Technium’s New Business Model: Becoming a "New Partner" Supporting Machine Tool Customers
#Machinery, Precision Instruments
Mar. 20, 2019
Technium was established as a joint venture between DMG Mori Seiki and Nomura Research Institute (NRI) to support customers with their machine tool operations. We asked them about how they combined the strengths of both companies, such as mechanical technology and engineering, secure use of data, and expertise in digital transformation. They also shared their initiatives to provide new value and their future outlook.
A Wide Range of New Services Post-Delivery
"The importance and potential of machine tools and production technologies have again come into the limelight amid digitalization and the resultant rapid evolution of society," says Tomohiro Sawada, COO of DMG Mori Seiki. He possesses rich experience in information systems-related projects and has been involved with Technium since its inception.
The manufacturing domain is moving towards more flexible and comprehensive processing, by moving from mass production to small-lot, multi-product production. In this context, machine tools have been made multi-functional, so that a single machine can be deployed in a wide range of processes. Production processes are also becoming automated. However, as manufacturing technologies become more sophisticated, engineers are facing new challenges with the acquisition of advanced technologies for production process design and processing program creation, or with monitoring and maintaining facilities using sensors and networks. "We are using machine tools along with digital technology to efficiently and effectively support customers' operations. Thus, instead of merely selling machine tools, we are taking on the challenge of adding value even post-delivery," says Mr. Sawada.
"Machine tool users are already aware of the problems that will arise with the shortage of manpower due to the retirement of highly skilled workers and declining birthrate. We believe that the use of highly versatile, high-performance machinery and automation systems will continue to grow in the future. We have plenty of room to support our customers' challenges through digital systems," says Mr. Yusuke Sugiyama, the Digital Platform Division Manager, who has been seconded from NRI and is working on developing new businesses.
Changing Production Sites through Digitalization
Traditionally, once a machine tool was delivered to the customer, there was almost no further contact between him and the manufacturer. However, the use of the delivered machine tool involves more than just processing; it comes with a variety of other tasks such as pre-processing process design, “setup” in preparation for processing, post-processing measurement, and quality control, preventive maintenance, and troubleshooting. Keeping this in mind, Technium has taken the first step towards building a framework capable of communicating with customers at all times by creating a membership website for machine tool users. The aim is to digitalize and compile all the information necessary for business activities using machine tools, such as the contract, operation manuals, maintenance information, after-sales service history, spare part purchase history, and machine operation training history.
CELOS Club, the flagship service that works with this website, is a subscription service that provides the latest features to maximize machine tool performance. It allows the tools to be connected to the network so that their operations can be monitored round the clock. Operational data can be useful in preventive maintenance, such as to understand the optimal timing for replacement of parts. Many problems can be quickly resolved if call centers can share this information when contacted by customers.
This service also provides an update to the latest version of the software whereby machine functions can be added or updated like a smartphone. “Because the solution is provided as a service, customers can reduce their initial investment. Furthermore, the data and new additional functions collected in the course of its usage will gradually allow products to be customized for each individual customer, thereby making it easier to use,” explains Mr. Sugiyama.
Regarding their future initiatives, Mr. Sawada says, "With the digitalization of various kinds of information, we are acquiring more and more data on machine operations and customers’ service usage histories. The possible use cases for this data are expanding as well. By combining this data on a cross-sectional basis, we can interpret them in a new light and then provide feedback, thereby creating new services and further improving our machinery and software."
Forging Partnerships with Customers to Revitalize the Japanese Manufacturing Industry
"We want to support our customers' innovation in the manufacturing industry through digital services and watch the changes actually take place on the ground. We are involved in all aspects such as user understanding, designing of service specifications and prices, and sales promotions, planning, and execution. The results can be seen in our customer numbers and their responses. The responsibilities are heavy indeed, but at the end of the day, the atmosphere at Technium makes it rewarding."
"DMG Mori Seiki and NRI have their own corporate practices, and they naturally tend to follow their own way in their respective companies. But, as Technium has different ways of doing things, people from both companies encounter new styles of communication or of creating strategies. This kind of opportunity for mutual learning is one of the benefits of a joint venture," says an upbeat Mr. Sawada.
As for the future, Mr. Sawada intends to create a platform that will be used not only by the users of DMG Mori Seiki's machines but also by manufacturers. He also intends to engage related players, including manufacturers of machine tool-related hardware and software, as well as financial institutions. "The manufacturing industry is now encountering the major wave of digitalization. We would like to be a partner to our customers and face the challenges that come with this change together with them. I believe that this will also push the Japanese manufacturing industry to greater heights."