Creating digital products in engineering companies : a practitioner’s review

Abstract German engineering companies with their focus on mechanical solutions and technical excellence are currently going through a major change in their value creation – digitalization of products processes and the digital transformation of the entire organization. Comparable to the introduction of service-oriented business twenty years ago, digitalization comprises the opportunity to enhance the existing offer portfolio in terms of product individualization, reduced scrap or lead times, but at the same time creates extremely deviating requirements regarding innovation management, business models, commercial structures as well as company culture. At the same time, successful examples from the consumer industry or best practices in general cannot be applied as a one-to-one copy due to the different market situation and boundary conditions. This paper thus reviews the major challenges engineering companies are currently facing. It evaluates existing models and approaches from the consumer industry with respect to their applicability in engineering and finally provides best practices and examples from the EPC (Engineering, Procurement, Construction) market as well as their implementation strategy.