Read Chris MacDonald´s perspective on predictive maintenance in this related interview.
Digital transformation and application of IoT and advanced analytics technology are no longer something to be delivered in the future. They are well established in industry, delivering value to a large number of enterprises of varying sizes and in multiple industries.
Chris MacDonald, Head of AI and Analytics and Joe Biron, General Manager, Strategic Missions Products at Microsoft discuss the adoption of connected products strategies, the use that connected products data stream and underlying data strategies that enable delivering business value.
Welcome to speaking of service, the podcast that uncovers practical ways to grow service revenue control costs and improve customer satisfaction. If you're looking to innovate, gain a competitive edge, or just learn about the latest service trends, you've come to the right place. In today's episode, Chris McDonald, head of AI and analytics sits down with Joe Byron. General manager, strategic missions products at Microsoft and former general manager and CTO of IOT at PTC to discuss the adoption of connected product strategies and the underlying business value they can deliver to your organization,Chris MacDonald:
digital transformation and the application of IOT and advanced analytics are no longer something to be delivered in the future. They are well established in industry delivering value to a large number of enterprises of all sizes across in. In fact digital transformation concepts are now so accessible that if you search for remote monitoring, you would find everything from cameras integrated into doorbells to understanding the performance of the most complex medical systems. While getting devices online is becoming more common companies, still lack confidence in their ability to make the best use of collected data, limiting the ROI on their connected systems. We've recognized the need of PTC and the team I'm representing here is dedicated to helping companies get the value from their connected data streams by demystifying the process for getting that done largely by focusing on the service outcomes that both you and your customers want. Joe, welcome to the show.Joe Biron:
Hey Chris, thanks for having me.Chris MacDonald:
You've been at this IOT thing for quite some. Would you give the audience a bit of your background?Joe Biron:
Yeah, sure. You know, it's been probably 15 years now. The term IOT was coined, not that long ago. Uh, if memory serves, it was circa 2009, but in the mid two thousands, Manufacturers who had service units for their products in mission critical settings, where their customers needed to have quick response and quick diagnostics of a problem with the equipment they were in the, you know, actually dating back to the mid nineties, deploying modems and fractional network lines. You much harder to operate much more expensive, much more care and feeding than the ubiquitous connectivity we enjoy today. So in the mid two thousands, they sort of caught on to using the capital I internet to connect to those settings, uh, which were the environments that their customers used, the products. And, uh, in the early days of. Uh, paradigm, if you will, it was really break, fix, reacts to the problem. So a technician who might have otherwise been a field service technician, jumping in a van and scooting out to the, uh, to the, the site, um, they were able to do that remotely dial in, um, uh, with the internet, not using expensive, uh, or archaic technology, but they were able to interactively diagnose the problem. Today, uh, we see the advent, you know, 15 years later, we're a lot smarter about the use of. Data analytics a lot smarter about informing engineering teams who are making such products on the kinds of telemetry. They can build into the product to take advantage of this ubiquitous connectivity. And most importantly, we're a lot smarter in understanding how to put this new technology paradigm to work in business context with repeatable solutions for our customers.Chris MacDonald:
So it sounds like the OT market has certainly matured, but what are you seeing from customers? And let me ask you, would you consider it an IOT market still?Joe Biron:
I think IOT is the name of a technology paradigm. Mm-hmm , we'll probably want to have different names of enterprise software categories. That are more evocative of the business use case. I think it's perfectly fine that we're still sort of transitioning from understanding how to put the relatively new paradigm to work. I think we certainly know what those use cases are today. They are. remote service and predictive maintenance for remotely deployed high value mission, critical assets and in a different setting than service. But if you just let me kind of complete the picture mm-hmm uh, it's the manufacturing setting. And optimizing the operation of a manufacturing environment by leveraging connectivity to the control systems and, uh, the environment of the factory. So swinging back over to service, we have certainly seen that our customers from the early days with that very acute need, I need to remotely and interactively diagnose my equipment as the O T paradigm. Caught the imagination of the world in the late, uh, two thousands and through the 20 teens, uh, how can I, you know, do more things and some experiments which were fun and exciting, uh, and, and, um, very helpful in understanding. Well, let's pivot back to the grand challenges that the business has. And now that we know a lot more about how the technology can serve us, let's expand on those early use cases of the interactive remote troubleshooting and take advantage of advancements in, in analytics and big data processing among others.Chris MacDonald:
It sounds like you're describing a journey that has taken place with technology and advancements that are now under sort of the umbrella of IOT and the use cases, particularly in service that can be executed, but there's also a journey for the customer and adopting these technologies. And as new technologies sort of fill this space and allow us to realize value. From these new things, like advanced analytics, what is that like for the user? What have you seen at our customers in the journey of the user, um, in taking advantage of these and for the company in terms of business objectives and ROI. Yeah.Joe Biron:
Great question, Chris. So it's sort of your classic progression of new technology paradigm enables solutions to the grand challenges that have. ever present, right? The challenges are never new. The technology that can serve those challenges is what becomes new. Then those solutions come into being, and I I'd say that we are squarely in the era of clearly understanding the use cases with repeatable solutions. What has to happen for any given enterprise along that journey that they're taking, uh, for themselves is business process. So, for example, I've, I've already mentioned a couple of times the break fix mentality. I'll wait for something to go wrong. It's fantastic that I can get a, uh, a proactive alert from a connected device, but it's still telling me something's wrong now. Or the customer is still calling me. It's great that as a remote service technician, Uh, and I think back to the early days of the COVID lockdown and I happen to see you can't see it on as the audience, but behind the camera. I have a beautiful view of the Boston cityscape and I can see mass general hospital. It was very exciting to know that in the early days of the lockdown. Service technicians who were servicing medical devices in mass general were doing so in their pajamas from home because of this connectivity. So there's nothing wrong with that. Remote diagnostics, interactive superpowers that project myself from far away. That's fantastic, but understanding the data stream that can drive simple alert. More advanced alerts that take advantage of new techniques in machine learning and artificial intelligence and so forth. Those techniques give those field technicians and remote technicians, even greater superpowers, right? It doesn't change the need for their role. It changes the way they will go about servicing their customers. Because again, in the mass general hospital, they can just barely see in my view, I don't think the patients, doctors and nurses really care about how the problem's being solved. Right. So the focus is on the customer satisfaction and keeping those mission critical, uh, assets, um, working appropriately.Chris MacDonald:
Yeah, I think that's a great example. I think we often, uh, Think of remote management now that the market has matured as this, uh, ne you know, necessity or something that just comes with, you know, an O T package, so to speak. And that's, that's often true, but the value of it, especially in a pandemic to your, to your example, literally was able to, to get people to service equipment safely and equipment. That was part of a life saving treatment in many cases. So that sort of remote management, literally the. Brought to bear how important that is. And as you go from beyond remote management, and whether you are remotely servicing a customer is servicing on their own preventative maintenance, or you're delivering a truck roll with the right pieces and equipment. How does a customer move from just this remote service to a data driven understanding of what's happening with their equipment and a service strategy that becomes more proactive? How does the shift in focus from remote management to really. curating and understanding data around my equipmentJoe Biron:
happen. Yeah. Great question again. Um, so I'm gonna use a little bit of a buzzword phrase here, but it's a digital twin mm-hmm so like all of these buzz words, right? It's really about a metaphor that you can hold in your brain and it helps unlock some of the possibilities possibilities with today's technology. So a digital twin of a. Uh, liquid chromatography, uh, analyzer in a laboratory if the product team and the service team that knows that machine very well from the design and servicing aspect, think about a digital twin that represents one of those machines that gives me the ability to interact with it in an it fashion. If there was such a thing, what would be its attributes? What would, what would be the observations and questions I would like to ask that digital twin and what does that digital twin need to know about itself to be able to answer it? So that was very abstract, more concretely it's back to thinking about the key life cycle events that those machines go through. Maintenance events, unplanned downtime, et C. if we knew what the downtime was caused by, we wouldn't have had an unplanned event. Right. So clearly there's something we're missing. What kinds of data can help us understand with advanced technology like machine learning, et cetera? Well, the answer is we don't know because we don't know mm-hmm so I like to think about this as an abundance. with data. We truly have an abundance of accessible insights. We just don't know what to do with them. So we're gonna use the technology and technology that's been refined in an applied use case to make some sense of that data. So it's perfectly acceptable to. Publish and report on data that you're not sure the value of yet. I say that's okay because we're not exactly stingy about that stuff. Mm-hmm what we want to do is cast as wide a net as possible so that we can refine insights and the machines don't know what data they need until the insights are discovered. It.Chris MacDonald:
And I think as more and more devices come online, there's no excuse for being data starved. Right? You should have that data, abundance problems. It's much easier to solve that, uh, because you have it figuring out what data really matters as you prune through it and derive these insights. And then eventually, you know, operationalize advanced models. But all of this starts with data acquisition as more and more devices come online. You see companies either. Not collecting data cuz they don't know what to do with it or collecting data and not doing anything with it. How do you see leaders and executives at companies taking advantage of, of this sort of digital transformation, changing their role in the implementation and the use of these critical technologies?Joe Biron:
Uh, another great question. There's a concept that's been discussed for the, probably the last decade, the so-called ization of products or products as a service. Now that sounds like a blue sky business model that may maybe only those in the rarefied air have actually taken advantage of. It's actually far more common than one might expect. For example, a life sciences manufacturer of various forms of laboratory instruments. Such as liquid chromatographer, fancy term that I used a little while ago, they likely have a portfolio of machines like that. PCR, analyzers, et cetera. Their business today is predominantly in terms of revenue, the aftermarket consumables that drive those machines, reagents and so forth. So if your business model is selling gear and servicing gear, that's. But the new trend in such business models is to enable a long, uh, relationship with your customer that goes far beyond selling that one piece of equipment. So providing them with an automated consumables replenishment plan, that's informed by actual use of the equipment, not on some crude schedule, um, or, and this is a trend we're starting to see with manufacturers at service setting. Laboratory equipment, industrial equipment in a factory, um, uh, gas pipeline, uh, equipment and so forth. If they are the 800 pound gorilla mm-hmm right. Product vendor in that setting, they have the right and claim to being the management partner for everything that's happening in that. Right. So right. We see these product vendors who have a great business beyond the sale of the product. Also looking at how they can help their customers optimize the operation of their setting in which their products happen to show up very exciting ideas.Chris MacDonald:
Absolutely. And Joe, you and I have worked together for a few years now. So I'm gonna go a little bit off the cuff and ask you something that, as you're talking about this, I, I certainly would love to know. I think our listeners would love to know if you were to look. The IOT space, which you've been a part of now for a great part of your career from where it was, you know, 10, five years ago to where it is now. And I was to ask you, what would you tell a CTO of a company to do differently, or to look at differently as they implement, as they digitize, as they try to transform their service business. And what would you tell a service leader or the, the head of service at a given company, um, to do differently?Joe Biron:
I would tell the first thing that comes to mind. Data is your real product. Mm-hmm because data drives the insights into how the physical product should be engineered. The next generation should be engineered for service engineered for optimization of use, and it's data about your customer's operation that is potentially as valuable in some settings, more valuable even than the products that you're. So it's really the next generation of what a product company is going to be. If a CTO or a CDO or a CEO of such a company has that vision in mind. And I'm happy to report that. I, I didn't get this idea myself. I learned it from such individuals at our customers. Um, they have a vision for their entire organiz. And O T is an important aspect of that. Certainly, you know, the rest of a portfolio, um, such as, uh, digital thread offerings from PTC and other vendors is gonna be part of that digital transformation vision. Um, but, uh, thinking about. Not what the old service and offering was, but the next generation that, that will be the next 20Chris MacDonald:
years. And I think if you're gonna make data, a strategic asset as a critical initiative at your company, thinking of data as an offering core to what you are bringing to market fundamentally makes that critical, right.Joe Biron:
Actually, Chris, the, the data as the offering, but more importantly, insights derived from that data. I'm speaking your language now. Yes. And who better? To drive, to derive and curate those insights, then the vendor and designer of the product inChris MacDonald:
it in the first place. Absolutely. And I will, of course, now that we're speaking about advanced analytics from a data science perspective, a lot of the things that we're talking about are right at the core of what a data scientist and an analytics team wants. If you could define the business problem, you're trying to solve. If you can treat data as describing that. Critical asset. The application of logic becomes a heck of a lot easier. And in fact, as a company and a vendor working to bring these solutions to life and market, if we can define the problem space better in our very solutions, and we can curate that data, we can make it easier and easier for the customer to apply logic and realized advanced insights. And that leads me to my last question, um, which is what are we doing to make it easier for users to, to go on this journey and to realize value from this journey.Joe Biron:
Well, we are talking right now over some communication gear that we have in these studios that uses radio waves. There are radio waves bouncing across our environment all the time. We hear each other right now because we are tuned to the right frequency. We can think about data. Data that's liberated through IOT technology and put to work by advanced analytics as these radio wave that are bouncing all over the place. We don't know what to do with them until we choose a frequency to tune into. So if you take that strange metaphor, now apply it towards a business application. A business application has a prescribed workflow. There's a consistency. Born from product managers and engineering teams that have thought really hard about a problem they're trying to solve, interviewing their customers, trying, trying experiments with those customers. And finally in ultimately creating a set of applications that codify the best practices to solve that problem with the advanced technology it's prebuilt application screens, business logic, and data transformations. Data structures and analytical models that are tuned to the right frequency to solve that problem. If I could categorize the early years of IOT, it was radio wave is bouncing in every direction mm-hmm and very few signals, very few radio dials tuned to a frequency that was a clear signal. We're happy to report. Now. The O T ecosystem has tuned into the right frequencies and created. Radio stations, if you will. Mm-hmm in the form of repeatable business applications.Chris MacDonald:
And I think to carry your analogy forward, I think we've come to learn that in the early days of IOT, everyone was a snowflake. Everyone was exploring the technology in a different way. They thought their unique circumstances were exactly that unique to them. But there are things that are general about service service, business outcomes have remained the same, and there are best practices that have come from over the years of how to apply this technology to tune into the right frequency. But that doesn't. Your ability to listen in different ways has to be standard, right? We can still allow for flexibility so you can consume and deliver those insights in a way that works for you while still maintaining that standardization across customers. Is that a fair statement? IJoe Biron:
think that statement applies to really any enterpri enterprise software category. Good. E R P CRM. Just go down the run the board. There is no enterprise. In the world that takes an enterprise software package in the prebuilt configuration settings logs in and starts using it. Right. That's right. But importantly, the software is designed to understand the degrees of freedom and flexibility and configurability that's required for an enterprise customer. That's got a sophisticated use case. There's 80%. That's right. Outta the box, right down the middle. The other 20% is contemplated in the design and there are extensibility mechanisms in the software to allow for that.Chris MacDonald:
Thank you, Joe. It has been a great pleasure to have you on the show. Um, I think we've derived a lot of insights, learned a lot about what our customers, um, are going through on this journey and how they can derive value from data by treating data as a strategic asset and taking advantage of these concepts like advanced analytics and digital transformation and IOT. So thank you very much, Joe, for coming on the show we appreci.Joe Biron:
Right on. Thank you, Chris, for having me.Announcer:
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