How is the industry looking in Germany?
A significant research collaboration between Phoenix Contact and Ruhr University Bochum, Germany, led to a new scientific study illustrating profound industry changes, spearheaded by Dr. Fabian Bertelsmeier of Phoenix Contact.
Dr. Bertelsmeier, every control cabinet builder is already familiar with the daily challenges and trends in the industry. What added value does such a study bring?
Everyone had a certain market understanding, which was confirmed by our study’s results, along with new insights. No previous German study has explored these central questions in such depth with scientific data, from communication and data exchange between control cabinet builders and customers to the production and final inspection of control cabinets, achieving unprecedented detail.
The industry is very diverse and you were able to win over 50 very different companies for the survey. How difficult was it to get so many participants to join in?
The study was challenging, beginning with identifying companies in the control cabinet building industry. The survey distinguished between ‘control cabinet builders’ and ‘machine building and system manufacturers’. A small pilot study involving five companies helped test and finalize the questionnaire and methodology. In 2023, scientists surveyed 50 companies, conducting on-site interviews complemented by company tours. Despite the effort required from both scientists and respondents, participants received early access to comprehensive results, offering an informative industry outlook.
Informative in what way? Which specific areas did the scientists examine?
The study design followed the control cabinet building process chain from engineering and project planning to procurement, production, and delivery, enabling detailed capture of the industry’s current state-of-the-art based on quantitative characteristics.
The first part of the study, which has already been published, provides detailed insights into the industry’s key metrics. It covers various aspects including challenges, strategic and technical trends, average turnover, numbers of employees, and the importance of import and export, among other metrics.
Let us examine one particular area: where are German control cabinet builders facing major challenges?
Material bottlenecks were prominent, mainly due to the “post-COVID-19 period” observed during the survey, affecting 49 out of 50 companies. Another significant issue was the shortage of skilled workers, with almost 90% unable to hire them. Companies instead increased process efficiency, reduced waste, and employed semi-skilled workers, using solutions like worker assistance systems. Additionally, lack of space was a concern, yet most control cabinet builders opted against outsourcing production abroad, highlighting the industry’s location-oriented nature.
Speaking of the shortage of skilled workers, aren’t a large number of the major future trends that the respondents highlighted also associated with this?
Most control cabinet builders are considering automation and assistance systems to counter the skilled worker shortage, yet over 90% of respondents identified digitalizing engineering and production as the key technological trend. Ninety-four percent are willing to change their processes for complete digitalization. Companies consistently encounter mixed component quality from various manufacturers, requiring variable improvements to maintain consistent data quality. Thus, component manufacturers must supply high-quality data.
Promoting digitalization and efficiency processes, a lack of skilled workers and space: these do not sound like economic difficulties, rather they sound like growing pains. Is the current situation having such a low impact on control cabinet building?
Key investments are currently being delayed or reduced in some market segments. Interestingly, the 50 surveyed companies supply 20 different industries, with none serving just one. This diversification may be why control cabinet builders are doing relatively well, as they aren’t reliant on the success of a single industry.
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