Accenture’s Busy ER&D Summer. Set to Re-shape the Industry

/ August 27, 2018/ Accenture, Automotive, Embedded Systems, Germany, M&As (small under $50m in revenues), Mobile, Product Design, US

Accenture had a busy summer, making three tuck-in acquisitions to its recently-created new Industry X.0 unit that is part of Accenture Digital:

  • Columbus, OH-based Pillar Technology provides embedded software capabilities for connected products such as cars. The company has a headcount of 320 and was founded in 1996
  • San Francisco-based Mindtribe provides hardware product engineering services as well as embedded software. The company is smaller with a headcount of 40. The company operates in a space close to product design services, and has experience working with a physical product design firm MATTER, now a unit of Fjord, itself part of Accenture Interactive, a division of Accenture Digital…
  • Designaffairs is based in Germany and is a product design, UX, user research firm. The company has a headcount of 100.

Also with this M&A activity, Accenture Industry X.0 opened a third Innovation Hub in June. The center is like the previous two focused on automotive and is located, unsurprisingly, close to  Detroit, MI. Accenture Industry X.0 expects to employ 200 FTEs by the end of 2020 in the center. The Detroit center complements two other centers opened in 2017-2018: one close to Munich, in Garching, and the other is in Modena, the city, which is home to Ferrari and Lamborghini. All three centers are both demo centers for client interactions and development centers.

Accenture is executing on its strategy to scale up its Industry X.0 unit and is deploying its M&A and digital center model. The company is being smart and is focusing initially on embedded software and product design.

Accenture has deep pockets and is not shy of making acquisitions to fuel its shift towards digital. It has been hugely successful at this portfolio shift towards digital, cloud, and security, something it calls The New and at a corporate level, now derives more than 50% of revenues from The New. Accenture is now the world’s second largest IT service vendor with approximately USD 40bn in revenues, manages to grow by 10% (including acquisitions) each year, despite its size. Finally, Accenture though Fjord has now a significant UX and digital design business that mostly serves e-commerce projects but can potentially be used for digital and physical ER&D projects.

You probably guessed it: I truly think that Accenture with Industry X.0 can enter the ER&D service industry and reshape it.

Do re-read a blog that NelsonHall had published in H1 2018 to understand where Industry X.0 is going:

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