Goldwind Views

Wu Gang: Digital Transformation Will Spur New Changes in the Wind Power Industry
2017-10-20
Source: GOLDWIND

On October 16-19, 2017, China Wind Power 2017(CWP 2017) was held in Beijing. The event witnessed extensive and in-depth discussions on the topic as to "how should wind power companies embrace the digital era,” what opportunities and challenges will the new era present to wind power companies? And how should they react? These were the questions that had baffled the industry insiders for long time.

At the opening ceremony of CWP2017, Wu Gang, Chairman of Xinjiang Goldwind Science &Technology Co., Ltd. (Goldwind), said,  “Digital transformation will spur new changes in the wind power industry,"  Wu Gang talked about the theoretical and practical problems the industry would face on both macro and micro levels, winning warm applause from the audience.

  • Energy transformation has entered the digital era

It is utmost necessary for China to carry out energy transformation immediately. The BP Statistical Review of World Energy (2017) shows that China is still the world's largest energy consumer, accounting for 23% of global energy consumption and 27% of global energy consumption growth. As the world's largest developing country, China plays a crucial role in the process of global energy restructuring.

In a speech titled “Towards a Mutually Beneficial Partnership for Sustainable Development” on September 26, 2015, Chinese President Xi Jinping proposed to build a global energy Internet to facilitate efforts to meet global power demand with clean and green alternatives. This proposal received positive responses from countries around the world.

In the Government Work Report delivered on March 5, 2017, Chinese Premier Li Keqiang also stressed the need to step up efforts to improve mechanisms and technologies and to prioritize the integration of renewable energy sources into the electric grid. In the meantime, the "Made in China 2025" initiative should be put into practice through increased use of big data, cloud computing, and the IoT. New technologies and business models need to be applied as replacements to traditional industrial production, management and marketing models. It is evident that “innovation in wind power technology in the digital era” has become an important topic as the global energy mix leans towards low-carbon and green energy.

"Thirty years ago, wind power in China got off to a start, riding the wave of the reform and opening-up policy. Today, as the wind power industry enters the stage of large-scale development, it is caught up in the trend of global energy transformation. I believe that, with the support of favorable policies, China's energy transformation will be a great success," Wu Gang said.

  • Opportunities and challenges in the digital era

Wu Gang said that the digital era is about leveraging data for the interconnection of all things so that our life can be more intelligent. He stressed that management concepts in the digital era will put more emphasis on experience, interconnection and platform.

"What is the experience about? It is about change in the perception of customer values. To be specific, in the past, an enterprise only needed to take care of its own business. But now it has to pay closer attention to customer needs. In the digital era, there might be a lot uncertainties and changes. There is plenty of work to do, but it won’t suffice for a company to rely solely on its own resources. Instead, it would need to pool more resources to focus on what customers care most about, and offer them better value experience

Interconnection means that a company must be open-minded and voluntarily connected with the wider society and the larger world. The resources of one individual, department, or company, are always limited. Only through interconnection can we build a stronger platform, create a better culture, and deliver better performance."

Wu also pointed out that the pyramid-shaped management structure inherited from the industrial era needs to be changed to a flatter one so that the company serves only as a platform. "We need to create equal partnerships between managers and those being managed, to empower the front lines, and to give initiative to the employees closest to our customers, so that they can be stimulated to innovate."

The digital era entails innovation in technology and business models, as well as conceptual changes.

In the digital era, technological innovation will be more about insights into and control over the future market. While developing new products, it would be necessary to take into account the latest trends in industrial environment, policy environment and customer values. Furthermore, the application of AI and digital technology will greatly strengthen the abilities to design and calculate, and the application of the IoT will lay a solid foundation for systematic solutions.

"For example, in the past, it took days to calculate the energy and load distribution of several wind farms. But now it can be done within a day. In addition to increased computing power, the digital era also entails more sophisticated and personalized data, which allows for more personalized design by weather and terrain, and for better understanding of customer needs, "Wu Gang pointed out.

Moreover, in the digital era, the optimization and iteration of products will happen at a faster pace, raising higher requirements for wind power companies. Wu Gang believed that in this context, digital services will gradually become a valuable business model." For example, the emergence of digital wind farms allows for data-based asset performance management, thereby further increasing power generation and reducing operating costs."

In terms of HR structure, as the wind power industry becomes more specialized, digitized, and automated with IT application, the demand for knowledge workers specializing in digital management will see a substantial increase. It is safe to say that in the digital era, the diversification of human resources would be inevitable.

  • What should wind power companies do?

What does the future hold for wind power companies in the digital era? Wu Gang came up with suggestions on both macro and micro levels:

On the macro level, it is necessary to build an energy Internet and develop multiple energies to complement each other. Digital prediction may be leveraged for unified management of load and power supply. Lastly, cross-border sharing and integration should be made possible through data-driven innovation.

On the micro level, it is necessary to digitize the whole industry, starting from data definition, standards setting, and quality inspection, which constitute the foundation of digital transformation. "Data constitutes the basis of intelligence. For manufacturers, data is indispensable on their way to becoming providers of efficient systematic solutions and personalized designs. The ultimate goal is to realize the lean production, and evolve from intelligent manufacturing to smart manufacturing."

Secondly, a company needs to align its data architecture with the business structure, and on that basis build a data analytics platform. The platform is used for organically analyzing all sorts of data, such as field operation data and R&D data, and putting forward solutions that correspond to market demand." In the wind power market nowadays, a lot of knowledge-based service providers are emerging. They provide professional solutions that suit customers’ specific needs on the basis of massive amounts of basic data and model analysis."

Wu Gang also believed that using software to facilitate corporate growth is an inevitable trend." We will need to use software for data management, and adopt AI, IoT, big data, and other technologies, for intelligent operations."

Wu Gang stressed that, at a time when companies are encouraged to apply information technology as they pursues industrialization, wind power companies, among other industrial enterprises, should pay equal attention to both." At the first stage, we need to realize digitization of the key businesses through their professional, standardized and information technology-based development. At the second stage, we need to interconnect and integrate our key businesses. In other words, we must link isolated systems and turn them into an integrated network and platform. At the third stage, we should introduce machines and AI to intelligent and collaborative production through IT application. In this process, there is possibility that Chinese companies will catch up and take a leading position, if a solid foundation is laid for specialized, standardized and digitized growth. Therefore, we must build the necessary infrastructure for digital transformation and IT application as we pursue intelligent growth. It is a future trend we must adopt it.”

  • Leading the Future Energy Market through Innovation

Wu Gang stressed that, in the digital era, there is a need for wind power companies to leverage digital technology for a shift from result management to process management, from local management to global management, and from static management to dynamic management.

In the digital era, AI, machine learning, and other new technologies in the wind power industry, will be extensively applied on large scale, enabling a frog leap from automated manufacturing to intelligent manufacturing. Indeed, digital transformation will lead to enhanced capability in supply-side management, and supply- and demand-side interconnection, thereby boosting the usage of renewable energy. In the meantime, digital technology has enabled the description of things in a subtler manner than ever, which means the boundary for innovation has been expanded infinitely. As the energy industry continues to evolve further, there is a high possibility that wind power will be made much more affordable in the future.

"Thanks to digital transformation, which has facilitated the scale of development of renewable energy, low-carbon and green growth has become a leading target of global energy system change. Digital transformation forms the foundation of an energy Internet. It can be forecast that fossil fuels and renewable energy will complement each other for a long time to come. In the context of digital transformation, Goldwind is committed to creating an affordable, reliable and sustainable new energy system that leads to the future," Wu Gang remarked while concluding his speech.