We’re now in the era of Industry 4.0, evolving to increasingly autonomous systems capable of making decisions in response to new inputs.
The ABB/IBM Watson wind-energy forecast solution we’re demonstrating at IBM Think in Las Vegas is pretty cool, but it’s just one example illustrating tectonic changes now disrupting the global industrial landscape. Digital reinvention may be familiar news in such industries as media, retail, and high tech, but less than 40 percent of global industry in general – think oil & gas, energy, mining, transportation, etc. – is currently digitalized, according to McKinsey. There’s a lot of disruption underway right now, and more yet to come. Exciting times.
The ABB/IBM Watson energy forecast solution is part of the maturation story of the renewable energy sector. As renewables like wind become significant parts of the energy market, they are subject to the same regulations and expectations as traditional energy sources. Inherently fickle wind energy is being held to the same standards as all forms of energy.
Accurate forecasting of wind energy is now essential, which presents a major challenge to the industry. To maximize revenue and maintain their position as serious energy-market participants, wind generators need to know how much power they’re going to produce, and when. Mistaken wind-generation forecasting creates over- and under-supply, opening operators to financial penalties. When forecasting is accurate, generators can reduce costs and boost income.
Our demo project at IBM Think combines IBM Watson’s AI with weather forecasts, which are then blended with customer data from ABB’s generation, grid, and market management systems in real time to produce wind energy forecasts of unprecedented accuracy.
This solution is an example of multiple trends now underway in global industry. Most important among them is connecting the unconnected. Think of all the industrial machines scattered around the world collecting and storing potentially valuable data that goes nowhere and accomplishes nothing because each machine is an isolated island. ABB realized some time ago that there was enormous potential in connecting those unconnected information nodes. In our case, we’re talking about 70 million devices, 70,000 digital control systems, and 6,000 enterprise software solutions. And that’s just our customer base. We also connect our customers with their entire ecosystems.
We’re optimizing what all that data, collected and analyzed, can accomplish. Not just increased efficiency, but entirely new levels of flexibility, agility and customization in imagining and delivering new products and services.
Our demo wind-energy projection project at IBM Think also underscores the importance of integrating Operational Technology (OT) and Information Technology (IT). The companies that will thrive in Industry 4.0 require intelligence at the edge, in the cloud – everywhere. Smart companies are building out a “digital nervous system” for entire electromechanical industrial infrastructures.
Smooth integration of OT and IT extends to industry’s soft white underbelly – cybersecurity. Part of the problem is that many OT systems are simply old. Perhaps more complex, the internal politics between OT and IT professionals can sometimes hinder security. As my colleague Satish Gannu, ABB’s Chief Security Officer, has pointed out, a recent Forrester survey of IT and OT/LOB leaders showed IT and OT managers evenly divided on whether IT or OT is responsible for security. As an alarming result of this standoff, says Forrester, an unacceptably large number of companies – 59 percent – are willing to “tolerate medium-to-high risk in relation to IoT security.”
Our goal at ABB is to help our customers blend the talents and experience of OT and IT to bring optimal security to the industrial world. Complete security isn’t possible, of course, but our target is maximum reduction of risk.
We’re now in the era of Industry 4.0, evolving from automation – where rule-based computers tell machines what to do – to increasingly intelligent autonomous systems capable of making decisions in response to new inputs. Technology innovations that began in high-tech or the consumer world – blockchain, AI, augmented reality, drones, etc. – are now creating full-force disruption in the industrial world. Why? Because total digitalized transformation is the best way to help our customers defeat existential challenges. Established industrial companies are keenly aware that upstart newcomers represent a growing proportion of the S&P 500, and the only way forward is up. As I said, exciting times.