Automation The strategy of innovation-driven development
An exclusive interview with Hans Beckhoff, Founder and Managing Director of Beckhoff Worldwide; and Ma Xingkai, General Manager of Beckhoff China.
Accuracy, efficiency, flexibility, cost and speed are core features of automation technology and is used to enhance manufacturing value. In recent years, the integration of digitalization and automation technology has been rapidly put into practice in the manufacturing industry. Intelligent values help users improve their competitiveness through various innovative applications across numerous industries.
“If you want to love your own value, you have to create value for the world”, a famous saying from the ‘Aphorisms’ of Goethe is also the motto of many automation companies which specialize in serving the manufacturing industry, of which Beckhoff is an outstanding representative.
Looking back at 40 years of development, one can not only feel Hans Beckhoff´s enthusiasm for automation technology, but also realize his real passion for innovations and facing market competitions. Beckhoff started from scratch with only one person and today it is a major representative of PC-based control technology. The company has brought its innovative values to the manufacturing industry and changed people's lives.
The PC-based control technology perfectly convergences information and communication technology (IT) and automation technology (AT) and will undoubtedly usher in a broader space for development in the digital age.
The company has achieved valuable growth despite the Covid-19 pandemic. Beckhoff Automation generated a global revenue of 1,096 million dollars in 2020. This corresponds to a slight growth in turnover of 2 % compared to the previous year. The firm currently has approximately 4,500 employees worldwide. Beckhoff China also made a remarkable achievement. It realized sales income of 1.4 billion yuan with an impressive growth of 27% in 2020. At the beginning of 2021, Ma Xingkai officially took over as the General Manager of Beckhoff China.
How will the firm seize market opportunities in the ‘post-pandemic era’? How can the company promote the continuous growth of Beckhoff's business and share the innovative values with its users? Through this interview, we look forward to exploring the thinking and actions behind Beckhoff's success.
Grow against the trend and expand production capacities to seize opportunities
Beckhoff Automation has been taking the best possible precautionary measures since February to protect the health of its employees and to maintain continuous and stable production operation. “At the same time, we significantly increased our orders to the suppliers to ensure a regular supply of components, which were required for production. Despite the impact of the pandemic, our positive attitude and effective measures allow us to keep everything under control. Beckhoff's production capacity is not restricted at any time, and R&D as well as sales activities are stable. We are operating at full capacity and have the confidence as well as the ability to provide optimal services to our customers worldwide,” reports Hans Beckhoff.
He continues, “The benefit of being a family-owned private company with a healthy financial background is that Beckhoff can take decisions for long-term development. For instance, Beckhoff is investing in its warehouse stock level. By stocking raw materials and components for an additional 4 – 6 months, Beckhoff can guarantee regular production and delivery. Meanwhile, Beckhoff sensitively keeps monitoring any disruptions in the supply chain of core components, such as electronic components and takes rapid reaction. It is this kind of proactive planning that helped us to get through the hard times."
According to Ma Xingkai, Beckhoff China was among the first companies to react to the Covid-19 pandemic. The company decided to significantly increase the product stock levels in China by renting a new 1,000 sq m warehouse at its headquarters in Shanghai, China. The stable supply of products, reflecting the power of Beckhoff, is the key to winning orders in special times.
In terms of product applications, Beckhoff is involved in around 30 high-profile projects worldwide, for example, the development of respiratory and testing equipment, N95 mask machines as well as vaccine production and filling machines; six of which are implemented in China. In addition, Beckhoff’s components are widely used in many respiratory protective equipment and mask production facilities. In the global fight against Covid-19, Beckhoff is playing an active role and fulfilling its social responsibility.
Although it is still too early to tell if the global pandemic is going to be stabilized, measures such as setting areas for temporary quarantine and vaccination will gradually bring the pandemic under control and a result, market rebound will become inevitable.
The outbreak of Covid-19 has had a huge impact on the manufacturing industry, but it has also unexpectedly become a catalyst for accelerating the digitalization process. Opportunities and challenges co-exist under the changes, and the critical period of manufacturing transformation may have arrived quietly. For 2021, Hans Beckhoff sees a very positive business development worldwide with double-digit growth rates.
All its subsidiaries around the world have resumed business expansion and attained dynamic growth! Beckhoff plans to expand production capacities for individual product ranges by up to 30 % in 2021. In addition, Beckhoff will continue its investments in research and development and training with full intensity. After 20 years of development, the Chinese market is becoming increasingly important for Beckhoff.
Inherit the past and forge ahead into the future – rapid respond to market requirements
In retrospect, Beckhoff opened its first representative office in Beijing in 2001. In May 2007, a wholly-owned subsidiary of Beckhoff in China was established in Shanghai. In 2019, Beckhoff China’s head office moved into a new five storey building with over 4000 sq m of usable floor space. In addition, a warehouse and a logistics center with a total floor space of 2,200 sq m along with a 400 sq m service center were set up near the main building. So, the total area is 6600 sq m.
On the first floor of the building, a modern 450 sq m showroom gives an overview of the comprehensive range of products and solutions from Beckhoff with state-of-the-art multimedia support. It is the largest showroom of Beckhoff worldwide. Beckhoff China currently employs 280 people and is presented in 27 large and medium-sized cities. It has maintained a growth of 19 % in turnover over the past five years and has become an important technology and market leader in the field of industrial automation in China.
Ma Xingkai, who joined the Beckhoff Group in Germany in 2006 and was later made in charge of Beckhoff China’s wind business, is a witness to the development and growth of Beckhoff’s business in China. He points out that helping customers realize value increase with continuous product and technology innovations is key to the success of Beckhoff China.
In addition, the direct sales system, which distinguishes Beckhoff China from its many competitors, allows Beckhoff to be physically closer to its customers, to understand their demands, to discover market opportunities, to carry out research and development activities and to adjust business direction in time. The success in the Chinese wind energy sector is a typical example of how quickly Beckhoff China can respond to the market needs. Through the establishment of a local wind team in China, Beckhoff opened up the Chinese wind power market.
The C-based Control makes it possible to integrate operational management, pitch control, inverter control, condition monitoring, and visualization on a single CPU, which represents a proven system solution and can effectively improve the efficiency and cost-effectiveness of wind energy utilization.
The continually promoted localization strategy is a guarantee to help Chinese customers quickly experience the innovative value of Beckhoff in a wide range of areas, such as laser cutting systems for the sheet metal working industry, real-time control solutions for the semiconductor industry, mechatronic control platforms for the packaging industry and tobacco machines.
Beckhoff China has promoted the digital and intelligent development of traditional industries with comprehensive PC-based control solutions, providing effective support for enhancing the self-innovation capabilities of Chinese enterprises and shortening the gap between China's equipment manufacturing industry and the international advanced level.
In 2014, Ethercat – the real-time Industrial Ethernet technology became a recommended national standard (GB/T31230-2014) in China. In December 2015, Ethercat was compiled in the ‘Guidelines of the National Intelligent Manufacturing Standard System’ by the Ministry of Industry and Information Technology of the People's Republic of China, providing important support for intelligent manufacturing.
According to Hans Beckhoff, automation technology has to be very user-friendly and at the same time will also become increasingly sophisticated, a development which can be seen worldwide. China’s market is very large, it grows quickly and is developing as one of the leading technology markets. It features a diversity of manufacturing sectors and covers a wide range of fields. So, it’s particularly important to provide effective technical support and build long-term relationships with customers.
In the past, Chinese customers did not have many preferences and were more concerned with economic and practical issues, operating habits and technological friendliness. They prefer automation suppliers to provide complete solutions and to get the machines running as quickly as possible. These conditions have changed in recent years, for example, many Chinese customers in diverse industries including wind energy, new energy vehicles and lithium batteries have begun to lay emphasis on technological innovations and seek equipment differentiation.
Hans Beckhoff mentions that Beckhoff Automation has made a major decision to localize production in China in order to increase production capacities, improve market response and drive automation technology in China! With the openness and flexibility of its products and technologies, Beckhoff is able to promote digital innovation and contribute to the high-quality development of China’s manufacturing industry.
Innovation-driven industrial green development
Worldwide, Beckhoff Automation has achieved a strong growth in sales since 2000, with an impressive average annual growth rate of 14 %, innovation is the driving force behind this rapid growth. Hans Beckhoff emphasizes that "quality and innovation of automation products determine people's living standard and innovation is our responsibility. We are saying that the engineers have to save the world!”
This is deeply true because the engineers have to provide all the technology advancements which are needed to reduce the consumption of material and energy in production. And the reduction is needed urgently, because more and more people want to live at a higher standard without sacrificing our wonderful planet earth. Beckhoff introduces evolutionary and new improved developments in all its product ranges, every year, which allows customers to optimize their machines for higher efficiency!
“But the real fun is to invent new revolutionary automation products which really change the way of doing automation and almost every 5-7 years, we successfully release new automation principles. This is one of the reasons for customers worldwide to use Beckhoff automation technology! We also think that the control of machines should be as powerful and intelligent as possible, because this helps them to run faster, smoother and more efficiently, which leads once again to a better economic performance, which is the original intention of our technological development. We improve our products, enhance the functionality and optimize the price/performance ratio,” shares Hans Beckhoff.
The persistence of innovation originated from Hans Beckhoff’s deep understanding of technological values. Beckhoff Automation has always been at the forefront of industrial innovation: from stepping off the beaten path to choosing PC-based control technology in the early days of the company, the development and introduction of the Ethercat communication protocol and the gigabit extensions – Ethercat G and G10, at 1 Gbit/s and 10 Gbit/s respectively, realization of modular value chain integration via the Twincat software, through to the XFC (extreme Fast Control) technology and XTS extended Transport System and the extended Xplanar planar motor system.
At Hannover Messe Digital 2021, Beckhoff demonstrated industrial PCs with more powerful multi-processors, new I/O signal types as well as bus terminals optimized in terms of performance and cost. Additional highlights included the newly expanded motor series in the standard rotary as well as in the linear range and associated drives, exciting expansions in XTS and Xplanar motion systems.
Beckhoff had also announced the integration of Machine Learning (ML) into the Twincat 3 automation software. Last year, Beckhoff had an effective beta phase and a very successful market launch. "Our automation architecture is based on different engineering departments: I/O, industrial PCs, motion control, software and system integration. Beckhoff has a large R&D team and we are investing about 8 % of our turnover into R&D each year. Besides I/O, motion and software Beckhoff is also a deeply integrated IPC manufacturer. Every motherboard is developed and manufactured inhouse. Every year, the latest embedded Intel and AMD platforms are integrated as upgrades into existing IPCs or are the base for new IPC products lines. Long term availability is achieved by this inhouse strategy and has, in addition to high performance and high quality, a high value for many customers," explained Hans Beckhoff.
Innovation in business models is equally important. According to Hans Beckhoff, Beckhoff Automation has already developed its service business for helping customers achieve value enhancement through data analysis and industry experience. Almost any Beckhoff control can be directly connected to the internet and cloud. This is the base for many Beckhoff customers to develop their service business strategy.
‘Add on’ software functions may be sold and installed on the machine controls, and the Beckhoff analytics-logger and analyzer functions allow a complete remote monitoring of the machine. The ‘flight recorder’ function for a machine is very helpful to optimize the machine or in case of trouble shooting. The rapid development of networking technology allows cloud-based control concepts to meet the requirements of stability and real-time. Beckhoff deploys virtual controllers on servers or even on virtual machines in the cloud to distribute tasks according to the customers’ application requirements to realize efficient remote control.
Beckhoff has already prepared a new business model for the industry’s future. The overall software-based approach from Beckhoff is based on its control software package Twincat which may be used on a local IPC directly at the machine. Because of the ‘software only’ concept, the same control software can also be installed in the cloud and may serve as a ‘cloud-based PLC’, or a ‘PLC on demand’, a concept which opens a lot of new application ideas.
Sustainable development is also an important direction for Beckhoff's innovations. Ma Xingkai stated that the Chinese Government has made a solemn commitment to "reach peak CO2 emissions by 2030 and work towards achieving carbon neutrality by 2060". At the same time, China has also set a clear goal of “lowering the country’s carbon dioxide emissions per unit of GDP by more than 65 % from the 2005 level by 2030”. The 14th Five-Year Plan is also determined to continue to promote the development of renewable energy.
Beckhoff China will grasp the strategic direction of sustainable development and further expand key industries such as wind energy, lithium battery, photovoltaic and intelligent building. The PC-based automation and control technology from Beckhoff enables more cost-effective use of green energy.
At the end of the interview, Ma Xingkai emphasized that China offers huge market potential and China’s automation market will continue to prosper in the post-pandemic era. Beckhoff China will pay close attention to national development policies, insist on and strengthen localization development strategies, expand the customer service network, enhance business coverage, improve technical services, promote the implementation of digital development and intelligent manufacturing, contribute to the transformation and upgrading of China's manufacturing industry, and continue to create outstanding value for customers in the cognitive practice of exploring the future of the industry.