How SMEs benefit from Big Data

Smartphones that can operate door handles, robots that deliver parcels and independently communicating Euro pallets - what sounds like a vision of the future has long since become reality.

This is made possible by continuous data streams and digital processes. Digitalization refers to the networking of physical products, systems and processes with the help of internet technologies.

The Internet of Things is often mentioned in this context. This alone leads to rising profit margins due to falling production costs, but the real added value lies in the analysis and provision of data.

Data is therefore seen as a raw material. And an extremely valuable one at that. Money is earned through and with data. Google, Facebook and Apple show this.

"Data has long been considered the oil of the future"

describes Bilgin Kilic, Sales & Product Leader Toolbox at G.I.B, the cross-industry consensus.

"The trick now is to be able to analyze the data, understand it and create new benefits from this data in order to generate new profits - the keyword here is smart data."

Hedge funds, for example, are already using the flood of data from Twitter to predict price trends on the stock market. Whether manufacturing, products, sales or markets - big data is massively changing the world we live in.

Technologies such as Hana open up new possibilities and make even more data available to the end user faster and more transparently.

Big data for small and midsize companies

Meanwhile, big data and digitalization are by no means just an issue for large corporations, but also and especially for SMEs.

"Just because it says big doesn't mean it's not for small and midsize companies"

says Björn Dunkel, Chief Sales Officer (CSO) and member of the G.I.B Management Board.

"On the contrary: SMEs may even be more relevant when it comes to using big data in order to assert themselves against increasingly similar competitors."

The strong focus on customer benefit, the hallmark of traditional SMEs, is becoming an even more effective lever with digitalization.

For example, batch size 1 production, i.e. the fully automated production of individual items according to customer-specific requirements, can only be achieved quickly and easily in a digitized smart factory.

The proximity of medium-sized companies to customers ensures that they know the specific requirements of a particular niche very well, so that a very specific customer market can be served.

"With the help of digitalization, SMEs will be able to do this in an even more time and cost-optimized and therefore more effective way"

Kilic is certain.

Step by step to new additional business

In order to remain competitive in the long term, SMEs and smaller companies in particular should therefore get to grips with big data. Nevertheless, there is still a noticeable reluctance in some areas. Many are reluctant to invest in complex, expensive Industry 4.0 solutions.

"In some places, big data is still seen as a great unknown, a danger rather than an opportunity"

reports Kilic.

"However, I think that German SMEs are in a good starting position for digital production, especially if they follow the motto 'Think big and start small'."

Companies that prudently approach a smart factory and/or networked sales step by step will benefit from digitalization in the long term.

"As a driver of innovation in the interests of our customers, we jumped on the bandwagon very early on and are therefore well ahead when it comes to offering solutions based on the new Hana technology that are suitable for SMEs and make Industry 4.0 solutions usable for SAP customers"

Dunkel explains.

Concrete application scenarios can already be observed at some SMEs and new services have emerged in the big data context. As CIO of G.I.B, Nikolaj Schmitz is aware of new, highly profitable additional business:

"Digitalization is already enabling our customers, for example, to offer more services tailored to their customers or - in the area of predictive maintenance, for example - to save costs and minimize production downtime."

Rapid technological progress is now making it possible to achieve business benefits with digital data. Technologies such as Hana, for example, open up new possibilities and SAP software no longer reaches its performance limits, meaning that more data is ultimately available - faster than ever before and in a more transparent format.

Retain data sovereignty

Schmitz refers to a hot potato when it comes to digitalization:

"The issue of security plays a major role. On the one hand, important insights can be gained from the additional data in order to become even more effective; on the other hand, there is the scenario that cyber terrorists could paralyze entire production lines or gain control of a nuclear power plant at the click of a mouse."

Typically, it is often IT that wags a warning finger at the visionary digitalization ideas of the specialist departments.

"But that's a good thing"

finds Dunkel.

"The specialist department should be able to act freely according to 'design thinking' when creating new business models and not be guided by intellectual barriers such as IT security. This is then later the task of IT."

It is important to keep the know-how in-house in order to retain control over the valuable data.

Brave new G.I.B world

Against this background, data sovereignty included, perhaps in the future a G.I.B Dispo-Cockpit Planning, an SAP add-on from the Dispo-Cockpit product family, will use heuristics to automatically determine the most economical time to replace an important component in a production machine.

"The preventive maintenance of production facilities via G.I.B DCP data transferred to SAP ERP is my favorite scenario for the Internet of Things in connection with the Dispo Cockpit modules"

Dunkel says.

"A maintenance order is created in advance via the G.I.B Dispo-Cockpit Operations, so that components and service technicians arrive at the production facility for the scheduled maintenance event and carry out preventive maintenance."

Conclusion: Whether with such smart services or with digitally enhanced products - SMEs that can make meaningful use of the data gained through digitalization will be able to expand their business model and position themselves for the future. Because in the words of G.I.B CSO Dunkel:

"While the innovations of the previous industrial revolutions with the steam engine, mass production and automation took years to establish themselves across the board, Industry 4.0 will come across the country in real time. Anyone who misses the boat here will quickly go from big player to biggest loser."