Siemens' key differentiator in the realm of digitalization is a comprehensive end-to-end solution

Can you share Siemens' overarching vision for the water industry and how the company plans to address the key challenges and opportunities in this sector?

Water has long been an essential and stable business sector for Siemens. However, current global trends such as water scarcity, severe weather events, workforce shortages, and underfunded infrastructure have created a growing regulatory and industrial demand for new technologies.

I believe water is becoming as critical an issue as CO₂, with a rising demand to secure this precious resource, particularly in the industrial sector. While Siemens has traditionally focused on municipal water and wastewater services, we are also deeply involved in various industries such as food and beverage, automotive, semiconductors, and pharmaceuticals. Our customers in these fields are increasingly focused on water savings and sustainability targets.

Our strategy is centred on three core pillars. The first pillar focuses on strengthening our market position in automation, aiming to maintain our leadership in distributed control systems, SCADA, and instrumentation. The second pillar emphasizes expanding our sustainability offerings, with a significant focus on energy efficiency, particularly in the water and wastewater industry. The third pillar involves growth in the fragmented water and wastewater market, addressing these priorities as key to solving our customers' core challenges.

We also observe a shift from CapEx to OpEx due to budget constraints in infrastructure. This has led to a greater emphasis on operational efficiency, where real-time optimization and asset management software play a crucial role. Siemens provides end-to-end solutions, leveraging our expertise in hardware like PLCs, instrumentation, meters, and sensors, along with our expanding software portfolio and integration services. We can handle IT/OT integration comprehensively. For example addressing energy costs, which constitute 30% of operational expenditures. Our software helps monitor energy consumption across the value chain and identify energy-saving opportunities.

Additionally, the aging workforce is a significant concern. Digital tools can help reduce the manpower required to operate infrastructure and extend the life of existing systems.

Can you tell us about your role as General Manager, Global Water Industry at Siemens and how your experience has shaped your approach to driving innovation and sustainability in the water sector?

My responsibility is to drive Siemens' market share growth in the water and wastewater industry globally. This involves three core areas. The first is portfolio shaping & innovation. My team and I gather and discuss requirements from different regions since Siemens operates worldwide. We serve nearly every country with our water and wastewater portfolio, collecting market requirements, consolidating them, and driving product innovation.

The second core area is business development, where we support our regional companies in building relationships with new customers and introducing new products to the market.

The third core area is technical standardization. We develop and globally implement technical standards, e.g., automation systems in water plants, making them available for training purposes to internal teams and key customers and partners.

How does Siemens position itself in the global water industry market, and what are the key strategic initiatives driving growth in this sector?

In addition to our three strategic pillars, Siemens drives growth through key initiatives aligned with our Siemens Xcelerator vision. Siemens Xcelerator, our open business platform, aims to simplify our customers' experiences by providing an interoperable portfolio. For instance, our hardware seamlessly integrates with various software solutions, enabling different software systems to communicate via open architecture and interfaces. This approach is fundamental to delivering our comprehensive end-to-end value proposition.

Siemens serves nearly every country with our water and wastewater portfolio, collecting market requirements and driving product innovation

Our second key initiative focuses on enhancing and expanding our ecosystem. We actively collaborate with partners such as system integrators, EPCs, and IT consultants. By adopting the "Made by Our Partner" principle, we leverage market opportunities to enrich our portfolio through these collaborations. Our goal is to make our products accessible to everyone, which includes launching new sales channels and approaches. We are also embracing digital selling methods, such as marketplaces, to reach a wider audience.

What differentiates Siemens’ water industry solutions from those of its competitors, and how does the company plan to maintain its competitive edge?

I would say it depends on the competitive benchmarks we are considering.  With our hardware portfolio, including automation and instrumentation, we hold a leading market position. Our key differentiators are the high quality, longevity, and resilience of our products, and we are committed to maintaining these standards.

In the realm of digitalization and software, the landscape is quite different. The market is highly fragmented, with numerous startups and small to medium-sized players. However, the market is evolving, leading to significant M&A activity. Our key differentiator in this space is the comprehensive end-to-end solution we offer. We possess deep domain expertise in Operational Technology, understand the requirements for effective software functionality, and have the capability to implement all necessary system architectures and layers. This enables us to extract, manage, analyse, and utilize data effectively. Additionally, we excel in optimization, covering the entire water cycle and focusing on enhancing resource efficiency through monitoring and optimization.

Depending on the regions where we operate, we adopt a more localized approach to our product portfolio and market strategies to address varying competitive landscapes.

Can you discuss Siemens’ strategy for expanding its water industry solutions, and what opportunities or challenges you foresee?

Our key focus is to offer our customers and partners comprehensive solutions, not just products. At the beginning of this year, we launched a major campaign called the Non-Revenue Water Campaign, which integrates various portfolio elements. Depending on the customer's needs, we can provide a software license for leakage detection or bundle it with a MAG 8000 battery flow meter. If hardware installation is required, we can also offer engineering and implementation services. This multi-layered bundling principle embodies our approach to industry solutions.

Siemens has transformed from a hardware-focused company towards a comprehensive tech company, including software. To achieve this, we are fostering greater internal collaboration, with dedicated groups working closely on the portfolio side. Additionally, this approach requires increased collaboration with partners. The market is very heterogeneous, with some partners being globally active, allowing us to set up dedicated global account managers. However, we also work with partners that are highly specific to local markets.

A standout feature of our leakage detection software is the "zero-touch" principle. This design makes implementation extremely user-friendly, which is crucial in the water and wastewater industry where workforce shortages are common. Many utilities lack the capacity and expertise for large-scale implementation projects. To simplify this process, our software comes preconfigured with data for our portfolio's flow meters, and we aim to include flow meters from other suppliers as well. This integration means that clients can easily download the software, scan the QR code on their installed flow meters, and automatically integrate the data of the flow meter into the system.

Additionally, the software is based on artificial intelligence, making it a self-learning system that understands the network's setup and behaviour, becoming operational within a few hours. This ease of use and rapid deployment is a key unique selling proposition that we now offer to the entire water and wastewater industry. We recently showcased this innovative solution at Munich’s IFAT 2024, demonstrating the smooth onboarding process.

Can you comment on Siemens’ partnership with Ketos and how it might contribute to addressing the needs of water operators?

Water operators face significant challenges related to both water quantity and quality, particularly with the introduction of new regulations such as PFAS. Effective water quality management is essential for achieving sustainable operations and fostering innovative use cases.

Our partnership with KETOS is a key element in our water reuse initiatives, which aligns with our Siemens Xcelerator strategy and allows us to offer advanced water quality solutions to the market. Through this collaboration, we are particularly focusing on the industrial water sector, aiming to enhance our capabilities and provide comprehensive solutions for water quality management.

Siemens Water (SIWA) applications are specifically developed for the water and wastewater industry operators. Can you discuss how these tailored solutions contribute to efficiency and sustainability?

Our key differentiators are the high quality, longevity, and resilience of our products, and we are committed to maintaining these standards

The SIWA Leak Finder is designed to help network operators identify leaks with higher accuracy and determine which leaks need to be repaired, thus saving on maintenance and service costs. In Sweden, Siemens assisted water company VA SYD in reducing its water losses from 10% to 8%. While this might not seem significant, it made a substantial difference for the utility. Our software enabled the identification of the smallest leaks, detecting water losses of around 0.2 to 0.5 litres per second. These small leaks often contribute more to overall water losses in the network compared to larger ones, as they are harder to detect. VA SYD was extremely impressed with our solution.

Regarding non-revenue water in general, reducing water losses can significantly impact energy costs. In many countries, water loss rates are even higher. For example, Mexico experiences 30% to 50% non-revenue water. Considering that 30% of total operational costs are due to energy expenses, addressing water leakages can lead to substantial energy savings. This highlights the major sustainability benefit of reducing water losses.

Siemens is expanding its software portfolio for the water industry. Can you discuss new software offerings such as SIWA Blockage Predictor or others?

The SIWA Blockage Predictor helps predict sewage spills in real-time within wastewater networks and optimizes their performance. While this challenge is not universal, many countries have combined wastewater networks for households and industries, where overflows are a significant issue.

Regarding water quality, Siemens recently launched a new product in collaboration with Northumbrian Water Group at the UK Innovation Festival. The UK, known for its innovative market, was the ideal setting for this co-creation. Our new business model, Water Quality As A Service, simplifies the provision of our software and complete service packages to water companies.

The Treatment-to-Tap initiative aims to revolutionize water quality management. By the project's end, Northumbrian Water will operate Europe’s largest integrated network of water quality and leakage management sensors and analytics software. Managing water quality is increasingly challenging due to aging networks and growing populations. This new research will explore how to best engage and support customers with real-time water quality insights, making water company operations more customer-centric than ever.

Furthermore, Siemens Financial Services offers unique financing solutions to support these implementations. We developed this application at the Northumbrian Water Group Innovation Festival, with participation from other water utilities and water regulators, providing an excellent testing ground to finalize our offerings.

Another great example is SIWA Sewer Optimizer, which helps avoid non-compliant discharges and manage the entire wastewater network during heavy rain events: a real-time prediction of control interventions to reduce spillovers of untreated water.  We are also looking to enhance this solution by integrating weather forecast data for greater accuracy.

We at Siemens are committed to addressing key industry challenges, which drive our portfolio expansions. We start with local pilot projects, primarily in co-development contexts, and scale globally when feasible. Although some solutions are more localized, our goal is to develop a globally accessible portfolio for our customers.

What role do you see for digital twin technology in the water and wastewater industry?

In my opinion, digital twins are crucial for creating an efficient, sustainable, and resilient water infrastructure. At Siemens, we recognize that different phases of an infrastructure's life cycle require distinct digital twin solutions. We offer tailored digital twin solutions for each phase: design and engineering, commissioning, operation, and maintenance.

The SIWA Sewer Optimizer helps avoid non-compliant discharges and manage the entire wastewater network during heavy rain events

Our digital twin solutions focus on optimizing infrastructure management and planning. Additionally, we provide digital twin solutions to optimize the process itself, for example to enhance energy efficiency within a wastewater treatment process. This is particularly beneficial for brownfield water infrastructure. Siemens has a long history of using digital twins, with many references in different industries and infrastructure, like energy grids.

A key requirement for all our digital twin offerings is having a unified data backbone. Many of our customers start with a digital twin for the engineering and planning phase and later utilize the same data for digital twins during the operations phase for simulations and other purposes. This seamless integration across different phases is Siemens' key value proposition.

Our defence-in-depth concept consists of three layers: physical security, network security, and system integrity. The outermost layer, physical security, includes measures to prevent unauthorized physical access to critical components and systems, starting with conventional building access and extending to securing sensitive areas with access control. The middle layer, network security, focuses on installing secure communication solutions to protect networks against unauthorized access, ensuring availability and protecting easily accessible systems. The innermost layer, system integrity, involves system hardening, user and patch management, and malware detection and prevention to maintain the integrity of the system.

This year, Siemens has also launched the SINEC Security Guard, an intuitive cloud-based software that enhances cybersecurity on the shop floor. It enables industrial operators and automation experts to perform vulnerability mapping and manage security measures effectively.

In today’s business world, with significant activity conducted remotely or via the cloud, robust cyber defence is critical. Siemens continues to innovate in cybersecurity and communications. This continuous rapidly innovative approach ensures our customers have the latest tools to protect their systems against evolving cyber threats.

Could you share some examples of how Siemens’ technologies have helped water utilities improve efficiency and sustainability?

We have many examples to share, but one we are particularly proud of is our work with our Portuguese customers EPAL (Empresa Portuguesa das Águas Livres) and AdVT (Águas do Vale do Tejo). The utilities launched the “EPAL 0%” Program, which aims to achieve energy neutrality in all its operations by 2025 through an integrated mix of technological solutions. This includes energy efficiency measures, producing renewable energy by installing hydroelectric, wind, and photovoltaic power plants, creating microgrids, digitalization, and utilizing water reservoirs for energy storage.

EPAL and AdVT sought to reduce their reliance on non-renewable energy sources and minimize the environmental impact of energy production. Siemens supported EPAL in achieving its energy neutrality goals by optimizing the efficient management and remote control of its complete assets, being an integral part of their journey towards sustainability.

How is Siemens aligning its water industry solutions with environmental regulations in global sustainability goals?

Our expertise in industrial automation and digitalization enables us to develop innovative technologies for the water management sector

Achieving Sustainable Development Goal 6, which ensures access to water and sanitation for all, is a core mission for Siemens. We are dedicated to helping societies worldwide gain access to safe water, sanitation, and hygiene as fundamental human rights. The water sector plays a critical role in this mission, which is why Siemens offers comprehensive solutions spanning the entire water cycle — from desalination and water treatment to freshwater networks and wastewater management. Our key claim, "technology to transform the every day," embodies our commitment and in the water and wastewater industry, we support our clients by providing end-to-end solutions.

What future innovations can we expect from Siemens in the water industry, particularly concerning digitalization?

Digitalization is at the core of Siemens’ product offerings. Our leakage detection solution, for example, runs on artificial intelligence, one of the key technologies Siemens is continually innovating. We leverage AI extensively, believing it can help make the world more sustainable, efficient, and resilient. In the context of digitalization, AI plays a crucial role in simplifying operations for water and wastewater industry operators. Our AI-driven software is user-friendly and requires no specialized skills to operate, making it easier for operators to manage their tasks effectively.

What is your personal vision for the future of digital and smart water solutions, and how is Siemens positioned to lead this transformation?

My vision is a future with digital and smart water solutions. Siemens is playing a crucial role in this transformation by ensuring efficient and sustainable water management, which in turn improves resource conservation and quality of life. With our Siemens Xcelerator strategy, we are positioned to lead this change. Our extensive expertise and experience in industrial automation, digitalization, and smart solutions enable us to develop and implement innovative technologies for the entire water management sector. This applies to both municipal and industrial applications, addressing the complete spectrum of water challenges.

Is there anything else you would like to share about Siemens’ vision and strategy for the water industry that we haven't covered during the interview?

I would like to emphasize that while we have a strong market position, we are committed to further expansion. Siemens is a global leader in the water and wastewater industry, but collaboration is essential. Building a robust ecosystem and forming partnerships are crucial success factors from my perspective, and I am dedicated to driving this effort.

At Siemens, we address our customers' core challenges by evaluating whether we already have the necessary solutions. If not, we determine whether to develop it in-house, acquire it, or partner with another company. A prime example is our acquisition of BuntPlanet, which provided a clear competitive edge for Siemens, illustrating the strategic importance of such partnerships.