WFSGI Manufacturers Forum: What Sports Brands Can Learn from Siemens

“Digitization always means disruption for the business model up to that point,” says Professor Heinz Eisenbeiss, Head of Marketing Factory Automation at Siemens: “Think of books and e-books, or CDs and the digitization of music – or taxis and car-sharing platforms.”

Eisenbeiss works in the Digital Factory division at Siemens. For Siemens, like for other companies, entire production cycles are being digitized, from the product design to product development right up to product production. He says that many areas of the sporting goods industry will take this step in the next five to ten years. A well-known example of this could be the Speedfactory from Adidas.

Four characteristics of digitization provide decisive advantages over the competition to companies with digital business models:

• Speed: Products can be designed, manufactured and delivered more quickly.
• Flexibility: The market is always demanding faster new solutions, simulating new trends, which means that products must be able to evolve more quickly.
• Quality: High quality is imperative, considering the competition. In the event of defects, digital traceability is necessary to discover the cause of the error and improve.
• Efficiency: It will be necessary, even with smaller quantities, to offer prices seen in mass manufacturing; individualized products require ultra-efficiency in order to remain viable.

The biggest source of danger during the transition to digitization is the issue of data security. “I have two concerns here for the industry,” says Eisenbeiss. “Firstly, a cyber attack can lead to a production standstill.” Secondly, Eisenbeiss believes the issue of intellectual property is more controversial than in pre-digital times. Data can be taken straight from the design laboratory and copied. That is, at a much earlier point in planning as was previously the case.

The biggest challenge for a successful digitization according to Eisenbeiss: digital collaboration of all processes within the value chain. He says this can only happen as a top-down process. The management level is required, for example with the introduction of a chief digital officer, to coordinate and lead the implementation.

The intertwining and simulation of all processes is successful at Siemens due to the creation of a “digital twin.”

A “digital twin” is a digital reflection of the entire product process, where all phases intertwine and everyone involved has access to all data relevant to the process. The “digital twin” is subdivided into three areas:

1. Design on the computer: The product, so for example a sneaker, is presented, developed, and perfected digitally. Exterior influences, wear marks, etc. are simulated.
   The result: the product’s “digital twin.”
2. Product planning and development on the computer: The entire production process is simulated. What resources are needed? Which working conditions dominate? How long do certain manufacturing processes take? What happens if material is missing? Where can mistakes occur? For example, when manufacturing sneakers, a database of existing and used textile materials specific to the manufacturer could be applied.
   The result: the production’s “digital twin.”

Product production: All data on production, quality control, etc. is tracked.
The result: the actual manufacture’s “digital twin".

Another important question that can be answered by the introduction of the “digital twin”: Can multiple product lines be assembled in the production plant?

“The sports industry can follow the example of the automotive industry here,” says Eisenbeiss. “With manufacturers in the past, complete manufacturing halls were emptied out after a few years and refitted with new machines when there was a new model series.” He thinks most manufacturers would not be able to afford this nowadays. Manufacturing machines will have to be adaptable to other manufacturing conditions, new models for example.

In the sporting goods industry, it’s about a lot more than just customization, surmises Eisenbeiss. His assessment: In a few years, sports companies will have to be produce products that possess the following characteristics:

• Quickly produced and delivered
• Adaptable
• Targeted to very small, specific target groups or individual people

Heinz Eisenbeiss’ conclusion at the WFSGI Manufacturers Forum: “Digitization therefore also means that, for sports companies, the customer’s interests and preferences must take center stage.”