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How AWS plans to strengthen its cloud proposition for manufacturing companies

On September 18, PAC attended the AWS Transformation Day 2018 in Munich.

26-Sep-2018
How AWS plans to strengthen its cloud proposition for manufacturing companies
On September 18, PAC attended the AWS Transformation Day 2018 in Munich. The event was specifically targeted at enterprise customers and aimed to demonstrate how cloud can accelerate companies‘ digital transformation. AWS also used the event to present to visitors from industrial companies its new partner program specially designed for industrial software partners. With this program, AWS seeks to strengthen its cloud proposition particularly for industrial companies such as manufacturers, by adding industry-specific competencies via partners.

The AWS Transformation Day 2018 in Munich was extraordinarily well-attended, with over 800 people taking part in 30 sessions throughout the day. The overarching theme of the event was how to use the cloud to drive digitalization and innovation. Manufacturing being one of PAC’s vertical focus areas, we were, of course, interested to hear about AWS’ announcements in this space. The major one certainly concerned the launch of its new partner program for industrial software partners, which is why we would like to provide some more detail in this blog post.

What is the goal of AWS’ new partner program for industrial software partners?

AWS aims to support its customers, e.g. from the manufacturing industry, with end-to-end solutions for their most relevant value chains. The company’s current focus is on software supporting processes that range from product and production design to shop-floor operations and operations management. The goal is to be able to offer an end-to-end toolchain comprising software solutions for the above-mentioned processes from AWS partners, who are certified for their competence of running their software in the AWS cloud.

What are the investments related to this new program?

For software companies providing software applications for the areas of product design, engineering, production and operations, there will not be another fee on top of the one for joining the AWS Partner Network (APN). The major investment for software partners will rather be the amount of time and effort spent on working with the AWS Industrial Software team, technicians and partner managers, to ensure that the software application fulfills a wide set of criteria. To become an AWS competency partner, they must have demonstrated technical proficiency (for example in areas such as functionality, security) but also fulfill related criteria such as proof of customer success. The process of making sure that all criteria are met will be jointly defined by AWS and the software partners in an individual project plan.

What are AWS’ plans for the area of manufacturing?

AWS aims to extend its mindshare within the production industry by significantly expanding its partner network in this space. In discussions we were told that there are not any limitations in terms of the number of industrial software partners that can be onboarded and that it plans to continue investing in this context.

PAC’s take
From PAC’s point of view, this industrial software partner program will strengthen AWS’ cloud proposition in the manufacturing domain, help to expand its customer base in the production industry and open up new business opportunities.

Besides, this move will help manufacturing companies to identify and select software partners with proven expertise not only in addressing industry-specific processes with specialized software solutions but also when it comes to maximizing the benefits of using these solutions in the cloud. Having guidance on which software partner to select for cloud migration is quite helpful for manufacturing companies, many of which have only just started to evaluate cloud options for software applications supporting their core operations.

At the time of the launch of the new partner program on September 18, AWS could boast 15 partners. However, in order to really support its manufacturing customers end to end, from product design to production and operations, and to help manufacturers address their current challenges in engineering and on the shop floor, more investments will certainly be needed to fill the white spots. This applies to investments in additional software partners for specific processes (e.g. MES, CAx, PDM/PLM, EAM) as well as software partners that can provide support in local markets as well as partners with regional and global coverage. With the range of partners announced at the event, a good start has been made with first partners having been announced addressing industry-specific processes (see image), also including first lighthouse customers.

For industrial software partners that consider to partner with cloud providers, AWS is a good choice, being the dominant leader in the area of cloud infrastructure and providing a huge mindshare advantage. Additionally, AWS offers high resource capacity, massive scalability, a global presence and a highly innovative culture, bringing regular innovation to the market. Nevertheless, given its market dominance and capability to build own IP in the area of business applications, software partners will have to examine closely the pros and cons of entering into a strategic partnership with AWS.

Currently, these industry-specific applications are sold by partners through their existing salesforce and their channels. This means that the software partners in AWS’ new industry software partner program will be the central point of contact for manufacturing companies. But, given the increasing adoption of cloud-based solutions, manufacturing companies will expect to be offered bundles of software solutions which are integrated and which are serving the needs of various different use cases. For that reason, PAC believes that those providers that can offer such integrated bundles of software solutions, for example via cloud-based marketplaces or platforms, will in particular be in a good position. Whether or not AWS has this on its strategic agenda (e.g. offering bundled, integrated solutions from its AWS Marketplace) will have to be seen.

However, it must be said that although we see the degree of openness toward an extensive use of public cloud solutions being strongly on the rise, it still differs between the various regions (e.g. continental Europe is still more reluctant than the US), sub-sectors of production, accounts and use cases, presenting quite a challenge for public cloud providers. Yet, it also raises the importance of working with a global network of industry specialists that are recognized and trusted software partners in the manufacturing industry.

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