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Our lives are becoming more electric and more digital. This is good news because the combination of electrification and digitization makes it possible to shape a sustainable world.
Climate change demands that we all act today to transform energy generation and consumption to achieve global net-zero emissions by 2050. Whilst electricity is the best vector of decarbonization and the most efficient way to transport and distribute green energy, digitization enables a smart future by allowing for the efficient and automatic operation of microgrids in homes, buildings, districts, cities, and countries. Together, electrification and digitization are creating the New Electric World.
However, the journey to such a world is not without challenges. Recently, the pandemic and geopolitical tensions have prompted our teams at Schneider Electric to re-think how we design, manufacture, provide, and maintain our offers. By evolving our go-to-market processes, we have been able to maintain and even exceed the service levels expected by our customers despite the unprecedented changes of the last two years.
Ensuring business continuity
COVID-19 and the delta and omicron variants have been game-changers for companies worldwide. “Business as usual” has been replaced by ‘the new abnormal” where disruptions to availability, capacity, transportation, and labor require constant adaptation.
Relationships between companies and their customers have been transformed as well, with demand vanishing in some cases and soaring in others. Furthermore, the ongoing threat of trade bans among countries is challenging organizations to become more resourceful and agile in their operations.
To improve their agility, businesses across industries are increasing inventory levels and forgoing at least for the moment the practice of hyper-efficient “just in time” manufacturing. At the same time, many companies are regionalizing their distribution to ensure they have inventory in multiple places and thereby reduce their dependence on a single location. According to a recent McKinsey & Company survey of companies across industries and geographies, “almost 90 percent of respondents told us that they expect to pursue some degree of regionalization during the next three years.”
Leveraging a multi-hub strategy
Several years ago, Schneider Electric moved from a quite centralized system for R&D, offer management, and industrialization to a decentralized, multi-hub approach. By setting up hubs in our major markets, we now have excellent proximity to our customers in each geography, which gives us a better understanding of their needs. For example, we are familiar with local habits and protocols when a customer needs to recover from a power outage.
Our hubs translate into better operational continuity in three important ways:
- Earlier risk detection. Issues affecting customers can be detected faster and addressed more effectively by local teams, before causing disruptions to customer deliveries and service.
- Faster resource qualification. Testing, validation, and qualification of alternative materials and parts are performed in local R&D labs, speeding the identification and engagement of reliable resources.
- Local collaboration. In each Schneider Electric hub, local R&D, marketing, industrialization, and customer service departments collaborate as a true cross-functional team to mitigate risks, align on priorities, detail action plans, secure resources, and meet customer needs.
In addition, in a strategy we call “the power of two,” all of our hubs dual-source critical components from partners in different geographies to help ensure availability regardless of geopolitical issues.
Leveraging digitalization and connectivity
The energy management solutions that we provide through our regional hubs are embedded with advanced digital electronics, allowing customers to connect and automate their operations, and monitor them on-site or remotely. And by standardizing our technology platforms as much as possible, we reduce complexity, deliver cost savings, ease integration, and simplify management and maintenance. Such standardization ensures a consistent experience for our global customers, as well.
Platform standardization can present difficulties in today’s multi-polar world, but thanks to the local knowledge that our hubs possess, we are able to adapt our offers to meet each market’s specific expectations and regulations. For example, our EcoStruxure energy management platform can be easily tailored to meet local IEC and UL electrical standards in various regions and countries around the world. Our goal is to combine the best of both platforming and regionalization to help our customers advance their businesses and thrive.
Leveraging simplified, open, and digital
Adaptation of our energy management solutions for local markets is facilitated further by a company mindset and way of doing business that is simplified, open, and digital.
- Simplified means we provide smart, connected products and solutions that are easy to install and easy to use.
- Open means our partners have support in everything they do, with more than 650,000 connected professional peers worldwide; open also describes our interoperable architectures, which allow faster integration and commissioning.
- Digital means both our partners and customers realize the full potential of digitalization, from making their operations more efficient to helping to advance a sustainable net-zero world.
What challenges do you face?
Because we are all in this together, I invite you to share your thoughts on the challenges businesses face today in their efforts to become more sustainable. Have you found the right balance between platforming and regionalization? How has the pandemic affected your operations? How have the expectations of your customers evolved over the last two years?
Please feel free to email me directly. And to learn more about Schneider Electric, including how we are helping companies become more resilient through better energy management and sustainability, visit se.com.