Digital transformation leads to savings in CapEx: Study

DIGITISATION of engineering processes, for instance, can save businesses and organizations an average of 35 per cent in CapEx costs and time optimisation. Further, commissioning costs of new systems and assets can be reduced by an average of 29 per cent, reveals a recent study completed by Schneider Electric.

Schneider Electric, the global leader in the digital transformation of energy management and automation, released the Global Digital Transformation Benefits Reports 2019, presenting concrete evidence of the power of digitisation across the spectrum of global industry, commerce, and the public sector. This evidence takes the form of deep, quantifiable, business benefits derived from a repository of 230 customer projects Schneider Electric completed in the last five years across 41 countries – all employing the company’s architecture and platform, EcoStruxure.

The goal for this report was to provide readers with a useful and realistic benchmark on digital transformation’s potential in energy management and automation. At the core of this report are 12 key business benefits of digital transformation. These benefits are divided into three categories, each essential to effective marketplace competition: capital expenditure (CapEx), operational expenditure (OpEx), as well as sustainability, speed, and performance. The Report focuses on four key sectors of the economy — buildings, data centers, industry, and infrastructure — all undergoing transformations that will fundamentally change the way people will live, work and play.

The evidence presented by the report puts to rest concerns in the market that digital transformation is an expensive Capital Expenditure proposition involving new systems and difficult integration into existing processes. The customer projects studied in the Report demonstrate the opposite.

The study shows that digitisation of engineering processes, for instance, can save businesses and organisations an average of 35 per cent in CapEx costs and time optimisation. Further, commissioning costs of new systems and assets can be reduced by an average of 29 per cent.

The study also reveals that digitisation, by harnessing IoT, can result in significant savings in Operational Expenditure – leading to step change improvements in efficiency, reliability, safety, and sustainability. Businesses and organisations report an average savings of 24 per cent in energy consumption, as a result of digitisation.

In industrial applications, digital transformation allows businesses to do more with less — more yield with less energy, fewer materials, and fewer labor hours. Increased productivity, up to 50 per cent, results from energy management and automation efficiencies across the value chain, from IoT-enabled tracking to automated production lines.

Schneider Electric has started its digital transformation journey years ago. In 2009, Schneider Electric launched EcoStruxure, its IoT-enabled, plug, and play, open, interoperable, architecture and platform.

Now boosted for cloud and digital services, EcoStruxure delivers enhanced value around safety, reliability, efficiency, sustainability, and connectivity. EcoStruxure leverages advancements in IoT, mobility, sensing, cloud, analytics, and cyber-security to deliver innovation at every level, from connected products; edge control; and apps, analytics and services.

EcoStruxure has been deployed in 480,000+ sites, with the support of 20,000+ system integrators and developers, connecting more than 1.6 million assets under management through 40+ digital services. Building on EcoStruxure, 45 per cent of Schneider Electric sales in 2017 were IoT-related.

A larger story emerges from this report about the power of digital transformation in energy management and automation: when businesses digitise both, energy management and automation, the two work in concert to drive even greater, unprecedented, value.

Digital transformation is the only way of delivering consistency and efficiency across a company. Technologies such as the Internet of things (IoT), artificial intelligence and big data analytics are making companies more efficient and innovative, boosting their competitive advantage,” said Jean-Pascal Tricoire, chairman and CEO of Schneider Electric. “Our report indicates that many businesses and organisations need a trusted authority to manage this complexity to unlock the full potential of digital transformation. Our technologies, built on EcoStruxure™, harness the power of digitization, enabling our customers to become more efficient, safe, reliable, connected and sustainable – leaders in the New Digital Economy.”

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