The new competitors march to a different beat

Digitalisation is increasingly leading to business segments merging and to new competitors forcing their way into previously fenced-off sectors. These are not always start-ups, but occasionally also established players with strong financial backing.

By Dr Lars Watermann

In the last issue of LIFTjournal, I analysed how industrial added value is increasingly moving towards software as a result of digitalisation (“Digital revolution: more than a fad”). Consequently, the importance of manufacturing is declining, the entry barriers for new competitors falling and knowledge of technology becoming more portable.

But the term “digitalisation” remains diffuse. What does it mean specifically for the field of maintenance and repair? To answer this question, one must first define who the new competitors might be. Here, many think of start-ups approaching the topic from the IT side, usually with innovative ideas. Initial approaches are admittedly detectable here, but they are still some way off from being ready for the market.

Building technology providers

By contrast, providers from other building technology areas are much closer to getting involved. After all, a lift is just one of many installations that have to work in a building, but in direct comparison, its operating costs are rather low. Put differently: in their fields, other providers have a much higher incentive to achieve cost savings through digitalisation.

Furthermore, these sectors are often different in structure to the lift sector. There are several big players that can and have to bear investment and development to a completely different extent if they want to expand their competitive position.

That being said, which technologies would be strong enough to overturn the current order? One example would be the use of so-called AR glasses. They film the visual field of the particular wearers and display it to them – enriched with additional fade-ins and information. Hence, in future highly qualified experts will no longer need to be on the spot. Instead, other technicians with wider, but not such profound knowledge will provide remote instructions for jobs – for example, by marking relevant components and monitoring the repair live.

A single technical generalist

If one thinks this model through consistently to the end, only one technical generalist will be sent to buildings. He will check the individual lifts and if necessary obtain remote assistance from experts. In future, the specialists of the various trades will remain at the company headquarters and wait for their knowledge to be requested before conveying it via AR to the person on the spot.

This bundling represents an enormous cost savings potential. The convenience factor should not be underestimated either. After all, in this scenario, the building owner would have just one contact for all trades.

There are already many providers who operate as general service providers in the building technology field and offer maintenance in segments such as heating/air conditioning, electricity, water/sanitary, admission control/security and IT infrastructure from one source. Lifts have not yet been included in these product ranges. But there is no reason to assume that this segment is going to remain an isle of the blessed.

Smart building from Amazon

Consequently, the competitors of the future could be companies such as Strabag or Wisag as well as Bosch, Siemens and Deutsche Telekom. And even if it sounds crazy from today’s vantage point: who is to say that in the long term Amazon with its Alexa technology will only offer smart home and not smart building technology?

In the final analysis, it’s all about digital logic: efficiency enhancement through the targeted deployment of hard- and software, which is easy for anyone to understand and use. At any rate, lift manufacturers who do not yet have any strategy here will find it difficult to defend their service business against these new rivals.

The author is managing director of Watermann Agens GmbH and specialised in company transactions in the lift sector.

More information: watermann.ag