The Global Operational Technology Market size is expected to reach $221 billion by 2028, rising at a market growth of 5.7% CAGR during the forecast period.
Operational technology monitors and regulates the performance of physical devices. The capacity to remotely monitor and manage physical equipment is a key element of operational technology. Because it is widely employed in refineries, nuclear plants, and other critical infrastructure systems, operational technology has become a common and vital component of critical infrastructure systems. Previously, it was exclusively utilized in manufacturing, transportation, and utility control systems, and the technologies had networking limitations. With technical developments in communication and networking, the traditional operational technology that was solely employed in industrial control systems is now being superseded by operational technology, leading to the emergence of the trend for smart operational technologies. This has enabled administrators to carry out their duties remotely within the network, allowing users to complete tasks in real-time.
The barriers between IT and OT began to dissolve several years ago, and the integration of operational technology and IT is still occurring. This convergence isn't just about technology; it's also about people and how it work. The responsibility for OT is evolving as the aforementioned IT-based technologies become integrated with OT networks, as well as the entire Industry 4.0 and industrial transformation phenomenon.
In contemporary times of industrial transformation, operational technology is being discussed more and more from the standpoint of cyber security. OT security requires increased attention as industrial infrastructures become more complicated and as digitization continues. There are also significant distinctions between IT and operational security (without the cyber part). IT security is more focused on safeguarding all aspects of data and how it is stored, transferred, processed, and used in business processes, whereas conventional security was more focused on protecting physical processes, safety, up time/production/efficiency, and personnel protection.
COVID-19 has had impacted negatively all across the economy and almost every industry in the world. Lockdowns have been imposed by governments to stop the spread of the virus. People's livelihoods and standard of living were badly disrupted by the overall lockdown in the early stages of the pandemic in several countries. As a result, supply chain halts have taken place all over the world. The world's economies have suffered as a result of a significant drop in product demand. Due to the pandemic, which resulted in a shortage of raw materials, production over industries has been hampered. A decrease in supply chain and exports disruptions are two main factors adding to the output fall. During this period, businesses' major goal was to be afloat, and operational technology performed a critical role in assisting firms in operating efficiently with limited resources and personnel.
Governments throughout the world are recognizing the huge potential of operational technologies, and as a result, there is supporting and funding for research and development of technologies like IIoT and industrial 3D printing. In addition, governments from a variety of countries are sponsoring IIoT breakthroughs because there is hope to be early users of the technology. Additionally, governments are investing in new IoT research and execution projects in order to construct and operate smart cities in the future.
With the cheaper labor costs and real estate prices, companies from industrialized economies are eager to expand their operations in emerging economies. Furthermore, growing industrialization in rising economies such as India, Africa, Japan, Mexico, Brazil, and Indonesia has resulted in large infrastructure expenditures, luring all the firms to set up manufacturing operations in these areas. All the corporations typically use FDI to establish new manufacturing operations in emerging economies. Low manufacturing costs and low-cost labor are the most important factors driving the transformation of developing economies into major industrial centers.
The implementation of the newest automation technologies, such as DCS, SCADA, PAM, and HMI, is required for the creation of new automated manufacturing plants. SCADA data collecting aids in the reduction of calculation errors while still improving product quality and the efficiency of industrial plants. Large capital investments in software, equipment, and training are required to set up these production units. For new market players that are starting up their first factory, investing such a significant sum is tough. As an outcome, these companies must do a detailed analysis of their return on investment before implementing industrial automation systems and solutions.
Based on Networking Technology, the market is segmented into Wired and Wireless. The wired segment acquired the highest revenue share in the operational technology market in 2021. Actuators, Sensors, and other devices that transfer data through wires are referred to as wired technology. Control systems and process-control applications that require a physical link between units for remote operation use wired technology. When power must be transferred from one device to another, like with electric traction railways, it could also be useful (metros).
Based on Component, the market is segmented into Control Systems (Distributed Control System & SCADA, Warehouse Management System, Plant Asset Management & Functional Safety, Human Machine Interface, and Manufacturing Execution System), Field Devices (Industrial Sensors, Industrial Valves, Transmitters, and Actuators), and Services. The field devices segment garnered a significant revenue share in the operational technology market in 2021. Transmitters, valves, switches, and actuators are examples of operational technology field devices. The sorts of equipment and systems that are used in operational technology, including the use of operational technology as a whole, are determined by the industry and the forms of industrial processes.
Based on Industry, the market is segmented into Machine Manufacturing, Automotive, Aerospace & Defense, Semiconductor & Electronics, Chemical, Oil & Gas, Pharmaceuticals & Medical Devices, Pulp & Paper, Metals & Mining, Food & Beverages, and Others. The machine manufacturing segment acquired the highest revenue share in the operational technology market in 2021. Manufacturers are under increasing economic pressures, as well as increased demand for a diversified product portfolio, all while adhering to regulatory and safety norms. In addition, manufacturers can use technologies like MES, PAM, and HMI to standardize their workflow and reduce lead times by removing the time spent obtaining approval from multiple associations and the FDA. MES also keeps track of data and processes that must be followed during manufacturing to ensure regulatory compliance. The use of MES helps to eliminate the requirement for paper-based record keeping. By offering continuous maintenance activities in these industries, PAM and machine condition monitoring allow the appropriate functioning of systems employed in the manufacturing process.
Based on Regions, the market is segmented into North America, Europe, Asia Pacific, and Latin America, Middle East & Africa. The Asia Pacific emerged as the leading region in the operational technology market with the largest revenue share in 2021. The rising demand for smart tools due to increased automation in industries; rising implementation of technology like Industry 4.0, smart factories, IoT, and IIoT; and the growing need to optimize productivity and lower operational and maintenance costs are the key factors driving the growth of the operational technology market in this region. One of the main elements that is expected to enhance demand for operational technology in the coming years is government backing for industrialization in various APAC countries. Numerous government initiatives in the region, like Japan's Industrial Value Chain Initiative (IVI), China's Made in China 2025, South Korea's The Manufacturing Innovation Strategy 3.0 (Strategy 3.0), and India's Samarth Udyog Bharat 4.0, are expected to play a significant role in industrial advancement and, as a result, provide growth opportunities for the operational technology market.
The major strategies followed by the market participants are Acquisitions. Based on the Analysis presented in the Cardinal matrix; ABB Group, Honeywell International, Inc., Oracle Corporation, IBM Corporation and Siemens AG are the forerunners in the Operational Technology Market. Companies such as General Electric (GE) Co., Rockwell Automation, Inc. and Emerson Electric Co. are some of the key innovators in the Market.
The market research report covers the analysis of key stake holders of the market. Key companies profiled in the report include Siemens AG, ABB Group, Schneider Electric SE, Mitsubishi Electric Corporation, General Electric (GE) Co., Honeywell International, Inc., Oracle Corporation, IBM Corporation, Rockwell Automation, Inc., and Emerson Electric Co.
Operational technology monitors and regulates the performance of physical devices. The capacity to remotely monitor and manage physical equipment is a key element of operational technology. Because it is widely employed in refineries, nuclear plants, and other critical infrastructure systems, operational technology has become a common and vital component of critical infrastructure systems. Previously, it was exclusively utilized in manufacturing, transportation, and utility control systems, and the technologies had networking limitations. With technical developments in communication and networking, the traditional operational technology that was solely employed in industrial control systems is now being superseded by operational technology, leading to the emergence of the trend for smart operational technologies. This has enabled administrators to carry out their duties remotely within the network, allowing users to complete tasks in real-time.
The barriers between IT and OT began to dissolve several years ago, and the integration of operational technology and IT is still occurring. This convergence isn't just about technology; it's also about people and how it work. The responsibility for OT is evolving as the aforementioned IT-based technologies become integrated with OT networks, as well as the entire Industry 4.0 and industrial transformation phenomenon.
In contemporary times of industrial transformation, operational technology is being discussed more and more from the standpoint of cyber security. OT security requires increased attention as industrial infrastructures become more complicated and as digitization continues. There are also significant distinctions between IT and operational security (without the cyber part). IT security is more focused on safeguarding all aspects of data and how it is stored, transferred, processed, and used in business processes, whereas conventional security was more focused on protecting physical processes, safety, up time/production/efficiency, and personnel protection.
COVID-19 Impact Analysis
COVID-19 has had impacted negatively all across the economy and almost every industry in the world. Lockdowns have been imposed by governments to stop the spread of the virus. People's livelihoods and standard of living were badly disrupted by the overall lockdown in the early stages of the pandemic in several countries. As a result, supply chain halts have taken place all over the world. The world's economies have suffered as a result of a significant drop in product demand. Due to the pandemic, which resulted in a shortage of raw materials, production over industries has been hampered. A decrease in supply chain and exports disruptions are two main factors adding to the output fall. During this period, businesses' major goal was to be afloat, and operational technology performed a critical role in assisting firms in operating efficiently with limited resources and personnel.
Market Growth Factors
Governments encouraging the implementation of operational technologies
Governments throughout the world are recognizing the huge potential of operational technologies, and as a result, there is supporting and funding for research and development of technologies like IIoT and industrial 3D printing. In addition, governments from a variety of countries are sponsoring IIoT breakthroughs because there is hope to be early users of the technology. Additionally, governments are investing in new IoT research and execution projects in order to construct and operate smart cities in the future.
Increasing industrial growth in emerging economies
With the cheaper labor costs and real estate prices, companies from industrialized economies are eager to expand their operations in emerging economies. Furthermore, growing industrialization in rising economies such as India, Africa, Japan, Mexico, Brazil, and Indonesia has resulted in large infrastructure expenditures, luring all the firms to set up manufacturing operations in these areas. All the corporations typically use FDI to establish new manufacturing operations in emerging economies. Low manufacturing costs and low-cost labor are the most important factors driving the transformation of developing economies into major industrial centers.
Market Restraining Factors
High installation and maintenance costs
The implementation of the newest automation technologies, such as DCS, SCADA, PAM, and HMI, is required for the creation of new automated manufacturing plants. SCADA data collecting aids in the reduction of calculation errors while still improving product quality and the efficiency of industrial plants. Large capital investments in software, equipment, and training are required to set up these production units. For new market players that are starting up their first factory, investing such a significant sum is tough. As an outcome, these companies must do a detailed analysis of their return on investment before implementing industrial automation systems and solutions.
Networking Technology Outlook
Based on Networking Technology, the market is segmented into Wired and Wireless. The wired segment acquired the highest revenue share in the operational technology market in 2021. Actuators, Sensors, and other devices that transfer data through wires are referred to as wired technology. Control systems and process-control applications that require a physical link between units for remote operation use wired technology. When power must be transferred from one device to another, like with electric traction railways, it could also be useful (metros).
Component Outlook
Based on Component, the market is segmented into Control Systems (Distributed Control System & SCADA, Warehouse Management System, Plant Asset Management & Functional Safety, Human Machine Interface, and Manufacturing Execution System), Field Devices (Industrial Sensors, Industrial Valves, Transmitters, and Actuators), and Services. The field devices segment garnered a significant revenue share in the operational technology market in 2021. Transmitters, valves, switches, and actuators are examples of operational technology field devices. The sorts of equipment and systems that are used in operational technology, including the use of operational technology as a whole, are determined by the industry and the forms of industrial processes.
Industry Outlook
Based on Industry, the market is segmented into Machine Manufacturing, Automotive, Aerospace & Defense, Semiconductor & Electronics, Chemical, Oil & Gas, Pharmaceuticals & Medical Devices, Pulp & Paper, Metals & Mining, Food & Beverages, and Others. The machine manufacturing segment acquired the highest revenue share in the operational technology market in 2021. Manufacturers are under increasing economic pressures, as well as increased demand for a diversified product portfolio, all while adhering to regulatory and safety norms. In addition, manufacturers can use technologies like MES, PAM, and HMI to standardize their workflow and reduce lead times by removing the time spent obtaining approval from multiple associations and the FDA. MES also keeps track of data and processes that must be followed during manufacturing to ensure regulatory compliance. The use of MES helps to eliminate the requirement for paper-based record keeping. By offering continuous maintenance activities in these industries, PAM and machine condition monitoring allow the appropriate functioning of systems employed in the manufacturing process.
Regional Outlook
Based on Regions, the market is segmented into North America, Europe, Asia Pacific, and Latin America, Middle East & Africa. The Asia Pacific emerged as the leading region in the operational technology market with the largest revenue share in 2021. The rising demand for smart tools due to increased automation in industries; rising implementation of technology like Industry 4.0, smart factories, IoT, and IIoT; and the growing need to optimize productivity and lower operational and maintenance costs are the key factors driving the growth of the operational technology market in this region. One of the main elements that is expected to enhance demand for operational technology in the coming years is government backing for industrialization in various APAC countries. Numerous government initiatives in the region, like Japan's Industrial Value Chain Initiative (IVI), China's Made in China 2025, South Korea's The Manufacturing Innovation Strategy 3.0 (Strategy 3.0), and India's Samarth Udyog Bharat 4.0, are expected to play a significant role in industrial advancement and, as a result, provide growth opportunities for the operational technology market.
The major strategies followed by the market participants are Acquisitions. Based on the Analysis presented in the Cardinal matrix; ABB Group, Honeywell International, Inc., Oracle Corporation, IBM Corporation and Siemens AG are the forerunners in the Operational Technology Market. Companies such as General Electric (GE) Co., Rockwell Automation, Inc. and Emerson Electric Co. are some of the key innovators in the Market.
The market research report covers the analysis of key stake holders of the market. Key companies profiled in the report include Siemens AG, ABB Group, Schneider Electric SE, Mitsubishi Electric Corporation, General Electric (GE) Co., Honeywell International, Inc., Oracle Corporation, IBM Corporation, Rockwell Automation, Inc., and Emerson Electric Co.
» Partnerships, Collaborations and Agreements:
- Nov-2021: Rockwell Automation came into a partnership with Dragos and CrowdStrike and a new Cybersecurity Operations Center. This partnership aimed to improve its information technology (IT) and operational technology (OT) cybersecurity providing, better equipping customers with the protection they require in a perilous environment. This partnership is expected to emphasize threat intelligence and incident response services.
- May-2021: Siemens joined hands with ServiceNow, an American software company based in Santa Clara, California. This collaboration aimed to build an integrated software service offering allowing energy companies to monitor, detect, and react to cyber threats targeting digitally connected critical infrastructure. The integrated software solution is expected to make a detection engine and workflows that streamline operations for cybersecurity analysts to check anomalous or malicious behavior in Security Operations Centers (SOC), and energy plant operators to act on credible threat intelligence at machine speed.
- Apr-2021: Siemens came into a partnership with Google Cloud, a suite of cloud computing services that runs on the same infrastructure that Google uses internally for its end-user products. This partnership aimed to improve factory processes and better productivity on the shop floor. Siemens focused to unify Google Cloud’s leading data cloud and artificial intelligence/machine learning (AI/ML) technologies with its factory automation solutions to aid manufacturers to innovate for the future.
- Nov-2020: Honeywell International came into partnership with Nozomi Networks, a leader in OT & Internet of Things (IoT) capabilities. This partnership aimed to deliver complete solutions to handle cybersecurity compliance and lower the risk of downtime due to cyberattacks.
- Oct-2020: ABB joined hands with IBM, an American multinational technology corporation headquartered in Armonk, New York. This collaboration aimed to enable companies to work on the edge and position easily over hybrid cloud environments spanning on-premise, private or public clouds. In addition, this joint solution is created so that security processes operate through automation and do not disturb industrial workflows.
- Oct-2020: Rockwell Automation extended its partnership with Microsoft Corporation for five years. This partnership aimed to develop unified, market-ready solutions that aid industrial customers to enhance digital agility with cloud technology. This partnership further aimed to provide innovative edge-to-cloud-based solutions that link information between development, operations, and maintenance teams in a singular, trusted data environment.
- Sep-2020: Siemens formed a partnership with Atos, a global leader in digital transformation. This partnership aimed to fasten Siemens’ digital objectives in the areas of services modernization and digitalization, data-driven digital, cloud transformation, and cybersecurity. As part of the partnership, Atos is expected to also invest in innovation and digital modernization, to advance important innovation topics for Siemens.
- Jun-2020: General Electric came into a partnership with Schneider Electric, the leader in the digital transformation of energy management and automation. This partnership aimed to aid drive major advances in making smart buildings the standard. Both companies have developed, tested, and validated designs that aid link building management systems to an Internet Protocol (IP) network with a secure, scalable, and resilient architecture that is simple to handle.
- Feb-2020: Honeywell International formed a partnership with Tech Mahindra, an Indian multinational information technology services and consulting company. This partnership aimed to capitalize on digital transformation, Industry 4.0, 5G, software capabilities, and engineering expertise to allow customers in the manufacturing industry to scale up even faster.
» Product Launches and Product Expansions:
- Mar-2022: Oracle Corporation introduced 11 new computer, networking, and storage services and capabilities. This product launch aimed to allow customers to run their workloads faster and more securely at lower costs. New offerings deliver customers agile core infrastructure services, automatically optimizing resources to meet application needs and drastically lower costs.
- Jan-2022: Honeywell International introduced the Honeywell Threat Defense Platform (HTDP). This product helps to detect known and unknown (zero-day) attacks over the operational technology (OT) environments in commercial buildings.
- Nov-2021: ABB Group introduced ABB Ability Smart Melt Shop, the first smart factory digital application of its kind for the metals industry. This product launch aimed to enable steelmakers to digitally link all processes and moving equipment in the melt shop, attaining synchronized operations and eliminating bottlenecks in production capacity.
- Jun-2021: Honeywell International unveiled Honeywell Advanced Monitoring and Incident Response (AMIR) service. This product launch aimed to deliver an integration of advanced cybersecurity software, playbooks, and experts with remediation guidance in order to detect, prevent, analyze, evaluate and coordinate the response to cybersecurity threats occurring within OT environments in a better way.
- Feb-2021: ABB Group unveiled GoFa and SWIFTI, new cobot families. This product launch is expected to enable customers to not depend on in-house programming specialists. In addition, this launch is expected to unlock industries that have low levels of automation, with customers able to operate their cobot within minutes of installation, straight out of the box, with no specialized training.
- Nov-2020: Rockwell Automation released a FactoryTalk InnovationSuite, with a new set of capabilities. This product launch aimed to simplify, scale and fasten digital transformation for industrial organizations. FactoryTalk InnovationSuite delivers a fully unified industrial internet of things (IIoT), manufacturing execution system (MES), edge-to-cloud analytics, and augmented reality (AR) capabilities.
- Aug-2020: Mitsubishi Electric introduced a series of collaborative robots named MELFA ASSISTA in India. This product launch aimed to work together with humans, keeping safety features like collision detection a priority and complying sincerely with the international safety and robotic standards ISO 10218-1 and ISO/TS15066. This product launch is expected to focus to deliver its customers advancements in productivity, quicker automation, safety, and flexibility.
» Acquisitions and Mergers:
- Dec-2021: General Electric signed an agreement to acquire Opus One Solutions Energy Corporation, a software company that aids electric utilities to improve energy planning, operations, and market management. This acquisition aimed to aid utilities makes decisions about the way to integrate renewables and Distributed Energy Resources (DERs) at scale over the electric grid.
- Nov-2021: Rockwell Automation took over AVATA, a services provider for supply chain management, enterprise resource planning, and enterprise performance management solutions. This acquisition aimed to aid further unlock the value of information technology/operational technology (IT/OT) convergence that Rockwell can provide to customers.
- Nov-2021: IBM Corporation took over ReaQta, a top-tiered AI Autonomous Detection & Response platform. This acquisition aimed to expand IBM's capabilities in the extended detection and response (XDR) market, matching IBM's strategy to provide security with an open method that extends over disparate tools, data, and hybrid cloud environments.
- Jun-2021: Honeywell International formed a merger with Cambridge Quantum Computing (CQC), a leading quantum computing and quantum technology business. This merger aimed to integrate to make the largest, most advanced standalone quantum computing company in the world. Along with that, the company is expected to offer the world's highest-performing quantum computer and a full suite of quantum software, including the first and most advanced quantum operating system.
- Jun-2021: Rockwell Automation signed an agreement to acquire Plex Systems, the leading cloud-native smart manufacturing platform operating at scale. This acquisition aimed to fasten the strategy to bring the Connected Enterprise to life, driving faster time to value for the customers as they increasingly implement cloud solutions to enhance agility, resilience, and sustainability in their operations.
- Jun-2021: IBM Corporation took over Turbonomic, an Application Resource Management (ARM) and Network Performance Management (NPM) software provider based in Boston, MA. This acquisition aimed to become the leader in application management in an ever more complex hybrid cloud world and continue to gain from this partnership.
- Oct-2020: Rockwell Automation took over Oylo, a privately-held industrial cybersecurity services provider located in Barcelona, Spain. This acquisition aimed to provide best-in-class cybersecurity services and solutions. Oylo’s OT cybersecurity expertise suits the IT cybersecurity expertise gained by the acquisition of Avnet Data Security.
- Oct-2020: Emerson Electric took over Progea Group, an industry-leading provider of industrial internet of things (IIoT), human-machine interface (HMI), plant analytics, and supervisory control and data acquisition (SCADA) technologies. This acquisition aimed to make upon Emerson’s embedded software and control portfolio for manufacturing, infrastructure, and building automation applications and allow customers to streamline complete plant and machine control systems to a single partner.
- Oct-2020: Emerson Electric took over Open Systems International, a leading supplier of open automation solutions for real-time management and optimization of complex production. This acquisition aimed to deliver utility customers with the ability to improve energy efficiency from generation by customer delivery, allowing the broader industry goal of grid stability and renewables integration.
- Jun-2020: Siemens took over UltraSoC Technologies, a provider of instrumentation and analytics solutions. This acquisition aimed for customers to access not just design-for-test, but an overall 'Design for Lifecycle Management' solution for system-on-chips, comprising of functional safety, optimization, and security.
- Jun-2020: IBM Corporation signed an agreement to acquire Spanugo, a US-based provider of cloud cybersecurity posture management solutions. This acquisition aimed to advance IBM's differentiated capabilities in security and compliance for enterprise clients, comprising those in highly regulated industries.
Scope of the Study
Market Segments Covered in the Report:
By Networking Technology
- Wired
- Wireless
By Component
- Control Systems
- Distributed Control System & SCADA
- Warehouse Management System
- Plant Asset Management & Functional Safety
- Human Machine Interface
- Manufacturing Execution System
- Field Devices
- Industrial Sensors
- Industrial Valves
- Transmitters
- Actuators
- Services
By Industry
- Machine Manufacturing
- Automotive, Aerospace & Defense
- Semiconductor & Electronics
- Chemical, Oil & Gas
- Pharmaceuticals & Medical Devices
- Pulp & Paper
- Metals & Mining
- Food & Beverages
- Others
By Geography
- North America
- US
- Canada
- Mexico
- Rest of North America
- Europe
- Germany
- UK
- France
- Russia
- Spain
- Italy
- Rest of Europe
- Asia Pacific
- China
- Japan
- India
- South Korea
- Singapore
- Malaysia
- Rest of Asia Pacific
- LAMEA
- Brazil
- Argentina
- UAE
- Saudi Arabia
- South Africa
- Nigeria
- Rest of LAMEA
Key Market Players
List of Companies Profiled in the Report:
- Siemens AG
- ABB Group
- Schneider Electric SE
- Mitsubishi Electric Corporation
- General Electric (GE) Co.
- Honeywell International, Inc.
- Oracle Corporation
- IBM Corporation
- Rockwell Automation, Inc.
- Emerson Electric Co.
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Table of Contents
Chapter 1. Market Scope & Methodology
Chapter 2. Market Overview
Chapter 3. Competition Analysis - Global
Chapter 4. Global Operational Technology Market by Networking Technology
Chapter 5. Global Operational Technology Market by Component
Chapter 6. Global Operational Technology Market by Industry
Chapter 7. Global Operational Technology Market by Region
Chapter 8. Company Profiles
Companies Mentioned
- Siemens AG
- ABB Group
- Schneider Electric SE
- Mitsubishi Electric Corporation
- General Electric (GE) Co.
- Honeywell International, Inc.
- Oracle Corporation
- IBM Corporation
- Rockwell Automation, Inc.
- Emerson Electric Co.
Methodology
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Table Information
| Report Attribute | Details |
|---|---|
| No. of Pages | 388 |
| Published | May 2022 |
| Forecast Period | 2021 - 2028 |
| Estimated Market Value ( USD | $ 152827 Million |
| Forecasted Market Value ( USD | $ 221033 Million |
| Compound Annual Growth Rate | 5.6% |
| Regions Covered | Global |
| No. of Companies Mentioned | 10 |
