In this article, we explore how open source is not just for makers anymore, and actually makes great business sense. Business Benefits of Open Source: The Pragmatic Side of a PhilosophyChoosing open source is not just a philosophical stance; it is a strategic decision with tangible benefits for businesses across a variety of sectors: manufacturing, building automation, smart cities, e-mobility, logistics, safety – and any industry where technology is key.Here are 7 reasons to consider open-source solutions:<ol><li dir="ltr">License Included: Escape the burden of hefty license fees, with an open-source model that completely eliminates the need for these costs.</li><li dir="ltr">Limit NREs: Non-recurring engineering costs decrease when you use an open and accessible platform designed for seamless integration.</li><li dir="ltr">No Vendor Lock-in: The growing Arduino ecosystem is not a trap; it’s a versatile offering that allows exploration and evolution, without imposing switching costs.</li><li dir="ltr">Extensive Documentation: Over the years, Arduino has built a treasure trove of documentation, tutorials, and tech specs to support users at every stage of development.</li><li dir="ltr">Community-Sourced Resources: Our vibrant community of over 33 million users ensures a constant flow of libraries, examples, and shared experiences.</li><li dir="ltr">Effortless Integration: Arduino products seamlessly integrate with third-party solutions, enabling cost-effective retrofitting and interoperability.</li><li dir="ltr">Lower Labor Costs: Arduino’s accessibility and user-friendly design mean lower labor costs, with a large pool of engineers familiar with the platform.</li></ol> Shared Commitment, Shared AchievementsArduino was founded on principles of open source since its inception in 2005, and continues to be at the forefront of the movement. Our recently released <a href="https://blog.arduino.cc/2024/01/11/the-2023-arduino-open-source-report-is-out/" target="_blank">Open Source Report for 2023</a> unveils a range of achievements that exemplify in how many directions this core value translates into new projects, products, resources and more.Key highlights include joining the Zephyr® Project, releasing five new open-source hardware components (Arduino UNO R4 Minima and R4 WiFi, Arduino GIGA R1 WiFi and GIGA Display Shield, Arduino Nano ESP32), and a plethora of updates to the Arduino IDE and command line tools. The pivotal role of the vibrant Arduino community is highlighted in the report too, with over 1,000 new libraries and 205 open-source tutorials shared on Project Hub in 2023.&nbsp;Another initiative fueled by the community’s contributions is <a href="https://docs.arduino.cc/" target="_blank">Arduino Docs</a>, a collaborative repository launched in 2021 as a testament to the brand’s commitment to sharing knowledge. The archive has grown into a comprehensive resource hub, and the Arduino Team’s efforts to keep a sea of information updated, organized, and easy to navigate for all recently led to a complete overhaul of the platform’s design and architecture, unveiled in January 2024.&nbsp; Unlocking Innovation with the Open-Source ParadigmIn a world where innovation is the lifeblood of success, adopting open-source technology platforms like Arduino can be a savvy move for entrepreneurs and engineers worldwide. The tangible business benefits, coupled with an outstanding track record of community collaboration and continuous improvement, position open source as not just a philosophy but a pragmatic pathway to sustained success in the ever-evolving landscape of digital transformation, leading to cost-effectiveness, innovation, and a future-proof tech ecosystem.

Open source makes business sense. Photo: Alberto Morici for Arduino

In the ever-evolving landscape of technology and innovation, businesses are constantly seeking ways to stay ahead of the curve, optimize processes, and drive innovation. One powerful approach gaining widespread recognition is the adoption of open-source technology platforms – and for good reason.

Unleashing Business Potential with the Advantages of an Open-Source Approach

Metal wire cloth is at the heart of countless filtrations, homogenisations and other applications with solid, liquid and gaseous media that benefit from the exact uniform structure and stability of wire mesh. Haver &amp; Boecker excels in perfection down to the last detail. This applies not only to the filter medium itself, which covers an extremely wide spectrum from the finest structures in the micrometre range to coarse structures. It also applies to the filters and fabricated parts into which the mesh is further processed, including plastic edging.When touring through the many production halls of Haver &amp; Boecker’s Wire Weaving Division in Oelde, Germany, one thing becomes very clear: it is the combination of tradition and experience on the one hand, and innovative strength and the cutting-edge technology on the other that makes it possible to develop individual product solutions for the filtration of solid, liquid and gaseous media. Plastic injection moulding has become an important component in recent years.&nbsp;“Plastics engineering in conjunction with wire mesh is a discipline in its own right, which also takes us experts to a new level,” says the industrial supervisor who specialises in plastics engineering.Whether simple cut-to-size wire mesh or complex components - made-to-measure metal filters and fabricated parts made of metal mesh are used in a wide variety of industries and areas of application. This is because virtually all manufacturing companies have to deal with the filtration of particles or the retention of foreign substances - be it in the development of individual components such as transmission oil filters for the automotive industry or in the ongoing treatment of waste water or process water. Wire mesh is an ideal filter medium thanks to its exact geometric structure and the precisely definable pore size and the material and flow characteristics.&nbsp;&nbsp;<h3>Custom-made hybrid components</h3>Overmoulding components with plastic is also nothing new. Haver &amp; Boecker‘s Wire Weaving Division introduced plastic injection moulding as early as 20 years ago. The requirements for functionality and handling of metal wire mesh filters increased along with the complexity of the product shapes and production equipment, and even experts in this field confirm that the combination with wire mesh is a whole field of plastics engineering of its own.Many decision-makers, however, are impressed in particular by the production of precision, lightweight fabricated parts coupled with the economical series production as the result of short cycle times.&nbsp;Always bearing speed and resource conservation in mind, Haver &amp; Boecker produces hybrid components on the basis of the state-of-the-art systems engineering integrated into the production line by the employees of its own toolmaking department. They work in wire weaving in many places and draw on a wide range of expertise ranging from adjusting screws on the looms to optimising coarse and fine meshes, to the finishing stations up to the complex production line.&nbsp;The successful series production of hybrid filters and the adoption of proven developments such as HAVER’s Vision System for visual inspection of all components speak for themselves. The development teams from our own toolmaking, research &amp; development, engineering and plastics engineering departments provide advice on new tool and system concepts including optimisation of the plastic itself. PEEK plastic, for example, was thus successfully modified by adding a silicone-based additive: <a href="https://www.haverboecker.com/en/news-media/success-stories/plastics-engineering-haver-adpeekr/" target="_blank">HAVER AdPEEK®</a> makes energy-efficient system utilisation possible by lowering the required melting temperature, amongst other things.&nbsp;<img src="https://images.wevolver.com/eyJidWNrZXQiOiJ3ZXZvbHZlci1wcm9qZWN0LWltYWdlcyIsImtleSI6ImZyb2FsYS8xNjk4NzQzNjQ0Mzk0LVdldm9sdmVyX0t1bnN0c3RvZmZ0ZWNobmlrX1Byb2R1a3RlLnBuZyIsImVkaXRzIjp7InJlc2l6ZSI6eyJ3aWR0aCI6OTUwLCJmaXQiOiJjb3ZlciJ9fX0=" style="width: 300px;" class="fr-fic fr-dib">Metal filters and fabricated parts made to measure&nbsp; All from a single source - All for your safety&nbsp; © Haver &amp; Boecker3D printing for prototypes with plastic edgingEvery development process is characterised by a regular exchange of information and coordination. Specific, three-dimensional and tangible approval samples are enormously helpful as a basis for discussion as they can be used to check handling, test the fineness of the meshes and develop packaging options. Haver &amp; Boecker uses 3D printing here on order to act quickly, flexibly and individually and thereby shorten the product development process.&nbsp;<h3>Flexibility is a valuable asset nowadays</h3>The various types of mesh, of which more than 3,600 are in stock alone on a total storage area of more than 6,000 square metres at the company’s headquarters in Oelde, cover a wide spectrum ranging from the finest of micrometre structures to coarse structures. Although such a high inventory level contradicts the general trend, it increasingly pays off as regards to dependable deliverability and adherence to delivery dates.&nbsp;Thanks to this interaction of tradition and innovation and the courage to put its own experience ahead of a trend, this family-owned business has become the world's leading manufacturer of wire mesh since the company was founded more than 130 years ago.<img width="510" src="https://images.wevolver.com/eyJidWNrZXQiOiJ3ZXZvbHZlci1wcm9qZWN0LWltYWdlcyIsImtleSI6ImZyb2FsYS8xNjk4NTY3Mzc5NDczLTE2OTg1NjczNzk0NzMuanBlZyIsImVkaXRzIjp7InJlc2l6ZSI6eyJ3aWR0aCI6OTUwLCJmaXQiOiJjb3ZlciJ9fX0=" class="fr-fic fr-dii">Plastics engineering in the Wire Weaving Division &nbsp;The individually developed production lines meet the highest standards of quality and reliability. © Haver &amp; BoeckerLearn more on our <a href="https://www.haverboecker.com/en/product-solutions/metal-filters-and-fabricated-parts/plastics-engineering/?lso=wevolver-kunststofftechnik-beitrag&utm_campaign=kunststofftechnik&utm_source=wevolver&utm_medium=beitrag&utm_content=_102023" target="_blank" rel="noopener noreferrer">website</a>.

In plastic injection moulding, edgings and complete fabricated parts are made from metal wire mesh.

Perfection in detail - Plastics engineering in the Wire Weaving Division

The world is not short on pressing problems. And many of them will fall to us - to the engineers - to solve. This article explores, arguably, the best approach to problem-solving, including the way I applied that approach to my own company which solves a problem inherent to the world of manufacturing.&nbsp;Engineering is about solving problems. And, for the most part, we&rsquo;re engineers in the first place because we&rsquo;re curious about things, the way they work and the way they can be improved. But that doesn&rsquo;t make us perfectly diligent and dependable.&nbsp;Engineers &ndash; at time of writing &ndash; are all too human and we often think we are solving problems when in fact we are just finding clever ways to live with them. Often that&rsquo;s because time and resources are limited. To tear something up and start again is normally the expensive, difficult route, at least at first. But I feel strongly we should always try to consider what something might look like if we went back to the start and approached it as if for the first time.&nbsp;There&rsquo;s an important distinction between completely fixing something and merely improving something. The latter is a kind of solution, but often it&rsquo;s just delaying the inevitable, kicking the can down the road, as they say. A useful way to ensure you are solving a problem and not simply finessing it is to ask how you would approach things if you went back to the beginning. This clears your mind from the existing solutions and creates room for visualising the perfect future without constraints. Once you get there, you can start asking what else should be true for this perfect solution to be true? This gives you the requirements along with the smaller problems to solve and you can assess whether this completely new and better solution is viable or not. That new beginning, that new way of doing something, will probably be hard to get to. There will be serious barriers, not least time and cost. But in the long run the right solution will be more economical, efficient and sustainable than any easy improvements you might make to the old method.<h3>Starting over with Fractory</h3>My own company was created to solve a problem, one I feel acutely as an engineer because it takes up my time and energy and is expensive and distracts me from the core engineering work I would prefer to focus on. It&rsquo;s the problem engineers face in procuring parts. It&rsquo;s the problem they face navigating supply chains. For the wider industry it even incorporates the problem of better utilising machinery and material resources. &nbsp;So, with my co-founders, we created Fractory, which automates time-consuming and difficult aspects of the manufacturing process, specifically quoting and buying as well as project management and logistics. We free engineers from the intensive work of traditional drawings because metal parts can be ordered simply by uploading CAD files to our platform. We free them from the crazy stresses of managing supply networks. And we improve things for suppliers too, for the metal fabricators themselves, by providing demand where and when there is capacity and capability to supply.&nbsp;Our solution saves time and saves energy, freeing up talent and allowing people to focus on important work and perhaps allowing them to solve vital problems. Engineering time is precious and the shortage of engineers is a serious threat. So, Fractory greatly improves utilisation of the existing engineering resource.&nbsp;And we really did go back to the beginning. We built a machine (our platform) for instantaneous quoting and ordering from design files, which optimises for cost and lead times. And we built an organisation (our people) to handle those orders that don&rsquo;t achieve an instant quotation and to handle design complexities and supply chain intricacies where they occur. We didn&rsquo;t create just a marketplace where people upload designs and companies quote for them, as this would have actually made the situation even worse for companies wasting their time on quoting. That would be an example of building on top of existing solutions. Rather, we imagined a new way, a solution for both ends - the customer and the supplier.&nbsp;We wondered what a brand-new solution would look like. In fact, the goal was not just a new solution, but rather a perfect solution, something to be imagined without fear of the status quo. And that&rsquo;s what the Fractory software engineers and mechanical engineers are building. And now global businesses come to us for their series and project manufacturing needs. And universities and inventors come to us for their prototyping needs. Our solution is being adopted across the manufacturing spectrum and is already making a difference.<h3 id="isPasted">Things as they could be</h3>In approaching problems it&rsquo;s useful to make sure we are not just thinking about things as they are, but about things as they could be. The pen is powerful, most writers would acknowledge. But someone once decided that the status quo on writing implements could be smashed and that we should create something new, something that was hugely difficult to make, that had thousands of moving parts and weighed a tonne, that would cost a lot of money and take a lot of time and that would be difficult &ndash; at first &ndash; to use. Lo and behold, the typewriter, an object currently recognisable as a crucial part of most computers.That was quite a leap! The process to get to a working typewriter and then to settle on the famous QWERTY layout was not straightforward, surely.&nbsp;<h3>Admitting there&rsquo;s a problem</h3>It would have been easy to just make do with the pen! But somebody recognised a problem and got curious about a solution. Early efforts, machines as big as cars, were perhaps dispiriting. But the search for a solution went on and soon small electric models were being churned out. (And look where it&rsquo;s got us: everyone&rsquo;s got a novel in them!)Yet a great many are all too happy with things as they are. We see it with Fractory. Some engineers do not easily recognise the problem we first identified, the huge amounts of time and expense spent on procurement, spent on navigating supply chains: the problems that Fractory solves. That&rsquo;s why often it is good to talk less about solutions and more about problems. Get into the problems! Recognise them! Admit to them! And then be brave and go back to the beginning. Ask yourself, what would it look like if we started again? &nbsp;

Photo by ThisisEngineering RAEng on Unsplash

Let’s not think about things just as they are but let’s think about things as they could be – that is the heart of problem-solving. 

Solve Problems by Going Back to the Start

Let us delve into the profound impact that generative AI may have on employment, exploring both the opportunities it creates and the challenges it presents, as we strive to shape a world where human ingenuity and machine intelligence can coexist harmoniously.


How Will Generative AI Revolutionize Our Work?

This is the second piece in a <a href="https://www.wevolver.com/article/hardware-is-hard-does-it-have-to-be" rel="noopener noreferrer" target="_blank">4-part opinion series</a> for and about hardware/software businesses.<hr>Last week, the media picked up that BMW is selling heated seat subscriptions for $18/month in some countries. As a result, BMW is awash in negative press, garnering headlines such as &ldquo;<a href="https://www.thedailybeast.com/bmw-has-started-charging-by-the-month-to-keep-your-ass-warm" rel="" target="_blank">BMW Has Started Charging by the Month to Keep Your Ass Warm</a>&rdquo; and &ldquo;<a href="https://www.theverge.com/2022/7/13/23206999/car-subscription-nightmare-heated-seats-remote-start" rel="" target="_blank">The future of cars is a subscription nightmare</a>&rdquo;.Internally, Particle had&hellip; similar feelings. Some choice quotes from our Slack thread on the topic:<ul><li>&ldquo;Would 100% ensure I didn&#39;t buy a BMW&rdquo;</li><li>&ldquo;Very excited to live in the new microtransaction hellscape.&rdquo;</li><li>&ldquo;Reminds me of Spirit Airlines &lsquo;racing towards&rsquo; charging for carry-ons.&rdquo;</li><li>&ldquo;I hate this with every fiber of my being&rdquo;</li></ul>But wait a second. Particle is an IoT platform whose customers ship hardware/software products, generally with subscriptions attached. This newsletter is only on its fourth issue and I&rsquo;ve already advocated for &ldquo;hardware-as-a-service&rdquo; business models at least twice. So why all the shade cast towards BMW?I believe that manufacturing businesses are going through a business model transformation that will lead to any high-value product ($10K+) being sold either partially or completely under a subscription model. Businesses that drive that transformation will become industry leaders, and others will be left behind.But I also believe there is a right way and a wrong way to go through that transformation. And BMW&rsquo;s approach is, frankly, wrong.So, let&rsquo;s use this as a case study. What is the wrong way to implement subscriptions for a hardware product? And what does that imply about what the&nbsp;right way is?<h3>BMW&rsquo;s Subscription Model</h3>First, let&rsquo;s get past the headlines and lay out the facts about BMW&rsquo;s subscription model:In 2020,&nbsp;<a href="https://www.bmwusanews.com/newsrelease.do?id=3611&mid=" rel="" target="_blank">BMW announced</a> that they would begin selling features of its cars through &ldquo;digital after-sales&rdquo;. Here&rsquo;s the relevant text from the announcement:<blockquote>BMW already offers its customers digital services and additional vehicle functions in the form of digital after-sales, some of which are deeply embedded in the vehicle&#39;s software. In the US, BMW Drive Recorder is offered through a pilot program. In the near future, additional functions will be added that can access the vehicle&#39;s existing hardware and software, such as certain comfort functions or driver assistance systems.With the option of subsequently booking additional vehicle functions via the ConnectedDrive Store, BMW is strengthening selection and personalization for customers, offering them maximum flexibility. BMW provides the hardware and software in the vehicle at the time of manufacture for the implementation so that it can be adapted later on as required and in accordance with customer preferences. &nbsp;If, for example, vehicle functions were not yet requested at the time of purchase, they can be added later. A second owner thus can configure the used vehicle according to their own wishes.</blockquote>Side note: I find it fascinating that they seem to be avoiding the word &ldquo;purchase&rdquo;, like they don&rsquo;t want to admit that you&rsquo;re going to have to pay for this stuff. You can &ldquo;book&rdquo; additional vehicle functions, they can be &ldquo;added later&rdquo;. Look folks, if you&rsquo;re embarrassed to admit your own business model, you&rsquo;re probably doing it wrong.As promised, the&nbsp;<a href="https://www.bmw.co.uk/en/shop/ls/cp/connected-drive" rel="" target="_blank">BMW ConnectedDrive</a> is filled with &ldquo;digital services&rdquo; you can buy (sorry, &ldquo;add&rdquo;). As of July 19, 2022, you can &ldquo;add&rdquo; a total of 13 features:<ul><li>Active Cruise Control with Stop &amp; Go function (Purchase)</li><li>Adaptive M Suspension (Purchase)</li><li>Apple CarPlay Preparation (Purchase)</li><li>BMW Drive Recorder (Purchase)</li><li>BMW Safety Camera Information (Subscription)</li><li>Driving Assistant Plus (Subscription)</li><li>Front Seat Heating (Subscription)</li><li>High Beam Assistant (Subscription)</li><li>IconicSounds Sport (Purchase)</li><li>Map Update Package (Purchase)</li><li>Online Entertainment Voucher (Subscription)</li><li>Service Inclusive (Warranty-style purchase, limited to 5yrs/100K km)</li><li>Steering Wheel Heating (Subscription)</li></ul><figure><a href="https://substackcdn.com/image/fetch/f_auto,q_auto:good,fl_progressive:steep/https%3A%2F%2Fbucketeer-e05bbc84-baa3-437e-9518-adb32be77984.s3.amazonaws.com%2Fpublic%2Fimages%2Fbbc5c856-2140-478e-bbcc-78c7c5a63919_3584x2108.png" rel="" target="_blank"><source type="image/webp" srcset="https://substackcdn.com/image/fetch/w_424,c_limit,f_webp,q_auto:good,fl_progressive:steep/https%3A%2F%2Fbucketeer-e05bbc84-baa3-437e-9518-adb32be77984.s3.amazonaws.com%2Fpublic%2Fimages%2Fbbc5c856-2140-478e-bbcc-78c7c5a63919_3584x2108.png 424w, https://substackcdn.com/image/fetch/w_848,c_limit,f_webp,q_auto:good,fl_progressive:steep/https%3A%2F%2Fbucketeer-e05bbc84-baa3-437e-9518-adb32be77984.s3.amazonaws.com%2Fpublic%2Fimages%2Fbbc5c856-2140-478e-bbcc-78c7c5a63919_3584x2108.png 848w, https://substackcdn.com/image/fetch/w_1272,c_limit,f_webp,q_auto:good,fl_progressive:steep/https%3A%2F%2Fbucketeer-e05bbc84-baa3-437e-9518-adb32be77984.s3.amazonaws.com%2Fpublic%2Fimages%2Fbbc5c856-2140-478e-bbcc-78c7c5a63919_3584x2108.png 1272w, https://substackcdn.com/image/fetch/w_1456,c_limit,f_webp,q_auto:good,fl_progressive:steep/https%3A%2F%2Fbucketeer-e05bbc84-baa3-437e-9518-adb32be77984.s3.amazonaws.com%2Fpublic%2Fimages%2Fbbc5c856-2140-478e-bbcc-78c7c5a63919_3584x2108.png 1456w" sizes="100vw"><img src="https://images.wevolver.com/eyJidWNrZXQiOiJ3ZXZvbHZlci1wcm9qZWN0LWltYWdlcyIsImtleSI6ImZyb2FsYS8xNjYxODQ2OTAwMTM0LTE2NjE4NDY5MDAxMzQucG5nIiwiZWRpdHMiOnsicmVzaXplIjp7IndpZHRoIjo5NTAsImZpdCI6ImNvdmVyIn19fQ==" width="1456" height="856" alt="" srcset="https://substackcdn.com/image/fetch/w_424,c_limit,f_auto,q_auto:good,fl_progressive:steep/https%3A%2F%2Fbucketeer-e05bbc84-baa3-437e-9518-adb32be77984.s3.amazonaws.com%2Fpublic%2Fimages%2Fbbc5c856-2140-478e-bbcc-78c7c5a63919_3584x2108.png 424w, https://substackcdn.com/image/fetch/w_848,c_limit,f_auto,q_auto:good,fl_progressive:steep/https%3A%2F%2Fbucketeer-e05bbc84-baa3-437e-9518-adb32be77984.s3.amazonaws.com%2Fpublic%2Fimages%2Fbbc5c856-2140-478e-bbcc-78c7c5a63919_3584x2108.png 848w, https://substackcdn.com/image/fetch/w_1272,c_limit,f_auto,q_auto:good,fl_progressive:steep/https%3A%2F%2Fbucketeer-e05bbc84-baa3-437e-9518-adb32be77984.s3.amazonaws.com%2Fpublic%2Fimages%2Fbbc5c856-2140-478e-bbcc-78c7c5a63919_3584x2108.png 1272w, https://substackcdn.com/image/fetch/w_1456,c_limit,f_auto,q_auto:good,fl_progressive:steep/https%3A%2F%2Fbucketeer-e05bbc84-baa3-437e-9518-adb32be77984.s3.amazonaws.com%2Fpublic%2Fimages%2Fbbc5c856-2140-478e-bbcc-78c7c5a63919_3584x2108.png 1456w" sizes="100vw" class="fr-fic fr-dii"></a><figcaption>What do you call &ldquo;nickel-and-diming&rdquo; when it&rsquo;s done in Euros?</figcaption></figure>Putting aside &ldquo;Service Inclusive&rdquo;, which seems like a standard AppleCare+ style model of expanding and extending the warranty, six of these upgrades are one-time purchases and six of these upgrades are subscriptions.If you&rsquo;re like me, you&rsquo;re probably reacting to this list as follows:<ul><li>It seems reasonable to charge a one-time fee for upgrades that I would traditionally purchase as part of a premium trim package (like &ldquo;Adaptive M Suspension&rdquo;). Rather than buying a basket of features up front when I buy the car, I can select only what I want and buy it whenever I feel like it. I&rsquo;m good with that.</li><li>That said, the longer this list gets, the more I feel like I&rsquo;m being nickeled-and-dimed. &ldquo;Bundling&rdquo; does have a clear benefit to the customer: avoiding &ldquo;microtransaction hell&rdquo;.</li><li>I kinda love that you can pay 99 euros to play the BMW engine sound inside the vehicle. That sort of reminds me of buying ringtones circa 2004.</li><li>Once we hit the subscriptions, things go off the rails. The seat heaters are the feature getting all the flack, but &ldquo;high beam assistant&rdquo; and &ldquo;steering wheel heating&rdquo; feel equally wrong.</li></ul>This subjective, intuitive reaction to the list of 13 features that BMW offers as &ldquo;digital after-sales&rdquo; shows that some fee structures seem reasonable and others don&rsquo;t. As we build a framework for the&nbsp;right and&nbsp;wrong ways to add subscriptions to a hardware product, let&rsquo;s pull in a counter-example from the automotive world &ndash; Tesla&rsquo;s Autopilot.<h3>Tesla Autopilot</h3>If I go onto Tesla&rsquo;s website to buy a Model 3, I am presented with a slick user interface to customize by car by adding/removing features. At the moment, I can spend as little as $46,990 or as much as $77,990 on a Model 3.<figure><a href="https://substackcdn.com/image/fetch/f_auto,q_auto:good,fl_progressive:steep/https%3A%2F%2Fbucketeer-e05bbc84-baa3-437e-9518-adb32be77984.s3.amazonaws.com%2Fpublic%2Fimages%2F724aa5b3-b8e0-42b9-852d-3ca4ad59b809_3584x2108.png" rel="" target="_blank"><source type="image/webp" srcset="https://substackcdn.com/image/fetch/w_424,c_limit,f_webp,q_auto:good,fl_progressive:steep/https%3A%2F%2Fbucketeer-e05bbc84-baa3-437e-9518-adb32be77984.s3.amazonaws.com%2Fpublic%2Fimages%2F724aa5b3-b8e0-42b9-852d-3ca4ad59b809_3584x2108.png 424w, https://substackcdn.com/image/fetch/w_848,c_limit,f_webp,q_auto:good,fl_progressive:steep/https%3A%2F%2Fbucketeer-e05bbc84-baa3-437e-9518-adb32be77984.s3.amazonaws.com%2Fpublic%2Fimages%2F724aa5b3-b8e0-42b9-852d-3ca4ad59b809_3584x2108.png 848w, https://substackcdn.com/image/fetch/w_1272,c_limit,f_webp,q_auto:good,fl_progressive:steep/https%3A%2F%2Fbucketeer-e05bbc84-baa3-437e-9518-adb32be77984.s3.amazonaws.com%2Fpublic%2Fimages%2F724aa5b3-b8e0-42b9-852d-3ca4ad59b809_3584x2108.png 1272w, https://substackcdn.com/image/fetch/w_1456,c_limit,f_webp,q_auto:good,fl_progressive:steep/https%3A%2F%2Fbucketeer-e05bbc84-baa3-437e-9518-adb32be77984.s3.amazonaws.com%2Fpublic%2Fimages%2F724aa5b3-b8e0-42b9-852d-3ca4ad59b809_3584x2108.png 1456w" sizes="100vw"><img src="https://images.wevolver.com/eyJidWNrZXQiOiJ3ZXZvbHZlci1wcm9qZWN0LWltYWdlcyIsImtleSI6ImZyb2FsYS8xNjYxODQ2OTAwNjQ2LTE2NjE4NDY5MDA2NDYucG5nIiwiZWRpdHMiOnsicmVzaXplIjp7IndpZHRoIjo5NTAsImZpdCI6ImNvdmVyIn19fQ==" width="1456" height="856" alt="" srcset="https://substackcdn.com/image/fetch/w_424,c_limit,f_auto,q_auto:good,fl_progressive:steep/https%3A%2F%2Fbucketeer-e05bbc84-baa3-437e-9518-adb32be77984.s3.amazonaws.com%2Fpublic%2Fimages%2F724aa5b3-b8e0-42b9-852d-3ca4ad59b809_3584x2108.png 424w, https://substackcdn.com/image/fetch/w_848,c_limit,f_auto,q_auto:good,fl_progressive:steep/https%3A%2F%2Fbucketeer-e05bbc84-baa3-437e-9518-adb32be77984.s3.amazonaws.com%2Fpublic%2Fimages%2F724aa5b3-b8e0-42b9-852d-3ca4ad59b809_3584x2108.png 848w, https://substackcdn.com/image/fetch/w_1272,c_limit,f_auto,q_auto:good,fl_progressive:steep/https%3A%2F%2Fbucketeer-e05bbc84-baa3-437e-9518-adb32be77984.s3.amazonaws.com%2Fpublic%2Fimages%2F724aa5b3-b8e0-42b9-852d-3ca4ad59b809_3584x2108.png 1272w, https://substackcdn.com/image/fetch/w_1456,c_limit,f_auto,q_auto:good,fl_progressive:steep/https%3A%2F%2Fbucketeer-e05bbc84-baa3-437e-9518-adb32be77984.s3.amazonaws.com%2Fpublic%2Fimages%2F724aa5b3-b8e0-42b9-852d-3ca4ad59b809_3584x2108.png 1456w" sizes="100vw" class="fr-fic fr-dii"></a><figcaption>I&rsquo;ll take my burger with everything on it, please.</figcaption></figure>That $77,990 price at the top end includes a whopping $12,000 for &ldquo;Full Self-Driving Capability&rdquo;. Tesla has gotten a lot of shit for how they&rsquo;ve marketed this feature by overpromising and under-delivering on delivering a true &ldquo;self-driving car&rdquo;, but to give credit where it&rsquo;s due, if you put aside the cost and the marketing for a second, this feature is pretty damn nice. Tesla has been a market leader in driver assistance features since it originally launched Autopilot in October 2015, even if other automotive manufacturers have since caught up.But Tesla didn&rsquo;t just lead the pack on driver assistance tech. They also innovated on the business model. Because if I choose&nbsp;not to pay $12K for the feature up front,&nbsp;<a href="https://www.tesla.com/support/full-self-driving-subscriptions" rel="" target="_blank">I can choose to activate a &ldquo;Full Self-Driving Capability Subscription&rdquo; later</a>.<figure><a href="https://substackcdn.com/image/fetch/f_auto,q_auto:good,fl_progressive:steep/https%3A%2F%2Fbucketeer-e05bbc84-baa3-437e-9518-adb32be77984.s3.amazonaws.com%2Fpublic%2Fimages%2F6ef799e3-699f-41ba-8cb4-eea526b9447e_1418x540.png" rel="" target="_blank"><source type="image/webp" srcset="https://substackcdn.com/image/fetch/w_424,c_limit,f_webp,q_auto:good,fl_progressive:steep/https%3A%2F%2Fbucketeer-e05bbc84-baa3-437e-9518-adb32be77984.s3.amazonaws.com%2Fpublic%2Fimages%2F6ef799e3-699f-41ba-8cb4-eea526b9447e_1418x540.png 424w, https://substackcdn.com/image/fetch/w_848,c_limit,f_webp,q_auto:good,fl_progressive:steep/https%3A%2F%2Fbucketeer-e05bbc84-baa3-437e-9518-adb32be77984.s3.amazonaws.com%2Fpublic%2Fimages%2F6ef799e3-699f-41ba-8cb4-eea526b9447e_1418x540.png 848w, https://substackcdn.com/image/fetch/w_1272,c_limit,f_webp,q_auto:good,fl_progressive:steep/https%3A%2F%2Fbucketeer-e05bbc84-baa3-437e-9518-adb32be77984.s3.amazonaws.com%2Fpublic%2Fimages%2F6ef799e3-699f-41ba-8cb4-eea526b9447e_1418x540.png 1272w, https://substackcdn.com/image/fetch/w_1456,c_limit,f_webp,q_auto:good,fl_progressive:steep/https%3A%2F%2Fbucketeer-e05bbc84-baa3-437e-9518-adb32be77984.s3.amazonaws.com%2Fpublic%2Fimages%2F6ef799e3-699f-41ba-8cb4-eea526b9447e_1418x540.png 1456w" sizes="100vw"><img src="https://images.wevolver.com/eyJidWNrZXQiOiJ3ZXZvbHZlci1wcm9qZWN0LWltYWdlcyIsImtleSI6ImZyb2FsYS8xNjYxODQ2ODk5MTk4LTE2NjE4NDY4OTkxOTcucG5nIiwiZWRpdHMiOnsicmVzaXplIjp7IndpZHRoIjo5NTAsImZpdCI6ImNvdmVyIn19fQ==" width="1418" height="540" alt="" srcset="https://substackcdn.com/image/fetch/w_424,c_limit,f_auto,q_auto:good,fl_progressive:steep/https%3A%2F%2Fbucketeer-e05bbc84-baa3-437e-9518-adb32be77984.s3.amazonaws.com%2Fpublic%2Fimages%2F6ef799e3-699f-41ba-8cb4-eea526b9447e_1418x540.png 424w, https://substackcdn.com/image/fetch/w_848,c_limit,f_auto,q_auto:good,fl_progressive:steep/https%3A%2F%2Fbucketeer-e05bbc84-baa3-437e-9518-adb32be77984.s3.amazonaws.com%2Fpublic%2Fimages%2F6ef799e3-699f-41ba-8cb4-eea526b9447e_1418x540.png 848w, https://substackcdn.com/image/fetch/w_1272,c_limit,f_auto,q_auto:good,fl_progressive:steep/https%3A%2F%2Fbucketeer-e05bbc84-baa3-437e-9518-adb32be77984.s3.amazonaws.com%2Fpublic%2Fimages%2F6ef799e3-699f-41ba-8cb4-eea526b9447e_1418x540.png 1272w, https://substackcdn.com/image/fetch/w_1456,c_limit,f_auto,q_auto:good,fl_progressive:steep/https%3A%2F%2Fbucketeer-e05bbc84-baa3-437e-9518-adb32be77984.s3.amazonaws.com%2Fpublic%2Fimages%2F6ef799e3-699f-41ba-8cb4-eea526b9447e_1418x540.png 1456w" sizes="100vw" class="fr-fic fr-dii"></a></figure>There is something inherently less&nbsp;icky about Tesla&rsquo;s subscription model here. There are some major differences between BMW and Tesla&rsquo;s subscription models that influence how customers will react to them:<ul><li>Tesla offers&nbsp;one&nbsp;subscription instead of many.</li><li>Tesla&rsquo;s subscription makes a&nbsp;very expensive feature more accessible.</li><li>Tesla emphasizes the&nbsp;ability to unsubscribe at any time and thus only pay for FSD when you&rsquo;re actively using it.</li><li>Tesla uses its subscription to&nbsp;facilitate evaluation; customers who are unsure whether they&rsquo;d like FSD can sign up for a month and try it out. This is important because a) most people haven&rsquo;t tried one of these driver assistance systems when they buy a Tesla so they might be unsure of whether they&rsquo;ll like it, and b) the feature keeps improving so if you try it and don&rsquo;t like it you can give it another shot after a year or two of improvements.</li><li>And now the big one: Tesla&rsquo;s subscription is applied to a feature whose&nbsp;value is delivered through software rather than through hardware.</li></ul>This last bullet is, in my opinion, the most important one.As the electronics products that we own have become more intelligent, we&rsquo;ve become trained to separate &ldquo;hardware value&rdquo; from &ldquo;software value&rdquo;. We attribute features that rely heavily on physical characteristics of the product &ndash; like heated seats &ndash; to hardware value that we expect to purchase upfront. In contrast, we understand that some features require a heavier software investment; those features have user interfaces presented on screens and get downloaded over-the-air and are improved over time by the manufacturer. We understand that these features require an ongoing cost to deliver, and therefore we are more willing to entertain the idea that the manufacturer has earned an ongoing fee.<h3>A Better Subscription Model for BMW</h3>Given the nature of the features that BMW is attempting to provide via subscription, is there a different model they could pursue that wouldn&rsquo;t piss people off?Yes! At least I think so. If I were BMW, I would bundle the relevant features into a &ldquo;Winter Driving Package&rdquo; that would look something like this:<ul><li>Heated seats</li><li>Heated steering wheel</li><li>Remote engine start, windshield defrost, and climate control (heat up the car and notify you via push notification when it&rsquo;s nice and cozy inside)</li><li>Advanced driving features to facilitate safer driving on ice and in snow (look, I don&rsquo;t know what these features would be exactly, but I&rsquo;m sure the smart people at BMW could figure it out)</li><li>$49/mo subscription, activate/deactivate at any time (encouraging customers to activate for the winter and deactivate in the spring when the weather warms up)</li><li>Marketing campaigns in the fall to sell a discounted &ldquo;full season&rdquo; winter driving package (e.g. $249 for access to the Winter Driving Package from October 1 to April 31)</li></ul>Why does this feel better than BMW&rsquo;s current approach? Because it&rsquo;s using a subscription model to do something that&nbsp;provides an actual benefit to customers. Not everybody lives in a climate that requires a winter driving package, not everyone is willing to pay for these features, and nobody needs them at all during the summer. If we design subscription packages around how customers want to use our products, we can build subscription revenue in ways that make customers happy.

BMW's attempt to enter the world of subscription services.

The Wrong Way to Add Subscriptions

Watch the full interview here.


Interview with Sanjay Dastoor, founder of Boosted and Skip

OKdo is a component supplier and electronics consulting company based in the UK. They are on a mission to inspire and enable customers to generate new ideas and turn them into commercial reality.<h2>The state of the semiconductor sector&nbsp;</h2>Semi-conductor chips are so important across all industries. They are the key component in electronic devices, inside everything from cars to appliances to factory equipment. For OKdo, all our products will contain these types of components as we specialise in hardware for computing power and connected devices.&nbsp;Many of our component manufacturing suppliers and industry partners continue to be in allocation, which means there is no free stock currently and prices are higher than normal. We must give at least 12&ndash;18-month forward forecasts to those suppliers to get in the queue to receive stock, and for new purchases from the main silicon brands, we&rsquo;re often quoted lead times far exceeding 12 months, extending well into 2023.&nbsp;However, we are seeing some indications of change. It has been announced just this week the UK is officially in recession, with rising energy prices pushing inflation above 13%. The picture is similar in most countries around the world. Consumer demand is generally in decline, due to rising costs of living and record interest rates, increasing loan repayments. As consumer demand falls, we would expect ramifications across manufacturing demand for products which require semi-conductors, resulting in greater availability of components early in 2023.&nbsp;<h3>What&rsquo;s caused the supply constraints over the last 18 months?&nbsp;</h3>The events of last 2 years have meant global supply chains have been hit extremely hard. At the start of the pandemic in 2020, we saw a huge demand increase for semi-conductors due to the global pandemic. This demand stemmed from increased demand for consumer electronics, home computing, and the automotive industry, which has been increasing electrifying.&nbsp;Automotive production and manufacturing lines all over the world halted, not only because of the lack of supply of chips, but because of labour shortages due to the pandemic. Uncertainty in the market driven by geo-politics, extreme weather events, logistics capacity shortages only compounded the affect. It was evident quickly that semi-conductor suppliers could not cope with even a small increase in demand.70% of the global foundries are concentrated across 2 or 3 locations and struggled to increase capacity and required huge billion-dollar investments to do so. This exposed a weakness in the supply chain and through years of optimisation of &ldquo;just in time&rdquo; manufacturing, no-one seemed to be prepared to handle extreme events. As demand outstripped supply, price&rsquo;s increased, shortage queues grew and margin-driven customer allocations (with all previous commitments null and void) became the norm.&nbsp;<img width="600" src="https://images.wevolver.com/eyJidWNrZXQiOiJ3ZXZvbHZlci1wcm9qZWN0LWltYWdlcyIsImtleSI6ImZyb2FsYS8xNjYxMzMwNDI1NzgwLXNodXR0ZXJzdG9ja18yMDc2Nzk5MzMwLmpwZyIsImVkaXRzIjp7InJlc2l6ZSI6eyJ3aWR0aCI6OTUwLCJmaXQiOiJjb3ZlciJ9fX0=" alt="inside an electric vehicle battery pack shop at a VinFast factory in Haiphong, Vietnam on Saturday, Dec. 25, 2021." class="fr-fic fr-dii">Image 1: The electrifying of the automotive industry contributed to the semiconductor demand.&nbsp;<h3>What do you think will be next &ndash; when will people start to see a change?&nbsp;</h3>Over the last 12 months, we&rsquo;ve seen global powers of USA and Europe put the semi-conductor supply chain issues at the top of the political agenda. Foundries have invested Billions on programs of increasing capacity and strengthening resilience in the supply chain by near-shoring new facilities in the US and others in Europe. This effort could easily be in vain, impacted by any number of geo-political issues emerging right now, so time will tell.<hr><h3>What can OKdo offer as a solution to customers who are struggling to find supply of SBCs or other connected devices, or who need a reliable manufacturing and design partner?</h3>At OKdo, we offer the following key services to our customers and ecosystem partners to cover the whole product life cycle through to end-customer delivery:&nbsp;<ol start="1" type="1"><li>Design Stage:&nbsp;component selection and rapid PCB/PCBA prototype and EVT</li><li>NPI/Proto/PVT/Ramp Up:&nbsp;agile manufacturing in global locations&nbsp;</li><li>Mass Production:&nbsp;scale up volume in global locations, with cost optimisation by OKdo supply chain and procurement professionals and CMs</li><li>Box Build/Kitting:&nbsp;to get the product customer ready, fully assembled or added value options to end-customers</li><li>Global warehousing and distribution:&nbsp;via a network of RS Group warehouses and OKdo managed 3PLs we offer drop ship or local distribution services to the end-user as well as global inventory availability and fast delivery options.</li></ol>We have a resilient supply chain and an agile design and manufacturing offer for our customers. Our internal supply chain expertise can help our partners navigate the enormous supply chain risks and challenges to the macro-economic climate today. Manufacturing today is entirely different from a few years ago, and we are ensuring we have coverage, capacity, and supply chain plans to manage uncertainty with our world-class team, and partners.Our manufacturing partners have world-class procurement and sourcing teams, ensuring continuity of supply of components to keep our promises to our customers. We have invested in internal resources within OKdo in procurement and supply chain to work alongside our CMs to ensure we negotiate and procure critical components to minimise risk of supply chain disruption for our customers.&nbsp;Our manufacturing services are based on the below 6 principles to benefit our ecosystem partners and to drive meaningful revenue growth for OKdo;<ol start="1" type="1"><li>Customer Orientated:&nbsp;The OKdo Technology, Manufacturing and Procurement Team are dedicated to our customers every step of their design to manufacture journey, fully equipped at a global and regional level for speed of execution and driving value</li><li>The Right Choice of CMs:&nbsp;Global contract manufacturing (CM) partnerships offering regional/local manufacturing capability, with a strong account management team with a range of languages to suit OKdo and our customers</li><li>ESG &amp; Sustainability:&nbsp;Our CMs have sustainability and ESG at the heart of their values and supply chain; aligned to the OKdo ethos and ethics</li><li>Living with Supply Chain Risk:&nbsp;Our CMs aid our endeavour for a flexible and agile supply chain, with global distribution options including direct to customer at a global and regional level and local buffer stocks&nbsp;</li><li>Smart Procurement:&nbsp;Strategic component partnerships directly managed, with multiple procurement approaches from direct through to using Letters of Authority to CMs to purchase turnkey</li><li>Equitable Relationships:&nbsp;Fair and balanced commercial frameworks for all parties based on trust and respect.</li></ol><h2>Is there any alternative SBCs we can offer our customers?</h2>We know there has been a shortage of single board computers due to the semi-conductor market. However, we have been working on a solution to this.We&rsquo;re introducing a new product range called OKdo Rock which has been designed around component availability, with the customer in mind in terms of ability and capability and we&rsquo;ve put in safeguards across the supply chain to ensure continuity of supply.Rock is an advanced SBC designed to empower engineers, students, and developers all around the world to create digital making by providing open, free, versatile hardware. What&rsquo;s more, the ROCK range of boards can be customised. The ability to depopulate SBCs without compromising their integrity brings huge financial and environmental benefits, allowing professional design engineers to leverage cutting-edge technology for developing high-volume end products that meet their exact needs and work towards reducing e-waste. This position it as an important play to our industrial customers.<img src="https://images.wevolver.com/eyJidWNrZXQiOiJ3ZXZvbHZlci1wcm9qZWN0LWltYWdlcyIsImtleSI6ImZyb2FsYS8xNjYxMzMwNTYwNzMwLU1pY3Jvc29mdFRlYW1zLWltYWdlICg1KS5wbmciLCJlZGl0cyI6eyJyZXNpemUiOnsid2lkdGgiOjk1MCwiZml0IjoiY292ZXIifX19" style="width: 300px;" class="fr-fic fr-dib">Image 2: new product range called OKdo Rock &nbsp;Visit us on our website <a href="https://www.okdo.com/solutions" target="_blank">https://www.okdo.com/solutions</a> to find out more. Find Sarah Fawcett at <a href="https://www.linkedin.com/in/sarahangelafawcett/" target="_blank">linkedin.com/SarahFawcett</a>.

Article #4 Electronics Innovation Series. Alternative SBC’s and customer-orientated manufacturing will ease supply chain conditions. 

Chipping in on the SBC Supply Chain - predictions for the future.

Which business model is best for your product?



Hardware and Software Business Models

This is the first piece in a 4-part&nbsp;opinion series for and about hardware/software businesses.&nbsp; <hr>&quot;Hardware is hard.&quot;Phrases like these don&rsquo;t get a lot of critical thinking. If you run a business that manufactures a physical product, &ldquo;hardware is hard&rdquo; is the kind of thing you&rsquo;d say in a meeting while lamenting the unavailability of silicon. Or when complaining about a delay. Everyone around the room will solemnly nod and agree.Hardware companies face unique challenges that pure software companies don&rsquo;t. Inventory, supply chain, shipping, logistics. Slower design cycles. Defects and returns. There are many challenges associated with making real things that software companies don&rsquo;t have to deal with.But there are a lot of things about software that are hard too. Pricing is hard. Reducing churn is hard. Increasing sales velocity is hard. Recruiting is hard. Scaling is hard. Is hardware uniquely hard?I would argue that the biggest difference is the mindset. The challenges a software company might face are perceived as solvable problems that separate strong SaaS companies from weak SaaS companies. Some software companies have high churn; others don&rsquo;t. If your churn is low, you&rsquo;re good. If your churn is high, fix it or die.We&rsquo;ve developed this kind of mindset because the internet is full of great stuff like this:<img src="https://images.wevolver.com/eyJidWNrZXQiOiJ3ZXZvbHZlci1wcm9qZWN0LWltYWdlcyIsImtleSI6ImZyb2FsYS8xNjQ5MjMxMTA2MDA1LWJlbmNobWFya3Mud2VicCIsImVkaXRzIjp7InJlc2l6ZSI6eyJ3aWR0aCI6OTUwLCJmaXQiOiJjb3ZlciJ9fX0=" style="width: 300px;" class="fr-fic fr-dib"><figure id="isPasted"><figcaption>Do a Google image search of any common SaaS metrics and you&#39;ll find a wealth of useful benchmarks.</figcaption></figure>If you are building a SaaS business, there is an incredible wealth of shared knowledge available to send you down the right path. Investors know what to look for in a SaaS business; founders know what metrics to monitor and improve; executives know what problems to fix and what opportunities to exploit. This knowledge is quickly and easily passed around through Medium posts and tweetstorms and books and conferences and 1-on-1 mentorship and seasoned executives who bring experience from company to company.There is no such shared knowledge for hardware businesses.This is what makes hardware hard. It&rsquo;s not capital intensity or gross margins or operational challenges. Those are all solvable problems. It&rsquo;s the lack of shared knowledge among founders, investors, and executives regarding these challenges and how to overcome them.So, let&rsquo;s fix that.My name is Zach Supalla, and I am the founder and CEO of <a href="https://www.particle.io/" rel="" target="_blank">Particle</a>, an IoT Platform-as-a-Service (PaaS). In addition to our cloud service, my company makes hardware &mdash; modules and gateways that connect to our platform. And our customers include thousands of OEMs, service providers, and start-ups who design and manufacture some kind of internet-connected widget. I&rsquo;ve spent the last decade learning the ins and outs of how companies make stuff, and how they build profitable, differentiated, and scalable businesses while doing so.What I haven&rsquo;t done &mdash; what none of us have done &mdash; is write down what I&rsquo;ve learned. The hard-earned lessons, the mistakes made along the way, the experiments that succeeded and failed.This opinion driven series &mdash; named for an oft-used phrase describing businesses that combine hardware (atoms) and software (bits) &mdash; is intended to be a resource for people leading or investing in what I will call &ldquo;integrated hardware and software businesses&rdquo; &mdash; &ldquo;HW/SW businesses&rdquo; for short. I&rsquo;ll &nbsp;answer questions such as:<ul><li>What separates a &ldquo;good&rdquo; HW/SW business from a &ldquo;bad&rdquo; HW/SW business?</li><li>How can HW/SW businesses manage and reduce the costs and risks associated with their hardware products?</li><li>How do you price a HW/SW product?</li><li>How does a pure hardware business become a HW/SW business? How does a pure software business become a HW/SW business? Should they?</li><li>Which SaaS metrics can be applied to HW/SW businesses? Which can&rsquo;t?</li></ul>Some of these questions I can answer on my own. For others, I&rsquo;ll be bringing in experts &mdash; founders, executives, and investors who play in and around this space. This series will alternate between essays like this one and video interviews with other people who know things that I don&rsquo;t know.<hr>If you&rsquo;re interested in following along and seeing what I have to say, follow me on Wevolver; I&rsquo;ll be publishing twice a month.&nbsp;And if there are particular questions you&rsquo;d like me to answer or people I should interview, shoot me a DM &mdash; I&rsquo;m <a href="https://mobile.twitter.com/zs/with_replies" id="isPasted" rel="" target="_blank">@zs</a> on Twitter.

A brief introduction to my series for and about hardware/software businesses.


Hardware is hard. Does it have to be?

The content of this article is inspired by the Amazon bestseller book “<a href="https://www.amazon.com/INTELLIGENT-AUTOMATION-Artificial-Intelligence-business-ebook/dp/B08KFLY51Y" target="_blank">Intelligent Automation</a>.”Intelligent Automation (IA), also known as hyperautomation, is a set of technologies and methods for automating the work of white-collar professionals and knowledge workers. Here, we present a framework for explaining its power in terms of four main capabilities—Vision, Execution, Language, and Thinking &amp; Learning—and how they can enable business transformations, with people and business goals at the center.<h2>Vision</h2>Computer vision is an area of technology that’s progressing extremely rapidly, with new breakthroughs coming all the time. It is coupled with deep learning, allowing the computer to make sense of what it sees and make intelligent guesses about any missing visual information, as the human brain does for the eyes. In practice, large collections of digital images and videos are used to train machine learning algorithms, which enable computers to understand and automate tasks like the human visual system.<img src="https://s3-us-west-1.amazonaws.com/wevolver-project-images/froala%2F1645440396189-IA-Vision.jpg" style="width: 200px;" class="fr-fic fr-dib" alt="Hyperautomation Vision">The vision capability within the IA frameworkApplications of computer vision in a physical environment include recognizing objects (for example, in a robot navigating its physical environment) and interpreting signs and road markings (for example, in a self-driving car). However, it has even more applications in a digital environment.Computer vision is used for intelligent character recognition (ICR), the more advanced descendant of optical character recognition (OCR). ICR can be used to digitize documents, such as invoices, contracts, or IDs, and extract and interpret the information in them.Computer vision can also automate the analysis of images and videos. This has a vast range of applications. It can automate medical diagnostics, improving outcomes and freeing up doctors’ time. It can provide retail store automation, such as Amazon Go, where cameras determine which items a customer has picked up and billing them accordingly, without the need for a human checkout assistant. It can be used in business process documentation, automating what is usually a lengthy and resource-intensive process by detecting the applications and objects that a computer user interacts with and then creating a flowchart of the process, complete with screenshots. Furthermore, computer vision can be used for biometrics, with applications in identification, access control, and surveillance.<img src="https://images.wevolver.com/eyJidWNrZXQiOiJ3ZXZvbHZlci1wcm9qZWN0LWltYWdlcyIsImtleSI6ImZyb2FsYS8xNjQ1MDAwNDMzNjYyLXJldGFpbF9hdXRvbWF0aW9uLmpwZWciLCJlZGl0cyI6eyJyZXNpemUiOnsid2lkdGgiOjk1MCwiZml0IjoiY292ZXIifX19" style="width: 300px;" class="fr-fic fr-dib" alt="automation in retail store">Computer vision supports shop automation by simply using surveillance cameras. Image: Courtesy of AIpolyA variety of machine learning models and algorithms are used to support the development and operation of computer vision applications. Nowadays, the most popular algorithms for computer vision tasks are based on deep neural networks and the deep learning paradigm. As a prominent example, Convolutional Neural Networks (CNNs) are widely used as data-driven feature extractors i.e., to identify and extract features from images and videos. As another example, Artificial Neural Networks (ANN) such as autoencoders are very commonly used in tasks like facial recognition and object detection. Autoencoders are very efficient when it comes to filtering, smoothening, and removing noise from images.<h2 id="isPasted">Execution</h2><img src="https://s3-us-west-1.amazonaws.com/wevolver-project-images/froala%2F1645440554485-IA-Execution.jpg" style="width: 300px;" class="fr-fic fr-dib" alt="Hyperautomation execution ">The execution capability within the IA frameworkExecution involves actually doing things—accomplishing tasks in digital environments. This can include clicking on buttons, typing text, logging in and out of systems, preparing reports, and sending emails.The execution capability acts as a glue to connect the other capabilities together in a streamlined way. For example, it can collect sales data using the Vision or Language capabilities, automatically convey the data to the Thinking &amp; Learning capability for analysis, and compile and send out a report about the findings, with the help of the Language capability.The key technologies supporting the Execution capability are smart workflow, low-code platforms, and robotic process automation (RPA). Smart workflow platforms help to automate predefined standard processes. (If existing processes have not yet been documented, this can be achieved using IA-powered business process documentation, as discussed in the previous section). Low-code platforms allow business users without coding skills to develop automated programs. RPA, which is the most powerful of these technologies, is used to automate any tasks that a human can do on a computer, such as opening applications, clicking menu items, entering text, or copying and pasting. It learns by recording the actions of the human user and then automates them to save time. RPA programs can be thought as configurable software robots that orchestrate many other enterprise applications in automated and intelligent ways. In this direction, RPA software interfaces to different enterprise systems (e.g., Enterprise Resource Planning (ERP) and CRM (Customer Relationship Management) systems) and databases via appropriate connectors. Leveraging these connectors, RPA streamlines and automates enterprise workflow. This obviates the need for repetitive, human-mediated, and error-prone processes such as manual switching of windows to copy information from one application and to paste it to another.<img src="https://images.wevolver.com/eyJidWNrZXQiOiJ3ZXZvbHZlci1wcm9qZWN0LWltYWdlcyIsImtleSI6ImZyb2FsYS8xNjQ1MDAwOTkwMjA3LTAwMDY1LmpwZWciLCJlZGl0cyI6eyJyZXNpemUiOnsid2lkdGgiOjk1MCwiZml0IjoiY292ZXIifX19" style="width: 300px;" class="fr-fic fr-dib">A smart workflow platform to manage a recruitment process. Image: Courtesy of &nbsp;<a href="https://www.pega.com" rel="noopener noreferrer" target="_blank">Pega Systems</a>In their simplest form, RPA bots automate software processes based on a set of business rules. The latter provides a deterministic, rule-based orchestration of enterprise systems. Rule-based RPA is the first step to RPA adoption, which is quite straightforward to develop and deploy<a href="applewebdata://D77ED351-A2A0-4D63-939E-A8BA18ABCC73#_ftn1" name="_ftnref1" target="_blank" title="">[1]</a>. However, the future of RPA lies in the integration of statistical techniques to support intelligent workflows that continually learn and optimize themselves. In this direction, it is possible to collect data about the process in order to train deep neural networks (e.g., CNN) to optimize enterprise workflows<a href="applewebdata://D77ED351-A2A0-4D63-939E-A8BA18ABCC73#_ftn2" name="_ftnref2" target="_blank" title="">[2]</a>. RPA software will be soon capable of implementing self-configurable and self-optimized business processes leveraging data about the performance of the automated workflows.<h2 id="isPasted">Language</h2>The Language capability enables machines to read, write, listen, speak, and interpret the meaning of natural human language. It’s used to extract useful information from unstructured documents, categorize text (for example, in spam filters), and perform sentiment analysis. It enables text-to-speech, speech-to-text, and predictive text keyboards. It’s also used to power chatbots, such as <a href="https://youtu.be/eyoBgNY1KA0" id="isPasted" target="_blank">ANZ Bank’s Jamie</a>, which is us to onboard new clients and guide them through the bank’s services, or <a href="https://youtu.be/D5VN56jQMWM" target="_blank">Google Duplex</a>, which can book restaurant tables and hair appointments over the phone; and machine translation, such as <a href="file:///C%3A/Users/User/Documents/Dropbox/freelancing/elance%20upwork/Pascal%20Bornet/translate.google.%D1%81%D0%BEm" target="_blank">Google Translate</a>, which is used by 500 million people each day to translate over 100 languages. Natural language processing (NLP) used to be coded as a set of rules, but nowadays it works using deep learning: reading large amounts of text and noticing correlations and patterns, very much like how humans learn and use languages. Modern businesses use a variety of NLP applications which range from the extraction of market sentiment for their products and services to chatbots and virtual assistants that boost the cost-effectiveness and the scalability of their front office.<img src="https://s3-us-west-1.amazonaws.com/wevolver-project-images/froala%2F1645440760034-IA-Language.jpg" style="width: 300px;" class="fr-fic fr-dib" alt="Hyperautomation language">The language capability within the IA framework&nbsp;In recent years there is also a surge of interest in NLP applications that can write entire articles and posts for blogging, content marketing, and copywriting purposes. Tools like <a href="https://www.jarvis.ai/" target="_blank">Jarvis.AI</a>, <a href="https://www.copy.ai/" target="_blank">Copy.AI</a>, <a href="https://www.copyshark.ai/" target="_blank">Copyshark.AI</a>, and <a href="https://openai.com/" target="_blank">GPT-3</a> produce very well-written essays in virtually any subject. In most cases, it is impossible to tell whether an essay was written by a human or an AI copywriting tool. Soon AI copyrighters will be also able to automatically draw visuals that will accompany their texts<a href="applewebdata://371DE6C6-304E-4CD0-AED4-D2528B54F628#_ftn1" name="_ftnref1" target="_blank" title="">[1]</a> leveraging approaches like X-LXMERT<a href="applewebdata://371DE6C6-304E-4CD0-AED4-D2528B54F628#_ftn2" name="_ftnref2" target="_blank" title="">[2]</a>. A comprehensive preview of such functionalities has been already provided in the scope of OpenAI’s DALL-E project<a href="applewebdata://371DE6C6-304E-4CD0-AED4-D2528B54F628#_ftn3" name="_ftnref3" target="_blank" title="">[3]</a> which creates images from text.From an engineering perspective, NLP applications employ machine learning algorithms to automatically process textual inputs. A variety of classical machine learning techniques (e.g., Support Vector Machines and Bayesian Algorithms) are used to implement NLP systems. Nowadays, deep learning techniques are widely employed because of their effectiveness and accuracy in cases where large training corpora are available. For example, systems based on LSTM (Long Short Term Memory) techniques lead to effective NLP systems for speech recognition, text classification, and sentiment analysis. Nevertheless, most enterprise-class applications integrate and combine multiple machine learning models in ways that achieve high accuracy for the business problem at hand.<h2 id="isPasted">Thinking &amp; Learning</h2>The Thinking &amp; Learning capability is about analyzing data, discovering insights, making predictions, and supporting decision-making. It can work autonomously, triggering automated process activities, or it can be used to augment human knowledge workers, providing them with insights to guide their decisions and actions.<img src="https://s3-us-west-1.amazonaws.com/wevolver-project-images/froala%2F1645441075747-IA-Thinking.jpg" style="width: 300px;" class="fr-fic fr-dib" alt="Hyperautomation Think and Learn">The think &amp; learn capability in the IA frameworkThe key technology behind this capability is machine learning—most of all, deep learning, which is the newest and most powerful component of machine learning. As already outlined, deep learning uses neural networks with multiple layers, each one processing and interpreting the data at a different level, inspired by how the human brain works. It learns autonomously from large amounts of training data, spotting patterns and correlations without being explicitly taught or programmed with any rules. Specifically, deep learning techniques outperform classical machine learning algorithms when faced with very large volumes of training data. Moreover, deep learning algorithms automatically select the features that are most important for the problem at hand, rather than expecting the data scientist to manually determine the features to be used. These are the reasons why deep learning techniques excel when faced with complex, unstructured data with numerous features. This makes them a primary choice for tasks like image classification, natural language processing, and speech recognition.The Thinking &amp; Learning capability also covers data management: acquiring, validating, cleaning and storing the data needed for machine learning, and providing data visualizations to help guide human decision-makers. These tasks are interrelated and typically executed in an iterative fashion. To perform and complete these activities, automation experts and data engineers preferably follow standards-based methodologies for data mining such as <a href="https://www.datascience-pm.com/crisp-dm-2/" target="_blank">CRISP-DM (Cross Industry Standards Process for Data Mining)</a><a href="applewebdata://4EC72B25-BAD4-49A7-9C8B-BFB04B70C957#_ftn1" name="_ftnref1" target="_blank" title="">[1]</a>, KDD (Knowledge Discovery on Databases)<a href="applewebdata://4EC72B25-BAD4-49A7-9C8B-BFB04B70C957#_ftn2" name="_ftnref2" target="_blank" title="">[2]</a> and SEMMA (Sample Explore Modify Model Access)<a href="applewebdata://4EC72B25-BAD4-49A7-9C8B-BFB04B70C957#_ftn3" name="_ftnref3" target="_blank" title="">[3]</a>.<h2 id="isPasted">The impact of IA capabilities on your business</h2>Our aim is that this conceptual framework will equip you with the information you need for selecting vendors and choosing technologies for your IA journey, and fitting them into your existing organizational IT landscape.Beyond the value that these four capabilities can deliver individually, though, the combination of them unlocks more impact than the sum of their parts. Combining the technologies broadens the scope of automation, from isolated tasks to continuous, automated, touchless end-to-end processes.<hr><h2>References&nbsp;</h2>[1] B. Axmann and H. Harmoko, "Robotic Process Automation: An Overview and Comparison to Other Technology in Industry 4.0," 2020 10th International Conference on Advanced Computer Information Technologies (ACIT), 2020, pp. 559-562, doi: 10.1109/ACIT49673.2020.9208907.[1] P. Martins, F. Sá, F. Morgado and C. Cunha, "Using machine learning for cognitive Robotic Process Automation (RPA)," 2020 15th Iberian Conference on Information Systems and Technologies (CISTI), 2020, pp. 1-6, doi: 10.23919/CISTI49556.2020.9140440.

Intelligent Automation (IA) is a set of technologies and methods for automating the work of white-collar professionals and knowledge workers. Here, we present a framework for explaining its power in terms of four main capabilities—Vision, Execution, Language, and Thinking & Learning—and how they can enable business transformations, with people and business goals at the center.

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