference, we were impressed by the technology that provides plant level solutions across many industries and functionalities. It was clear that the audience was deeply engaged in the message and the improvements constantly being made across all the product lines. The final presentation to analysts by the VP of the Process Automation business in the U.S. whetted our appetite for more on strategy and marketing direction. Although this message was shared little with the controls focused audience, it is clear that Siemens’ new organization will help to focus on key growth strategies.

Siemens in the U.S. is, compared to its position of strength in Europe, playing catch up with its key competitors. Some areas for improvement and continued focus are:

• Asset Performance Management (APM) is essential in asset intensive industries where Siemens faces tough competition. Although there was some mention of APM in analytics focused sessions, a complete APM message and solutions will help in these markets.
• Siemens has split its controls into two divisions, Digital Factory for discrete and Process Industries and Drives for batch and continuous processes. This is a good start on the road to a real industry focus, but Siemens’ competitors are doing more on industry specific solutions that are easier to seal to top management.
• Owning data is valuable. Siemens has demonstrated an excellent start in its support offerings using SAP HANA, a Big Data analytics system, to improve predictive maintenance and customer support.
• The wealth of information generated by smart systems in the plant and that generated by the machines into which Siemens controls have been embedded is a good starting point for an IIoT strategy. Siemens customers, both current and prospective, should ask strategic questions as well as technical ones when evaluating Siemens’ offerings.

Siemens has first class control technology. It must now demonstrate that it can deliver on an industry focused big solutions strategy, and a Big Data driven IIoT story that will enable its digital vision to be relevant to its customers and will deliver new growth and profit.