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Endress+Hauser Group CEO Matthias Altendorf on what's driving its future

June 18, 2020
The company head speaks on what technologies and products are keeping it relevant and innovating

Matthias Altendorf is CEO of Endress+Hauser Group. He started his career with Endress+Hauser with vocational training as a mechanic, followed by studies, stays abroad and further education. This led to several positions within the company until he took over as managing director of the Group’s largest production center. He joined Endress+Hauser’s Executive Board in 2009 and then took the helm as CEO in 2014. Matthias Altendorf is a member of the extended board of the ZVEI (German Electrical and Electronic Manufacturer’s Association) as well as of the advisory board of the Baden Economic Association of Industrial Companies (wvib); and is also on the board of directors of the Swiss Kistler Group. Matthias Altendorf has a keen interest in management theory, especially the topics of innovation and cooperation. He likes to spend his free time sailing, playing chess, restoring vintage motorcycles and working his own piece of forest. Travel, art and reading are additional hobbies.


Endress+Hauser Group

What are three key things that a machine builder, system integrator or manufacturer should know about Endress+Hauser?

From our perspective, we are a leading value and technology supplier for process automation equipment. We are family-owned, with a wide high-quality and innovative product basket, and we are focused on people who make, through process automation equipment in production or machines, a better world in a sustainable fashion. I think this describes in a nutshell what the people for process automation are.

What new technologies are driving your product development at Endress+Hauser?

I think there are a few elements I can share. I think one element is everything that has to do with digitalization. And this can be in all that you have wireless communication protocols or cloud services; this might be IT securities. Everything around that area plays a role basically in our daily lives today. And, from seamless integration in any kind on platforms, wireless, cloud base or even fully digital engineering tasks, this is one area. The second area, I would say, is everything that has to do with optical measurements in any kind of applications. However, specifically we use this for the process analytical world, and for non-contact measurements. In the non-contact measurements, the radar and free space radar ultrasonic or optical waves play a significant role for future technologies. And, last but not least, I would say more basic sense technologies which is focused on determining through RNA or DNA or molecule to specific behavior of biochemical reactions. And I will give an example, we have one sensing element, for example, which can determine or detect lactate levels in a cell. And this is really important for future genetically engineered type products. And those four elements are at the moment where we are working on and gets a lot of attentions and priorities. 

Can you explain how Endress+Hauser helps machine builders and system integrators to raise their efficiency?

I guess there are several steps where we can support them with the Endress+Hauser ecosystem of products. The easiest part is the selection of the right purpose product. Everybody who wants a product for a certain application can easily select it, and it’s the right technology for the right application. Then, it’s the fully digital capabilities of the engineering process, as well as, the buying process and support process, which you can have completely digital. This saves you time and gains sufficiency on that area. We are open for any kind of digital integration needed, and we ensure through intensive tests that it works with other automation components through our partnership program that we established. This also saves time because, if you use a PLC from A and you use a product from B, sometimes they don’t talk to each another, and we have an integrated partner program, and we also align ourselves as a preferred partner with Rockwell. So, when you buy a Rockwell PLC and a Endress+Hauser equipment, they perfectly match and this saves time on the integration part for both parties. But we also have this for other automation components suppliers. Then, we have easy installation routines on both sides. And we try to make everything fast and also limit the number of mistakes, when you integrate products in higher level systems. And I would say, our competence and logistics in product management, paired with a wide product basket, allows us to provide applications solutions and become a main implementation vendor for our customers. So, he can buy things out of one hand and he can be assured that it will work.

How does the Industrial Internet of Things figure in your business strategy, either as part of your own production or as part of the technology you’re including in your products?

Well, let’s start with our own products and logistics chain. Today, we are highly sophisticated in that, our whole production network around the world that has developed the logistic chain, is based on IIoT or Industrial 4.0, they would call it, applications. Today, they couldn’t manufacture buildings on variations just in time and build to order, if we wouldn’t have implemented over the past 20 years, this kind of technologies in all factories and with a high integration into our own IT and ERP systems. Today, we cannot produce it without those systems, because they help us to trace the right materials at the right time. It helps us to lead and guide colleagues in the manufacturing environment, and it allows us to build on order in real time, and we do not stock products, and still have a fast delivery. And this allows us, as well, to deliver this value through our products and services to our customers by providing basically the digital twin right from the birth of the order. Right from the birth of the order we start to establish the digital twin for our customers. And it ends basically in the lifecycle when the product would become out of order. This is a key element of all aspects of what we are doing in product design, in the manufacturing process, in the service aspect, but as well as in the sales and engineering area. So, we use this and we believe that this generates a lot of advantages for our customers by either being faster, either being more secure and more safe at the end of the day, or helping him be transparent to improve the processes that he has. And, of course, this all applies to us as a manufacturer, because we want to be faster, we want to save costs, and we want to have transparency in the process to improve the processes where the customers benefit from.

How will machine automation and controls alter the way you or your customers staff their operations in the future?

I think this has several aspects to it. I would say, first of all, the digitalization will change how we control the process and how we use humans to do it. And therefore, part of the change is the way machines or manufacturing processes will be designed. And I think we had a real example in the COVID-19 story. For Endress+Hauser, we had up to 10,000 people in the home office and still the company was running and working. So, from that point of view this new work will change the landscape in the office or in the engineering landscape and work, but it will also change the landscape inside the manufacturing world where people really assemble and produce the products. One example is in finding out what problem a machine or a process has; nobody needs to be close to a machine anymore. In the past, you know, people had to see the machines, feel it, touch it, see it, and today this is not needed. You could do this electronically; you could do this remotely. This means less risk, less cost and less time and more efficient, and we really did this now during COVID-19; we can even help people over the smartphones to detect the problem and even solve the problem from that point of view. I think it will also be more data and fact-based because we have more data and then we can locate a problem more on the facts. It might be that we need less experts out in the field. We might have experts in the backend, and they can support other experts which might not have the detailed knowledge yet. I think we can be more predictive; we can be fast in analyzing and the connection between other suppliers and customers is possible, easily. And I think an ecosystem becomes decisive for the way of doing business in the future and this ecosystem, of course, has to be somehow digitally and emotionally connected. All this leads to new capabilities around remote servicing. What we call the RealWear glasses or even new smart commissioning. We have a new smart commissioning app which you can use with the Endress+Hauser utility cloud.

As engineering and IT continue their convergence, which one is and/or will be leading the direction of future automation and technology at Endress+Hauser?

I think they are coming together because I believe IT, in the pure way like within our private life, can most likely never overcome the domain of process knowledge that machines or manufacturing processes have. And this is partly because it is embedded software, its specific mechanical designs or even electronic hardware based, and this is specific to what the application task is. This will remain somehow specific and will not become generic, in my opinion, and therefore does not go to the mainstream IT world. And this is in the interest of the customer and of course it is in the interest of the supplier, because from a safety perspective, this is critical, but also from a performance perspective this is critical. However, where those applications run if it is in an embedded environment, a cloud, a PC, a PLC, a DCS, or the device itself doesn’t matter so much in the future anymore. And then I believe standard IP security mechanisms, as well as protocols like Ethernet, Wi-Fi or Bluetooth will become standard like we know it today in our private world from IT technology because it’s cheaper, and it’s robust, and it’s pragmatic, also with the mobility, with the mobility devices. And we can assume that bandwidth will be almost unlimited wherever we go and therefore this changes the way of connectivity too. So I believe that both worlds will come together as long as you have dedicated abdications, security safety aspects, real-time aspects there will be always a specific process automation world. However, the broader perspective of IT will convert into the process automation world. And we use better components from the IT world because the IT network basically extends itself into the process automation world.

How has Endress+Hauser invested in its U.S. business over the past few years and what are your plans for future investments and technology?

In that path we have invested more than $150 million in the States. And last year we inaugurated the new plan in Ann Arbor for the process analyzers. And right now, we are in the process of finishing in Pearland, in Houston, Texas, a new sales and training center for the South basically. And if I sum this up in the last five years, that’s roughly $200 million in the States. Besides the money, I would like to mention we invest as well in the next generation. We always invest in the next generation of people because we must be able to connect with students of all different ages through our programs and the events we host. Some of these events and programs have originated at the U.S. headquarters at Greenwood, Indiana. Others are more in the regions at the end of the day, and we take a lot of effort and we ought to take a lot of pride to develop the young human beings as they become part of the process automation community, and we do this in all different ways. And we invented also a few things; we brought the European apprenticeship program over to the States because we had good experience in Switzerland and Germany. We also developed a program in the States, what we call a “rotational engineering program,” and we also participate in community career and education forums. So, for me it is also important not just in the physical world we invest, we also invest in the capability world of educating young people. In the Pearland campus, which we established in the Houston area for the Gulf region base, we try to be very close and have a close proximity to our customers there in the Gulf regions. We will have process training units because we believe also education for the existing customer base is really important and we network that. And we also will do this together with our partner Vectors Control and the Automation Group. And first time we also implemented a laboratory, so we can build a bridge between the lab and the process and that is what we are doing also for the first time in the Houston area. And of course, you ask about what is the future investment, and of course this always depends on how the business is growing. But we are prepared to invest even further because as soon as we need space to expand, we will do that. We have enough space in Greenwood, we have enough space in Houston, and we have enough space in Ann Arbor and most likely on the long run we will have to do something more in California.

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About the author: Mike Bacidore
About the Author

Mike Bacidore | Editor in Chief

Mike Bacidore is chief editor of Control Design and has been an integral part of the Endeavor Business Media editorial team since 2007. Previously, he was editorial director at Hughes Communications and a portfolio manager of the human resources and labor law areas at Wolters Kluwer. Bacidore holds a BA from the University of Illinois and an MBA from Lake Forest Graduate School of Management. He is an award-winning columnist, earning multiple regional and national awards from the American Society of Business Publication Editors. He may be reached at [email protected] 

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