Interview: Ulrich Spiesshofer, CEO of ABB
Ulrich Spiesshofer, the boss of one of the world’s largest automation companies talks to Jon Excell about collaboration, innovation, and why we shouldn’t fear the robots
The rapid march of automation and robotics is a divisive trend. For some, it’s a destructive force that threatens jobs and even entire professions. Others trumpet its productivity-boosting powers and the trickle-down benefits this brings to the wider economy.
There are no prizes for guessing where CEO of power and automation giant ABB Ulrich Spiesshofer sits on this. On a recent visit to the UK he explained to The Engineer why he believes we should welcome the rise of the robot.
“If you correlate robotic density with unemployment rates you will see the lower the robot density the higher the unemployment,” he said. “In the US, we have about 100 robots per 10,000 workers and an unemployment rate that is still significant. France has about 130 and an unemployment rate between 9 and 10 per cent. Germany, Japan and South Korea all have more than 300 robots per 10,000 workers and the unemployment rate is below 4 per cent. There is no correlation that would say that robots create unemployment. Quite the opposite. Robots drive employment because through new ways of competitiveness you create additional jobs.”
What’s more, while automation may not have delivered the life of universal leisure and indulgence once predicted by science-fiction writers, it has, Spiesshofer believes, been one of the single-most important factors in driving up global living standards. “In the last 50 years mankind has moved more people from below the extreme poverty line than the accumulated 500 years before and one of the key drivers is industrialisation of automation,” he said.
Robots drive employment because through new ways of competitiveness you create additional jobs
With the recent advent of Industry 4.0, collaborative robotics, and artificial intelligence – to name just a few transformative technology trends – this automation-driven revolution shows no sign of slowing. And, since taking the helm at ABB back in 2013, Spiesshofer has presided over a restructuring process designed to ensure that the firm is well placed to help drive this ongoing revolution.
One key change to the way the company operates has been a greater emphasis on collaborating with external partners, particularly in the academic research community. “We have changed the model in the last couple of years to where we rely much more than in the past on partnerships, not just on the business side but also in education and research,” he explained. “We need to tap innovation where it happens.”
The company’s relationship with Imperial College London is an example of that in action. Indeed, during his recent visit to the UK Spiesshofer signed a memorandum of understanding with the university to collaborate on research into the digital power grids, a key emerging area for the company.
But in parallel with an increased appetite to collaborate with the outside world, the firm has also upped its investment in internal R&D, particularly in emerging areas such as artificial intelligence, which Spiesshofer believes will define the future of the automation sector. “We’re coming from an industrial environment where automation helps to replace muscle, into a new environment where we bring together actuation, control, sensing, digitalisation and AI to make sure the expertise that’s captured in the brains of our people and control systems gets lifted out and aggregated so that we can really augment human potential by the use of AI.”
Restructuring the organisation to achieve this change has been a key goal for Spiesshofer and, over the past few years, he’s simplified the way it functions: maintaining the distinct focus of its four global business areas – power grids, electrification, industrial automation, and robotics – while maximising the opportunities for collaboration and expertise sharing across the business. “In the past, we were a vertically focused company that hung together horizontally, now we are a horizontally leveraged company that has deep vertical domain expertise,” he said.
In the years to come the world will have a lot of uncertainties, but technology can help us to become more independent from these uncertainties
To help create the right conditions for this collaboration to take place, Spiesshofer has put in place a process he calls the “growth port”: whereby all of the key division leaders meet regularly in a structured way with different parts of the business to identify opportunities. “First we bring in the sales people in and ask where are the priorities for market penetration,” he explained. “Next time we focus on innovation, then we bring the R&D leaders together and ask what can we do on the innovation side. Third time, we talk about market expansion and going into new areas and again we bring the business leaders together. We have created a growth and innovation machine that’s much more aligned than ever before.”
The transformation engineered by Spiesshofer has taken place against a backdrop of broader global economic change and uncertainty, a climate that has hampered global infrastructure investments, and created further challenges for technology suppliers such as ABB. However, Spiesshofer prefers to view this uncertainty as an opportunity. “We need to appreciate that in the years to come the world will have a lot of volatility and uncertainty, but technology can help us to become more independent from these uncertainties by providing a base productivity improvement, and by providing competitiveness. The countries and companies that are leading in technology adoption are leading in the world of uncertainty.”
It’s a point that’s perhaps particularly relevant to the UK, where the much-publicised productivity gap and continuing uncertainty over the shape and impact of Brexit are causing major concerns across industry. “I think that the UK with all the uncertainties on the political side at the moment should continue to deploy technology in a good way, and should become a faster adopter in more areas. Altogether, the UK has a tremendous opportunity for technology use. The robot density in the UK is far below Germany and Japan – so there’s an opportunity to do something and I think it will have a positive impact on the economy when you deploy technology more.”