NEWS n ARTIFICAL INTELLIGENCE IS rewriting how the industrial automation sector will make its money in future, away from traditional control systems, and towards software and data, according to a new analysis by the global consultancy, Bain & Co. It says that dramatic changes will shift the industry’s architecture and sources of profit away from the traditional pyramid structure (with field devices such as sensors at the bottom, and enterprise software at the top) to more of an hourglass shape, with at least 80% of profits coming from AI-powered software at the top, and smart field devices – such as machine vision systems, actuators and drives – at the bottom. Bain predicts that this will happen as soon as 2030, by which time software, data platforms and AI-enabled layers will account for more than half of the sector’s profits, with smart field devices accounting for a further 25–30%. This will leave the traditional controls layer – including PLCs, DCSs, I/O modules and Scada systems – coming under increasing pressure in the middle. Although controls will still matter, it adds, they will no longer be the profitable core of the industrial automation market. The study, called Industrial Automation: From Control to Intelligence, points out that the software-based components at the top of the stack scale faster, carry higher margins and compound in value as data and applications accumulate. They are increasingly acting as the “brains” of industrial operations, translating raw signals into decisions and outcomes. At the bottom of the stack, value is re-emerging in smart field devices that are no longer passive endpoints. With embedded intelligence, connectivity and edge computing capabilities, they generate data, execute decisions, and improve performance continuously. Although traditional controls remain essential, they are becoming harder to scale and to differentiate, the report suggests. New entrants are reducing margins by shifting value away from these core controls. By the end of the decade, it predicts, most profits will flow away from the centre to the two ends of the hourglass. Bain predicts that AI-enabled technologies could unlock up to $70bn of new market value – a 22% AI will transform how the automation market makes its money by 2030 SCHAEFFLER HAS WON THIS year’s Hermes Award for a scalable, integrated actuator technology that it has developed especially for use in humanoid robot joints. The award, which is made at the Hannover Messe every year, recognises outstanding products with a high level of innovation and significant benefits for industry. Schaeffler’s actuators incorporate highefficiency servomotors with integrated power electronics and encoders, and can be configured with two-stage planetary gears or shaft-mounted gears. In developing the actuators, the company’s aim was to save installation space, while delivering a high continuous torque. The devices are said to be about 20% smaller and up to 500g lighter than rival products. The copper fill factor in the frameless PSM motors was increased to ensure that temperatures remain low at high torques. Schaeffler says that its actuators will reduce system costs significantly. When developing the actuators, Schaeffler relied on 12 of its core manufacturing technologies, including automated coil-winding, and chipless metal forming for the roller bearing rings that are just 1mm thick and are integrated into the rotor. The demand for efficient actuators for humanoid joints is growing globally. Because actuators account for around 50% of the total costs of humanoids, they are a pivotal factor in making them competitive. increase – by 2030. It expects the industrial automation sector to expand from a value of around $250m last year (generating profits of around $30bn) to $400bn by 2030 (with profits of $52bn). According to Bain, companies that already orchestrate data, software and smart devices at scale are achieving productivity gains of 30–50%, maintenance cost reductions of up to 35%, and extended asset lifetimes. “What's changing is not just the technology, but where economic value is created in the market,” explains Adrien Bron, leader of Bain Advanced Manufacturing & Services in Germanspeaking Europe. “As software, data and smart devices take on a larger role, industrial automation companies will need to rethink how they maintain and continuously enhance differentiation, where they find sources of scale and leadership, and where they can capture value over time.” Bain’s analysis reveals that a small number of applications – such as adaptive robotics and predictive maintenance – account for a disproportionate share of the Al benefits, with much of that value expected to materialise in the next one to five years. Although most people in the sector are aware that industry is going digital, not all are aware how quickly the shift is undermining the sources of differentiation that they have relied on for decades, Bain warns. The risk for automation incumbents is not overnight disruption, it adds, but gradual irrelevance. It’s a slow drift from being a strategic manufacturer partner to becoming a mere component supplier, even if revenues appear stable, the report warns. According to Bain, the shape of the industrial automation market is transforming from the traditional pyramid structure (left), to an hourglass shape (right), where 80% of profits will come from software at the top, and smart field devices at the bottom Schaeffler wins Hermes Award for actuator developed for humanoids www.drivesncontrols.com May 2026 9
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