Sep 7, 2022 | 5 min read

Dave Ayers

Podcast #188 Digital Innovation


Perspective on Digital Innovation

In this week's episode, Ken Forster speaks with Dave Ayers, our newest Strategy Partner at Momenta, about the lessons he has learned across water technologies, energy management, communication products, and services over the last 40 years.


Dave has worked as a senior leader in R&D at major technology firms like Nortel Networks, Alcatel Lucent, and Xylem for the better part of 40 years. His areas of expertise include water technologies, energy management, communication products, and services. He was most recently Vice President of Innovation Strategy and Partnerships at Xylem, where he was responsible for enterprise-level strategic planning across Xylem as well as for developing an ecosystem of alliance partners. Dave came into Xylem via its acquisition of Sensus, where he was VP of Global R&D, responsible for the technology strategy and product development for the smart metering portfolio worldwide. Dave graduated from Carleton University with a B. Eng. in Electronics.


Discussion Points:

  • What would you consider to be your 'Digital Thread.'
  •  I see you got your engineering start in the communications space, working across senior leadership roles at Alcatel-Lucent and Nortel. How did this early experience inform your views of smart and connected things?
  • You joined Sensus at a formative time, as they were laying the foundation for the first wide-scale connected device rollouts of smart Water, Electric & Gas meters in North America and Europe. Tell us a bit about your work and wins here.
  • We met literally 'across the table' as Momenta supported Xylem during the acquisition of Sensus back in 2016. What the market saw as an acquisition of metering, we saw as an acquisition of an industrial-grade full-stack IoT development house and solution. In that light, what were some of the key synergies you saw from this marriage?
  • You spent the last two years heading up Innovation Strategy & Partnerships for Xylem. What was your remit here and some of your key accomplishments?
  • We often talk about the importance of water, but the past years have reinforced the critical importance of this precious commodity. Where do you see some of the largest opportunities remaining for us in water management?
  • Let's dig deeper into your Innovation Strategy work. How do you define 'Innovation in the context of a large industrial OEM'?
  • I'm particularly interested in your perspective on so-called 'outside in' innovation: including universities, startups, and venture capital. Who is doing this well, and what are some of the best practices you've seen?
  • Which trends are you watching these days?
  • In closing, where do you find your personal inspiration?


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View Transcript

Ken: Good day, and welcome to episode 188 of our Momenta Digital Thread podcast series. Today I'm pleased to host Dave Ayers, our newest Strategy Partner at Momenta. Dave brings over 40 years of senior leadership experience in R&D leadership across global engineering and business teams in water technologies, energy management, communication products, and services with major technology companies, from Nortel Networks and Alcatel-Lucent to Xylem. He was most recently Vice President of Innovation Strategy and Partnership at Xylem, responsible for enterprise-level strategic planning across Xylem and for developing an ecosystem of alliance partners. Dave came into Xylem via its acquisition of Sensus, where he was VP of Global R&D, responsible for the Technology Strategy and Product Development for the Smart Metering portfolio worldwide. Dave holds a Bachelor of Engineering in Electronics from Carleton University. Dave, welcome to our Digital Thread podcast.



Dave: Thanks so much, Ken. It's great to be here, and I'm looking forward to the discussion.



Ken: As well. I appreciate you taking the time to do that. Of course, I greatly appreciate that you've joined Momenta recently, so this should be a great conversation on several topics. As you know, we call this the Digital Thread podcast series. I always ask, "What would you consider your digital thread?" In other words, the one or more thematic threads that define your digital industry journey?



Dave: That is an interesting question. When I think back on my digital industry journey, I think of it in several phases. There are several foundational technologies that I had the opportunity to be involved with that were, when I look back, necessary as enablers for the full range of IoT applications and services that we now think of when we talk of the digital industry. In my view, it started from the incredible pace of silicon technology back in the '80s and '90s, enabling enough computing capability to be leveraged for remote two-way communications. That was initially mainly wireline, but it was cost-effectively integrated and deployed end devices for new voice and data applications. That same rapid pace of technology integration enabled the wireless revolution, with cost-effective wireless communication back in the '90s. Just as importantly, the transition from analog to digital networks. That revolution gave us cellular that brought larger scale data networks to industrial consumer applications and the ability to connect to millions of endpoints. We match that up with- then I think back to the deployment of the internet in the early '90s and the beginning of mass sharing of data. Then, as I think back, the digital network's building blocks were in place. That same computing technology integration now started to- enough intelligence at each endpoint of the network, not only for more and higher bandwidth levels to and from the network but also for enough computing at the edge for monitoring detection control. I think we had the beginning of digital IoT networks at scale. That processing and communication continued to scale and MIPS, several endpoints, data rates, and enough security to allow the data intelligence to be cost-effectively centralized, and data aggregation and software analytics to leverage that. The opportunity was now here for Cloud computing. Then, we have the digital network to deploy almost infinite new applications, predictive analytics, digital twins- virtually anything and everything. I think back to the several stages over those 30 to 40 years.



Ken: I like how you've built up that, which I like to call generally full stack if you will. Anybody working in IoT appreciates the sensor up to the Cloud and how relevant and important all those various components are. But as you said- as you talked about your journey, there are only a handful of people who have lived that from one extreme to the other, and those tend to be those that are in senior leadership positions when it comes to developing full stack solutions in there. There are a lot of good conversations we will have in that regard. I liked that your engineering start started in communication: senior leadership roles, Alcatel-Lucent, and Nortel. Let me ask, how did this early experience inform your views of smart and connected things?



Dave: Yeah, I feel very fortunate thinking back. I wasn't sure what it would mean at the time. Still, when I started my career in telecommunications- initially at Nortel Networks and then with Bell Labs and Alcatel-Lucent after that, I felt very fortunate to have been able to participate in many of those enabling technologies.  The telecommunications industry, I think, was one of the drivers for the mass deployment of new multi-computing architectures because, at the time, those were the largest networks there were. Even with the initial analog networks that were in place in the '80s, they had the scale to be across millions of people. Those computing architectures were required to support that and more powerful computing chips for small connected devices. Indeed, about the first ten years of my career in telecommunications, it was all around new computing architectures starting way back with the 8085s and 68040s and then new risk computing technologies and multi-computer technologies. Telecom was at the leading edge of adopting those. That industry then focused on scaling up to support data, not just voice, and it was first for those that may remember this for ISDN. But wirelessly via cellular- like 3G spectrum and 4G technologies- all came into telecom. The focus then correctly changed now that we had this network in place and scale and wireless conductivity; the focus changed for more and more software applications across that network to leverage that data- not just voice between consumers and businesses, but data. Looking back, the communications industry has focused on the right building blocks for the future IoT. Even at a time initially when the internet wasn't yet widely available. I look back and probably didn't realize how fortunate I was then. Still, it was the opportunity to see these formative technologies for what is now connected networks and IoT across every industry.



Ken: Perhaps I'm dating myself, but my first microprocessor was an 8085. There used to be a thing called the SDK-85, which you might have had with the whole hex keyboard and everything else. I greatly enjoyed that. I appreciate what you said a moment ago as you discussed seeing these different waves and how you were part of those. You joined Sensus at a very formative time, and one of the largest, wide-scale, or large-scale use cases was smart metering at the time, across the US and even in Europe. You were there to help create the foundation of that across smart water, electric, and gas meter business in North America. Tell us a bit about your work there and some of the wins at the time.



Dave: It was interesting. Ken, I thought I was moving from telecom to a new industry in smart metering. I don't think I realized until a few months into the transition from telecommunications to Sensus- and how Sensus was leveraging very similar concepts. Telecom was a highly scalable, two-way network increasingly wireless, as we spoke about earlier- communicating data for various applications. Sensus was creating something very similar. They were creating and already deploying large networks; they already had several million-meter deployments in the US and Canada, and those were across wireless networks. They were dedicated industrial wireless networks but were very similar concepts, initially for remote monitoring, in this case for energy or water billing for the utilities. But the concept of a scalable, secure wireless network for industry had many similarities to telecom. The opportunity as Sensus got involved was first continuing to upgrade the communications network for full two-way control, and not just monitoring or billing readings, and especially using industrial levels of security and then making sure that they had the scale and bandwidth to put other applications beyond smart metering that could then flourish on that network and offer more value to the utility customers. That was the first opportunity that we've worked on.


The second was to allow that same level of network scale to be deployed in water and gas meters. It started in electric, but water and gas were also tremendous opportunities. That was also much more challenging because those devices had to be battery-powered and remotely located. They require high efficiency, low power, onboard edge, and communications processing. Our next challenge was to get that same level of network intelligence in two ways: secure communication to battery-operated endpoints- as in this case, water and gas metering, but then it became all kinds of other monitoring control devices. Well, we had those network technologies in place and proven at scale; the promise of a true multi-application network could then be realized for other endpoints, such as monitoring control, electric distribution, water network, leak detection, and prediction in water networks, or detection of the risk of catastrophic pipe bursts in gas distribution networks. All those things could then be added to the Sensus network and Sensus portfolio. But by this time, we were quite proud at Sensus. I think- it probably did and still does have the broadest set of Smart Grid applications in the industry. Looking back, we already had ourselves an IoT network.


You mentioned any other wins. One particularly nice win- we leveraged that technology because it was becoming quite evident that we were doing a lot with the Smart Metering network and turning it into a truly smart grid, and that helped Sensus at the time, using that proven technology and demonstrated the capability of an IoT network to new markets outside of North America. The most significant one looking back, that we were quite proud of at the time, was a win in the whole northern half of the UK. That was in partnership with Arqiva, a large telecom infrastructure company. That's in deployment now; it's well past a million endpoints. It will be one of, if not the largest smart grid network in the world. That was something that we were particularly proud of at the time.



Ken: Some people accused me of collecting people. It's interesting because you and I met literally across the table as Momenta supported Xylem at the time during the acquisition of Sensus way back in 2016. What was very interesting was what the market saw as an acquisition of metering, which confounded, I think, some of the analysts at the time, given that Xylem's focus was water, thus water metering. We saw it as an acquisition of industrial grade, full-stack, IoT development house-in solution. In that light, what were some of the key synergies you saw that ultimately came from this marriage with Xylem?



Dave: I remember that well, Ken. It's one of the reasons I enjoyed working with you on the team at the time because you were exactly right. The acquisition was much more about leveraging Sensus technology for what it could be in industrial-grade IoT networks. Indeed, that includes metering, which is a critical application for utilities. But probably more importantly, for the future potential. It was for the capability of new monitoring control IoT applications across various intelligent industrial applications, including what Xylem was already building. Xylem already had a rich suite of industrial products for water distribution and treatment for sensing, becoming increasingly intelligent. Matching up Sensus brought leading technologies for connecting those devices to the network, that which is right at the beginning of the stack; we've been talking about moving into IoT, connecting those to the Cloud, and then allowing data aggregation, new software analytics, data correlation for truly new intelligence solutions for Xylem customers. In essence, Sensus was bringing lead capabilities and technologies in network connectivity and Cloud analytics to bolster Xylem's growing portfolio of industrial measurement control and transport and treatment products for the water industry. You were exactly right with what you saw at the time; there was a greater potential now being deployed across that portfolio in Xylem than just bringing on a smart metering company.



Ken: It's interesting, we do a lot of work with industrial OEMs, of course, and you are certainly part of that team now as well. But one of the challenges we have continued to see is that industrial OEMs bring on more digital capabilities or are asked to bring on digital capabilities. Crossing that boundary from hardware to software is not easy, and certainly in the middle is electronics, so Xylem wisely picked up. You could say it was a very expensive acquire in some sense, but picked up the equivalent of how I mean, their own in-house full development team, everything from chips up to, as you say, the wireless network and the Cloud infrastructure. I think that was an immense boost to the digitization efforts that Jay Iyengar, at the time, was leading as Chief Innovation and Technology Officer. It's interesting to see how all of this has come together. Indeed, the market has rewarded Xylem over the last several years since its acquisition in terms of its digitization efforts. Maybe that's an excellent chance to segue into your time recently at Xylem. You spent the last two years heading up Innovation Strategy and Partnerships. Tell us, what was your remit here? And what were some of your key accomplishments?



Dave: It was a fun transition, one I enjoyed a lot. When I first was joining Xylem, that was part of that acquisition of Sensus. I spent the first few years just ensuring we were leveraging the Sensus technology we spoke about- connectivity, RF engineering, and software analytics- into Xylem's best parts. Then, after seeing that that was on a good path, there was an excellent opportunity to move into a broader enterprise role at Xylem, which was in the Strategy and Partnerships group you mentioned. That allowed me to learn and engage across virtually all of Xylem's portfolio and product teams beyond just the Sensus team or some other areas where they were leveraging Sensus technology. I had the opportunity to work in both the traditional and industrial ones and the flurry of newer digital analytics areas across Xylem. As I mentioned, Xylem has had and has what I think is the broadest portfolio of products and solutions in the water distribution and treatment industry today. Not to mention how this can help in energy distribution, including electricity and gas.


What was most exciting to me was to help set a path across that portfolio of products and how we could get more of them as increasingly more digital solutions in the portfolio. How could we continue in the industry by making these products part of a connected digital IoT network for Xylem's customers? There are so many leading products that we could then turn into intelligent endpoints in an IoT network and then allow the data between them to be shared into more robust solutions and services. We also create an enterprise view of Xylem's digital technology stack, mapping to critical technologies where some strengths or areas that need more focus, as well as identifying focus areas for what should be more organic development or what should also be with an expanded set of ecosystem partners to accelerate the innovation for these solutions. I think it was rewarding to see more and more of the products become part of connected solutions. It was rewarding to see a blueprint and then a roadmap leveraging the breadth and depth of the technology stack. Also, to help to foster new, more strategic partnerships with other strong ecosystem partners.



Ken: Xylem's theme, if you will, is let's solve water. We've often talked about the importance of water. Still, the past couple of years has reinforced this precious commodity's critical importance. Where do you see some of the most significant opportunities remaining for us in water management?



Dave: I think we all see, of course, the increasing criticality of the importance of water in both developed and developing countries and the key pillars of finding solutions that deal with water scarcity, including having safe, affordable drinking water for society. But also, having a resilient supply for industries may be considered our most critical imperative. When we tackle these pillars, I think we can also help contribute to another key imperative that sometimes people don't think about as much, which is sometimes referred to as the water-energy nexus. Water treatment and distribution currently require massive energy and carbon footprint reduction. Water and wastewater industries account for 75 billion kilowatt hours of electricity per year just in the US. It's not uncommon to see that the water utility often consumes a third of the municipality's total energy budget. There's ample opportunity to secure the water supply and look at the energy, the carbon footprint, and the opportunity to reduce that. Specifically, in water networks, many of these water networks can be 100 years old. They are aging and need not only efficiency improvement but significant repair and rework. It's not uncommon; leaks in distribution and collection networks are significant. There's a term in the water industry of non-revenue water, which means water that is lost before getting to the consumer. It can be as high as 50% in major municipalities, including large, developed ones. Not only are we losing critical availability of water because it doesn't get to where it needs to be, but we're wasting all that energy to treat and pump it to no avail.


That is, the term non-revenue water and infiltration are massive issues but also great opportunities to improve the efficiency of the network and the energy required. We've been talking about digital technologies previously, and the technology to help these challenges I just mentioned is here. Some of the most powerful new solutions in the water industry leverage the digital maturity curve fundamental to IoT networks. Using our analogy of connected products, the potential of taking these products- whether they're water sensors, treatment products, intelligent pumps, or metering and measuring control- getting those devices connected to the Cloud and ability to create new autonomous solutions for the utilities that then serve their consumers and industries. Treating these products as a network of intelligent devices and analyzing the data from these products together as a solution can give powerful new solutions for our customers in terms of efficiency and leak detection and digital twin modeling, and all kinds of things where it's now a solution that we're bringing to the utilities.




Ken: I think that perspective is undoubtedly apropos in your overall title, 'Innovation, Strategy, and Partnerships.' Let's dig a little deeper into this idea of innovation strategy. How did you define innovation in the context of a large industrial OEM?



Dave: That's a broad question. I think most large industrials have similar challenges. They have an installed base of customers, they have a deserved reputation for products and services in their areas of competitive differentiation, and they're working to define not only how to continue to innovate for improved products, but also increasingly, they must be looking at how to leverage the digital transformation potential to transition these products to new solutions for their customers. That's a major theme at Xylem as an industrial company, as we look to improve products and have them part of our intelligence solutions. I think that must be the main pillar of innovation. They certainly will and must continue to innovate in some of those critical areas. They also must be increasingly pivoting to how they think of innovation to transition these products and the product roadmaps to more powerful solutions that leverage data and intelligence from their products into new solutions where the value is greater than the group of individual products. Solutions that offer more powerful analytics for operational efficiency, predictive maintenance, early warning of significant failures that can be part of autonomous solutions, and more energy-efficient ones. I think those themes are for a broader way of thinking of innovation- I would bet we would see across any major industrial OEM.



Ken: I liked the themes, the way you've laid them out there. Let's talk a little about sources of innovation; particularly, I've always liked the idea of outside-in innovation, such as universities, startups, and venture capital. Who in your mind is doing this well, and what are some of the best practices you've seen?



Dave: I think this is one where I've seen a varied scale; some larger OEMs are doing it more effectively than others. I would say, if I think of best practices, the overall best practice I've seen is to understand your enterprise in terms of the technical stack, whether it's products or services, where you excel organically, where the gaps are, and then when to engage with a broader ecosystem of partnerships. Whether that is for product leadership, channel expansion, or to find ways to leverage that stack for new ways of combining data for new solutions that weren't possible before, I think it starts with looking at your technology stack that is fundamental to the products and services you're putting together, and then look at it to help focus on where the areas of improvement are and where the areas of leveraging partners. That ecosystem of partners will be symbiotic. You can share product technologies and data from different products from different vendors. You can have and forge common customers, and it can be rewarding for everyone, especially the customers, because you're bringing together an integrated type of solution that perhaps they didn't know was possible.


I specifically come to appreciate the importance of university partnerships, not just from the obvious benefit of early visibility to emerging and disruptive technologies and early-stage research, but also to be connected to their ecosystem- their ecosystem of spin-off startups that are coming from those institutions, as well as connection to other public sector institutions and government agencies that are shaping the policies that we need to understand for ourselves as an industrial OEM. I think, as I mentioned, a spectrum of some companies have adopted this well; others are just now starting to see the opportunity. Certainly, there are lots of companies doing it well. I think several large Cloud providers are quite successful at linking new emerging companies and products that become applications on their Cloud. But they also have very strong partnerships- from startups to large OEM enterprises. But I think there are many other OEM industrial companies, including, Xylem, that understand the strong potential for the power of outside-in innovation and partnerships. You can see it on several of their public domain, marketing literature, and websites on how they're putting a structured partnership program together, whether technology providers or universities.



Ken: What are some trends you're watching these days?



Dave: That's another broad question, Ken. But I think- I'll probably have a broad answer as well. I'm watching anything that has the promise to address the critical needs that are important globally. Areas in water scarcity, applying technology to those. Food scarcity, anything around helping with decarbonization, and the link to climate change. I think it's so important, perhaps for me, at this stage of my career, to know you're working on things that make a big difference. But this also could include anything that helps any industry be more efficient because that will help them in terms of their energy consumption, carbon footprint, water consumption, and ability to be more carbon neutral. I think it's just one of the fundamental challenges we have globally. I was a technologist and knew the opportunities to leverage more and more of these connected technologies together to make a difference. I'm also watching the degree of acceleration of those digital technologies across sometimes disparate industries that may not have been connected before. Now we can share metadata to accelerate the success in these critical areas I mentioned.



Ken: I like that you defined the water-energy nexus earlier and then wrapped around many potential sustainability benefits. I agree with you; perhaps the-, as you say, at this stage in your career, your best work is still ahead of you because of the impact of those technologies to help drive water and energy savings. Certainly, the sustainability benefits go with that. We mentioned food sustainability and certain climate as well. It's all coming to bear regarding how these networks all come together. I think you're probably positioned for some great work ahead. Since you like all my broad questions, the final one I'm going to ask you is, where do you find your inspiration?



Dave: As you mentioned at the beginning of the podcast, I spent most of my career in technology and product development. But as I tell my kids, what's been satisfying is I've had the privilege of working with incredibly smart people who are creative, disruptive, often cleverly funny, and humble enough always to learn new things. I greatly respect seeing individuals who want to use their ingenuity to create new products or applications that provide value and make a difference. The opportunity to work with people like that is a constant inspiration. It makes me want to continue this for years and years.



Ken: Hopefully, you're positioned well to do that. Maybe that puts a little more light on my comment about collecting people as I sat across the table from you. Long ago, I said, "That's a guy I would like to work with someday."



Dave: Likewise, Ken.



Ken: Well, thank you. Dave, thank you for sharing this time and insights with us today.



Dave: Thanks again, Ken. I enjoyed our conversation and looking forward to working with the Momenta team.



Ken: I enjoyed the conversation, and we are more than excited about having you as part of our team. This has been David Ayers, Strategy Partner with Momenta. Thank you for listening.



[The End]

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What inspires me?

I worked in technology and product development for the majority of my career. But, as I tell my kids, what's been most rewarding is the opportunity to work with incredibly smart people who are creative, disruptive, often cleverly funny, and humble enough to learn new things continually. I admire people who want to use their creativity to develop new products or applications that add value and make a difference. Working with people like that is a constant source of inspiration for me.


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