In the middle of the summer, Siemens AG is announcing some big news: Siemens Xcelerator as an open business platform.

But what exactly is the news here? Doesn’t Siemens Xcelerator already exist as a PLM platform?

In today’s article, I will take a closer look at this announcement and the implications of other new components, purchases and business news from Siemens’ big launch event last week.

In the PLM and automation industry, Xcelerator has been a mainstay for several years. The Xcelerator portfolio is already a well-known, world-leading platform with all the important digital tools needed for efficient product development and management. There are solutions such as Teamcenter for cPDm, NX CAD, Simcenter as a basis for simulation and analysis work, Polarion for software integration, Capital for electrical, Mentor for PCB, Tecnomatix for digital manufacturing, Opcenter for manufacturing operations, MENDIX for lowcode, MindSphere for the IoT operating system and edge computing, and so on.

The important point is that everything is connected, and in this the Xcelerator portfolio is Siemens Digital Industries Software's pride and joy. This is particularly true because the PLM pieces are connected to solutions for manufacturing from division colleagues on the automation side, such as MES on the shop floor. Seamless connections between the PLM and automation pieces mean that with a few keystrokes you can, for example, stage digital simulations of the production sequences before going into physical production, to check that everything works as intended or to optimize the process. In this, Siemens is a leader.

One of the important qualities that the Siemens board wanted in 2020, when then-CTO Roland Busch was elevated to the top position as CEO and president of Siemens AG, was to give new impetus to the companies and teams in the Siemens group being shaped by the digital transformation. We are there now, and last week's big event surrounding a number of important announcements for the entire group of companies within the Siemens Group was a manifestation of this. With the declaration that a broader concept around Xcelerator will be the group's new open business platform—not just the PLM and automation departments' solution portfolio—a clear path for digital transformation is manifested for all the Group's customers. Among the other news from the event, Busch highlighted that Siemens is making a heavy investment in SaaS as a business model across the board where it is applicable, as well as an expanded partner investment and in-depth collaboration on digital twins with NVIDIA, and a pooled purchase of Brightly Software to sharpen the SaaS arsenal for digital building and construction management. (Image: Enno Kapitza.)

A Conceptual Model for Holistic Industrial Product Realization

A reasonable interpretation is that last week's large-scale launch means that this conceptual model for a holistic industrial product development platform, which the software division CEO Tony Hemmelgarn and his staff have successfully built up in recent years, now takes another step up to become the guiding light for how to build interconnected solutions in all areas within the framework of Siemens AG.

This also has other effects, such as Software-as-a-Service (SaaS) becoming an important business model for what it offers its customers. By extension, there are also things like selling electric motors "as-a-Service" or switchgear "as-a-Service" and so on.

Roland Busch’s Enthusiasm for the New Platform

It was a strikingly enthusiastic Roland Busch, CEO of Siemens AG, who commented on these new major investments.

“Siemens Xcelerator, as the open business platform we launch today, will accelerate digital transformation and value creation for customers of all sizes in industry, buildings, electricity networks and mobility. Digital transformation becomes easier, faster and scalable. Siemens Xcelerator includes not only a select portfolio of IoT-enabled hardware, software and digital services from across Siemens, but also a commitment to a growing ecosystem of partners, and a larger marketplace to facilitate interactions and transactions between customers, partners and developers,” he says.

“Siemens new open business platform, Xcelerator, includes not only a select portfolio of IoT-enabled hardware, software and digital services from across Siemens, but also a commitment to a growing ecosystem of partners,” states Roland Busch.

SaaS for Construction and Expanded Partnership With NVIDIA

The broadened focus around the Xcelerator platform looks like a wise expansion of Siemens Digital Industries Software and Automation divisions' visions around a suite of digitally interconnected capabilities. On the PLM and automation side, the concept has long since shown its viability. The fact that Siemens AG is now hitting the big drum is in many ways an expansion of what the employees in the software and automation departments already put into a practical system.

The big launch last week, as mentioned earlier in the article, also included several other announcements:

Plans to acquire Brightly Software to sharpen the SaaS arsenal for digital building and construction management.
An extended "industrial metaverse partnership with NVIDIA" for digital twin development.
Investments in the partner eco-system and growing marketplace.

These are certainly all interesting pieces of news, but it is important to emphasize that the message from Busch is a confirmation not only of the technological power of the concepts from the industrial software and automation divisions in the group, but also that he sees a strong commercial development force within the entire company.

Measures to Create Additional Growth

Given this context, it is a qualified guess to think that Siemens has carefully examined how it could create additional growth power within the company—for example, by analyzing all the software and hardware in the company's enormous solution portfolio. With these components on the table, it became possible to think about how to transform the whole portfolio and develop better technical combinations, transform the hardware business, sharpen customers' need to build coherent value chains—and, at the bottom line, make more money for the group.

Furthermore, a cornerstone to this is to set up all of these offerings as SaaS products, and handle this for the entirety of Siemens AG.

By extension, there is also such a thing as selling electric motors "as-a-Service" or switchgear “as-a-Service”. This, if anything, is considered an important part of last week's big announcement. SaaS and “Product-as-a-Service” are trends that have shown exponential growth curves in recent years.

The technological successes that Tony Hemmelgarn, CEO at Siemens Digital Industries Software, and his coworkers have brought to the table–manifested in the PLM division’s tool suite Xcelerator—have obviously now permeated the entire group.

A Feather in Hemmelgarn's Cap

All in all, the conclusion is that the technological successes that Hemmelgarn and his employees brought to the table have now permeated the entire group and the company leader, Busch has enthusiastically embraced the message and the ideas and now turns them into group policy.

In a press release, Busch says that “Siemens Xcelerator will make it easier than ever for companies to navigate digital transformation, faster and on a larger scale. By combining the real and digital worlds of operational and information technology, we give customers and partners the opportunity to increase productivity, competitiveness and scale up innovations."

He also said that the company's portfolio is evolving towards even more open applications, “with more cloud-based and as-a-service solutions and IoT-enabled hardware, which can be constantly upgraded. At the same time, the collaboration will reach a new level in our growing ecosystem of partners,” he says.

As the first step in a deeper partner collaboration, Siemens and NVIDIA plan to connect Siemens Xcelerator and NVIDIA Omniverse, a platform for 3D design and collaboration. This will enable an industrial metaverse with physics-based digital models from Siemens and real-time AI from NVIDIA. Siemens states that, “the addition of Omniverse to the open Siemens Xcelerator partner ecosystem will accelerate the use of digital twins that can deliver productivity and process improvements across the production and product lifecycles. To the left NVIDIA’s leader Jensen Huang, and in the middle, Siemens’ Roland Busch.

The Acquisition of Brightly Software and the Deepened NVIDIA Collaboration

Siemens’ CEO also stressed the acquisition of Brightly Software and the company's expanded partnership with NVIDIA, which he claimed, "are important milestones in the implementation of our strategy to accelerate high-value growth."

Regarding Brightly, which is a leading U.S.-based asset and maintenance management software company, Busch said that “its well-established key industry capabilities add Siemens digital and software expertise to buildings. It will be a core element of the Siemens Xcelerator for Buildings portfolio.”

Building Information Modelling (BIM) supports decision making across the entire lifecycle of a construction project. The enhanced collaboration driven by the process collects and manages data to enable the work of all stakeholders to be coordinated and informed. With BIM, a building is first built virtually, then built physically, with construction only beginning after the virtual building meets all expectations and specifications. This is part of Siemens’ first new SaaS offerings in the Building X solution.

Another construction-related announcement was a first new SaaS offering as part of the Siemens Xcelerator. Building X is the name of the solution, which is a smart building suite for creating a single source of truth (SSOT) that removes the complexity of digitalization and supports customers to achieve their goals. “It is a complete data and analysis suite that breaks down data silos across domains such as energy management, security and building maintenance. Building X is a modular, completely cloud-based open-source software suite, with AI-enabled applications, strong connectivity and built-in cyber security,” says Busch.

The in-depth partnership with NVIDIA has to do with digital twin technology. The two companies are investing in enabling the industrial metaverse and increasing the use of AI-powered digital twin technology that will help take industrial automation to a new level. As a first step in this collaboration, the companies plan to connect the open digital business platform Siemens Xcelerator, and NVIDIA Omniverse, a platform for 3D design and collaboration. This will enable an industrial metaverse with physics-based digital models from Siemens and AI-enabled, physically accurate real-time simulation from NVIDIA, which will allow companies to make decisions faster and with increased confidence that they are navigating correctly.

Atos is one of Siemens' significant partners in industrial PLM operations—and an important part of the company's PLM department is the Nordic PLM company IDEAL Grp, whose operations were acquired a few years ago. IDEAL was then Europe's largest Siemens dedicated partner. During last week's event, Busch declared that this type of partnership will be supported by further initiatives.

A Stronger Partner Ecosystem

Another announcement was that renewed efforts are being invested in Siemens' commitment to developing a stronger partner ecosystem, based on existing strategic partnerships including Accenture, Atos, AWS, Bentley, Microsoft and SAP.

The intention is to expand the partnership ecosystem with small, medium and large companies.

This is perhaps more important than it might seem at first glance. Take the example of Siemens Digital Industries' revolutionary collaboration agreement with the cPDm suite Teamcenter a few years ago. Agreeing with the "big SAP" can help get to the bottom of things relatively quickly, but the next step—to get a collaboration with all SAP partners who work with SAP PLM solutions in a number of companies—requires significantly more work to ensure the basic agreement with SAP will be able to develop to its full potential.

Finally, Siemens also plans to integrate its industrial IoT (IIoT) solutions such as Industrial Operations X, which brings together solutions and applications from sensor to edge to cloud, IoT-as-a-Service and low-code development opportunities, as well as a wide range of ready-to-use apps. It enables the merging of data from the real world of automation with the digital world of information technology, enriched by Siemens' vertical IT / OT integration skills and capabilities. Breaking down data silos will help companies increase their performance, productivity, flexibility and sustainability.

The New Platform is a Logical Step for Siemens

All in all, it should be noted that there is significant value in expanding the Xcelerator concept to become a group-wide one. The world of product development is becoming increasingly complex as one reflection of increasingly advanced products and business arrangements, and the need to tear down the barriers between traditional silos in the value chain is increasingly urgent. But within the Siemens Group this isn’t a new thought, and the new Xcelerator concept looks like a blueprint of what the software and automation divisions have been doing for a long time. It can also be seen as a confirmation that they are on the right track.

At the same time, it should be said that the launch of the Siemens Xcelerator platform is the logical next step in the group's digital strategy. The company will be able to unlock significant value for existing and new customers—especially new customers in the small and medium-sized company segment.

For Siemens as a company, there are certainly financial gains to be made. The press material itself speaks of an annual growth rate of about 10 percent over the business cycle. With the SaaS concept as a basis, the business platform is also expected to be able to contribute to the development of offers that strengthen the opportunities to achieve these growth goals, particularly the increase in annual revenue.

"This is the logical next step in the implementation of our digitalization strategy to enable even faster innovation and value creation,” says Busch. “Siemens Xcelerator combines the power of our focused technology company with a thriving ecosystem of technology partners. We work together to simplify digital transformation so that customers of all sizes can benefit from speed and scale.”