4/12/2019 Industry 4.

0: Four Mittelstand firms that get the digital economy

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INDUSTRY 4.0

Four Mittelstand firms that get the digital

economy
Who says Germany’s family-owned, medium-sized firms
can’t keep up with the Internet of Things? These four
businesses are embracing the future.

John Blau

11/08/2017 - 11:13 AM • Share now

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4/12/2019 Industry 4.0: Four Mittelstand firms that get the digital economy

Seeing the future.

ANZEIGE

Germany is famous for its Mittelstand, the small and

medium-sized firms that are usually family-owned and
closely held — and often hidden champions in global
markets. But the Mittelstand as a whole is also at risk of
sleeping through the fourth industrial revolution, in which
new manufacturing techniques meet the Internet of
Things. Development bank KfW estimates that only one in
five Mittelstand firms is on the cutting edge. But that's still
a lot of firms. Here are four prime examples of German
businesses on the cutting edge of the latest technological
trends:

Duravit: At-home urinalysis

One of the world’s premier makers of sinks and toilets is located in a
picturesque valley in the Black Forest. Called Duravit, the firm doesn’t just
churn out any old porcelain for our effluvia; it works with celebrity
designers such as Philippe Starck for that je-ne-sais-quoi for your salle de
bain. Its next big thing, to be launched early next year, is a toilet bowl that
automatically takes urine samples just as a doctor would.

The toilets — admittedly dear at €7,000 ($8,100) — are operated by an

app. The initial target market is fitness-conscious people, says boss Frank
Richter. When the customer urinates, the toilet tests the fluid for all sorts
of health markers, from protein levels to signs of dehydration. Within
three minutes, it sends the data via Bluetooth to the app. This being a
German product, the data is of course protected — only the designated
device can receive and store it.

Just like the doctor, but with no wait.

Miele: Rentable washing machines

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4/12/2019 Industry 4.0: Four Mittelstand firms that get the digital economy

Founded in 1899 and known for its washing machines, dryers and other
“white goods,” Miele has never exactly been sexy. But the firm has picked
up on a Next Big Thing: the sharing economy. People already use Airbnb
to share their apartments and DriveNow to share cars. “Especially young
people are moving away from buying stuff and toward renting it,” says
Gerrit Heinemann, an expert at the University of Applied Sciences
Niederrhein. So why not washing machines?

To try the idea out, Miele has a pilot project called Blue Horizon that lets
people rent, rather than buy, washing machines. They can pay a flat rate
or per load; experts estimate an average cost of about €20 per month.
That not only makes the costs predictable and manageable to users, it
could also reduce the hassle of owning. That’s because Miele, as the
owner, will service the machines. Miele can only offer this service
because it thinks that the combination of software and connectivity will
allow it to monitor its machines all the time, seeing if one is about to
break down before it even happens.

Miele is not alone in spotting the trend, of course. German retail giant
Otto and electronics chain Media Markt are apparently considering
renting out TV sets. And that’s just the start of the sharing to come.

Sharing is caring.

Hhpberlin: Faking fires

Hhpberlin is a Mittelstand firm that simulates fires and engineers ways to
prevent or contain them. Among its clients are famous venues such as
Angela Merkel’s chancellery and the stadium of FC Bayern Munich. But
simulating fire is a fiendishly difficult business, requiring vast computing
power. So in 2015 Hhpberlin hopped on the cloud computing train.
Instead of owning and operating its own servers, it rents computing power
in a remote data center in Amsterdam, which it accesses through high-
speed fiber-optic lines. It’s sort of like sticking a fire hose into a cloud and
tapping it for water whenever you want.

“Now we can calculate different fire scenarios in parallel, have infinite

storage and can take on a lot more orders,” raves Stefan Truthän,
Hhpberlin’s director. About 45 percent of Mittelstand firms already use
cloud computing, according to consultancy Crisp Research, and another
35 percent have plans to do so.

Where there's smoke...

Bausch + Ströbel: Manufacturing VR

Bausch + Ströbel is a world leader in making huge machines for hospitals
and, like many Mittelstand firms, is based in a small town in the
southwestern region of Swabia. Its monster appliances clean, fill, inspect
and label syringes, vials, ampoules and all those other little bottles
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4/12/2019 Industry 4.0: Four Mittelstand firms that get the digital economy

doctors use. Even though it makes only about 400 such machines a year,
its revenues are around €200 million. In making these machines, the firm
used to have carpenters build huge models out of wood. Customers then
had to visit and look at the structures to see if they would fit into their
hospital or lab. Not exactly convenient or user-friendly. Whole warehouses
were cluttered with old wooden models.

Soon, however, Bausch + Ströbel will invite potential customers to put on

goggles and experience their future machines in 3D and virtual reality.
How does the air flow around the machine? How will staff operate and fix
them? What does it sound like? It's not only a better customer experience
but streamlines the manufacturing process. Right now, the time from
receiving an order to the first use of a machine is about 12 months; using
virtual reality will bring that down to seven or eight months, even for
custom-designed machines.

Seeing is believing.

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