In 2007, Siemens acquired a pioneering software company whose technology led to the development of digital twins—virtual models that allow researchers to test and refine products and systems before applying what they learn to real-life scenarios. Today, more than 170,000 companies and organizations use Siemens’s digital twin software. Automakers use it to design new factories. Medical device manufacturers use it to make their processes more efficient. Siemens’s digital twin software was even used to simulate how NASA’s Mars rovers would function in the Martian atmosphere, culminating in the successful Curiosity and Perseverance missions to Mars in 2012 and 2021, respectively.
Barbara Humpton, CEO of Siemens USA, believes digital twin technology can address supply chain challenges by enabling more goods to be produced locally. In her vision, companies will soon begin using digital twins to make models of things like car parts and semiconductors, then rapidly manufacture real-life versions using 3D printing. “I think digital twins will unleash the wave of micro manufacturing that has been predicted for some time,” Humpton says. “Back in 2007, I’m not sure how many people recognized what a key moment it was for Siemens and for the world.” In June, Siemens launched an open digital business platform called Xcelerator to help accelerate this digital transformation, offering the portfolio, partner ecosystem, and marketplace that companies need to scale up their innovations, stay competitive, and boost productivity.
Innovations such as these are part of Siemens’s DNA, stretching back to the company’s founding in 1847. Siemens’s 175-year commitment to improving lives and expanding what’s humanly possible makes the company a deserving winner of Fast Company’s 2022 World Changing Ideas Company of the Year award.
A STARTUP BEFORE THERE WERE STARTUPS
In 1847, Werner von Siemens, working from his Berlin home, developed the technology that led to the construction of Prussia’s first electric telegraph line, allowing people to communicate instantaneously across great distances. He went on to invent the first electric railway, revolutionizing transportation.
“What Siemens focused on was how people communicated, how they traveled from place to place, how they lived, and how they worked,” Humpton says. “We’re still building on that legacy today. Our mission is to transform the everyday. To that end, we’re working on enabling more agile and productive factories, more intelligent and efficient buildings and grids, and more reliable and sustainable transportation.”
Last year, Siemens, in partnership with Deutsche Bahn and the city of Hamburg, introduced a driverless train that can transport up to 30% more passengers than nonautomated trains while reducing energy consumption by up to 30%. The company’s vaccine production software and digitalization helped BioNTech convert a facility in Marburg, Germany, to produce its mRNA COVID-19 vaccine, developed in collaboration with Pfizer, in just five months. And it retooled its Dynamic VAV Optimization software, which helps optimize buildings’ HVAC systems, lowering the potential for virus transmission and reducing energy use.
“When you start looking for it, you’ll see Siemens technology everywhere,” Humpton says. “We’re commuting in cars that were designed with Siemens software and built in factories powered by Siemens automation technology. If they happen to be electric, they might be charged by a grid that has been developed and maintained by Siemens.”
INVESTING IN INNOVATION
To generate this array of world-changing ideas, Siemens embraces a multipronged approach to innovation. It invests more than $5 billion annually in its research and development team, which operates in a network of hubs around the world. It also sponsors several internal programs designed to spur innovation—for example, a program called Next47 Accelerator puts employees through a boot camp where they learn how startups operate and generate ideas for new inventions. Plus, its venture capital and M&A departments continually scan the horizon for disruptive startups to bring under the company’s umbrella, giving them access to Siemens’s resources and global reach. These parallel efforts have created an environment that generates about 20 new inventions every day—inside a company that already holds more than 40,000 patents.
The goal of all these innovations is always to make a positive impact on the lives of real people around the world. Several years ago, the managing board of Siemens identified five global megatrends for the company to focus on: climate change, urbanization, aging populations, an increasingly global supply chain, and digital transformation. Nearly all the company’s recent innovations address one or more of these trends.
“One of our mantras is that instead of falling in love with our own technology, we need to fall in love with our customers’ problems,” Humpton says. “And out of that comes the innovation that brings true change.”