Digital ecosystems point the way to the future

Nadella sees Microsoft as a company that empowers people and organizations to extend their potential and overcome challenging situations — such as the coronavirus pandemic. “Digital tech is super important for resilience,” he said. “We became digital first responders to all the first responders, whether it was in healthcare or in critical manufacturing, ensuring that digital technology was there to help them.” For example, the Microsoft Teams business communication software plays a big role for many people working from home. The number of monthly active users across the globe grew to 250 million. According to Nadella, the pandemic has brought about real structural change including an acceleration of digital technology across many sectors such as retail, healthcare, and manufacturing “In manufacturing, everything that can be simulated, automated, or digital twinned is being done… Remote operations of everything is now possible, and we’ve proven that.”

For example, Microsoft offers Azure Digital Twins for this purpose. This technology makes it possible to create digital twins in the cloud. These “twins” are data-based 3D models of objects or processes including cars, hospitals, value chains, or entire cities. Digital twins offer detailed insights into energy consumption or production processes, for example, allowing these to be optimized more quickly. The Microsoft portfolio also includes a solution for digital education and training: The HoloLens headset displays mixed reality applications in the wearer’s field of vision and can transmit this data to the Internet via an integrated camera. Real-world applications include training sessions in which a skilled worker supports employees of a manufacturing plant from thousands of miles away in servicing a machine on site.

According to Nadella, more and more everyday products will be connected in the coming years, thus becoming part of the Internet — including vehicles. He predicts that “the auto industry is going to become more digital, more software driven.” Software is becoming an important tool for car manufacturers to stand out from the competition, but at the same time it is tying them more closely to existing ecosystems. The dynamics of the mobility market necessitate a common, open, and flexible software platform that connects suppliers, app developers, and third-party ecosystems: “Let’s take the PC, or the phone, or the data center. There is an open software-defined platform where many suppliers can kind of participate. I think that that approach is what we’re obviously partnered on, and we’re very excited,” Nadella continued. Open interfaces allow for apps from partner companies to be integrated into vehicles, creating new opportunities across an ecosystem of suppliers. These apps can enable users to control their smart homes by preheating individual rooms shortly before their arrival, for example.

Software development is changing, too. “In the past, when you thought about software (development), you thought about people writing the code. In software 2.0, you train the software to learn from data,” Nadella said. This results in an ability to create predictive and casual reasoning power. Artificial intelligence will also be used in more and more everyday devices in the future. The combination of AI with the Internet of Things delivers new possibilities. In this context Nadella said, “Significant work (is done) in using the power of AI, IoT and sensors with that data-driven approach to software engineering, which I think is going to be a pretty profound shift.” This will help create a new generation of connected and intelligent devices and services that analyze data directly in products or in the cloud. For example, a connected car can send technical data on a car’s driving behavior to the cloud, where it is analyzed and then combined with feedback from customers that car manufacturers obtain via other channels including social media. This helps provide a more comprehensive picture so car manufacturers can improve vehicle models and future design processes.

In the industrial sector, the two partners also work together with other companies in the Open Manufacturing Platform, an alliance whose members share their experiences, data models, and solutions to accelerate manufacturing innovation at scale. In view of growing software ecosystems, such collaborations will gain in importance in the future.