>>from around the >>globe. It's the cube with digital >>coverage of IBM >>Think 2021 >>brought to you by IBM. Welcome back everyone to the cubes coverage of IBM Think 2021 I'm your host john ferry with the cube. Our next guest is Michelle well who's the industry General manager of Energy resources manufacturing. Great guest to break down this next generation of infrastructure, modern applications and changing the business and the super important areas is regulated verticals. Great to see you. Thank you for coming back on the queue. >>Thank you john good to meet you. >>You know this is the area where I've been saying for years the cloud brings great scale, horizontally scalable data but at the end of the day AI and automation really has to be specialized in in the verticals and this. We're going to see the action ecosystems for connecting. This is a big deal here think this year transformation is the innovation innovation at scale. It seems to be the underlying theme that we've been reporting on. So I'd love to get your thoughts on how you see this fourth industrial revolution as you say, coming about. Can you define for us what that means and when you say that, what does it mean for customers? >>Yeah, sure, sure. So you know, in in sort of simple terms, all the technologies that we see around us whether it's a I we talk about a I we talked about five G. We talk about edge cloud, robotics. So the application of those to the physical world in some sense, in the industrial world is what we define as uh as the fourth industrial revolution. Essentially it's the convergence between the humans, the physical aspect by the machines and the cyber at the digital aspects, bringing that together so companies can unlock the value from the terabytes and petabytes of data that's that are connected world is now able to produce, >>How does the IOT world come in? We've been again, I did a panel I think two years ago called you know the industrial IOT Armageddon. And it was really kind of point, it was kind of provocative title but the point was you know, the industrial connections are all devices now and they're connected to the network security. Super important, this industrial revolution includes this new edge, it's gotta be smarter and intelligent. What's your take on that? >>Absolutely, it is about the edge, it's about devices, it's about delivering capturing the data from the emptying devices. We've recently heard about the chip shortage which gives you an idea that there is so much utilization of compute power everywhere in the world and the world is becoming very software defined. So whether it's software defined machines, software defined products, the washing machines that he that we use at home, the cars we use at home, there everything is gradually becoming, not gradually, I'd say rapidly becoming intelligent and so that edge or IOT is the foundation stone also everything we're talking about. >>Well you mentioned software on a chip, S. O. C. Um, that's a huge mega wave coming. That's gonna bring so much more compute into smaller form factors. Which leads me to my next question, which kind of, I'm kind of answering for myself, but I'm not a manufacturing company, but why should they care about this trend from a business perspective? Besides the obvious new connection points? What's really in it for them? >>Yes, it's a big topic right now, is, is this topic of resilience? Right, So that's one aspect uh, this the pandemic has taught us that resilience is a core objective. The second objective which which is front and center of all CEOS, or CEOS, is out performance. And so what we're seeing is is out performance, are investing in technology for many goals, right? So it's either sustainability which is a big topic these days and huge priority. Uh it's about efficiency, it's about productivity, it's also now more and more about delivering a much stronger customer experience, right? Making your products easier to use much easily consumable as well. So, if you, when you pull it all together, it's it's an end to end thinking about using data to drive those objectives of out performance, as well as resilience. >>What's the progress being made so far in the manufacturing industry on this front? I mean, is it moving faster? Are you mentioned accelerating? But where is the progress bar? Right now? >>So, I think as we came into 2020, I would have described it as we were starting to enter the Chapter. Two companies were moving from experimentation to really thinking of scaling this and and what we found is the pandemic really caused a big focus on these. As Winston Churchill has been attributed the court never waste a good crisis. So a lot of ceos, a lot of executives and leadership really put their What their energy into accelerate industrial transformation. I think we relieve 2/3 southwell have been able to accelerate the industrial transformation. So the good news is, you know, companies don't have to be convinced about this anymore. They're really they're focuses on what's where should I start? Where should I focus on what should I do next? Right is really the focus and they're investing instead of two types of technologies is the way we see it, what I would call foundational technologies because there's a recognition that to apply the differentiating technologies like Ai and captured and taking value of the data, you need a strong architectural foundation. So whether it's it's cybersecurity, it's what we call it, the integration, connecting the devices back to to the mother ship and it's also applying cloud. But cloud in this context is not about typically what we think is public cloud or or or central spot. It's really bringing cloud like technology is also to the edge I. E. To the plant or to the device itself, whether it's a mobile device or a physical device. And that foundation is the recognition that you've got to have the foundation, that you can build your your capabilities on top, whether it's for customers or clients and colleagues >>as a great insight on the architecture, I think that's a successful playbook. Um It sounds so easy, I do agree with you. I think people have said this is a standard now, Hybrid cloud the edge, pretty clear visibility on the architecture of what to do or what needs to be done, how to do it almost story. So I have to ask you, we hear this barriers, there's always blockers. I think Covid released some of those, relieved some of those blockers because people have to force their way into into the transformation. But what are those barriers um that that are stopping the acceleration for customers to achieve the benefits that they need to see. >>Yes. So I think 11 key barrier is is a recognition that most of our plants or manufacturing facilities that supply chains really run run in a brownfield manner. I there's so many machines, so many facilities that have been built over decades. So there's a there's a proliferation of different ages of devices, machines, etcetera. So making sure that there is a focus on laying out the foundation. That's a key key barrier. Uh There is also a concern that uh you know, the companies have around cybersecurity, the more you connect, the more you increase the attack surface and we know that that acts and so on are the dominant issue. Now, whether it's for ransom, fair or for or for other malicious reasons, uh and so modernizing the foundation and making sure you're doing it in a secure way. Those are the key concerns that executives have. And then another key barrier I see is making sure that you have a key key core objective and not making sure making too many different varied experimentation bets. So keeping a focus on what's the call? Use case of benefit your after and then what's the foundation to make sure that you're going after it? Like I said, whether it's quality or productivity or such, like >>So the keys to success that I get this right is gonna have the right framework for this, as you say, industry 4.0, you got to understand the collaborative dynamics and then have an ecosystem. Yeah, can you unpack those three things? Because take me through that, you got to the framework, the collaboration and the ecosystem. What does that mean? Specifically? >>So uh the way, I think the simplest way to think of it as the amount of work and effort that all companies have been put in is so great in front of them, the opportunities are so great as well uh that nobody can hire all the smart people that are needed to achieve the goals. Everybody has their own specific I would say focus and capabilities they bring to bear. So the collaboration between manufacturers, the collaboration between operational technology companies like the Seaman's, A B B, Schlumberger's, etcetera. And and it technology companies like ourselves that three part collaboration is sort of the heart of what I see as ecosystems coming together. The other dimensionality of ecosystems is also looking at it from a supply chain or value chain perspective because how something becomes more intelligent or smarter or more effective is also being able to work across the supply chain or value chain. So those, those are our key focus areas, make sure we are collaborating across value chains and supply chains as well as collaborating with manufacturers and oT operational technology companies to be able to bring these digital capabilities with the right capabilities of operational technology companies into the manufacturers. >>If I asked you, how is you doing that? What specifically would you say? I mean, how are you collaborating? What's some examples, give some examples of of this in action? >>Certainly. So we recently announced uh over the last say nine months or so, three strategic very translated partnerships. The first one I'll share with you is uh is which number number two is the world's largest oil field services company and now also the world's largest distal technology company for the oil and gas industry. So we've collaborated with them to bring hybrid cloud to the digital platforms so they now can deploy the capabilities to any customer regardless of whether they want it in country or on a public cloud. Another example is we've we've established a data platform which number J for the oil and gas industry to be able to bring again that data platform to any location around the world. The advantage of hybrid, the advantage of A. I with the B. B. What we've done is we've taken our smarts in I. T. Security connected with their products and capabilities for operational systems and now are delivering an into institution that you can get cyber alerts or issues coming from from manufacturing systems right down to right up to an I. T. Command center where you're seeing all the events and alerts so that they can be acted upon right away. So that's a great example of collaborating with from a security point of view. The 3rd 1 is industrial iot with ceilings and we've partnered with Siemens to deliver their minds Fear Private cloud edition delivered on our red hat Hybrid cloud. So this is an example where we are able to take our horizontal technologies, apply it with their vertical smarts and deep industry cause of context put our services capabilities on top of it so they can deliver their innovations anymore. >>It is such an expert on this, such a great leader on this area. And I have to ask you, you know, you've been in this um mode of evangelizing and leading teams and building solutions around digital re platform or whatever you wanna call her innovation. Um what's the big deal now? If you had to? I mean, it seems like it's all coming together with red hat under the covers, get distributed networks with the edge, it's all kind of coming together now for the verticals because you get the best of both worlds programmable scalable infrastructure with modern software applications on top. I mean you've been even even in the industry for many, many waves, why is this wave so big and important? >>So I think there is no longer uh big reason why it's important. I think there's no no reason why companies have to be convinced now the clarity is there, that this needs to happen. So that's one. The second is I think there is a high degree of expectation among consumers, among employees and among among customers as well that everything that we touch will be intelligent. So these technologies really unlock the value, uh unlock the value and they can be deployed at scale. That's really, I think what we're seeing as the focus now and being able to deliver the innovation anywhere, whether someone wants it at the edge next to a machine that's operating or be able to look at how a manufacturing facility or different product portfolio is doing in the boardroom, it's all available and so that shop floor, the top floor connection is what everybody is aiming for. We also now called edge to enterprise >>And everything works better. The employees are happy, people are happy to, stakeholders are happy finish. Great insight. Thank you for sharing here on the Cube for think 2021. Thanks for coming on the Cube. >>Absolutely. Thanks for having me. >>Okay. I'm John Kerry hosted the queue for IBM think 2021. Thanks for watching. Yeah. Mm. Yeah.