Software as a Game Changer in Business Markets: Disrupting Competition with Bosch Rexroth’s ctrlX Open Industrial Ecosystem

Bosch Rexroth, a mid-sized player in the global automation industry, disrupted the competitive landscape with its open approach to industrial automation. In an industry accustomed to locking-in customers with proprietary technology, Bosch Rexroth challenged established practices with an interoperable system that broke down tech barriers and paved the way for comprehensive automation solutions. Grounded in its Linux-based operating system, ctrlX OS, Bosch Rexroth relied on a software-centric, app-based approach to industrial automation largely independent from the underlying hardware. This hardware-agnostic architecture provided industrial customers with unprecedented flexibility and laid the foundations for the company’s next-generation competitive advantage.
The case explores how Bosch Rexroth relied on software to gain a competitive advantage in the automation industry. Students investigate the growth trajectory and discuss future directions for the software platform and its ecosystem. Discussion focuses on the following issues: What are the main challenges faced by hardware-centric companies when seeking software-driven revenue growth? What internal barriers and external roadblocks must be overcome to make ctrlX AUTOMATION a veritable game-changer in the automation industry? How to excel in change management when transitioning from a hardware-centric to a software-driven go-to-market approach in B2B markets? When does it pay to free industrial customers from technological lock-in? Why, when, and how does software have the potential to redefine the competitive landscape in industrial markets? How should Bosch Rexroth manage and grow its portfolio of automation offerings and evolve its ecosystem of partner companies to secure its competitive edge over time?

The case enables participants to understand:
The transformative role of software in shaping market dynamics and competitive strategies.
The potential of software to serve as a revenue and profit engine in B2B markets.
The challenges involved in establishing and managing an industrial ecosystem.
The conditions that foster the shift towards open system architecture.