12 theses for the future of LAPP
Article by Georg Stawowy and Patrick Olivan, LAPP
It is difficult to make predictions, especially about the future – this statement is ascribed to Niels Bohr, and Samuel Goldwyn, Mark Twain, Robert Storm Peterson, and a number of others. And while it is hard to argue with the statement, it is a very basic objective of innovation management to do just that: to foresee possible, and likely, developments and to derive guidelines and define fields of action.
The reason why predictions are so difficult to make is due to a variety of reasons. On the one hand, assumptions have to be made as to how today's trends or paths will most likely develop linearly. On the other hand, to every trend or path there is usually a counter-trend which slows it down or reverses it. For example, there is the trend of mobility, in which we move more and more frequently between places worldwide, and the counter-trend of being rooted to one’s home, in which we yearn more and more to feel at home and secure. Or the trend towards digitalization, in which our lives are increasingly taking place on the internet, and the counter-trend of mindfulness, which encourages us to defend ourselves against increasing technologization and to put nature in the foreground.
At LAPP, we have addressed the future by using the methodology of extrapolation. We have made a leap into the year 2050 and from there we look back to 2030. This enables a change of perspective that does not simply extrapolate the past into the future, but rather deals more freely and radically with the future. The first step in the methodology was to analyse how the year 2050 would look in around 12 future studies. We filtered out and aggregated the underlying megatrends. For each trend, we identified various scenarios and selected the scenario most relevant to LAPP. The sum was a collection of relevant scenarios in 2050. It is not a question of predicting the future exactly, but of defining orientation points that make it possible to plan and focus innovation activities.
On this basis, the LAPP Management Board examined the implications this would have for LAPP in 2030. This was where the actual retropolation took place, i.e. based on scenarios in 2050 we looked back and derived what this would mean for 2030. The Management Board defined 12 theses and tried to formulate them as precisely as possible for LAPP. The complete theses are not intended for the public, but they are briefly outlined below.
1. Sales are increasingly taking place online
For several years now, digital distribution channels have accounted for a significant share of LAPP sales, and this share will continue to grow strongly - via proprietary platforms such as web shops and EDI, and presumably also via open platforms in the future. Here it is crucial to find the right balance.
2. Customer requirements are determined and transmitted digitally
New digital technologies make it possible for the customer's needs to be recognized digitally and converted into an order. Human input is becoming less and less necessary. Intelligent systems such as the LAPP e-Kanban or the Smart Cable Drum can trigger orders completely independently - this enables buyers and sales staff to focus more on other, value-adding topics.
3. No cable without data
Each machine and each active component will have its own IP address in the future. This means that each component is connected, accessible and controllable. From this we conclude that there will be no more pure power cables, each cable will also transmit data.
4. Wireless technologies are a natural part of our connection solutions
Wireless technologies open up numerous new possibilities - for example in the field of mobile machines. LAPP, as a provider of connection solutions, must also be able to offer this.
5. Miniaturization will require more compact, lighter connection solutions
The miniaturization of computing power is unstoppable: chips, sensors and machines are becoming smaller and smaller and more powerful. All this also requires smaller cables, connectors and other connection components.
6. Customizing requires high flexibility in delivery
Customers become more and more prosumers (Producer + Consumer). They expect to be able to adapt the purchased product individually to their requirements. Some customers will have a high need for individualization, others will have a high need for speed. This requires, among other things, a segmented and differentiated supply chain.
7. Radical shortening of the time between order and delivery
Production cycles and logistics are becoming increasingly flexible and faster. Both enable an enormous shortening of delivery times.
8. Up to 80% of business processes are digitized
As individualization increases complexity, efficiency gains are necessary to absorb cost increases. These are realized through digitalization, be it through online configurators or automatic order-to-production interfaces.
9. Modularization of the products
A further lever towards customization at competitive prices is modularization. Thanks to the modular design of products, economies of scale can also be exploited for small batch sizes.
10. No sale without a clear recycling process
Sustainability and recycling are becoming central requirements. A purchase decision will depend on recycling being ensured. In addition, the foreseeable shortage of important resources creates a further incentive for recycling in order to decouple itself from such developments in the best possible way.
11. Activities focus increasingly on Asia
The rapidly growing population in the Asia-Pacific region and the rapidly growing prosperity of the middle class ("The next Billion") will increase the economic power of India and China disproportionately. In addition, the ASEAN economic area is expected to catch up strongly in terms of economic strength. Indonesia is expected to be one of the ten largest economies in the world by 2050. We must therefore continue to develop and expand our presence in Asia in order to be able to serve these markets appropriately.
12. Shift of competence towards IT
Digitalisation redefines what competences and skills must be available in our organisation. The separation of business and IT, as it has been customary up to now, is not a viable model for the future. Each individual in the company will have to deal increasingly with IT issues. Knowing about digitalisation opportunities and processes and being able to design them will therefore become a central competence.