IBM and Schaeffler to work together

IBM and Schaeffler to work together

Today, lots of people think that they will continue to access the Internet via desktops, laptops, smartphones or tablets in future. However, physicists such as Michio Kaku realise that this will be seen as antiquated in a few years – much like using floppy disks in the 1980s.

Currently, chips are found in PCs or smartphones but in future they will be found inside everything – be it furniture, devices, pictures, walls, cars, clothing, spectacles, watches etc. – where they will communicate with each other and with us.

As soon as chips were inserted into devices, they underwent a miraculous transformation:

  • word processors emerged from typewriters
  • mobile phones and smartphones emerged from telephones
  • digital cameras and videos emerged from cameras
  • games consoles emerged from pinball machines
  • iPods emerged from record players
  • drones emerged from aircraft

Industry 4.0 is forcing companies to cooperate

The Franconian automotive supplier Schaeffler is well aware that in the future every component in a car will contain chips which will communicate with and control each other. The company is currently running the “Core” restructuring programme in its Industrial division,which is questioning 500 jobs, as anything that cannot work digitally will soon be superfluous.

IBM is suffering from the fact that customers no longer store their data on IBM computers but in clouds, as this new business needs less customer-support and less maintenance. Because it needs new areas of business, IBM has been expanding its cognitive competence for years. Cognitive computing can process language and vast quantities of data for instance. And because the WATSON computer network will be the company’s new cash cow, IBM is investing USD 200 million in the new Watson innovation centre in Munich alone up to 2018.

Traditional industries and information technology are coalescing

IBM can analyse complex data, network these data and manage them interactively, while Schaeffler’s expertise lies in industry, which is why they are now setting up an industrial partnership. Neither really understands the other’s business. Together, however, they can forge a future-proof alliance. Traditional industry and information technology are coalescing.

Neither party knows what the cooperation will actually produce in terms of products and business ideas over the next five years. They only know that they can benefit from the other’s expertise in future markets.

However, cooperative ventures of this kind pose cultural risks, as German and US management systems are very different. Management and decision-making are based on participation in Europe instead of the rigid hierarchies that characterise the US approach. There are also huge differences between those working in IT and those in mechanical engineering. Mechanical engineers like careful planning while IT staff often go for the “quick and dirty” approach. IBM is major international conglomerate with all the pluses and minuses that brings, Schaeffler is a substantial German SME. It will be interesting to see how their cultural differences can be overcome.