The client for this mandate was a global provider of condition monitoring systems for vibration monitoring based in Germany. The business model had remained unchanged for decades: the development, production and two-tier distribution of condition monitoring devices to operators of large plants and machines. The global market was worth around 1.4 billion dollars, with an annual growth rate of around 6 percent.
With the market availability of affordable precision sensors and the arrival of machine learning and deep learning technology, new business opportunities are emerging: With predictive maintenance, predictions about maintenance events can be made autonomously by machines and optimized recommendations for action can be analysed. The savings potential of this digitalization solution is enormous for users.
At the time of the interim mandate, a global market for predictive maintenance with a volume of around 11 billion dollars was forecast - with annual growth close to 40 percent. The introduction of the new technology had a significant impact on company valuations: the EV/EBITDA multiple for the plant and mechanical engineering sector during the project period averaged 10.2, while that for predictive analytics providers was 21.2.
The project objective was therefore to gradually develop a digitalization strategy to become a predictive maintenance provider, agree on the company's direction and detail the implementation plan.
Generating incoming orders in the predictive maintenance market with lead user
After a thorough analysis, the interim manager identified and recommended a platform-based software architecture to the company that would enable the centralized further development and application of these digital maintenance algorithms for monitored machines and systems worldwide.
Based on his experience with digitalization strategies in mechanical and plant engineering and his tried-and-tested approach, the interim manager was able to work with the management and the project team in rapid succession to gradually develop and agree the core building blocks for a comprehensive and sustainable digitalization strategy and transformation plan to become a predictive maintenance provider. The first implementation successes were achieved early on in the project.
The collaboration with lead users proved to be particularly effective right from the conception phase. This collaboration led to incoming orders with new digital services and business models. The customer-centric transformation gave all organizational areas involved the necessary orientation.
