The OEM

Research Challenge
Contents
Original equipment manufacturers (OEMs) are well on their digitisation
journey and are now facing the real challenge: putting data to work and
turning it into value. Are OEMs confident of their data strategy?

03
Understanding the
06
Five pillars of
data challenge the data journey

08 11
The edge moves Data is key to becoming
to centre ground customer centric

13
Listening to
data feedback
 3 THE OEM RESEARCH CHALLENGE

S TR ATEGY

Understanding the
data challenge
Effectively utilising data is a complex, but valuable,
undertaking for manufacturing providers

Finbarr Toesland

ollection and analysis of data by

C original equipment manufactur-
ers (OEMs) is being transformed
by advanced artificial intelligence (AI),
machine-learning and big data analytics,
which enhance their ability to extract value
and measurably improve operations.
Widely used internet of things devices are
also enabling large amounts of data to be col-
lected on an array of processes. Now the most
pressing question that OEMs need to consider
is not how to collect often disparate data, but
what exactly to do with the reams of informa-
tion that is continuously being generated by
their organisation, customers or end users.
4 THE OEM RESEARCH CHALLENGE

The sheer amount of data is leading OEMs

to become paralysed by how to create a cohe-
sive approach towards the data they hold.
“OEMs are overwhelmed by the expectations
of this opportunity and difficulties to take
advantage of it,” says Daniel Seseña Gaitán,
head of industry 4.0 operations at Minsait, a
digital transformation consultancy.
“Although much of the challenge is related
to privacy, security and compliance, the great
challenge is how to distribute the underlying
data value among the different actors – OEMs,
integrators, vendors and end-customers – and
how to establish open platforms where each of
them can extract value from this data in a sus-
tainable, confidential and secure way.”
According to market intelligence firm IDC,
there will be a forecast 175 zettabytes of data
worldwide by 2025, with OEMs responsible
for a proportion of this huge amount of data.
Each company will require a unique corpo-
rate data strategy, which is sure to develop
and expand over time, but a static procedure
that is limited in scope is unlikely to succeed
in the long term.
It’s clear OEMs that don’t start to grapple
with the challenges posed by advanced data
analysis will fall behind competitors. Those
firms that are able to identify relevant data,

28% 80%
store it in the most secure and accessible
way, and ensure they can process valuable
data to meet specific business goals stand to
be the most resilient against changing mar- of executives say their company of companies will list data on
ket conditions and innovative competitors. is investing in big data and AI their balance sheet by 2020
systems to become data driven
Having control over their data provides
OEMs with distinct competitive advantages, NewVantage Partners 2019 Gartner 2017

too. From uncovering new ways to mon-

etise data and identifying weaknesses in operations to gaining new insights into cus-
tomer expectations, the effective manipula-
tion of data can be a major advantage.
“With new big data processing capabil-
ities, OEM’s have a unique opportunity to
use data analytics to further differentiate
their original service parts from aftermarket
clones. For example, OEMs can now collect
and process real-time usage data from indi-
vidual parts to develop advanced predictive
maintenance capabilities. This new level of
“parts intelligence” will make it virtually
impossible for aftermarket substitutes to
copy,” says Tony Jewitt, vice president of big
data solutions at Avalon Consulting.
Very few OEMs have the internal “In this data-driven world, aftermarket parts
will become extinct for any important compo-
expertise and knowledge required to nent; good news for OEMs, and bad news for
leverage the most value from their data aftermarket and insurance companies.”
5 THE OEM RESEARCH CHALLENGE

A survey published in early-2019 by strate-

gic advisers NewVantage Partners found that
more than 97 per cent of executives say their
business is investing in big data and AI solu-
tions as they become data-driven enterprises.
It’s vital that OEMs create a flexible data
strategy that is able to respond quickly to
changing business priorities and ensure
the enterprise is agile enough to refocus
efforts on the most relevant approaches
to data. Any effective data plan needs to
go beyond just how corporate data is man-
aged and establish a cohesive framework
for how different projects are administered
to ensure the most pressing data challenges
are addressed.
“For an OEM it is fundamental, first, to
establish a data strategy. This strategy must
be flexible, given the uncertainties currently
existing in many layers, but it should also
incorporate an innovative vision about the
value proposition of the company based on
their participation in the generation, storage
or use of this data,” says Minsait’s Mr Gaitán.
Very few OEMs have the internal expertise
and knowledge required to leverage the most
value from their data. While data can be a
powerful asset when used in the most effec-
tive way, a haphazard approach provides little
Any effective data plan
needs to go beyond just how
corporate data is managed
benefits to OEMs that should work towards
achieving a unified data programme.
In collaboration with a trusted partner or
set of partners, OEMs are able to receive sup-
port on their data journey and ensure data
privacy, security and compliance issues are
considered at every stage.
“In the deployment of this strategy, it is neces-
sary to find the right partners. We would not talk
only about a single partner, but about an ecosys-
tem of partners with specialised capacities in
each of the areas – platform, security, analyt-
ics – to be able to adapt the deployment of this
data strategy in an uncertain environment with
accelerated changes,” Mr Gaitán concludes.
 6 THE OEM RESEARCH CHALLENGE

APPROACH

Five pillars of
the data journey
Ben Rossi

Storage
While poor computation, networking or ser-
vices may slow a company’s data journey, bad
storage design or product choices can com-
pletely collapse an organisation’s ambitions.
Once placed on a particular storage sys-
tem, data is extremely difficult to migrate to
another system, so it’s vital to identify the

1
best path as early as possible. Not considering
the impact of a new technology on the current
structure could also result in costly delays.
“The more a company decides this data
journey will involve newer technologies and
cloud, the more it requires an agile approach
to storage,” says Jaspreet Singh, founder and
chief executive at Druva, a data protection
and management provider.

Networking
Networks grow smarter, more agile and more
nuanced every day. Digital transformation
hinges on connectivity and networks are not
only a vital component in the data journey, but
they support every pillar, helping businesses
to stay connected and open new opportunities.
Networking is not only enabling digital trans-
formation, but also supporting other business
areas and applications in that journey.
“Agility and adaptability are becoming more

2
critical for networks, particularly with 5G on
the horizon,” says Jamie Jefferies, vice presi-
dent and general manager, Europe, Middle East
and Africa, at Ciena, a networking systems, ser-
vices and software company. “An adaptive net-
work provides the agility that businesses need
to support shifting environments and embrace
new innovations.”
 7 THE OEM RESEARCH CHALLENGE

Services
Data services are key to provisioning data
with trust, ease and consistency. In a similar
vein to software-as-a-service, the concept
of data-as-a-service (DaaS) has grown to be
extremely popular.

3
DaaS models abstract underlying complexi-
ties, such as data duplication and entity link-
ages, providing benefits related to agility, low
cost and data quality. Leveraging service mod-
els based on application programming inter-
faces, consumption could be made agnostic
to people, machines and devices. However,
enterprises must give important considera-
tion to security access and authorisation.

Servers
Workloads and software are increasingly distributed
across multiple servers, and often the traditional server
central processing unit is no longer the only place where
computation, or compute, happens.
Software development and management now rely on

4
quick development cycles and rapid, iterative deployments
on virtual machines and containers. As a result of these
changes, the network pillar has taken a more prominent
role in the data journey.
“IT directors and architects are fully aware they must
increasingly think ‘outside the computer’ for running their
workloads,” says John Kim of Mellanox Technologies.
“In-network computing means the network switches can
transform, filter and redirect data as it moves from server
to server.”
Solutions
Leveraging data solutions is the final ingredi-
ent in the journey, linking everything together
to provide visibility and insight. Enterprises
are increasingly pursuing a multi-cloud
strategy, embedding analytics and deploying
AI-based solutions to make the data journey
more frictionless.
Data solutions are spread across the whole
value chain, including data acquisition, ETL
(extract, transform, load), data management,
governance, curation, visualisation, analytics
and machine-learning. They are intrinsically

5
linked to the other pillars.
“Enterprises should adopt a use-case-driven
approach where an agile team with well-de-
fined data roles focuses on delivering clear
business outcomes,” says Sumant Kumar,
director of digital transformation at CGI UK.
“Most modern data solutions are architected
to facilitate agile-based implementations
using capabilities provided by cloud.”
 8 THE OEM RESEARCH CHALLENGE
COMMERCIAL FEATURE

COMM U NICATION

The edge moves

to centre ground
The ability to compute on the edge is set to be more important
than ever for manufacturing providers. Achieving mobility to
shift easily between public, enterprise and edge clouds, and
connect all the data in between, will prove crucial
Ben Rossi

dge computing, whereby data is
E processed at its source rather than
being transmitted to a datacentre,
occurs much more regularly among original
equipment manufacturers (OEMs) than tradi-
tional enterprises.
In fact, OEMs have been delivering solutions at
the edge for decades, though it has become more
prolific in recent years as they have sought to dig-
itise traditional operational technology or physi-
cal machinery, generating masses more data.
As more data is created at the edge, the sophis-
tication of data analysis grows with it. To gain extra
value, OEMs now need new kinds of computation.
To create intelligence from this data, it must be
analysed at the edge where there is no friction or
latency. This has made edge computing a close
cousin of automation, due to the need for com-
putation to occur where data is created, a com-
mon requisite in the industrial internet of things.
But as other sectors embrace machine intel-
ligence, its influence is spreading. The edge is
enabling autonomous cars in the automotive
world and data-driven hospital equipment in the
healthcare industry. Even in office environments,
it’s being used to automate air conditioning or
meeting room bookings.
According to analyst firm Gartner, by 2022
three quarters of enterprise-generated data will
be created and processed outside a centralised
datacentre, so at the edge. However, as this par-
adigm grows, it is becoming more challenging.
 9 THE OEM RESEARCH CHALLENGE
COMMERCIAL FEATURE

As OEMs release their solutions and intellec-

tual property to their respective markets, their
associated computation, network and storage
infrastructure become more complex, and they
require the data to flow seamlessly between
their public, enterprise and edge clouds.
The greatest challenge of all is the biggest
business imperative: gaining genuine business
value from all the data and insights generated.
While some OEMs are well into this journey,
having built a platform and developing new
services for it, others are still very much in
discovery mode.
“There are areas where the edge is taking
longer to be adopted than others; some of that
is down to skills gaps and some to security, com-
pliance and data privacy,” says Matt Quirk, global
market strategy and development manager, WW
channels and alliances – OEM, at Hewlett Packard
Enterprise (HPE).
“Operational technology has traditionally
required in-depth knowledge of the working
machinery at the edge, but not necessarily the
IT, networking or communications skills to be
The greatest challenge of all is
the biggest business imperative:
gaining genuine business value from
all the data and insights generated
able to bridge that across into making it a tech-
nology platform. Meanwhile, the huge volume of
data coming out of devices at the edge makes
security paramount, especially because OEMs
deal with multiple customers’ data as well as
their own.”
Last year, HPE announced plans to invest $4
billion in edge technologies and services over
the next four years. The company builds infra-
structure for OEMs on the cloud at the edge,
10 THE OEM RESEARCH CHALLENGE
COMMERCIAL FEATURE

74%
transformation from the edge to the cloud, and
helping OEMs connect all their data, edges and
clouds. The company is bridging the digital and
physical experience to make sense of the data.
“From an HPE perspective, we saw this
future coming early on. We’ve invested in the
of UK and US IT workers feel their Edge and will continue to invest in it, certainly
organization is struggling to generate
over the next few years with the $4b investment
useful business insights from its data
we announced last year.” says Mr Quirk.
SnapLogic 2018
“From a solution standpoint, we have very
robust relationships with OEM players around
the world that also interact with each other to
create partnerships to develop solutions for
and provides software between chip and the future. We have converged edge systems
application. By having the same set of tools and and world-class infrastructure that has enter-
software stack along the whole data pipeline, prise-class compute ready to go, so we’re there
OEMs are able to move their data seamlessly and for our partners as they move to their future
compute at the edge when they need to. technology roadmap.”
As OEMs continue to digitise, the massive
growth in data means what they do with it at one
step along the supply chain may differ to what
they do at a different stage. Whether OEMs are
operating at the far edge, near edge or back in a
datacentre, and whether they’re doing this on a
corporate network or an LTE (long-term evolu-
tion) or 5G WAN (wide area network), HPE ena-
bles them to move along that spectrum when it
makes sense for the data.
“It’s not one answer fits one industry or one
customer, it varies and it’s becoming more
dynamic,” says Rod Anliker, chief technologist
at HPE OEM Solutions. “We invest in tools to
make it easy to move data from a public cloud
to a private cloud to an edge cloud, and not
just move data but operate on data in differ-
ent environments. We’ve made investments to
make it easier to apply artificial intelligence to
very large datasets.
“We take massive value from our enterprise
IT world and we apply it into the business of
our OEM partners. If we can take away part
of that complexity and make it simple by pro-
viding the right solution – the right mix in our
portfolio for our OEM customers – then that
frees them up to do what really differentiates
them in the market.”
With the internet of things set to influence
industries in a hugely powerful way in the years
ahead, edge computing will only grow further
in prominence and importance. From the chief
executive down, the belief is strong that the
enterprise of the future is edge centric, cloud
enabled and data driven.
HPE is committed to accelerating the
11 THE OEM RESEARCH CHALLENGE

EXPERIENCE

Data is key to becoming

customer centric
Manufacturing providers now
have the opportunity to use
the increasing amount of data
available to them to improve
customer experience
Christine Horton

ntil recently the relationship between

U an original equipment manufacturer
(OEM) and the end-customer has
been somewhat limited as OEMs were depend-
ent on the direct marketing and sales activity
of their partners to drive explicit demand for
their solutions.
However, in today’s competitive landscape,
OEMs are increasingly recognising the need
to be more customer centric. In fact, customer
experience (CX) is now so important that
analyst Gartner has referred to it as “the new
marketing battlefront”, with more than 80
per cent of firms looking to compete mostly
or completely on CX in 2019.
This applies to OEMs, too. Forrester
research released earlier this year found
brands that provide an enhanced partner
experience grow faster than their peers, are
more profitable, and drive higher customer
satisfaction and retention downstream.
“Smart channel professionals are looking at
data across the partner journey as a way to dif-
ferentiate themselves from the competition and
accelerate faster in the market,” says Forrester.
That means OEMs can’t lose sight of their Delivering an excellent customer experience
end-users if they want to achieve the best
results and ultimately give themselves a com-
can mean the difference between short-lived
petitive advantage. progress and long-lasting success
“OEMs that focus on delighting customers
are able to drive revenue growth, customer
retention and outperform their competitors,”
says Matt Quirk, global market strategy and
development manager, WW channels and
alliances – OEM, at HPE.
12 THE OEM RESEARCH CHALLENGE
Mr Quirk believes data insight is key for OEMs
to understand where they are getting customer
engagement right and where they need to
improve. “Analysing data either at rest in the
datacentre, or in real time at the edge, gives you
actionable insight and that insight can drive
better outcomes for end-users,” he says.
An example of using data insight effectively
can be found in the retail world. According to
a PwC survey, companies can put a significant
price premium on their goods and customers
are more likely to try additional services or
products from brands which provide a posi-
tive customer experience.
“This can be as simple as having well-
trained staff all the way to providing cus-
tomers with in-store way-finding or loca-
tion-based services through mobile-first
technologies, such as Aruba,” says Mr Quirk.
Another example is in healthcare, where the
introduction of artificial intelligence (AI) at
the edge is changing how stroke victims are
treated. The time it takes to analyse a brain
scan and the accuracy of the interpretation are
critical to the patient experience and outcome.
Introducing fast insight delivers life-saving
treatment, reduces the scope for human error
and gives end-users, in this case patients, the
best possible experience in a difficult situation.
Edge computing may be tech’s biggest
development in 2019, with Gartner forecast-
ing 75 per cent of enterprise-generated data
will be created and processed outside cen-
tralised cloud datacentres and relocated to
the edge by 2022.
Put simply, edge computing moves the pro-
cessing and analysing of data out of the data-
centre to the network edge, closest to the point
of its collection. It enables data produced by
OEMs now have more opportunity to put
data to work, transforming it into a valuable
commodity in an increasingly competitive
and disruptive landscape
internet of things (IoT) and mobile devices to
be processed closer to where it is created.
Mr Quirk argues that this is now where
experiences happen and therefore the closer
OEMs can get to that experience with tech-
nology, the faster and more time relevant
their actions can be.
“Historically, there just hasn’t been the
enterprise-class technology able to leverage
the vast amounts of data generated at the
edge,” he says. “Today, with converged edge
infrastructures and multiple ways of digitis-
ing CX, OEMs can deliver solutions which can
accelerate time to insight and deliver new ser-
vices to enhance the customer experience.”
For example, Netherlands-based HPE OEM
partner XPAR Vision is using machine-learn-
ing and AI with leading industrial IoT capa-
bilities to make glass manufacturing more
efficient and safer. It enables its customers to
automate glass bottle production, which is a
hot, dirty and potentially dangerous process,
to achieve higher overall product quality with
fewer defects and less waste.
More good news for OEMs is that customers
have become more willing and able to inter-
act with brands electronically via the web,
mobile and social media. As a result, OEMs
have an opportunity to create a more direct
75%
customer relationship.
“Success is dependent on the rights tools,
for example marketing automation and asso-
of enterprise- ciated analytics, and leveraging the right
generated data will be data, acquired through online registrations,
created and processed
follows, likes and third-party sources,” says
outside centralised
cloud datacentres and Dale Vile, chief executive and distinguished
relocated to the edge analyst at Freeform Dynamics.
by 2022
There may also be an opportunity, says
Gartner 2017 Mr Vile, depending on the nature of the
OEM’s business offering, to exploit the IoT.
“This could involve gathering data through
telemetry – great for getting to know how
the end-customer is using the offering – but
it could also be about delivering remote ser-
vices and insights to the customer,” he says.
“Either way, there’s typically a need to
process, manage and analyse often large vol-
umes of machine-generated data.”
OEMs now have more opportunity to put
data to work, transforming it into a valuable
commodity in an increasingly competitive and
disruptive landscape. As Mr Quirk concludes:
“Delivering an excellent customer experience
can mean the difference between short-lived
progress and long-lasting success.”
13 THE OEM RESEARCH CHALLENGE

LEARNING

Listening to
data feedback
Skilled talent is pivotal in
gleaning insights from data
feedback loops

Finbarr Toesland

ata may be the new oil, but if original

D equipment manufacturers (OEMs)
don’t have the right talent and tools
to extract actionable insights, they will fail to
get the most value.
This final stage in the data journey is argu-
ably the most important. A substandard or
ineffective data analysis strategy can lead
to the discovery of insights that don’t fully
address the challenge the OEM wants to solve.
So the often laborious and costly collection of
relevant data will have been an unproductive
use of time.
These risks highlight the importance of
ensuring both skilled staff and practical tech-
nological solutions are available during the
creation and management of data feedback
loops. Gaining insights from feedback loops
enables OEMs to measure their performance,
uncover inefficiencies, learn from their weak-
nesses and ultimately deliver bottom-line well suited for deep learning,” says Luka
business value. Crnkovic-Friis, co-founder of operational
Through the use of next-generation tools, AI company Peltarion, and a member of the
namely machine learning and artificial intel- Swedish AI Council.
ligence (AI), data can be exploited to pro- “There are various opportunities; image
vide predictive insights and suggestions for classification can be applied to the detection
improved efficiencies. of a whole range of equipment types, as can
Such impact will be felt throughout the OEM’s switching to aftermarket services where the
operations with virtually all aspects of manu- repair and maintenance are a growing part of
facturing, internal services and customer-fac- the OEM offer.”
ing processes open to possible improvement. OEMs can tap into an array of data sources
“For example, in high-tech and volume and analyse them for improvements in
manufacturing, defect detection is an impor- everything from predictive maintenance to
tant and intensive process which would be the better allocation of resources. But they
14 THE OEM RESEARCH CHALLENGE
must address the professional, advisory and
operational talent gap that can hamper any
successful data strategy.
The rise of data analytics has led to an
accompanying demand for skilled data sci-
entists who have both the ability and expe-
rience to build and manage complex systems
that can produce actionable insights. IBM
predicts the demand for data scientists is set
to grow 28 per cent by 2020. AI and its associ-
ated technologies can only be transformative
business tools if the right team support their
implementation in the most suitable areas.
“There’s really no substitute for hiring an
expert for a short period of time who has the
knowledge of the range of tools available,
who is vendor neutral, and who understands
what can be achieved with a given set of
data and what can’t. Hiring such a person at
the beginning of a process is comparatively
cheap given the cost of going the wrong way,”
says Dr Andy Edmonds, a machine-learning
expert at Brainpool AI.
There is no single quick fix for the current
talent shortage, although there are a number
of short and long-term solutions which OEMs
are using to limit its impact. From upskill-
ing employees to offering higher salaries to
attract experienced staff and embracing tech-
nological platforms that augment the skills
of the workforce, OEMs are finding ways to
bridge the skills gap.
“By reducing the cost, skills and infrastruc-
ture required to use deep learning, OEMs can
put deep learning into the hands of a broader
set of data scientists, developers and even
domain experts themselves, moving projects
from concept to production much faster,”
says Mr Crnkovic-Friis.
Gaining insights from feedback loops
enables OEMs to measure their performance,
uncover inefficiencies, learn from their
weaknesses and ultimately deliver bottom-
line business value
$158.3m
Worldwide edge
computing market
in 2016
$3,240m
Forecast worldwide
edge computing market
in 2025
Agility on the edge
Grand View Research 2018
It’s vital that data from original equipment
manufacturers (OEMs) is processed quickly
and the manufacturing providers are as
responsive as possible to data feedback
loops. Cloud computing is perfectly suited
to many tasks, but as more and more con-
nected devices are added, the available
bandwidth will be reduced.
Advent of edge computing can enable
OEMs to be more agile when dealing with
data feedback loops as the data processing
location is brought closer to the data source.
By reducing the distance between these
two locations, network performance can
be improved as many latency issues can be
resolved, compared with centralised data-
centre storage.
Although data travels at very fast speeds,
even a delay of milliseconds has the poten-
tial to reduce latency and slow down pro-
cessing times. The last-mile bandwidth bot-
tleneck issue, where data has to be routed
through local networks before arriving at its
intended destination, can also be dealt with
in edge computing as data can be processed
at the edge of the network.
Unlike traditional datacentres, data is
stored in multiple locations in edge com-
puting, which means the failure or outage
of a single site will not be as damaging. This
benefit is particularly important for man-
ufacturers as even a small period of down-
time can be extremely costly.
“Edge computing offers huge opportu-
nities, but runs the risk that some vital
insights might be lost,” says Dr Andy
Edmonds at Brainpool AI.
“Data that is discarded can’t be recov-
ered. So OEMs must ensure that the edge
processing can be rapidly changed and
upgraded as new insights are needed.”
Hewlett Packard Enterprise (HPE) has When OEMs work with HPE OEM Solutions,
been working with original equipment they gain access to the HPE Pointnext
manufacturers (OEMs) for decades, helping Foundation Care – our worldwide network
them create innovative solutions that exceed of rapid and dependable 24/7 support from
industry demands, accelerate time-to- OEM experts – which ensures that any issues
market, and boost long-term profitability. faced by partner OEMs and their customers
can be resolved in a matter of hours,
In our increasingly hyper-connected world, anywhere and at any time.
real-time is the new just in time. Being
able to analyse data directly at the edge – We are here to help you transform innovation
the moment it is created – is going to give into enduring success. See what’s possible
companies crucial competitive advantage. with an HPE OEM partnership at
HPE is investing heavily in the Edge, and www.hpe.com/solutions/oem
has built industry-leading edge-to-cloud
components designed for industry-specific
applications. OEMs are using these off-the-
shelf solutions from us to free up time to
focus on the value-add of their products.

Publisher Richard Hadler Contributors

Project manager Sarah Callaghan
Finbarr Toesland Ben Rossi Christine Horton
Editor Peter Archer Freelance journalist, Formerly editorial director at Regular contributor
Publication sponsored by
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