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CAMBASHI THOUGHT LEADERSHIPThe Impact of COVID-19 on industrial IoT and
Digital Transformation: Winners and losers
CAMBASHI THOUGHT LEADERSHIPThe Impact of COVID-19 on industrial IoT and
Digital Transformation: Winners and losers
, tel.: +44 1223 460439, www.cam
bashi.com
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Abstract
Cambashi Thought Leadership briefing outline
An assessment of global COVID-19 economic impact scenariosCambashi uses industry forecasts from leading economic analysts such as Oxford Economics to estimate the global impact of the COVID-19 pandemic on Technical Applications software. In this section, we present some of the key, global statistics that we use.
The impact on industryIn the short to medium term, the predicted impact on different industries is not uniform. In general, industries that depend on disposable income, such as those that are travel- or fashion-related, are affected more than those which are vital, such as utilities and medically-related industries. This section includes feedback from briefings we have held with major software companies, most – but not all – of which we are aligned with.
The impact on the engineering/manufacturing/industrial software marketTo estimate the effect on the Technical Applications software market, Cambashi uses industry ‘value added’ figures – which, after many years of experience, it has found to be a better indicator than ‘revenue’. Cambashi then assesses the impact on IIoT, Connected Applications and Digital Transformation to identify Winners and Losers.
No-one can accurately predict the social and economic impact of the COVID-19 pandemic but, using scenarios from respected economists combined with Cambashi’s established datasets and intelligence, we can assess its impact on engineering, manufacturing and industrial (‘Technical Applications’) software markets including PLM/CADCAM, CAE, BIM, MOM and IIoT. Cambashi is providing a briefing – outlined below – that focuses on the industrial IoT software market and identifies ‘winners’ and ‘losers’ using nine ‘Connected Market Areas’ and typical Use Cases. This shows where providers are likely to see increased – or decreased – demand and where new opportunities may arise in the software market.
Cambashi is making this briefing available to its key clients and other companies involved in engineering and manufacturing software. Please contact us to arrange a convenient time.
, tel.: +44 1223 460439, www.cam
bashi.com
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How Technical Applications software markets such as PLM, CAx, BIM, MOM and Connected Applications (IIoT) are affected.
Fig. 1 Impact of Covid-19 on the Technical Applications software market, by industry (provisional figures)
Cambashi’s analysis shows that the growth in Technical Applications markets over the last few years has been very positive, and the effect of COVID is likely to be temporary. Different industry areas are more or less affected, as shown in Fig. 1 below that shows provisional forecasts for Technical Applications Spend Growth (in this case PLM and CAx) in selected manufacturing industries.
, tel.: +44 1223 460439, www.cam
bashi.com
© C
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Further analysis shows how different applications and programs are affected in different ways. This helps us to show where the ‘winners and losers’ are likely to be. Different solutions can be positioned on a matrix according to their Technological Capability and Business Impact. Cambashi’s view is that, while major business transformation projects (that may include ‘digital transformation’) will be resilient, some companies will be reluctant to embark on new transformation initiatives in the near future. More emphasis is likely to be placed on efficiency and cost-saving investments that have a quick payback. This is shown in Fig. 2, below:
The impact on IIoT, Connected Applications and Digital Transformation:Winners and Losers
Fig. 2 The Market Profile for engineering/manufacturing/ industrial software
Cambashi regularly assesses global economic forecasts and uses them to inform its software trends and forecasts in general, and the industrial IoT/Connected Applications and Digital Transformation market in particular. This proven process allows us to make granular market assessments and forecasts in our key focus areas that global software companies can use for sales and market planning, and competitive analysis. When evaluating a wide market such as industrial IoT, it is vital to consider its effectiveness alongside adjacent technologies such as PLM/CAD/CAM, CAE, BIM and MOM. Many companies provide a range of technical solutions and the combined datasets support integrated planning and go-to-market strategies. An example of where this is important is where simulation, provided by CAE (Computer-Aided Engineering) technology is used to facilitate the ‘Digital Twin’ concept using industrial IoT to record information from the ‘real world’. This is then used in the AEC (Architecture Engineering Construction) industry through BIM (Building Information Modeling) technology to help model, design and operate complex structures.
[email protected], tel.: +44 1223 460439, www.cambashi.com © Cambashi copyright 2020
Industry Knowledge for Business Advantage
There is variation within these software markets due to specific effects of the pandemic crisis, such as:
A. Concerns about the fragility of global supply chains will lead to ‘Re-shoring’ and increase investment in industrial automation
B. Investment will move towards ‘Basic applications’ that have short-term payback
C. Investment in ‘Exotic’ applications will be harder to justify
D. Some specific industries will be negatively affected by Financial & societal factors
E. Proximity and Safety measures will be forced by the crisis
F. The experience of global business disruption will encourage Cloud-based’ applications
Summary
Cambashi is making this briefing available to its key clients and other companies involved in engineering and manufacturing software. Please contact us to arrange a convenient time.